The planned reform of the Liquor Act moved a step closer to enactment when the Liquor and Other Acts Amendment Bill 2008 was tabled in the Queensland Parliament on 26 August. The details of the Bill do not differ greatly from the most recent press releases and comments made by the Queensland State Government and we have updated details from our previous article on the reform process below.

a) Ministerial banning power

The Minister will have the power to ban certain liquor products permanently.. The banning power will be directed at products which: specifically target and encourage the consumption of liquor by minors or young people or are likely to be confused with soft drinks or confectionery or are likely to have an appeal to young people.

The introduction of a power of this kind is largely uncontroversial, and brings Queensland into line with other jurisdictions.  However, there is no apparent right of appeal nor can the manufacturer show cause why the product ought not to be banned.

b) Mandatory RSA and RMLV training

As expected, RSA training will be mandatory for all staff involved in the service of alcohol. This includes bartenders, glass collectors, floor hostesses, security providers, room service staff and bottle shop staff.

RMLV training will be mandatory for all licensees, nominees and managers and will need to be renewed every three years, in line with the renewal period for RSA.

c) Standard trading hours

The move to standard trading hours will see the cancellation of all existing Extended Hours Permits which allow trading between 5 am and 7 am or between 7 am and 10 am.

Licensees may apply for an extended hours permit to include trading between 9 am and 10 am if it can be demonstrated that there is a community need for the permit.

Commercial licence holders may apply for a permit to trade between 7 am and 9 am only for the purpose of selling and supplying liquor to or for persons genuinely attending a function held on the licensed premises during those hours

Community club licence holders may apply for approval to trade between 7 am and 10 am provided there is a community need for the approval and the club is a sporting club.

d) Manager’s licence

The introduction of a manager’s licence is intended to ensure that managers of licensed venues are responsible for ensuring compliance with the Act and conditions of the licence.

An approved manager must be on the premises or readily available at all times the business is open between 7 am and 12 midnight. A manager must be on the premises at all times the business is open between 12 midnight and 5 am. Licensees who are individuals may apply for an exemption from this requirement for a period of up to three months under certain circumstances.

The manager must have completed the RMLV and RSA courses and must be of good character. In the event a licensed manager is found to have a poor management record, such as frequent infringement notices or documented complaints, the licence may be refused or cancelled.

The manager’s approval will be for a period of five years, which is at odds with the validity period of RMLV and RSA – three years.

e) Licence type restructure

The licence type restructure has followed the proposed outline. The table below contains the pre amended and post amended licence types.

A new bar licence type will be created for businesses with the principal activity of supplying liquor for consumption on the premises and with a maximum seating capacity of 60 persons. This is despite strong opposition to this move from certain sections of the industry and the questions over the success of a similar initiative in Victoria.

(g) Liquor accord legislation

Liquor accords will be formally recognised in the amended legislation and are defined as:

liquor accord, for a locality, means an agreement, memorandum of understanding or other arrangement entered into for the purposes of—
(a) promoting responsible practices in relation to the sale and supply of liquor at licensed premises situated in the locality; and
(b) minimising harm caused by alcohol abuse and misuse and associated violence in the locality; and
(c) minimising alcohol-related disturbances, or public disorder, in the locality.

Risk Assessed Management Plan

Another significant development is the replacement of the House Policy by the Risk Assessed Management Plan (RAMP) and the extension of this requirement to all licensed premises other than those trading under the authority of a licence or restricted club permit of less than one year’s duration.

Any changes to the RAMP must be approved by the Chief Executive and an amended plan must accompany any applications for transfer, variation, change in trading hours, alterations or approval for a change in the principal activity of a business conducted under a licence.

Whilst it’s impossible to put an exact figure on this, our example restaurant below increased annual profit by between $39,000 and $74,000.

To arrive at this figure we made a conservative calculation for a typical mainstream restaurant.
The restaurant is open six nights a week for dinner only and has 40 seats with an average occupancy of 70%. Main meals are priced between $15 and $30 and, before obtaining a liquor licence, the average spend per person is $30.

In Queensland the average mark up on liquor is 255%, delivering 71% gross profit to the business owner.

If you want to find out how Liquor & Gaming Specialists can help you add a new revenue stream to your business, call our office on 07 3252 4066. Our initial consultation is free and at that time we will give you an appraisal of the suitability of your premises.

Where do these figures come from?

