By deleting just two words in the JobKeeper regulations, eligibility could move from being once-and-for-all to being month-by-month. If a business expected revenue to recover in the following month, they would no longer qualify. This wouldn’t preclude them from qualifying again later should economic conditions deteriorate.
This fix would only withdraw support from those businesses no longer truly in need, and stamp out the rumoured profiteering. It would serve as an economic stabiliser, responding to changing economic conditions automatically.
They also suggest that it can be extended to other currently excluded workers and beyond September.
What I find puzzling, however, is that one of the two authors had an op-ed at the SMH just two weeks ago arguing the opposite point.
There are clear flaws in the current system, and for many businesses it could be wound up earlier as the outlook has changed somewhat for the better. But the government made a clear commitment to these millions of businesses and workers to maintain a certain level of support for the full six months.
The last thing anyone needs right now, when the confidence of consumers and businesses is more critical than ever, is to have the government pull the rug out from under them.
So clearly he has changed his mind. But why?
The stunning revelation that the JobKeeper wage subsidy is supporting only half the jobs and costing half as much as the government thought is of course embarrassing. And it’s genuinely concerning that the government and Reserve Bank relied on these numbers to get a read on the state of the economy and to calibrate policy.
We should seize the revelation of this massive error as an opportunity to fix some of the by now obvious problems with JobKeeper.
Well – the $60 billion stuff-up is embarrassing. Terry McCrann has views:
The head of Treasury, Steven Kennedy, and ATO Commissioner Chris Jordan must both be sacked for either deliberately misleading the Australian public or breathtaking incompetence the like of which I doubt we have seen before, or arguably both.
I’m in two minds – yes it is a monumental stuff-up, but we don’t want to discourage the bureaucracy from finding and reporting $60 billion windfalls. Mind you – it’s not actually a windfall.
The point is – I’m not convinced that under-spending borrowed money is reason enough to either extend the JobKeeper program or to fine tune it. Steven Hamilton’s certainty argument of two weeks ago is still valid today.
What is going to be challenging, however, is that the JobKeeper program ends before the budget will be brought down. I don’t know if that timing works.