THURSDAY, 28 JANUARY 2021
SUBJECTS: Labor calling for an inquiry into the JobKeeper scheme; Companies using JobKeeper to pay out executive bonuses; Companies repaying JobKeeper payments after reporting huge profits; Climate change.
THOMAS ORITI, HOST: As Australia's economy recovers from the initial blow of the pandemic and we approach these final weeks of the JobKeeper wage subsidy, there are calls for large companies that recorded profits to return government funds. Mining Company Iluka resources has joined carmaker Toyota and the Super Retail Group in voluntarily returning millions of dollars in JobKeeper payments after a surprisingly profitable year. So that begs the question, I mean, are there other companies that have profited from the wage subsidy and should they be forced to pay it back? Andrew Leigh is a federal Labor MP and the Shadow Assistant Minister for Treasury and he joins us live now. Morning, Andrew. Thanks for your time.
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Good morning. Great to be with you.
ORITI: Are you surprised that companies are volunteering to pay back millions of dollars to the government?
LEIGH: Not at all. Every large company says it's committed to corporate social responsibility, and this is simply the expression of that sentiment. If you've claimed JobKeeper thinking that your profits are going to be down and in fact they turn out to be up, then the right thing to do is to say to the taxpayer ‘we don't need government handouts, we've done well and here's the money back’ - in order to support people in the tourism sector, university sector, the arts sector, to support casuals, to support the million people who are out of work or the other million people who'd like more hours. There are people out there doing it tough and good corporates recognise that if they're not among them, they should hand the government subsidies back.
ORITI: Indeed, indeed. That’s in an ideal world, though. These are just the ones we know about. How many more companies do you think are out there in a similar position?
LEIGH: Unfortunately we don't know this, and that's because the government's kept the information secret. In New Zealand, there’s a public register which lists all of the firms that have received their equivalent of JobKeeper. In Australia, the government's refused to disclose that information to the COVID Committee, which is why I've written to Treasurer Josh Frydenberg asking for the House Economics Committee to be empowered to conduct an inquiry into JobKeeper and to get to the bottom of how many firms saw increased profits in 2020 despite receiving JobKeeper.
ORITI: Okay, but an inquiry of all these companies, though - I mean, wouldn't that take a lot of time and effort? I mean, would it really be worth it?
LEIGH: The information’s at the fingertips of the Tax Office. They simply need to disclose it to the Australian people. The thing about JobKeeper is the eligibility required was simply a brief downturn. Many firms that shut their doors in March of last year received JobKeeper. But then after they reopened their stores, they saw a profit boom and in the case of say Premier Investments - which owns Portmans, Just Jeans and Smiggle - they saw their best profit year ever in 2020. They’re a firm that was doing so well, they could afford to pay their CEO a $2.5 million bonus, doing so well that they paid out a significant dividend - a chunk of which went to their largest billionaire shareholder, Solomon Lew. And yet they won’t return to the taxpayer the JobKeeper subsidies they received which they clearly didn't need. We know about Premier, but we don't know about many other firms and it's important to get to the bottom of it because JobKeeper is the largest and most effective program in keeping people in work.
ORITI: The government maintains though there is no legal requirement to return the funds. I mean, should there be?
LEIGH: There’s no legal requirement, simply a call for good corporate ethics. But these firms all say that they’re committed to good corporate social responsibility. And if they are, then they should do the right thing. Now corporate social responsibility isn't just about greenwashing or making some donations to charity at the end of the tax year. It's fundamentally about doing the right thing, and not just by your shareholders, but by your customers, by your workers and by the Australian community. That's what it is to be a good firm in the modern age. This whole idea that firms are only for the shareholders, that went out the window with the Gordon Gekko era of the 1980s. That's an old-fashioned view of corporations.
