Small business owners in Woden believe the relocation of 1100 local public servants will do little to provide the long-term confidence needed to revitalise the struggling town.
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The town centre has been hit hard by an exodus of federal departments in recent years, with the federal government slashing the public service workforce and consolidating real estate across Canberra.
Tim Kinsela, who owns a specialist barber store in the town centre, said the ACT government should treat the relocation as a temporary solution rather than a permanent fix.
"Everyone seems to be patting themselves on the back about these public servants coming to Woden, but thousands have left this town in recent years so it's still a net loss as far as businesses are concerned," he said.
Late last year, the ACT government announced plans for 1100 local public servants to be relocated to Woden in a bid to boost the local economy.
So far, only 150 of the 750 ACT Health staff have moved into a Bowes Street office, the remainder unlikely to arrive until late 2016.
Another 320 staff from Access Canberra will also be relocated later this year, although the government has not yet announced an office space.
Mr Kinsela said he deliberately targeted his business toward younger and more affluent public servants and the relocation was welcome news.
"I know of two cafes that have closed very close to us around the public service offices and it scares me," he said.
"People always say it's good to see so many apartments being built around Woden, but it's departments we really need."
In January, the Department of Veterans' Affairs moved 526 public servants from Canberra's tallest building in Woden to the Gnabra building in Civic, which is leased by the Australian Tax Office.
The move was announced by the government in May 2014 and was expected to save close to $82 million on leasing fees and vacant office space across Canberra.
Close to 600 IT staff moved from Woden to Gungahlin in early 2015, adding to anxiety with federal relocations already announced.
Another small business owner Ricardo De Marco, who owns the recently opened Space Kitchen cafe in Woden, said public servants were the livelihood for many owners but could also be their downfall.
"You get used to seeing you regular customers everyday but when the department relocates that's it, you don't see them anymore"
"This can be harder for the more established businesses who had traditionally had established customers, as when new people come to town they tend to opt for the newest places.
Mr De Marco said relying on public servants for income was a risky move in Woden, with fluctuations likely to continue in coming years.
"When we opened we were not sure what would happen with the public service workforce so we didn't want to rely on them," he said.
