Job­shocker: $60bn gaffe of­fers re­cov­ery wind­fall

The Weekend Australian - - FRONT PAGE - GEOFF CHAM­BERS

A $60bn ac­count­ing er­ror in Scott Mor­ri­son’s his­toric JobKeeper scheme has handed the govern­ment a shock bud­get wind­fall but reignited the cam­paign for gen­er­ous wage sub­si­dies to be ex­tended to visa-hold­ers, uni­ver­si­ties and more ca­sual work­ers.

In a joint state­ment on Fri­day af­ter­noon, Trea­sury and the Aus­tralian Tax­a­tion Of­fice re­vealed a “re­port­ing er­ror” had re­vised their es­ti­mated cost of the JobKeeper scheme down from $130bn to about $70bn.

The de­vel­op­ment gives the govern­ment a $60bn boost to the bud­get bot­tom line that can be de­ployed to fight the im­pact of COVID-19 in other parts of the econ­omy or to avoid adding to the na­tion’s debt.

A day af­ter Trea­sury of­fi­cials told a COVID-19 par­lia­men­tary in­quiry that 6.3 mil­lion Aus­tralians were en­rolled to re­ceive the $1500-a-fort­night JobKeeper pay­ment, that num­ber was re­vised to about 3.5 mil­lion work­ers.

La­bor said there had “not been in more re­cent mem­ory a more se­ri­ous er­ror made in the bud­get”.

Josh Fry­den­berg came un­der im­me­di­ate pres­sure from the op­po­si­tion, busi­ness groups, unions and higher ed­u­ca­tion to use the ex­tra $60bn to sup­port for­eign work­ers, ca­su­als, univer­sity staff and em­ploy­ees work­ing for for­eign com­pa­nies. The Trea­surer warned the JobKeeper er­ror was not an “in­vi­ta­tion to go and spend more money”.

“All the money that the govern­ment is spend­ing dur­ing the coro­n­avirus pe­riod is bor­rowed money. There is no money tree,” Mr Fry­den­berg said.

Push­ing back against An­thony Al­banese’s call to ex­pand JobKeeper, the Trea­surer said it was “wel­come news that the im­pact on the pub­lic purse from the pro­gram will not be as great as ini­tially es­ti­mated”.

“The re­al­ity is there was an un­in­ten­tional er­ror by a thou­sand busi­nesses and it’s pretty shame­ful that the La­bor Party is seek­ing now to be po­lit­i­cally op­por­tunis­tic at the ex­pense of Trea­sury and the ATO,” he said.

Trea­sury mod­el­ling had pre­dicted JobKeeper would likely be de­ployed to sup­port about 6.5 mil­lion work­ers and this ap­peared to have been borne out by ATO forms filled out by em­ploy­ers.

But the ATO and Trea­sury in­formed the govern­ment late on Thurs­day of a “re­port­ing er­ror in es­ti­mates of the num­ber of em­ploy­ees likely to ac­cess the JobKeeper pro­gram”.

The Week­end Aus­tralian un­der­stands Trea­sury sec­re­tary Steven Kennedy also in­formed op­po­si­tion Trea­sury spokesman Jim Chalmers of the er­ror.

“The en­rol­ment forms com­pleted by 910,055 busi­nesses who have self-as­sessed as el­i­gi­ble un­der the scheme had in­di­cated that this pro­gram would cover around 6.5 mil­lion el­i­gi­ble em­ploy­ees,” the Trea­sury-ATO state­ment said.

“The ATO’s re­view of these forms has found that around 1000 of those busi­nesses ap­pear to have made sig­nif­i­cant er­rors when re­port­ing the es­ti­mate of el­i­gi­ble em­ploy­ees on their en­rol­ment form.

“The most com­mon er­ror was that in­stead of re­port­ing the num­ber of em­ploy­ees they ex­pected to be el­i­gi­ble, they re­ported the amount of as­sis­tance they

ex­pected to re­ceive. For ex­am­ple, over 500 busi­nesses with ‘one’ el­i­gi­ble em­ployee re­ported a fig­ure of ‘1500’ (which is the amount of JobKeeper pay­ment they would ex­pect to re­ceive for each fort­night for that em­ployee).”

