It’s really hard to tell which businesses received JobKeeper. Here’s why it’s a problem for Australia
Treasurer Josh Frydenberg is expected to announce this month JobKeeper will end up costing less than the $101 billion originally budgeted, after the number of people on the wage subsidy halved in October.
But with more than $70 billion spent on the program so far, it is already the biggest economic stimulus package in Australian history.
So, should Australian taxpayers be entitled to know exactly where their money has gone?
Unlike comparable schemes in New Zealand, the United States and South Africa, there is no public register of businesses receiving JobKeeper.
The only way to find out which companies are on it — as well as how much they have received and whether they really needed it — is to dig through their financial records.
That process is even more tedious than it sounds.
Take Cotton On, the Australian retailing juggernaut that was accused of unfairly excluding some of its casual workers from JobKeeper in May.
It is privately owned, so unlike businesses that trade on the Australian Stock Exchange, its financial statements are not published on a free website.
Instead, you must climb through a jungle of financial records held by the Australian Securities and Investments Commission to discover that Cotton On is owned by a parent company called COGI Pty Ltd.
Journalists are entitled to access ASIC records for free, but a member of the public would have to pay $42 for a copy of COGI Pty Ltd’s financial statements for the 2019-20 financial year.
Even if they paid up, they would not find specific references to JobKeeper — even though the company was receiving the payment during the final few months of the financial year (and most likely until at least September).
The closest is a reference in the notes to its accounts: “The group received or was entitled to receive government grant funds as a wage subsidy with the objective of keeping employees connected to the group. These amounts have been included in employee benefits expenses in the consolidated income statement.”
In other words, COGI Pty Ltd has chosen to account for the subsidy it received in Australia — and in the other countries where it operates — in its overall wage bill for the year, which was about $300 million.
It has not specifically said how much JobKeeper it received from the Government.
That is despite ASIC — which regulates financial reporting — recommending to businesses in July their financial statements “should prominently disclose significant amounts, the commencement date and expected duration of support or assistance”.
When ABC Investigations asked Cotton On how many of COGI Pty Ltd’s 15,272 employees were on JobKeeper and the total amount the company had received under the scheme, it said in a statement: “As a private company, it’s our policy not to provide financial information beyond our statutory requirements.”
To make matters more complicated, many companies and organisations (including charities) lodge their accounts by calendar year, so we will have to wait until early next year for the drip feed of financial accounts for the JobKeeper period.
And there’s one more confounding factor — not all companies are required to lodge annual financial statements with ASIC.
Only businesses that have annual revenue of more than $50 million, more than 100 employees or have assets worth $25 million need to make their accounts publicly available (smaller companies that are foreign owned also must lodge financial statements, as do companies that hold investments from the general public).
Yet over the Tasman Sea, it is a very different story.
Information about all recipients of New Zealand’s COVID-19 wage subsidy is held on a central database that is publicly accessible.
A quick search of the register reveals Cotton On’s New Zealand’s operation received $NZ4.6 million ($4.3 million) worth of subsidies for its 783 staff.
It got another $840,260 for its 151 Cotton On Kids employees in New Zealand.
However, there will be another chance soon to look under the bonnet of Australia’s wage subsidy scheme.
The Australian National Audit Office (ANAO) — which uncovered the extent of the sports rorts scandal and the Leppington Triangle land deal — has quietly revealed on its website that it is considering an investigation into JobKeeper.
The ANAO says the probe would follow up on an audit already underway into COVID-19 economic stimulus measures and would “include an examination of the implementation of integrity measures designed to protect the scheme against fraud and other abuse”.
As ABC Investigations revealed last week, the Australian Tax Office has 19 active criminal investigations underway into potential fraud against the scheme.
These factors all point to a scheme that has been vulnerable to abuse and fraud.
But without the same level of transparency of other similar schemes around the world, taxpayers who are bankrolling it have no idea of which companies could be exploiting those vulnerabilities.
They will have to trust that authorities know where to look.