Retailers welcome rental, wage relief, as Heightened Alert 'almost like a circuit breaker'

RETAILERS who have suffered a drop in sales by as much as 80 per cent amid the current heightened restrictions to curb the spread of Covid-19 have welcomed the government's offer of rental relief and increased wage support.

Kate Low, founder of lingerie retailer Perk by Kate, for instance, said that the state of Heightened Alert (HA) has felt almost like a circuit breaker - but without the assurance of relief schemes - until Friday's offer of an S$800 million support package that includes enhanced wage subsidies under the Jobs Support Scheme (JSS) and rental relief for businesses and workers.

Ms Low said: "This rental relief honestly came as a pleasant surprise to us."

Finance Minister Lawrence Wong on Friday announced that the JSS would be enhanced to help businesses significantly hit by the Phase 2 HA measures. Retailers will get 30 per cent support, up from the current 10 per cent, from May 16 to June 13.

The government will also provide rental relief to small and medium-sized enterprises (SMEs), with tenant-occupiers of government-owned commercial properties to receive one month of rental relief.

Qualifying tenants of private commercial properties will get half month rental relief in a cash payout disbursed by the Inland Revenue Authority of Singapore (IRAS), starting from mid-August.

Mr Wong urged landlords to match the half-month rental relief. "I am glad that key landlords ... have already put out statements, even prior to today's announcements, to assure their tenants that they will provide additional support," he said. "I would urge all landlords to do so."

Under the current Phase 2 protocols, retailers have still been able to operate, but a temporary ban on services such as dining-in have had spillover effects on their sales. Tighter capacity caps on retail spaces such as shopping malls and showrooms have shrunk foot traffic.

Shoe retailer Pazzion, for instance, has suffered a "drastic drop" in retail footfall since the start of the HA on May 16, said director Tom Ng. Under the current protocols, it has also had to temporarily close five of its 11 outlets, as these are in malls that had been visited by infected persons.

The Fair Tenancy Framework Industry Committee, which includes representatives from the retail, restaurant and nightlife bodies, said the new measures will place "targeted help where help is needed".

Retailers are relieved that the rental rebate would be given to them directly. "It means we do not have to chase our landlords," as Ms Low put it.

During last year's circuit breaker, property tax rebates were disbursed to the landlords, who were asked to pass the savings on to tenants. Not all did so.

Having IRAS handle the process would ensure that "nobody drags their feet" in getting the relief shared out, said James Quan, co-founder of leather goods maker Bynd Artisan.

"(The previous method) created a lot of stress, uncertainty and angst. Not-so-nice things were said," he recalled.

Yet, some had expected more, given the continued uncertainty in the pandemic situation. Ricky Lim, founder of florist The Green Capsule, noted that the lower sales could persist beyond the end of Phase 2 HA, even if restrictions are not extended.

"It doesn't mean that after June 13, we can party. People will still be afraid to go out, so we won't expect sales to pick up for at least another two months. There are still many uncertainties," he said.

Still, retailers recognise that despite the similarities to last year's "circuit-breaker" period of partial lockdowns, the measures in the current Phase 2 HA allow them to remain open for business. Support would therefore be offered at relatively lower levels than last year.

Electronics retailer Audio House managing director Alvin Lee said he appreciated the JSS support, which will help it to continue paying its staff the same salaries as before. Their commission-based earnings have been impacted by the measures restricting the number of staff who can be in the showroom at one time.

Said Mr Quan of Bynd Artisan: "Taking into consideration that there is still business to be done in the shops - albeit less because the neighbouring F&B (food and beverage outlets) are not physically open - this initiative is very apt."

He added: "Every bit helps. Is it enough or not? It's always never enough, but there wasn't anything for retailers a month ago. Now there's something. And we haven't been totally shut down ... Sometimes, we just have to be grateful."

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