The figures used above to calculate profit for a fictional restaurant in the Greater Brisbane area are based on research carried out by the Liquor Licensing Division in 2004. We have received a copy of the summary report of a Statutory Records Compliance Audit of On Premises (Meals) Licences. The report contains data on trading figures from 786 licensed restaurants Statewide. The aim of the audit was to identify any restaurants potentially not meeting the primary purpose of the business: the supply of meals.

Of the premises surveyed, 16 respondents, or approximately 2% of the total, had liquor sales in excess of the 50% benchmark. These premises were identified as popular bar/nightclub style restaurants and in the intervening period a number of the businesses have obtained a liquor licence better suited to their style of operation, such as a General or On Premises (Cabaret) Licence.

Of the remainder:

29 restaurants, or less than 4%, had liquor sales in the 41-50% category. Many premises in this category were well known for a significant bar trade but also enjoyed an excellent reputation for quality dining.

Approximately 30% of restaurants, 250 in total, reported liquor sales in the 21-40% category, and were described as ‘typical mainstream restaurants’ where many diners purchase a bottle of wine with a meal.

The majority of respondents, 491 restaurants or 62% of the total number, reported liquor sales in the 1-20% category. This category was predominantly made up of Asian and Italian restaurants but included Sizzler (average 7%), Aromas and other restaurants specialising in coffee.

Therefore,  a typical mainstream restaurant will account for 21-40% of turnover through liquor sales, while restaurants with a focus on coffee, take away food or basic Asian style cuisine can expect to account for 1-20% of turnover through liquor.

The data we have does not include a detailed breakdown of sales. However, the report includes an analysis which tells us that across all premises to respond, liquor represented 17% of total sales.

The details in this article are intended for information only, and are not intended to provide formal advice. For this reason, Liquor & Gaming Specialists Pty Ltd cannot accept liability for any loss or consequential loss, however arising,brought about as a result of a person acting, or refraining from acting, on material contained in this article. For formal advice on any matter, please contact our office by clicking here.

The Queensland Government recently published a report known as a Regulatory Impact Statement/Draft Public Benefit Test (“RIS”) relating to the review of the Liquor Act 1992. The RIS is part of the legislative process. It sets out the proposed changes, and calls for submissions on the changes from any interested party. You can download a copy of the full document here.

The RIS raises many questions but lacks the detail necessary to form a proper view of the changes in many respects.

Submissions in response to the RIS closed on 13 March 2008. To view submissions we made on behalf of a number of trader groups visit our documents page. After considering the submissions the Government issued Outcomes of the RIS/DPBT Consultation Process for the Liquor Reforms.

As more detail comes to hand we will publish it on this website.

In the meantime, the proposed changes are set out below, together with some short observations regarding possible issues for licensees in Queensland and the community as a whole.

a) Ministerial banning power

It is proposed that the Minister will have the power to ban certain irresponsible liquor products not in the public interest for up to three years. The banning power would be directed at products which specifically target and encourage the consumption of liquor by minors, or products which encourage the rapid or excessive consumption of liquor. This would include products packaged in a way that does not allow the consumer to recognize the impact of the beverage (such as the number of standard drinks contained per drink).  Examples stated are alcoholic iceblocks, alcoholic milk, alcohol vapour, and alcoholic products sold in aerosol containers which are considered undesirable because of their appeal to young people and their ability to increase intoxication in a very short timeframe.

The introduction of a power of this kind is largely uncontroversial, and brings Queensland into line with other jurisdictions.  However, it would be reasonable to expect that the power would be described in such a way as to preclude the banning of products which do not meet the criteria referred to in the report. The Government also plans to have a consultation process with industry and allow a manufacturer seven days to show cause why the Minister should not ban a product.

b)Mandatory RSA and RMLV training

An amendment will make RSA training mandatory for all staff involved in the sale or supply of liquor in licensed premises state-wide, including bartenders, glass collectors floor hostesses, security providers, room service staff and bottle shop staff. RMLV training will become mandatory for all licensees, nominees and managers and will need to be renewed every three years.

These requirements already apply to any licensed premises operating after 1.00am within the Brisbane City Council area. The principle issues for liquor licence holders are increased costs to the licensee and further pressure on workforce participation in hospitality jobs. Questions might include whether the cost of training should be subsidized and whether school-based training should be made available as part of the education system.

c) Standard trading hours

It is proposed that ‘high risk’ permits (as an endorsement on a licence) will be required for trading between 12am-3am, and ‘elevated risk’ permits (as an endorsement on a licence) be required for trading between 3am-5am. One-off permits for trading during these periods will also be available. However, trading between 5am-7am will no longer be possible.

