Monique Wright:
The Minister in charge of the Australian Tax Office is the Assistant Treasurer Michael Sukkar and he joins us this morning. Good morning to you and thank you for being with us, Minister. Look we get that things had to happened lightning fast and that was terrific but how do you even begin to explain what is being described as Australia’s biggest budget blunder?
Minister Sukkar:
Well Monique and Matt there are two real points here to make. The first is that at the time the JobKeeper scheme was put together – as you rightly pointed out in pretty unprecedented circumstances and in record time – obviously the health outcomes and the peak of coronavirus was looking much worse, the restrictions, potentially, were looking much worse and the $130 billion estimate that was made at that time was in the context of much worse health outcomes. Now obviously a credit to the National Cabinet, the Prime Minister and the Premiers has meant that the health outcomes have been much better than we expected and therefore, of course, the economic outcomes have been better. So that counts for one aspect. On the second point, yes, there was about 500 - 1000 businesses who misreported the number of employees out of about a million businesses that have registered for JobKeeper. In the process of reconciling payments to the number of employees that were enrolled, it became clear that there were a number of mistakes make on forms and the moment that was identified, it has been communicated. So, the reality is the $130 billion was an estimate from Treasury, it is not an objective, it is not a target. This is a demand driven scheme, the parameters of the scheme are there. If a business qualifies i.e. for a small or medium business it is had a turnover reduction of at least 30 per cent or for very large business, a turnover reduction of 50 per cent, their employees are eligible. Importantly there are going to be, we expect, about 3.5 million employees to benefit from this scheme, about 800,000 businesses that benefit. So, it is by any measure, an extraordinarily large scheme whichever way you look at it.
Matt Doran:
Assistant Treasurer, it is also by any measure an extraordinarily large blunder and I accept that, given the magnitude of the Governments COVID-19 response, errors are going to be made, lets accept that but let’s look at this. Just last week in an interview with the ABC, you said “it would be a very different conversation if you said to me there’s only three million people who are covered, its half of what we expected”. The Governments been standing up and saying there are 6.5 million Australians receiving this response. What I am struggling with and I think what a lot of Australians are struggling to comprehend is what the flow on effects are for the Government’s whole response to COVID-19 when you thought an extra $60 billion odd, was being pumped into the economy?
Minister Sukkar:
Well in the end, what it means is our country is less indebted than it otherwise would be. This is all borrowed money, there is not a pot of money that we have sitting aside waiting to be spent on programs like this. The reality is that, where we are at the moment, that’s $60 billion less that needs to be borrowed and I think again, I think this a point that is really important to be made, when these estimates were put in place – and I reiterate they were estimates, that’s not an objective or a target that we are seeking to reach – the health outcomes were looking like they were going to be much worse, restrictions much harsher and for longer and so the economic outcome has been commensurately better…interrupted.
Matt Doran:
But Assistant Treasurer, I am sorry to jump in here, but can I just ask one point of clarity? This was a clerical error. If for example there was something on the forms saying that every employee must supply their tax file number, this would never have happened?
Minister Sukkar:
Yeah, look there has been no doubt there has been a really big error here. I don’t want to ascribe blame to Treasury or the ATO because the reality is they have been working at absolutely maximum capacity, whether it’s been administering this scheme or the many other schemes in place – JobSeeker, cashflow boost for business, early release of superannuation – but here clearly there were 500 to 1000 forms that were put in with a disproportionately large number of employees that were registered. Now it has been picked up. Admittedly it has been picked up through the process of reconciling the program. Would I have liked for it to have been picked up earlier? Of course, and then that way we would have been providing accurate numbers as we were receiving them but, in the end, the error has been made. The error in the first instance was made by applicants to the program and we don’t blame them for that but, would we have liked to have picked it up earlier, or for the ATO to have done so? Of course.
Monique Wright:
So, let’s just forget the blame game for a second. The money is there, we know that the money is there. How about expanding the JobKeeper scheme now or extending the JobSeeker? We know that there are a lot of people out there. There are foreign workers, there are people in the arts industry, university staff, who are desperate for some help. Will you extend the scheme?
Minister Sukkar:
Well, Monique, again I make the point that the money, as I said, is borrowed money so it’s not a pot of money sitting there just waiting to be spent and waiting for the Government to decide how to spend it. The parameters of the scheme are broad, there are going to be 3.5 million employees that access this scheme. Importantly, the comprehensive response we’ve put in place, whether its JobKeeper, or for those people who can’t access JobKeeper because they are unemployed or otherwise don’t qualify, they’re entitled to JobSeeker which – with the Coronavirus Supplement – they will receive payments of around $1,100 per fortnight. So, one way or the other, every Australian – through this package and through our especially important social safety net – is being supported. JobKeeper is not the only story, important though it is.
Monique Wright:
Assistant Treasurer, Michael Sukkar, we do appreciate you talking to us this morning. Thank you.
Minister Sukkar:
Thanks Monique, thanks Matt.