Update: Relief Fund Grants and Patron Numbers

BSP Lawyers understands that many licensed premises operators are having difficulty securing access to the correct payment from the Licensed Premises Hospitality Fund 2021 (LPH Fund) due to not having a maximum capacity endorsed on their liquor licence or having a limited maximum capacity contained on their liquor licence that does not reflect the actual capacity of the venue.

LPH Fund

The LPH Fund comprised an original grant announced in late June 2021, and has included as many as seven (7) different top-ups and additional payments. Those payments were automatically paid to an applicant who had applied for the original grant.

Four (4) of the top ups (on 28 July , 6 August, 12 August and 19 August) included a top up-payment between $5,000 to $20,000 per week which was determined based on patron capacity. The top ups applied to a 5 week period and therefore comprise between $25,000 and $100,000 in grants.

The Business Victoria website states that ‘patron capacity will be as reflected on the liquor licence for the premises in July 2021’.

Patron Capacity

It has come to our attention that licensed premises that either have no overall maximum capacity or a maximum patron capacity that applies only after a certain time (say 11pm) endorsed on their licence are being treated on the basis that they attract a lower level of payment that what they ought to be entitled to.

For example, a metropolitan Hotel has a late night (general) liquor licence with a maximum patron capacity of 120 patrons that applies after 12 midnight. The patron capacity prior to 12 midnight is not restricted by the liquor licence but is subject to compliance with the Building Code of Australia in terms of safe maximum occupancy (under a separate legislative scheme). That safe operating capacity might be as high as, say, 500 patrons.

That premises therefore ought to be entitled to $100,000 in grants as a ‘500 patron capacity’ premises, but will only have received payment of $40,000 having been instead classified as a ‘120 patron capacity’ premises. Clearly, the shortfall is significant.

Can this be changed?

Many operators are asking whether premises that do not have an approved patron capacity on the licence can write to the Commission to request a patron capacity be endorsed. This is on the basis that Business Victoria appear to be consistently applying the grants based on what is shown on the liquor licence – not what capacity the premises can actually hold, and therefore extrinsic evidence like an occupancy certificate may not necessarily change the outcome.

Operators should carefully consider potential ‘knock on’ impacts of imposing or attempting to impose an overall maximum capacity on their licence in order to obtain the higher payment.

In particular:

  • In many cases it is likely that the renewal fees for those premises has historically been calculated on the basis of the lower patron numbers. In the example the Hotel above, it has likely been paying annual renewal fees of $5,110. If it accepted an overall maximum capacity of 500 patrons, it’s renewal fee in future for each and every year would be $8,177.
  • The evidence that the VCGLR will require to endorse an overall capacity is unclear but might include a letter from Council confirming that the higher patron numbers is not in contravention of the planning scheme. This will necessitate Councils reviewing all historical planning permits for your site and carefully checking all aspects of compliance before issuing that letter. And potentially requiring a planning permit application before any change can be made to the capacity on the liquor licence.
  • Most relevantly, there is no guarantee that Business Victoria will retrospectively increase the grants provided, or whether the change in patron capacity can be immediately applied to apply to future top ups (noting, for instance, the statement from Business Victoria that the licence conditions as at July 2021 are what is currently being relied upon).

On that basis, we would suggest that licensees as a starting point attempt to liaise with Business Victoria to rely on an extrinsic document, such as an occupancy certificate or a building surveyors report, rather than making immediate changes to your permanent licence.

Where an existing occupancy certificate is not available, the best method for licensees to demonstrate a higher lawful and safe operating capacity is by way of a desktop calculation by a registered building surveyor attesting as to the safe operating overall capacity of the premises. For the above reasons, permanent changes to your licence should not be the automatic solution to the issue – there are more complex considerations to take into account. We suggest that if any venue is experiencing this issue that you contact us to discuss and we can work through what might be the best approach for your venue.

This update does not constitute legal advice and should not be relied upon as such. It is intended only to provide a summary and general overview on matters of interest and it is not intended to be comprehensive. You should seek legal or other professional advice before acting or relying on any of the content.