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Colin Brinsden and Daniel McCulloch
(Australian Associated Press)
Retail spending in the run-up to Christmas was even stronger than first thought, with Melburnians particularly rampant at the shops after emerging from a lengthy lockdown.
Retail trade soared by 7.1 per cent in November, even higher than preliminary findings previously released by the Australian Bureau of Statistics, led by a whopping 22.4 per cent increase in Victorian sales.
Retail turnover was a hefty 13.3 per cent over the year to November.
According to economists at ANZ, this was the second strongest annual result since January 1989, the first being when prices were pushed up by the introduction of the GST in 2000.
However, there are concerns about how recent local flare-ups of coronavirus and associated restrictions will affect confidence, and in turn spending, in coming months.
National Australia Bank global research head Ivan Colhoun believes a recent outbreak in Sydney’s northern beaches, together with Brisbane’s snap lockdown, will dent economic growth in the December and March quarters.
“But in the scheme of things, these are relatively minor on an economy-wide scale, though terrible for many businesses and communities,” he said.
NSW locked down Sydney’s northern beaches area just before Christmas as a COVID-19 cluster emerged in Avalon, with restrictions only eased on Sunday.
Queensland also declared a snap lockdown in the Greater Brisbane area over the weekend – after a case of the highly infectious UK strain was detected.
That will end on Monday night after the state recorded zero locally acquired cases for the third day in a row.
But Australian Industry Group chief executive Innes Willox is unhappy about border closures, such as those tied to the Brisbane lockdown, accusing premiers and medical officers of making decisions at a drop of a hat.
“It impacts on business confidence in a significant way,” he told Sky News.
Still, Treasurer Josh Frydenberg points out that tax cuts and concessions worth $7 billion have been distributed to nearly eight million Australians over the past six months to ease the pain of the pandemic.
Taxpayers pocketed $1.1 billion through the federal government’s stage two tax cuts between July 1 and January 3.
Another $5.9 billion has been paid under low- and middle-income tax offsets to 7.8 million people.
Mr Frydenberg expects billions more dollars in tax relief to flow into people’s pockets in coming months, coupled with other economic initiatives rolled out during the pandemic.
“There is a whole sweep of measures that the government has implemented that will help the economy face its biggest economic shock since the great depression,” he said.
Shadow treasurer Jim Chalmers said tax relief is a good thing if it is circulating through shops and the economy more broadly.
“But we need to make sure that right across the board people are being supported because a lot of people are still doing it tough and still at risk of being left behind,” he said.