Topics: South Australian COVID business support; JobKeeper
David Bevan: Federal Finance Minister and South Australian Senator Simon Birmingham joins us now. Good morning, Minister Birmingham.
Simon Birmingham: Good morning, David and Ali.
David Bevan: The government has announced another raft of support for businesses. I want to ask you how confusing it must be for businesses right now, but can you explain what’s the latest that’s ending up in people’s pockets?
Simon Birmingham: Sure, David. So obviously, during the recent lockdown, we announced some packages of support, in particular from the federal government perspective, we provided close to 41 million dollars in support to individuals across South Australia who had lost hours of work and that assistance whilst the state government provided a business support package. As many businesses know, some of the restrictions are continuing despite the ending of the lockdown. And so what’s been agreed with Rob Lucas and Steven Marshall is for us to jointly fund a further business support package, which is a combination of $3,000 grants for businesses who employ other staff, $1,000 grants for sole traders. Those businesses will need to be experiencing a decline in turnover of at least 30 per cent over a two week period as a result of the restrictions in place. There’s some additional support for CBD based businesses recognising that they’ve been doing it, perhaps toughest of all, and also some support there for major events too.
David Bevan: There were people on the news last night saying these grants, they won’t even touch the sides. And the state opposition is saying you need to put something in place which gives ongoing support.
Simon Birmingham: We’ll always monitor the circumstances and needs to be appreciated that this report comes on top of lots of assistance that has been provided through the enduring course of the pandemic. And what we see in terms of analysis of the bank accounts right across the country is that there’s a lot of significant increase to the tune of a couple of hundred billion dollars in national savings that many have actually reduced their debt and during this time as a course of prudent activity. Now, some are obviously still doing it very tough. But these grants shouldn’t be seen in isolation. They should be seen as part of a continuum of trying to make sure that we keep the economy strong, businesses as strong as possible, so that when restrictions are ultimately eased further, there will be a strong recovery, as we’ve seen before.
David Bevan: But the businesses who applied for and receive the money during the lockdown from a few weeks ago, do they have to sit down and fill out another batch of forms to get this next round of grants? I mean, these people it must be so depressing sitting in your shop just filling out forms.
Simon Birmingham: Look, it’s tough. Absolutely. And so applications for this through the South Australian Treasury website, Treasury.sa.gov.au. I would imagine, I don’t know the South Australian government systems as well as I know our own. But for example, were SA to go into lockdown again and South Australians needed to claim the individual support, the 750 dollar payments that we provide. They’d find it much easier the second time around than first time around because we already have so much of their information in the system. So they just really need to use that existing registration to say I’m now eligible again for these payments.
Ali Clarke: Simon Birmingham, a Senate estimates hearing was told 11,771 people have had a review completed on their income support payments and have been sent a Centrelink debt letter trying to claw back money that was given to them through JobKeeper. Why is the government going after the individual as opposed to some of the big companies, the corporations and the groups that have posted record profits, some of them huge profits, some of them, and still got massive amounts of JobKeeper?
Simon Birmingham: We’re actually doing both, Ali, in terms of where anybody has wrongly made claims for payments. So those individuals you speak of are cases where somebody was receiving essentially unemployment benefits, JobSeeker payment, and also claimed JobKeeper payment, essentially a double dipping arrangement. Now, we’re not chasing the money back instantly from those cases. They’ve been served notice and there’s a process to go through to make sure that we don’t cause undue financial distress to people and we work through it sensibly. But there are also businesses who wrongly claimed, over claimed against the rules. And we’ve identified $284 million worth of incorrect claims from businesses that we are equally going through the process of reclaiming. The vast majority of businesses acted in accordance with the rules in place at the time for JobKeeper. And of course, it saved, according to Reserve Bank estimates, 700,000 jobs across the country.
Ali Clarke: So how many companies or groups or organisations in that $284 million have been served a letter like these individuals have saying, hey, you need to pay it back. You know, in whatever way you choose to, but you need to pay it back. How many companies are there?
Simon Birmingham: I don’t have the exact number of companies, but all of them, as far as I’m aware, have been made aware in a similar type of process. And the tax office will similarly work through recouping that money from them.
