6PR PERTH LIVE
TUESDAY, 22 SEPTEMBER 2020
SUBJECTS: JobSeeker; Companies treating JobKeeper like BonusKeeper; October Budget; the Morrison Government’s lack of long term planning.
OLIVER PETERSON, HOST: Andrew Leigh, good afternoon.
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Good afternoon, Olly.
PETERSON: It looks like more than 3000 people have found a loophole with JobKeeper. They’re claiming unemployment benefits because the asset test was waived. Seems a bit odd, Andrew.
LEIGH: It certainly does, Olly, and the government could have dealt with this anytime in the last six months with just the stroke of a pen. The thing about the JobKeeper and JobSeeker changes is that the government had extraordinary discretion to be able to close this loophole, and seems to have chosen not to.
PETERSON: We're talking about people who may have assets such as cars, perhaps holiday homes, totalling more than a million dollars. Should they have to pay this back?
LEIGH: I think it’s a question for the government. They're the ones that chose not to close the loophole, they're the ones that have chosen to allow JobSeeker to be used in this way. So really, it's up to them how they deal with an issue that shouldn't have gotten to this stage.
PETERSON: They're going to be closing that loophole this Friday as the JobKeeper program is having a few nips and tucks, for want of a better term. The asset test will return later this week. So it's estimated 30,000 people will be affected by the asset limits. Is that some sort of acknowledgement or confession, do you think Andrew, from the government that this loophole should have been closed when the program was created?
LEIGH: Olly, I think it made sense at the time the changes were made [in March] that we relaxed the asset limit somewhat. The problem was that the government allowed it to go completely and then didn't keep an eye on who was actually claiming. We do need to make sure that the support’s available for people who need it. I know that the sudden snapback in JobKeeper and JobSeeker is going to take a lot of money out of local communities. One thing about the payments given to those who are earning very little is that they go straight back into the economy. So they're out there supporting retail, supporting hospitality, supporting childcare. And as that money gets taken out of communities, we can expect a follow on effect on the economy.
PETERSON: If you take Harvey Norman for example, on that point Andrew, profits are up by I see a staggering 185 per cent. So are most Australian spending their welfare payments?
LEIGH: Australians have been doing an awful lot of online spending, and certainly the retail spending that’s going through Harvey Norman has been astonishing. What's surprising to me though, is that Harvey Norman was also getting JobKeeper assistance. If you add up what went to head office and the franchisees, it's something in the order of $10 million up to the 30th of June. It could well be twice that by the time we get to the end of the program. So it seems strange to me that Harvey Norman is able to deliver significant dividends, a substantial amount of which goes to their billionaire majority shareholder, and still be claiming taxpayer assistance.
PETERSON: Last time we spoke Andrew, you had stood up in the federal parliament outlining a whole heap of companies which had been on the JobKeeper program but still paying their executive bonuses. I don't think there's too many Australians right now who would be agreeing with a company that decided to sign up to JobKeeper and still gave all the executives a little hit to the hip pocket.
LEIGH: That’s right, mate. It’s called JobKeeper, not BonusKeeper, and the fact is that if you're putting your hand out for taxpayer assistance the CEO shouldn't be getting a bonus. It's not just me saying that - the head of the Business Council Jennifer Westacott has made exactly the same point. So I think some of these firms need to pull their head in, need to recognise that being a firm is about having a social licence to operate: not only looking after the executives and the shareholders, but also making sure you're doing the right thing for the workers and the community. When the broader community is doing it tough, when people are tightening their belts right across the country, it's just not appropriate to get taxpayer subsidies through JobKeeper and pay them out as executive bonuses.
PETERSON: And on that point, Andrew, we note last week Qantas CEO Alan Joyce is taking upwards of an 80 per cent pay cut this financial year. I mean, that's the sort of leadership Andrew you'd expect from companies which have been affected by the coronavirus, but showing that sort of leadership from the top down to other employees who've ultimately lost their jobs. The situation we find our airlines in right now is just awful. It's nothing that could be done on behalf of the companies themselves to the coronavirus, but isn't that the sort of leadership you want to see from Australia's business community?
LEIGH: Absolutely. And you've seen that across the vast bulk of firms who've done the right thing, who've looked after their most vulnerable employees, who said some of those who were getting six and seven figure pay packets can tighten their belts so those on five figure incomes can spend money and get food on the table. So there's been that good approach right across the community. And indeed, if you look across the ditch to New Zealand, there's been a firm Mainfreight that said we're eligible for JobKeeper, or their New Zealand equivalent, but we won't take the money. So those firms that have done the right thing for the community are to be commended, and I think they'll gain additional customers as a result of the good corporate citizenship.
PETERSON: Sky News is reporting the budget papers will reveal the full extent of unemployment and confirm JobKeeper will draw to a close in March of next year. It will be replaced by a wage subsidy for hiring new employees. Obviously, the devil will be in the detail, but on the surface of this Andrew, would this be a policy framework you believe Labor might get on board with?
LEIGH: It's got to be tailored to the circumstances. So we've been talking about a V-shaped recovery, we're certainly not going to get one of those. I think we're more likely to get a K-shaped recovery, in which the economies of some states diverge from others and Victoria in particular I think is going to need additional assistance for quite some period. It's also going to be the case that there are sectors that just won’t recover for years. If you're reliant on international tourism or overseas students, then those sectors are going to continue to do tough and are going to continue to need support as they struggle and ultimately look to restructure. My concern is that the federal government hasn't put forward a long term plan for the economy, doesn't seem to recognise the seismic shifts taking place with a whole lot of people moving from tele work and a whole lot of low skilled jobs really struggling as automation continues apace. We need a better long term vision from the federal government than we're getting now. There’s a bunch of stopgap measures, but not a whole lot of long term thinking.
PETERSON: Andrew Leigh, appreciate your time as always. Thank you so much.
LEIGH: Absolute pleasure. Thanks again.
Authorised by Paul Erickson, ALP, Canberra.