The 3am lockout will be retained.

Trading other than for functions and other than with some form of special approval will not be permitted prior to 10am.

It is unclear what issues are being addressed by these measures. On the face of the report it appears that current arrangements for late night trading will remain untouched. However, other than renewal fees no detail is provided regarding any specific requirements with respect to either permit, what conditions will be imposed, cancellation provisions etc

d) Manager’s licence

An amendment to the legislation will make it mandatory for an approved manager to be present if the venue is licensed to operate after 12am, or is catering to a function (on or off-site) where the number of consumers for the current licensed operation or activity is increased.

It is proposed that a manager’s licence/approval will be assessed according to the same criteria as an application for a new nominee which includes:

• completion of a RMLV course;
• completion of a separate RSA course;
• probity check; and
• assessment of management history e.g. infringement notices, complaints.

In the event a licensed manager is found to have a poor management record, such as frequent infringement notices or documented complaints, the licence may be refused.

The issues here again relate to the absence of any detail in the report. For example, how will licensees cope with processing delays with Liquor Licensing? How many licensed managers will be required for each venue? What will be the policy for dealing with an emergency situation where the venue might be without a manager, or the manager might call in sick?

Consideration must also be given to the effect on labour force participation in duty manager roles if the requirements are too difficult. Although it is hard to argue against any measure which improves the quality of management, yet another licensing system will create further compliance issues and must be applied using a common sense attitude.

The most recent information from the Liquor Licensing Division allows for managers of “low risk” venues to be absent for up to 28 days, subject to conditions, but no allowance has been made for other venues.

e) Licence type restructure

It is proposed that the licence categories for applications will be streamlined into two distinct licence types – commercial and community – with subcategories for each based on risk.

The proposal is for effectively 5 licence categories –

• Commercial Hotel – equivalent to a current General licence
• Commercial Casino
• Commercial Other – this will be the category for nearly everyone else: restaurants, cabarets etc
• Community Club
• Community Other

It is also proposed to introduce new licences for small/boutique bars and wine (exclusive) bars with a maximum venue capacity of 60.

There is very little detail provided in the RIS regarding how the risk-based subcategories of the Commercial Other designation will work.

Gaming and detached bottleshops will only be possible for a Commercial Hotel licensee, although the RIS does not deal with take away packaged liquor from a main licensed premises at all.  Commercial Hotel and Community Club licensees will be the only categories permitted to have a DOSA.

This may be no more than a re-naming exercise. On the other hand it may lead to issues with proliferation of outlets, particularly when the new boutique bar proposal is considered. Interestingly, the report does not discuss the effect of increased numbers of licensed premises from a harm minimization point of view.

There is an inadequate level of detail about the practical aspects of the changes.  For example, will the 60 person capacity for boutique bars be determined on seating or standing room?  Or on floor area?

The most recent press release regarding this aspect says only “Typically, these venues seat less than 60 people.”

(f) Licence fee restructure

It is proposed to amend the Liquor Act and the Liquor Regulation to require annual renewal of licences. The annual renewal fee would seek to cover the direct costs to Government of regulating the liquor industry.

Criteria	Scale	Risk	Fee $
Commercial	Hotel		$2 700
	Special facility (5am-12am trading up to 10 outlets; for each extra outlet above 10 add $1000)		$10 000
	Special facility (10am-12am up to 10 outlets; for each extra outlet above 10 add $1000)		$7 500
	Other		$500
Community	Club (large)		$2 200
	Small Club (<2000 members)		$500
	Other		$250
Bottle shops	Detached bottle shop (for each shop)		$3 000
Trading Hours	7am to 9am – clubs – demonstrated need (sporting or shift workers) and includes functions if approved	Low	$1 000
	7am to 9am – functions (only)	Low	$1000
	9am to 10am – subject to demonstrated need –	Low	$ 500
	(commercial & community licences)
	10am to 12am standard trading	No	$0
	12am to 3am	High	$7 500
	3am to 5am	Elevated	$10 000
Noise dB(C)	Exempt existing cabaret licences with current structural specifications	No	$0
	≤ 75	No	$0
	76-90 Noise with an acoustic report	Med	$500
	91-100	High	$1 000
	>100	Very High	$2 000
Provision of food	Off-site sales	No	$0
(standard trading hours)	Not applicable	No	$0
	Prepared meals (2hrs prior to closing)	No	$0
	Prepared snacks (2hrs prior to closing)	Medium	$500
	No food	High	$1 000
Provision of food	Prepared meals (1hr prior to closing)	No	$0
(extended trading hours)	Prepared snacks (1hr prior to closing)	High	$1 000
	No food	Very High	$10 000
Compliance history	Positive management history	No	$0
	Warnings	Low	$3 000
	Infringement notices	Medium	$5 000
	Prosecution/Disciplinary action	Very High	$10 000
	Major trauma	Encumbrance	$20 000

