JOBKEEPER WASTE COULD COST 250,000 JOBS
A new report from Ownership Matters today analyses ASX300 firms that received JobKeeper subsidies in the second half of 2020. It finds that one-fifth of the JobKeeper they received went to entities that reported an increase in their underlying earnings metrics from pre-pandemic levels.
This is a shocking waste. JobKeeper was suppose to support firms that were suffering. JobKeeper was never meant to go to firms whose profits were rising.
The Treasurer has refused to release data on overall JobKeeper payments. If the pattern identified by Ownership Matters holds up for firms outside the ASX300, then it suggests that in the second half of 2020, almost $10 billion of JobKeeper went to firms whose profits rose.
And that’s just for the last six months of 2020. Across the whole year that JobKeeper has been available, the amount given to firms with rising profits could be $15 to $20 billion.
This waste has a real cost today.
If the Morrison Government had avoided this waste, it could now afford to extend JobKeeper (at the tier 1 rate of $500 per week) to all 1.1 million people who are currently receiving it for another six months.
At the end of March, Treasury estimates that cutting off JobKeeper will cost 100,000 jobs. Respected Melbourne University labour economist Jeff Borland estimates that 150,000 to 250,000 jobs will be lost when JobKeeper ends.
None of these job losses would have been necessary if the Morrison Government hadn’t given JobKeeper to firms with rising profits.
Authorised by Paul Erickson, ALP, Canberra.