JobKeeper payments exploited by profitable companies, Parliamentary Budget Office reveals

Last week, the Australian Parliamentary Budget Office (PBO) figures while reviewing the renewal of the JobKeeper scheme brought to light wastage of astounding proportions. Businesses unaffected by the Covid-19 crisis were given AUD12.5bn under the government's JobKeeper scheme. This was almost 14% of the $90Bn program. 

The PBO figures also showed that 23 big companies with turnover of more than $1bn, that were supposed to show a fall in revenue of more than 50% to qualify, received $79m in JobKeeper. Recent research by proxy firm Ownership Matters unveiled that 25 companies in the ASX300 index got payments under the JobKeeper support scheme and then paid their executives bonuses totaling more than $24m. This revealed an unscrupulous practice called  “dividendkeeper” in which JobKeeper payments, which are meant to be used to provide employment during the COVID-19 crisis, are being used to amp up dividend payments to shareholders.

The JobKeeper scheme was introduced in March 2020 to help Australians keep their jobs and provide financial support and assistance to businesses badly impacted by the ruinous waves of COVID-19. The scheme ended in March 2021. 

Industry players are asking for a renewal of the scheme to emerge from the economic distress created because of the lockdown restrictions in NSW, Victoria, and South Australia. Stalling of the construction industry in Sydney is also leading to worsening economic distress for the locals. Leading economists have predicted that Australia’s economy will shrink over the second quarter of the year as consumer spendings continue to fall further every month.

Parliament is currently mulling over the Greens bill that would make it mandatory for companies to pay back the JobKeeeper grants that they received but did not need. The bill will also ensure that there is a public register of recipients going forward. 

Andrew Leigh, Labour MP said that the businesses that increased their turnover by receiving jobkeeper payments should pay it back. However, Dean Paatsch, Ownership Matters co-founder, supported the idea of a public register of recipients instead of the Greens Proposal. The Opposition has called the job keeper payments “the biggest waste of public money in living memory.”