The re­vi­sions mean the JobKeeper and Job­Seeker pay­ments will sup­port about 5.1 mil­lion Aus­tralians in­stead of the pre­vi­ously es­ti­mated 7.9 mil­lion out of a work­force of about 13 mil­lion.

Uni­ver­si­ties Aus­tralia chief ex­ec­u­tive Ca­tri­ona Jack­son said the govern­ment should re­con­sider its de­ci­sion to ex­clude higher ed­u­ca­tion from JobKeeper.

“As we have said in re­cent weeks, with­out greater sup­port uni­ver­si­ties face the loss of 21,000 jobs in the next six months and a sig­nif­i­cant re­duc­tion in the es­sen­tial re­search un­der­taken on our cam­puses,” Ms Jack­son said.

“We were dis­ap­pointed that the govern­ment changed the reg­u­la­tions on a num­ber of oc­ca­sions to ef­fec­tively ex­clude uni­ver­si­ties. We call on them to re­con­sider.”

ACTU sec­re­tary Sally Mc­Manus said the govern­ment should ex­tend JobKeeper to sup­port tem­po­rary visa hold­ers, ca­su­als and higher ed­u­ca­tion work­ers.

“The govern­ment com­mit­ted $130bn to help pro­tect the jobs of six mil­lion work­ers. Now we learn it will only help 3.5 mil­lion,” Ms Mc­Manus said.

“The govern­ment has op­posed ex­tend­ing the pack­age to ca­sual work­ers, those on tem­po­rary work visas, work­ers in higher ed­u­ca­tion, Aus­tralian work­ers whose com­pany is owned by a for­eign govern­ment, and those in our arts, cul­ture and en­ter­tain­ment com­mu­ni­ties. Cov­er­ing these work­ers would ac­count for al­most three mil­lion work­ing peo­ple. Work­ers need this sup­port ex­tended … there are no more ex­cuses.”

Aus­tralian In­dus­try Group chief ex­ec­u­tive Innes Wil­lox said the JobKeeper ac­count­ing er­ror was on “the right side of the ledger”. “It’s un­for­tu­nate that the mis­take has been made. But it’s on the right side of the ledger, rather than the wrong side of the ledger, so there’s more money that the govern­ment po­ten­tially has to spend or less debt that it has to pay off,” Mr Wil­lox said.

The re­port­ing er­ror came to light fol­low­ing anal­y­sis by Trea­sury and the ATO as­sess­ing the amounts be­ing paid out un­der the scheme and “rec­on­cil­ing these with the es­ti­mates pro­vided by en­rolled busi­nesses of the likely num­ber of el­i­gi­ble em­ploy­ees”.

“It was not picked up by the ATO ear­lier as their pri­mary fo­cus in the first fort­night of JobKeeper pay­ments was on en­sur­ing that JobKeeper pay­ments were paid promptly to those el­i­gi­ble for them, and not paid to those who were in­el­i­gi­ble,” the joint state­ment said. “Im­por­tantly this re­port­ing er­ror has no con­se­quences for JobKeeper pay­ments that have al­ready been made to el­i­gi­ble busi­nesses.”

Trea­sury said it re­mained the case that, with­out JobKeeper, un­em­ploy­ment would have been about five per­cent­age points higher. “Trea­sury con­tin­ues to ex­pect the un­em­ploy­ment rate to reach around 10 per cent,” it said.

Mr Al­banese said the JobKeeper re­port­ing er­ror “blows any pre­vi­ous mis­take when it comes to eco­nomic fig­ures in Aus­tralian his­tory right out of the wa­ter”.

“This is a mis­take you could’ve seen from space,” he said.

The Op­po­si­tion Leader said the govern­ment had said “its pro­gram was fully sub­scribed and that the $130bn had all been al­lo­cated”.

NIKKI SHORT

Friends Paris Granger and Ben McCal­lum share a drink at the Lord Nel­son pub in The Rocks, Syd­ney, on Fri­day

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