Guild wants reform changes to ensure small business survival

Although short-term relief is welcome, the Pharmacy Guild of Australia WA Branch is calling for long-term reform changes to ensure additional certainty for community pharmacies facing financial hardship due to the COVID-19 pandemic.

The move came shortly after the announcement by the Western Australian Government to extend the emergency period under the Commercial Tenancies (Covid-19 Response) Act 2020, until at least March 28, 2021.

“It has become clear during this Covid period that legislation is required in order for tenants to receive the financial assistance they need to remain viable and survive into next year”, said Guild Director Matt Tweedie.

Independent tenancy expert David Halvorsen notes that the extension is a common sense and practical decision given the severe and ongoing economic impact of Covid-19. “In order to better manage the permanent structural impacts that we have seen emerge in the WA economy, the government should, as a matter of urgency, conduct its proposed review of the Commercial Tenancy (Retail Shops) Agreement Act 1985.  This legislation was not very effective in protecting tenants pre-Covid and is certainly is not fit for purpose in the new economy”, noted Mr Halvorsen.

Throughout the COVID-19 pandemic, community pharmacy has continued to provide patient services. However, this has come at a cost, with seventy 70% of WA pharmacies reporting a decline in turnover of at least a 20%.

Many of these businesses are unable to access the financial support offered through the JobKeeper program to retain staff, and therefore are not able to access support provided through the Commercial Tenancies (Covid-19 Response) Act 2020.

Community pharmacies that have accessed government support, frequently report that landlords are acting outside the requirement to act reasonably and in good faith, and instead are engaging in difficult, protracted and delayed negotiations.

“That the imbalance between landlord and tenant has required the National Cabinet to develop a Code of Conduct and two dedicated pieces of quickly drafted Western Australian legislation highlights the challenge, Mr Tweedie said.  “As a result, very few community pharmacies have been able to access their entitlements, but rather are caught between an offer of ‘take it or leave it’ from landlords and the alternative, which is an expensive and time-consuming determination service.”

The announcement acknowledges the stresses that commercial leases place on the viability of community pharmacy. The Guild believes a review of the Commercial Tenancy (Retail Shops) Agreement Act 1985 is both required and long overdue.