The table above is from ‘Outcomes of the RIS/DPBT Consultation Process for the Liquor Reforms’ From the figures above, a licensee trading under a general licence until 5am with music levels of more than 100dB(C), not providing food until 1 hour before closing will pay an annual fee of $32,200, or higher in the event of any compliance problems.

Issues here are relatively obvious.  There is no distinction made between venues based on geographic location or size. The economic pressure will therefore vary from one venue to another which is not a fair  approach.

Also, although annual licence fees were abolished in 1997 they were replaced with sales tax changes and ultimately with GST. So it is incorrect to say that licensees are not already contributing to meeting the costs of regulation etc.

(g) Liquor accord legislation

Liquor accords are not currently recognised in the Liquor Act. Recognition in the legislation will offer certainty as to the nature of accords and the responsibilities of those who are members of the accord.

Most industry participants are supportive of accords, and any strategy to increase participation is probably welcome.

In the 70s and 80s, when Brisbane was being transformed into the Mini-Manhattan we now know and the Western corridor was exploding, almost all large developments were single use structures – offices, hotels or retail. This unilateral approach to development was encouraged by zoning laws which failed to contemplate mixed use development.

Thankfully, most big developments in Queensland now have a variety of facilities normally blending living, working and entertaining into one planned community. Examples of this type of development can be seen at the Emporium, Fortitude Valley, Southbank, South Brisbane and Varsity Lakes on the Gold Coast.

These planned communities differ considerably from the developments planned and executed in the past. Nowadays a great deal of thought goes into the mix of businesses the developer wants to attract. Identifying a balanced mix of businesses will make office and residential lettings more attractive when tenants see many of their needs being met locally.

In addition to essential services such as parking, shopping and service businesses, the workers and residents also want restaurants, cafes and some form of entertainment. Most developers realise there will be a need for some form of liquor licence for these businesses, but do not realise that in Queensland an application for a liquor licence can be finalised long before completion of the project. In fact, once the relevant planning approvals are in place an application for a liquor licence can be lodged and the process begun.

Applying for a liquor licence in the early stages of a development has many advantages. The benefit to the property developer is that premises earmarked for use as a restaurant or bar are much easier to lease if the liquor licence has been approved in advance. Benefits to the prospective tenant include certainty on the availability of a liquor licence* and a reduced likelihood of objections to the application from residents.

To find out more about Liquor & Gaming Specialists’ services for developers call us on 07 3252 4066 or email Diarmuid Deans on ddeans@lgs.net.au.

*Although it is unusual, we have come across situations in the past where an oversight in the initial development application omitted restaurant or bar from the list of approved uses. This is a problem for any operator but it is disastrous if the viability of the business is dependent on obtaining a liquor licence because, in Queensland, without town planning approval the application for a liquor licence cannot begin.

Greg Currie and Tracy Humphreys are highly respected trainers in the liquor and hospitality industry. In July 2007 Greg and Tracy formed ComTraQ and with their combined experience and reputations, they have built it into a highly successful provider of RMLV training.

In February 2008, the Liquor Licensing Division called for expressions of interest from Registered Training Organisations to deliver face to face RMLV & RSA training. This change in policy, from approval of individuals to approval of RTOs, threatened to remove ComTraQ from the picture.

LGS and ComTraQ and have now joined forces to form LGS Training. Our application for registration as a training organisation is under way and we plan to begin operation once the necessary approvals are in place.

Greg & Tracy will continue to operate as ComTraQ under the authority of the newly formed RTO. Our initial approval will allow us to provide courses in Responsible Management of Licensed Venues, Responsible Service of Alcohol, Responsible Gaming Service and Food Safety Officer Training. In the future we will be expanding to include emergency management procedures, occupational health & safety for licensed venues and security provider training.

Until the new licences to operate have been issued by the Liquor Licensing Division, Greg & Tracy will continue to provide RMLV training. To book a course, call ComTraQ on 07 3371 7999, visit www.comtraq.com.au or call LGS on 07 3252 4066.