Over speculations of a security guard being infected by the highly contagious UK strain of coronavirus, Perth, Peel and South West areas of Western Australia were put under a five-day lockdown. It comes at a precarious time for small businesses with the government's JobKeeper scheme ending in this quarter.
CPA Dinesh Aggarwal says that if the lockdown does not stretch beyond two weeks, small businesses do not stand to lose much.
Key Highlights
- Perth had entered a 5-day lockdown on Sunday
- Western Australian economy so far has been in surplus
- With financial aides like JobKeeper coming to close, speculations over the impact on small businesses has been ripe
“For 10 months, Premier Mark McGowen has kept the state safe, but we all knew this could have happened. Having seen what happened in Victoria and New South Wales, we were better prepared and could react faster when the time arose,” the Certified Practising Accountant says.
Dinesh feels that the panic buying frenzy that people went into as soon as the lockdown was announced was a bit of an overreaction.
“When the restrictions had come for the first time last year, it was still understandable," he says.
"People were scared, and supplies did go short in the end. However, this time around it makes little sense. People have already seen what panic buying does. Also, the lockdown, as of now, is for five days only, and the markets are full.
“Those who did not have essential supplies for five days would have naturally rushed to markets, but others made no sense.”
Dinesh Aggarwal has over 20 years of experience of tax advising to small businesses Source: Fortuna Advisory Group
He says that the Western Australia economy is strong enough to absorb the shock of a small lockdown.
“Apart from the businesses being directly impacted by the lockdown, like clubs, pubs, retail and restaurants, the economy largely has the space to absorb the shock of this lockdown. Even with cafes and restaurants, there is a new business system of takeaways and deliveries available.”
However, things may not be as comfortable if the lockdown was to extend any further than two weeks.
He processed many JobKeeper applications in the past few months past and his major concern now is that the financial aid is coming to a close.
The Perth lockdown has come at a time when the financial aide of JobKeeper is its last quarter.
"It is difficult to say at this point, but God forbid, if the lockdown was to increase, there will be problems. Will the Federal government consider the extension of the program for one state? Remains to be seen.”
He thinks government should pay more attention to better monitoring of frontline workers.
He suggests that complacency has entered the system.
"A security guard working on the same floor as someone infected by the UK strain of the virus was working multiple jobs. Apparently, he was a student.
"The Federal government can look into making such roles sustainable enough so that the person would be contained. A better system of checks and balances will help us avoid such situations,” he suggests.
Dinesh observes that his firm has seen their clients make their business concerns flexible to adjust to the requirements of the pandemic.
He suggests that businesses should keep their eyes and ears open in this economy as there are many opportunities available, and prepare themselves accordingly.
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