The review, undertaken by consultant KPMG, found that of the $4.33 million that was spent by Rundle Mall management last financial year, $2.03 million covered administration costs – up from $1.83 million the year before.

The majority of that funding covered the cost of employing nine full-time staff, whose salaries total $803,570, however, staffing costs reduced by two per cent on the previous year.

There was also a 12 per cent increase in security costs last financial year, which KPMG said was due to an “overall increase in crime noted within the precinct which has occurred during COVID-19”.

Meanwhile, spending on marketing and events dropped from $2.74 million in 2019-20, to $2.3 million last financial year.

Rundle Mall management, which operates under the Adelaide Economic Development Agency (AEDA), which commissioned the review, generates income from pop-up activations and sponsorships, as well as a levy paid by the approximate 1500 traders.

According to the Adelaide City Council, the levy is used for “managing and marketing the Rundle Mall Precinct”. 

It is based on property value and has been held at $0.03582 per $1 of the property’s value for the past two years.

A report outlining findings of the KPMG review states Rundle Mall traders raised concerns about how the precinct’s management prioritised spending.

Traders told KPMG they were unaware how their levy payments were being spent, or whether management was spending money on the “right things”.

“I have no idea what the budget is spent on or the campaign costs,” one trader was quoted as saying.

“I asked why cleaning and security costs are so high and how these figures are derived but no answer as yet – this needs to be more transparent,” the report quotes another trader as saying.

KPMG made about 20 recommendations to AEDA to improve its management of Rundle Mall, including providing more information about its spending in its business plan and annual report.

According to the report, AEDA has developed a plan to address the recommendations of the review and presented traders with the findings at a meeting in December.

AEDA Rundle Mall project manager Nicola Smith told InDaily in a statement that the difference in administration costs over the past two financial years was due to a change from presenting the information exclusive of non-cash items such as depreciation, to providing the information inclusive of those terms.

“Depreciation was not included in the 2019-20 financial year figure, but it was in 2020-21,” she said.

“With depreciation included in the 2019-20 figure, the variance in administration costs is approximately $40,000 – attributable to increased security required to ensure public safety in the Mall during the pandemic.”

Smith said the cancelation of VOGUE Festival due to COVID-19 reduced Rundle Mall’s sponsorship income and marketing and events budget.

“Rundle Mall redistributed the budget allocated for VOGUE Festival on other initiatives, including COVID recovery measures, the Precinct’s winter campaign and Tasting Australia activations,” she said.

The KPMG report also highlighted a current lack of “contemporary retail knowledge” on the AEDA board.

AEDA chairperson Nikki Govan told an Adelaide City Council committee meeting on Tuesday that the lack of retail expertise on her board prompted her to commission the review.

“Quite frankly, the lack of representation was something that we recognise,” she said.

“We did have a retailer that had been appointed to the AEDA board and they had some financial strife and therefore they withdrew from the board.

“We’ve been concentrating very much on looking at filling that skills gap.”

Govan said six people with retail management experience had nominated to join the AEDA board, with an appointment to be made within two to three weeks.

She said the board was also looking to appoint a dedicated Rundle Mall manager.

“It’s important to have a dedicated Rundle Mall manager to look after Rundle Mall, to look after the stakeholders, the levy payers and particularly to also have a focus on (retail) curation,” she said.

According to the KPMG report, traders also raised concerns about the cost of car parking near Rundle Mall.

“The fundamental issue I hear a lot is restrictions around parking and costs of parking when you can go somewhere else for free,” one trader was quoted as saying.

AEDA managing director Ian Hill told the Adelaide City Council committee meeting that the board was considering introducing a validated car parking system whereby people would be offered free parking if they spend a certain amount at Rundle Mall.

“For example, if you spend $100 you would get a $10 parking ticket as a way of getting that validated through expenditure,” he said.

The Adelaide City Council abolished the Rundle Mall Management Authority in January last year and replaced it with AEDA.

Smith said commissioning the KPMG review was “good business practice and a proactive measure”.

“As per the feedback in the review, additional sessions are planned for stakeholders to provide further input into future planning,” she said.