Josh Frydenberg gave $20 billion to firms with rising earnings

E&OE TRANSCRIPT

RADIO INTERVIEW

5AA MORNINGS WITH LEON BYNER

THURSDAY, 14 OCTOBER 2021

 

SUBJECT: JobKeeper

 

LEON BYNER, HOST: I want to talk about JobKeeper. Now, nobody argues that it was a good scheme in principle, but it did spend an enormous amount of money. Now, we are told, initially, that $27 billion was what was spent and didn't need to be, when it turned out to be $40 billion.

One of the people who I think in the parliament is one of the most qualified, and frankly, he's one of the cleverest in our Parliament today: he's got a PhD in public policy at Harvard; he's a Master in public administration at Harvard; he's a Bachelor of Law and a Bachelor of Arts, so he's no slouch. I'm talking about a very capable politician. His name is Andrew Leigh. He's the Member for Fenner, in the lower house, the House of Reps, and he's with me now. Good to talk to you, Andrew.

ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: Always great to talk with you, Leon. Thanks for the generous words.

BYNER: Well, they're only the truth, and the people need to know that there are good people out there well-qualified to look after their interests. So, how did we discover this disparity from $27 billion to 40 billion? How did that happen?

LEIGH: Well, these are new figures from the Parliamentary Budget Office, and there's a blizzard of numbers coming around there, Leon, but the numbers you've talked about are those firms that didn't meet the forecast downturn. Another figure, which is perhaps even more stark, is that $20 billion went to firms whose revenues increased. A scheme that was designed for firms that had falling revenue actually ended up padding the pockets of firms who were having a better year during the pandemic than they had in 2019.

LEIGH: Well, just simple mismanagement of the scheme by Josh Frydenberg. Labor supported JobKeeper, we called for it, we wanted it to succeed. But as money started going out the door to firms such as AP Eagers, the car dealer who got $130 million, to firms such as Lovisa, the jewellery seller, which got $23 million, to Monash IVF that $10 million of JobKeeper, to McGrath, the luxury home seller that got $4 million in JobKeeper, Josh Frydenberg didn't put measures in place to stop that leakage.

The amount of JobKeeper that went to firms with rising revenues is about $2,000 for every single household. That is waste on a gargantuan scale.

BYNER: Are you saying $2,000 for every Australian?

LEIGH: $2,000 for every Australian household, that's right. The amount of money going to firms having a better 2020 than 2019 is just massive. Think about the opportunity cost to that, Leon. We could have done fibre-to-the-home National Broadband Network. We could have extended support to small businesses suffering in lockdown. I know in South Australia, as Sydney and Melbourne locked down, immediately that hits the businesses in the tourism sector and hospitality sector.

BYNER: Yes, it did. Is there any kind of remedy, or have we just, because we were very generous and didn't have enough checks and balances, not much we can do?

LEIGH: Well, we won't be demanding the money back, but I think some firms need to look at their corporate social responsibility statements and see whether it's in their interest to hand money back. Domino's, Toyota, Iluka, firms that were very quick to say, 'here's the money back that we didn't need', they've been rewarded by their customers who've said, 'that's great to see you doing the right thing.' Harvey Norman reluctantly handed back the JobKeeper that its head office received after significant public pressure, so there is a moral argument to be made there. Certainly, we won't be changing legislation demanding it back. It's too difficult to unscramble the egg in that case.

BYNER: Now look, you're somewhat of an economic head on these matters. Small business, in many cases, and certainly tourism and hospitality, have absolutely been kicked in the gut. Is it your view that we need to do more to help them?

LEIGH: Absolutely. We need to make sure we've got a more dynamic economy and that small businesses are at the forefront of the recovery. What I'm really scared about as we go into recovery we might see a wave of insolvency rather than a surge in startups. We need to make sure that we're getting those new firms emerging, that people have the access to capital that they need, and also that they're not stultified by big firms taking over the market. One of the things the Biden administration has been very conscious of, Leon, is making sure that some of those huge, behemoth companies aren't crowding out scrappy startups. They've been reining in, in particular, the tech giants, but also firms in other sectors that seem to be getting in the way of startups.

BYNER: Did small businesses miss out at all on this?

LEIGH: Small businesses missed out when the program was shut down. The program was shut down because too much money was going to firms that didn't need it. If it had been a leaner, better-targeted program it could have continued for longer and managed to serve more small businesses. Because so much of it lined the pockets of billionaires too little was available support battlers. Because too much went to executive bonuses and to big dividend payouts, too little was available to keep mums and dads to put food on the table and small businesses to keep ticking over.

BYNER: Are you guys at Labor going to make this somewhat of an important policy issue as we head to an election?

LEIGH: We certainly will. We'll keep on talking about the waste, which I think goes directly to the Coalition's claim that they are somehow more prudent manages of the nation's finances. Conservative commentators, such as Niki Savva, Janet Albrechtsen, and Judith Sloan have made pretty clear that they're as outraged by this waste from the Coalition as Labor is.

BYNER: We're getting Judith on the show soon, too.

LEIGH: Very good. We need to see more transparency. In Canada, Britain, the United States and New Zealand they had a public register of JobKeeper recipients, and Labor believes that big firms that got JobKeeper should have their names published. Not every small business, but if you're a large firm that got JobKeeper, it is appropriate for taxpayers to know where our money went.

BYNER: Look, Andrew, thank you for coming on. Dr Andrew Leigh, he's federal Shadow Assistant Minister for Treasury.

 

ENDS

 

Authorised by Paul Erickson, ALP, Canberra


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  • Anthony Hodges
    published this page in What's New 2021-10-15 09:21:19 +1100

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Cnr Gungahlin Pl and Efkarpidis Street, Gungahlin ACT 2912 | 02 6247 4396 | [email protected] | Authorised by A. Leigh MP, Australian Labor Party (ACT Branch), Canberra.