ORITI: Okay, Andrew Leigh, I've got to ask you about another issue making news this morning. The Leader of the Opposition Anthony Albanese will reshuffle the Shadow Cabinet on the weekend. It's been reported he'll remove Mark Butler from the climate change portfolio amid some factional rifts. I mean, will the Cabinet reshuffle see Labor move to the left or to the right?
LEIGH: It'll see Labor still holding the centrist position on climate change that we've held for the past decade. In fact is that climate is really a problem of the Coalition’s, where they’ve failed to move with the rest of the world. Seventy other nations have now signed up to net zero emissions by 2050, the Biden administration signing on, the Chinese saying they'll be there by 2060. The Coalition's incredibly out of step on this. Whether it’s Chris Bowen, Mark Butler or someone else, I think they’ll do an excellent job.
ORITI: Indeed. It is important to note it has been widely speculated will be Chris Bowen, he's a member of the right faction. I mean, what should we read into that?
LEIGH: The thing is, you just don't see big differences between left and right on climate change, Thomas. I've been following the debate very closely obviously as a member of federal parliament since 2010. The big differences in the parliament are not between the factions of the Labor Party. They’re between the recalcitrants in the Coalition, who are dragging behind not just Labor, but behind the rest of the world-
ORITI: Mark Butler though, he wanted to maintain short term targets to cut carbon emissions. Are you saying that that's not going to change if there's going to be a cabinet shift?
LEIGH: We'll work out precisely what our medium term targets are going to be as we get to the election. The fact is-
ORITI: Surely Labor’s got a policy position on reducing emissions now.
LEIGH: Absolutely. We want to get to net zero by 2050. To the last election, we took a series of policies which would not have hurt the coal industry but would have done significant amounts to reduce Australia's carbon footprint. We are more affected by dangerous climate change than any other advanced country, so we have a much stronger interest in acting fast on this. I just don't know why the tinfoil hat brigade and the knuckle draggers in the Coalition have been allowed to hold Australia back from serious climate action. And whoever holds the portfolio in Labor, they will continue the policies we have pursued of moving with the rest of the world to act on dangerous climate change.
ORITI: Mark Butler is not new to the portfolio though. So I'm trying to get my head around what the motive would be in changing that now ahead of the next election, if there's no change in the policy platforms and factional disputes have nothing to do with it.
LEIGH: It’s a matter entirely for the leader on this and he'll be making his announcement this weekend and making some preliminary comments in about 10 minutes when he stands up for a press conference. But the fact is Mark Butler's done a fabulous job in the portfolio since 2013. People do periodically move around different portfolios. Anthony Albanese himself held this portfolio when we were in the opposition for time. So it's perfectly normal for people to move around different roles. But your listeners can be assured of one thing, which is that Labor’s strong commitment to action on climate change will continue whoever is in that portfolio.
ORITI: Bill Shorten, the former Labor leader, criticised the party's policies or in his view lack thereof recently. I mean, do you think this has the makings of a leadership spill or are you confident that Anthony Albanese will lead the party to the next election?
LEIGH: I think that's been oversold. I've seen what Bill has been saying there and his commitment is to having a commitment to strong policies and to making sure that we're in there in the ideas debate. That's a tradition that goes right back through Labor. It’s a tradition that Anthony Albanese, Bill Shorten and the rest of the Labor team are committed to. Politics isn’t Coke and Pepsi. Labor has a special role in Australian politics as the generator of ideas, and we will continue to play that role in this term of government as we did in the previous term of government. Australia's wage subsidy scheme is there in large part because of Labor's strong advocacy for it, along with that of many in the community sector. We had a banking royal commission as a result of Labor’s strong advocacy and the reforms that flow from that are a direct result of Labor's commitment to better policy in that space. So that'll continue whoever's in which roles following the cabinet shuffle.
ORITI: Okay. I like the Coke and Pepsi analogy there. Andrew Leigh, thank you very much for your time this morning.
LEIGH: Always a pleasure, thanks Thomas.
Authorised by Paul Erickson, ALP, Canberra.