New "draconian" lockdown restrictions are set to last at least six weeks © Asanka Ratnayake via Getty Images
New "draconian" lockdown restrictions are set to last at least six weeks © Asanka Ratnayake via Getty Images

Victoria lockdown to impact vital industries

10 August 2020

“Draconican” measures to tackle the rise of the coronavirus in Victoria will devastate livelihoods, because of the impact on supply chains, construction and manufacturing, the Australian Industry (Ai) Group has warned.

According to the country’s national employers association Ai Group, new lockdown restrictions, which are set to last at least six weeks, will result in many businesses struggling to reopen. 

Ai Group chief executive Innes Willox said the “draconian measures” would devastate the livelihoods of millions in the state.

“Closing or restricting large swathes of manufacturing and construction as well as their supply chains brings the hammer down on sectors that have been responsible for relatively little transmission, which have followed strict Covid-safe plans and are vital to the community and the country’s economic wellbeing,” he said.

Willox added many Victorian businesses operated and supplied goods and services across borders, and the restrictions on well over 20% of Australia’s economic activity would have massive flow-on implications across the nation. 

“Many businesses will struggle to reopen after the minimum six weeks of these restrictions and closures. The future of their employees is now uncertain,” he added.

He acknowledged the need to put health first, but said that “proportionality” was also important.

The head of Ai Group in Victoria, Tim Piper, said that the total Victorian supply chain had not been fully considered with the restrictions, with companies such as metal fabricators, which support the food sector, health and related activities, told to close. 

“The gaps in the supply chain created by these closures and restrictions will inevitably be met by interstate companies,” said Piper. 

“This may numb some of the national implications but will be cold comfort for businesses and their Victorian employees if customers are lost permanently.”

He added the government should remain open to amending or removing restrictions where possible.

Speaking in an interview on news programme RN Breakfast, Business Council of Australia chief executive Jennifer Westacott said that it was crucial that governments worked with industry to monitor supply chains.

Talking about the impact on businesses, she said: “I’m more concerned, I'll be honest about it, small businesses who have said to me, ‘We just can't do it a second time. We don't have the balance sheet like Wesfarmers, or another big company does. We don't have the capacity to keep going.’ I’m very concerned about those people and I think it’s really crucial that the Victorian government works daily with industry to monitor this, to check for unintended consequences to see if we can get some things back earlier where the health risk is under control.”

Last week, Qantas Freight announced it was suspending operations in its Melbourne freight terminals as Victoria declared a “state of disaster” in response to the rising coronavirus outbreak.

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