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Efforts to transform Sydney’s late-night economy face structural barriers in the form of transport options, critical mass and penalty rates, the City of Sydney’s business and safety manager Suzie Matthews says.

The City’s “OPEN Sydney” action plan is the result of extensive consultation beginning in 2011 and aims to diversify Sydney’s night-time entertainment options beyond the consumption of alcohol.

The long-term strategy goes out to 2030. But asked about progress in 2014, Ms Matthews said there were several issues that could impede action in the short term.

The first structural issue is about “building a level of trust and confidence in our late-night public transport system that might not be there at the moment”. City businesses need to know their staff can commute home safely and efficiently, but Sydney’s train and bus network is notably patchy late at night.

Nor are the solutions necessarily easy. The City’s strategy calls for more public transport, better taxi availability and improved bicycle access. But Ms Matthews noted that when the state government provided extra buses in Kings Cross, it did little to attract patrons.

“They did it, and no-one got the buses,” she said.

Secondly, there is uncertainty about whether foot traffic has reached critical mass for business owners to keep trading after hours. Ms Matthews says the City has almost finished crunching data collected from pedestrian counts, intercepts and observational studies conducted in 2012. The research looked at the numbers, demographics and purposes of people in the city and precincts between 6pm and 6am.

“That’s data that I believe is gold,” she said.

Thirdly, Ms Matthews raised the issue of penalty rates acting as a disincentive to businesses operating late at night. In October, the Restaurant and Caterers Association asked the Fair Work Commission to reduce or remove penalty rates for weekday hospitality work performed after 10pm. Fair Work rejected the application.

“[It’s] beyond ours to address, but it was certainly something that was raised with us during the Open Sydney consultation process,” Ms Matthews said. “[It’s] a massive barrier for businesses to do business late at night.”

One area of regulation that does fall within the City of Sydney’s remit is around opening hours, which are prescribed by an operator’s development application. According to Ms Matthews, there is now a proactive focus on giving shops the flexibility to stay open longer, which didn’t exist before.

“Let’s give you the maximum that you might want. You may not want to do it now, but it gives you the flexibility down the track to do it,” she said.

Ms Matthews said a recent trip to Korea had given her a better insight into a diverse and accessible late-night economy.

“There was a lot of public drunkenness in Seoul, but I didn’t see the bad behaviour that I see in Sydney. You had the range of options that brings families, kids [and] older people into the city. It’s not dominated by one use.”