Every adult in New South Wales will be given $100 in vouchers to spend on dining and entertainment under a state government initiative to stimulate the economy.
NSW residents aged 18 and over will be eligible to receive four $25 digital vouchers through the Service NSW mobile app from late January.
The state’s treasurer, Dominic Perrottet, officially announced the ‘Out & About Scheme’ when he handed down the NSW budget on Tuesday.
Among other things, Mr Perrottet announced $107 billion in infrastructure spending spread over four years, as well as the construction of 1300 new social housing units and a reduction in the payroll tax rate from 5.45 per cent to 4.86 per cent.
The treasurer also announced that first-home buyers could opt out of paying stamp duty in favour of an annual land tax – as TND columnist Michael Pascoe explains here.
But let’s get back to the vouchers.
Two can be used for dining out and two can be “used for activities such as visiting cultural institutions, performing arts, cinemas and amusement parks”.
Economists who spoke to The New Daily welcomed the measure on the basis it targeted the industries hit hardest by the pandemic.
And the scheme’s not without precedent.
Tasmania introduced a voucher scheme months ago to support its tourism industry – it offered accommodation vouchers worth $100 and “experience vouchers” worth $50 – and the United Kingdom offered 50 per cent discounts on people’s meals and soft drinks under its ‘Eat Out to Help Out’ scheme.
The UK Treasury says the government subsidised 100 million meals under the stimulus measure, with restaurants reporting more than double the amount of bookings on the final day of the scheme than the equivalent day in 2019.
BIS Oxford Economics chief economist Dr Sarah Hunter said this suggested the scheme in NSW could be “fairly effective”.
She said incentives from other jurisdictions – including the Northern Territory’s home renovation grant and Tasmania’s ‘Make Yourself at Home’ travel vouchers – had also boosted consumer spending.
And, when asked by The New Daily, Dr Hunter said it was unlikely the money would be spent on brunches and dinners that would have happened anyway, which is sometimes the fear with such programs.
“With the cost of the vouchers being $25, it’s very likely you’ll get additional spending on the part of the consumer as they would likely spend more than $25 on a dinner or regional trip,” she said.
“And with the scheme limited to weekday spending, it helps to spread consumption over the full week and alleviates the risk of the scheme burdening hospitality venues already at capacity due to COVID restrictions.”
The New Daily also asked AMP Capital senior economist Diana Mousina whether capacity constraints imposed on venues because of the pandemic would limit the effectiveness of the measure.
“It will still have a pretty positive boost,” she said.
“It seemed to work quite well in the UK … and NSW has eased some restrictions. [For example] you can now book for 30 people, whereas before you could only book for 10.
“People will want to use it. If the restaurant is booked on Friday or Saturday night, they’ll use it on Monday or Tuesday … they’ll find a way to use it. Everyone loves free money.”