David Bevan: But can you see as somebody who’s on Centrelink and they might have double dipped or they did the wrong thing, they shouldn’t have done it, but they’ve ended up with an extra few hundred bucks in their pocket. They look across at somebody who may be a furniture and electrical goods mogul or maybe the Adelaide Archdiocese or of the Catholic Church, which posted a surplus and they received millions of dollars in support and they don’t have to pay a penny back.
Simon Birmingham: Well, billions of dollars in support was paid, but every single dollar that was paid in JobKeeper was paid on a condition that it actually passed through in employee wages. I remember having the discussions last year, the fact that some people were getting paid more as a result of the JobKeeper payments, the seven hundred fifty dollars than they actually would normally receive. But that’s because it was a condition of the way that program operated. So no businesses got to keep their JobKeeper payments. They had to pass those payments through to their employees.
David Bevan: Yes, but if it turned out those businesses-
Simon Birmingham: Some businesses ended up enjoying an economic recovery-
David Bevan: Yeah, but if it turned out those businesses or those not for profits were actually doing very nicely. Thank you very much. They should never have got the JobKeeper, should they?
Simon Birmingham: Well, JobKeeper went through several stages and the first stage was when we had the nationwide lockdowns and shutdowns occurring right back at the early stages of last year. And so all of those businesses were eligible for JobKeeper and other organisations on the basis that they were expected to lose 30 per cent of their revenue. Now, it turned out that in that first phase, we got through it a little bit faster and better than had been expected. And some of them came out in a stronger position than had been anticipated. But at that stage, we didn’t put in place the type of criteria that subsequent iterations had, which were far tighter eligibility criteria, because we just had to put it in place quickly to save jobs. And that was that was the case. Now, some businesses have done a very honourable thing and chosen to voluntarily repay money that they were entirely eligible to receive, but they’ve chosen to voluntarily repay it. I applaud them. But the others weren’t operating outside of the guidelines or the rules at the time. And those rules at the time did save many hundreds of thousands of Australian jobs.
Ali Clarke: So that’s why the federal government won’t just put up a list. So we as consumers or people can make a moral or ethical decision as to whether or not we want to continue supporting these groups. That’s basically why you’re not actually putting out a really easy list. And each company or each big group is kind of being found by investigations from journalists or even maybe independent senators or the like?
Simon Birmingham: Well, Ali, we are going after those who made claims incorrectly against the rules and the guidelines that they weren’t eligible for, and that’s why we’re chasing $284 million worth of payments from businesses. But we’re not going to go and vilify those who were acting in accordance with the rules of the program at the time. The program was one of the best and most successful in the world at saving jobs and ensuring our economy bounced back strongly in what we want to make sure through all of the support measures, including the extra support for South Australia at present, is that when we get past these current stages of restrictions, we get the same sort of economic recovery, a world leading one that in Australia saw us get to a position of having more people back in jobs in this country than we had pre pandemic, the first major economy in the world to be able to do that.
David Bevan: Ok, but are you arguing there’s a moral equivalence between somebody who was on welfare and then ended up or maybe they were on a job, a casual job, but they lost their job and ended up getting more money through JobKeeper than they would have when they were actually employed? Okay. So they were actually better off during the pandemic. And there’s a moral equivalence between that and a company that received JobKeeper and ended up turning in a surplus. So everybody gets to keep their money.
Simon Birmingham: Now, I highlighted that example, David, of the fact that some individuals received more to emphasise the point that every dollar of JobKeeper funding, as a condition of that program, had to be paid to the employees so the business didn’t get to keep the money.
David Bevan: All right. Before you leave us. The AM program this morning is reporting that Peter Dutton has sent out, the Defence Minister has sent out the word, I want a review and overhaul of naval shipbuilding programs, that the contracts that, of course, is going to affect South Australia. Do you know what the impact will be?
Simon Birmingham: There’s always the pursuit of getting things done better across government departments, but it’s not about any changes to where those programs are delivered. We’ve got thousands of jobs already being created in South Australia as a result of the submarines, the frigates and the first couple of offshore patrol vessels being built down at Port Adelaide. And I expect to see that jobs growth in South Australia continue.
Ali Clarke: Ok, thank you very much, Simon Birmingham. Federal Finance Minister.
Simon Birmingham: Thanks guys, my pleasure.