Should retail trading hours be restricted?

Bunnies for sale

Over the Easter long weekend there will be special retail trading hours in south east Queensland, as detailed in a report by the Brisbane Times.

Shop trading hours in Queensland are strictly regulated by State Government legislation, the Trading (Allowable Hours) Act 1990.

But do these trading restrictions make sense, in an age when on-line shopping is becoming more and more popular?

What Redland City Council thinks

At the last Council Meeting, a proposal to oppose any change to  current restrictions on trading hours in south east Queensland was supported unanimously. These restrictions let small businesses open for longer than major stores.

The Council also decided to make a submission to the Queensland Industrial Relations Commission opposing an application by large stores for increased trading hours.

For further information about Redland City Council’s stance on trading hours refer to item 12.1 in the Minutes of the Council Meeting on 25 March 2015.

What the Federal Government is thinking

On 31 March 2015 the Federal Government released the Final Report of the Government’s review of competition policy, generally known as the Harper Report.

This report was the outcome of an election promise by the Coalition to conduct a “Root and Branch Review of the Competition Laws”. This promise was item 5 of The Coalition’s Policy for Small Business (August 2013).

The Review Panel was led by Professor Ian Harper. The Panel’s  Draft Competion Policy Review report was released for public consultation in September 2014.

The Final Report makes the following recommendation on trading hours:

Remaining restrictions on retail trading hours should be removed. To the extent that jurisdictions choose to retain restrictions, these should be strictly limited to Christmas Day, Good Friday and the morning of ANZAC Day, and should be applied broadly to avoid discriminating among different types of retailers. (page 165)

In making this recommendation the panel notes that Queensland, South Australia and Western Australia are the states that have the greatest restrictions on trading hours. The Report says:

Submissions to the Draft Report from small businesses, particularly small supermarkets in Western Australia, South Australia and Queensland, do not support removing restrictions on retail trading hours, with some noting that the current restrictions provide them with a degree of protection from competition, as they are free to open when other retailers are not.

My business will lose that last opportunity to impress customers that come in because we are open earlier than the majors and the flow on effects are immeasurable. (IGA Walloon, DR sub, page 1)

Though we have busy times similar to the chains, we tend to do better when they are closed, either early in the morning or later at night. If the chains have deregulated hours then this will decrease our sales dramatically. (Nicks Supa IGA, DR sub, page 1)

The Report goes on to say:

However, the relevant policy question is whether the restrictions are in the public interest, not whether they are in the interest of particular competitors. No compelling evidence has been presented to the Panel that, in the States and Territories with deregulated retail trading hours, the benefits to the community are outweighed by the costs. (page 162)

The Report cites the experience in Tasmania which removed most trading hour restrictions in 2002. Following deregulation, both retail sales and retail employment increased in Tasmania, at rates well above national averages. (page 164)

The Federal Government is currently consulting and seeking comments on the Final Report by 26 May 2015.

What do you think about regulation of trading hours?

The Redland City Council says its “open for business” but supports current restrictions on trading hours to avoid the imposition of “further financial stresses on smaller and independent retailers”.

The Federal Government is proposing, in a well argued report, to end restrictions on retail trading hours as part of implementing its election promises and policies for small business.

Which policy is going to work best for people and businesses in Redland City?

Redlands2030 – 2 April 2015