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Issue #1917      June 1, 2020

LEAVE NO ONE BEHIND!

The Prime Minister looked very embarrassed when Treasury revealed that the likely cost of the $130 billion JobKeeper scheme would be $70 billion. What a great excuse – an extra $60 billion – for a reluctant government to expand the scheme, so nobody is left behind. And the government could do this without losing face!

These latest estimates might still be well off the mark as employers that missed the boat for payment at the beginning of May sign workers up later. Time will tell.

The government has been under considerable pressure from within its own ranks to cut the scheme back to three months. It has so far resisted attempts by the Greens and Labor to expand the JobKeeper scheme. Now is the time to change that.

BAD ARITHMETIC

Treasurer Josh Frydenberg was quick on his feet to try to turn the arithmetic “error” into a credit to his good economic management. The economy is doing much better than expected according to the Treasurer.

The JobKeeper scheme offers employers who have experienced a significant loss of income* as a result of COVID-19 a $1,500 fortnightly subsidy for each eligible worker. The agreement of individual workers is necessary.

Companies are obliged to pay each worker a fortnightly minimum of $1,500 in advance. If the worker is still employed, then they must continue to pay the same wage if it is higher.

TOO HARD BASKET

While the scheme sounds simple, when it comes to its implementation, it has not proven to be so.

Making sense of the scheme and filling in the forms proved to be a nightmare, even for some accountants. There are anecdotal reports of small businesses just giving up and throwing the whole idea into the too hard basket.

There are many media reports of employers being unable to meet the requirement of paying $3,000 per worker in advance in April to qualify for payment in early May. This is particularly the case where small businesses were closed (often by government restrictions).

The government told them to get a loan! Never mind if their future is uncertain, if they do not know when or if they will ever reopen or they already carry a large debt. It just goes to show how little the government cares about small business and workers.

One can only speculate how many technically eligible enterprises would have been and should have been receiving the subsidies and their workers miss out.

LEFT BEHIND

The scheme is “targeted,” with an estimated 3 million workers being unfairly excluded as strict eligibility rules are applied. Workers who are full-time, part-time or fixed-term employees as at 1st March are eligible. Long-term casuals employed on a regular and systematic basis for at least twelve months with the same company are also eligible.

“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,” Australian Council of Trade Unions (ACTU) secretary Sally McManus said.

Certain other categories of visa workers, including international students, are also left behind. The students were told if they didn’t have work to go home!

“Covering these workers would account for almost three million working people in Australia.”

They are being punished for being a causal, scratching a living in the gig economy, changing employers, etc. In one instance, where a company was taken over by another one, casual workers were found to be ineligible – they had changed employers during the year!

Universities have taken a hit with the loss of international students. These students, once considered cash cows are now left high and dry, and the universities face a loss of billions of dollars in income. The staff are not eligible for JobKeeper. The National Tertiary Education Union recently negotiated an agreement with the universities in an attempt to hold on to as many jobs as possible.

The agreement involves higher paid staff receiving eighty-five to ninety-five per cent of their salary for one year. At least 12,000 jobs were at risk. (See Guardian, “Landmark agreement protects 12,000 jobs and hard won university conditions,” #1915, 18th May, 2020)

ECONOMY

The government has so far resisted pressure to include these workers – mostly in low-paid, insecure jobs – who were quite unfairly excluded from JobKeeper. These exclusions are consistent with its ongoing neoliberal “targeting” of payments that consider it a crime to be poor warranting punishment.

Employers have until the end of May to join it. There could be more applications made during that time.

So far, the government has shown little inclination to discontinue the scheme after three, instead of six months. Perhaps that should come as no surprise. After all, the scheme was not with the interests of working people in mind.

The aims of employer subsidy are to:

  • act as a stimulus to the economy by putting money in people’s pockets to increase consumption
  • keep businesses afloat during the shut down
  • keep businesses connected to their workforce so that when the restrictions are lifted there can be a swift economic recovery.

The government can claim the $60 billion gap proves the economic fundamentals are good as much as it likes, but words do not and will not alter reality. The economy is not in good shape, people are hurting and there will not be a quick “V” or “U”-shaped recovery.

The CPA demands no one is left behind and the savings from bad arithmetic be allocated to those millions of workers left behind, that the scheme be extended to 31st December 2020 and reviewed in the new year.

* To qualify employers must have had a decline in income of at least 30 per cent if their total income is less than $1 billion. For companies with turnover greater than $1 billion, the threshold for turnover is a decline of 50 per cent. Turnover for eligibility purposes is based on GST, which the ATO check against BAS statements.

Next article – MAY 1 MOVEMENT

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