ABC NEWS RADIO
FRIDAY, 18 SEPTEMBER 2020
SUBJECTS: Australian universities facing job losses after missing out on JobKeeper; Companies treating JobKeeper like BonusKeeper; Charities facing a perfect storm.
GLEN BARTHOLOMEW, HOST: The ABC is revealed one of America's top universities, with revenue of 16 and a half billion Australian dollars, has received the JobKeeper payment at its Sydney campus. New York University is an elite institution with outposts all over the world, but staff at its Sydney campus were apparently able to access Australia's taxpayer funded JobKeeper program. Its eligibility could infuriate Australian universities, who missed out and where job losses have exceeded 11,000 with more to come. Federal Labor MP Andrew Leigh is the Deputy Chair of the House of Representatives Economics Committee. He recently asked why many corporations in receipt of millions of dollars in JobKeeper payments seem to be passing it on to their executives in the form of large bonuses, while the taxpayers cover their wage cost. Andrew Leigh, good morning.
ANDREW LEIGH, SHADOW ASSISTANT MINISTER FOR TREASURY AND CHARITIES: G’day, Glen. Great to be with you.
BARTHOLOMEW: First, reaction to this news that a New York University was eligible for this taxpayer assistance.
LEIGH: Look, I don’t begrudge NYU getting it. I don’t begrudge a private Australian university - Bond University - getting it. But it is pretty extraordinary, isn't it, that the government's changed the rules three times to prevent public universities from accessing JobKeeper. We're now seeing 11,000 job losses. Universities Australia say it might go to 21,000 losses. And all this at a time in which young people are facing the worst labour market in decades, when we should be opening up university places. Now the smart thing to do during a downturn is to provide young people with a chance to study. We ought to be expanding universities, not contracting them.
BARTHOLOMEW: But on this eligibility for NYU, Greens Senator Mehreen Faruqi says it's a double standard, that the government should have exactly the same rules for universities. But Treasurer Josh Frydenberg says while he wouldn't comment on the tax affairs of an individual JobKeeper recipient, he says all universities were eligible if revenue fell steeply enough. So NYU somehow met that criteria while others here didn't?
LEIGH: The government repeatedly changed the rules to ensure that public universities were shut out of JobKeeper. It's as simple as that. Now, this is the culture wars run again. You might be facing a pandemic and the worst global downturn since the Great Depression, but the Liberals never seem too busy to run the culture wars. And it's so misguided right now, Glen, because if young people don't go to university they'll be out on the dole queue and that’s an incredible waste of their energies and talents. We should be using this moment as an opportunity to skill up the next generation. We ought to be ensuring that we're expanding opportunities right across the board. Instead, the Liberals are raising the prices of kids going to university, and then not restoring the demand-driven system which did so much to improve access to universities.
BARTHOLOMEW: You say they’ve changed the rules a few times. The Federal Treasurer Josh Frydenberg also says Australian universities only missed out because the government guaranteed their revenue from domestic students. Let's have a little listen to I think what he's had to say on that front.
JOSH FRYDENBERG, TREASURER: That is not support that's available to foreign universities that may have a domestic campus. So it's a, it's a different situation. You're talking about an apple and an orange.
BARTHOLOMEW: Is that a fair trade off?
LEIGH: The apples and the oranges are both looking pretty rotten right now. My old university, the Australian National University, is shedding over 400 jobs and we could even see institutions go to the wall. It makes no sense whatsoever, Glen. Remember during the last downturn in Australia, the recession of the early 1990s, we saw a massive increase in the Year 12 completion rate. That made total sense at that stage, for young people to get more education by staying on school. We’re now a generation on and the equivalent of finishing Year 12 is to get a tertiary qualification. So we need to be expanding VET. We need to be expanding universities. It's the smart play, which then sets us up to the much more productive and a more equal country.
BARTHOLOMEW: You’ve expressed concern that many corporations in receipt of millions of dollars in JobKeeper payments were passing it on to their executives in the form of large bonuses while the taxpayers cover their wage cost. One example I've seen, what LendLease got I think $9.7 million in JobKeeper payments and handed out $10 million in executive bonuses. So what, the taxpayer effectively paid for them?
LEIGH: Yeah, it’s called JobKeeper not BonusKeeper, and I’m not the only one who is criticising the practice of taking money from taxpayers and passing it on to executives. The head of the Business Council of Australia Jennifer Westacott says that's not on. What's extraordinary is that the government won’t say a peep. The Liberals aren’t willing to speak out about taxpayer subsidies effectively going to the C-suite. They're not willing to speak out about the fact that a program that was designed to protect the jobs of battlers is now subsidising the salaries of people who are already on seven figure incomes.
BARTHOLOMEW: What about the design then? LendLease CEO Steve McCann conceded the bonuses were paid, despite his company recording a statutory loss for the last financial year. He says the receipt of a quote, ‘modest amount of government assistance had no influence on the amounts paid’. Should this eligibility criteria have come with more conditions, where companies were required to perhaps spend their own money first?
LEIGH: It's always difficult to legislate ethics, isn't it Glen? I think this is a basic question of corporate responsibility. Firms need to recognise they're not just there for their shareholders and for their managers. They're there for their communities. They’re there for their workers. Some of the worst examples have been firms which asked casuals to cut back on their shifts, at the very time at which they are paying executive bonuses. That sort of double standard wasn't practised by most firms. Most firms overwhelmingly do the right thing. JobKeeper has been the main program that has ensured that our unemployment rate didn't go double digit, but a few firms have done the wrong thing. They've been called out by the head of the Business Council. But Scott Morrison and Josh Frydenberg won’t say boo.
BARTHOLOMEW: Meanwhile a new survey finds the community service sector is approaching crisis point with more than a million people excluded from such income support, and expected cuts to support for about 2 million others.
LEIGH: Yes, as Shadow Assistant Minister for Charities I have an awful lot to do with the charity sector over recent months, and they're facing a perfect storm. Two thirds of volunteers have cut back. There's been a significant fall in donations, and people are flocking to their charities for help. Whether it's food banks or mental health charities, our charities are doing vital work right now to hold the social fabric together. They need much more support from the community and also from the government. Charities were ignored entirely from the first couple of packages, and it was only when we pushed hard that they received that different eligibility threshold for JobKeeper. But many are doing a tough. It could be as many as one in five charities go to the wall if this expected downturn continues.
BARTHOLOMEW: Andrew Leigh, thanks for your time this morning.
LEIGH: Thank you, Glen.
BARTHOLOMEW: Federal Labor MP, who is the Deputy Chair of the House of Representatives Economics Committee.
Authorised by Paul Erickson, ALP, Canberra.