The council last night agreed to write to the State Government endorsing the recommendation of the Anderson liquor licensing review that Small Venue Licences be available to North Adelaide entrepreneurs.

The licensing scheme, currently quarantined to Adelaide’s CBD, has been credited with improving the “vibrancy” of the city.

Area Councillor Natasha Malani, who proposed the endorsement at last night’s meeting, told InDaily this morning that the hipster-attracting small-bar phenomenon would be a “competitive advantage” for North Adelaide, which had suffered business closures on its main streets in recent years.

“We need to address vacancy on those streets,” said Malani.

She said about 8000 people passed through North Adelaide to get to and from the football on game days at Adelaide Oval, but the council wanted to encourage more people to spend more time in the area.

“We want diversity of offering for people going to the games,” she said.

“That will provide other businesses with more [customers].”

But Malani told InDaily: “We do have some preference that the boundary stays within the City of Adelaide [CBD and North Adelaide].

“We do see this as an advantage for us.

“I can appreciate that Prospect and Norwood [and other council areas] … would like small bars.

“The [Anderson] report clearly states that there are alternatives for those areas.”

She stressed, though, that the council had no formal position on any expansion of the scheme beyond its borders, and insisted, “we’re not opposed to the expansion [beyond the council boundary] but … we welcome the opportunity based on the findings of the report”.

But Prospect Mayor David O’Loughlin told InDaily he was “tired of vested self-interest driving liquor licensing policy”, and described the restriction of the Small Venue Licence to a limited area as “protectionism”.

“It’s completely inequitable that this law only applies in a limited zone,” said O’Loughlin.

“There’s no other shop or service that’s as highly restricted from competition as the hotel industry.

“The city pilot has proved that it can work – it’s time to spread the love [and] get out of the way of local enterprise.”

Malani suggested it was a good idea to encourage small bars to “cluster” like fast-food venues.

However, O’Loughlin said it was “fanciful to believe that clustering can only happen in the CBD [and North Adelaide]”.

“We have written to the minister on more than one occasion that we want the rules changed,” he said.

Australian Hotels Association SA General Manager Ian Horne told InDaily the Government should do a “full economic impact assessment” of all 129 recommendations of former Supreme Court Judge Tim Anderson in his review.

He said the association was “not convinced” the small bar business model would work beyond the city and North Adelaide.

However he also warned that an expansion into the suburbs and beyond may cause a surge in the supply of liquor venues without necessarily increasing demand for them.

Central Ward councillor Houssam Abiad said his position as a councillor and his support for the free market were in conflict when it came to small bars.

“Selfishly, from the Adelaide City Council perspective, we want to retain our competitive advantage,” Abiad told InDaily.

“Do I, as a councillor, support Adelaide City Council retaining its competitive advantage? … 100 per cent, I do.”

However, wearing his “entrepreneur’s hat”, he said: “I support the free market”.

North Ward councillor Anne Moran told InDaily: “if you dilute it too much, away from the city, you may kill the golden goose,” however she said the scheme may well expand across the state in coming years.

Abiad added that his opinion on small bars in other council areas did not “matter”, because he had no power to influence the State Government, which is currently considering the recommendations of the Anderson report.