Struggling businesses with a turnover of less than $50 million will benefit from a mandatory code of practice from as early as next week, Prime Minister Scott Morrison revealed on Friday.
The Prime Minister has teased an industry code of practice for commercial tenancies, including retail tenancies, but said the new measures weren’t ready just yet.
“That industry code has not gotten to the point that we believe it needs to get to to ensure sufficient security for tenants and landlords affected by these arrangements,” Morrison said.
The code will ensure that where a tenant has a turnover of less than $50 million and are a participant in the JobKeeper program, which means they have had a loss in turnover of more than 30 per cent, they would be offered some form of rent relief.
“These are things that we do not wish to be prescriptive about,” the Prime Minister said.
“What we want to do is have landlords and tenants in the room to ensure that they can work these issues out between them, so they can have an arrangement which enables them through this period, and to get to the other side.”
As an example, the Prime Minister flagged landlords could adopt three to six month rental waivers, or extend the overall lease for up to six months while waiving rent during this period.
The government said the banks would also need to comply.
“The banks will need to come to the party as well,” the Prime Minister said.
“The banks are not parties to those arrangements, so that makes it legally more difficult...but we would expect banks to be supportive of the agreements reached by landlords and tenants.”
The Prime Minister also said mediation will be available in the event that landlords and commercial tenants are unable to reach an agreement.
The government announced on Sunday that all state and territory governments would be moving to put a moratorium on evictions of persons for six months.
“If they are unable to meet their commitments...there would be a moratorium on evictions for the next six months under those rental arrangements,” the Prime Minister said.
However, the Prime Minister said this doesn’t put a moratorium on rental payments.
“It means that people are responsible for their rents, but there is a moratorium on evictions - we won’t have anyone thrown out of their homes. That’s very important,” Morrison said.
The Prime Minister flagged there would be “further work” in the residential tenancies area, but urged landlords to “do the right thing.”
“My comment to landlords is do the right thing. We are all in this together. Sit down with your tenant who has been paying you rent, working in their business week after week after week. Respect each other's livelihoods and support each other's livelihoods whenever you can.”
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