NSW businesses lose $120 million annually due to planning delays, with venues paying $30,000 just to extend hours to 11pm.
What’s happening: NSW’s night-time economy generates $56 billion annually across 45,000 businesses employing 300,000 people, but faces regulatory barriers costing venues around $30,000 and four months just to extend trading hours to 11pm.
Why this matters: Streamlining planning processes could save businesses $90 million yearly while unlocking billions in additional economic activity, addressing post-COVID social isolation and boosting productivity across NSW communities.
NSW’s $56 billion night-time economy is being strangled by red tape, with new research revealing businesses lose more than $120 million annually due to planning delays and excessive bureaucracy.
The NSW Productivity and Equality Commission found that venues seeking to extend trading hours to just 11pm face costs of around $30,000 and waiting periods of approximately four months for Development Application approvals.
The night-time economy generated more than $56 billion in turnover in 2023-24, delivered across more than 45,000 businesses and directly employing more than 300,000 people in NSW.
Red Tape Crisis
The report found NSW businesses lose more than $120 million in sales each year due to delays, while extending trading hours can cost an average of $30,000 in reports and fees.
NSW Productivity and Equality Commissioner Peter Achterstraat AM said the barriers are preventing businesses from reaching their potential.
“People are missing out on the benefits of new and growing businesses because unnecessary and cumbersome rules make change too costly,” Achterstraat said.
“The Commission heard from stakeholders that finding out they need to apply for a DA is enough to stop people pursuing their ambitions.”
The $90 Million Solution
The Commission’s review identified 55 recommendations to address these barriers, with streamlining processes offering significant cost savings.
Streamlining liquor licensing and planning approvals for businesses looking to trade later into the night could save $15 million a year. If this was applied to all businesses seeking these approvals, the total potential saving could be over $90 million a year.
Key recommendations include making it easier to start and grow night-time businesses, improving transport access, and clearly communicating existing initiatives like vibrancy reforms to businesses and councils.
Post-COVID Challenges
The Commissioner highlighted concerning social trends emerging since the pandemic that are impacting both economic productivity and community wellbeing.
“We’ve heard that since COVID, a lot of people find it easier to stay home and play video games than going out and mixing with people,” Achterstraat said.
“I’m worried that this ‘slouch on the couch’ attitude is reducing productivity, harming social connection and could also cause long-term mental health issues.”
He proposed dedicating the first Friday of every month as ‘Friday Night Live’ to encourage people to engage with their communities.
Safety Concerns
The report says 65% of people would go out more if they felt safer, that represents a huge opportunity. Consumer concerns about safety, limited late-night public transport, and cost-of-living pressures are making evening entertainment less appealing.
The Commission emphasised that addressing these challenges would create a positive cycle, pointing to successful precincts like Newtown where diverse, quality offerings attract customers across Sydney.
“A vibrant, safe and growing night-time economy is crucial for both social and economic reasons,” Achterstraat said. “It enhances the quality of life for residents and visitors by offering a diverse range of leisure and cultural activities.”
The findings complement the NSW Government’s reform programme aimed at removing barriers holding back billions of dollars in additional economic activity from the night-time sector.
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