Senate demand for JobKeeper data escalates to threat of fines or jail for ATO boss

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Tax commissioner Chris Jordan is being warned he could be fined or jailed under the Parliamentary Privileges Act for failing to comply with a Senate order to publish the names of large private companies that received JobKeeper payments.

Some public companies have returned JobKeeper payments in the wake of the corporate regulator, ASIC, requiring them to publish details of how much they received, but the same requirement does not apply to private firms.

As the political stoush intensified over whether or not to publish the names of the private companies, new Parliamentary Budget Office (PBO) data showed which industries benefited most from the JobKeeper program.

The PBO data, which is based on information from the Australian Taxation Office (ATO), has provided a breakdown by industry of the JobKeeper payments that went to firms that saw their revenues increase.

The data was provided to Labor’s Shadow Assistant Minister for Treasury, Andrew Leigh, and shared with the ABC.

As the table below shows, $4.6 billion in JobKeeper wage subsidies were sent to firms that saw their revenues rise in the first three months of the program alone.

In the construction industry, an estimated $828 million was sent to firms with rising revenues, while in the retail industry, an estimated $460 million was sent to firms with rising turnover.

The data in the first two columns come from PBO analysis.

The data in the third column are based on calculations made by the ABC (based on the PBO’s distribution of the $4.6 billion).

It comes after other PBO data showed hundreds of millions of dollars in JobKeeper flowed to companies where turnover doubled or even tripled.

ATO boss remains firm he will not disclose JobKeeper details

Dr Leigh had pushed for new laws that would have required the ATO to publish the names of all businesses with a turnover of more than $10 million that received the JobKeeper wage subsidy.

That legislation was defeated in the Senate after failing to win the approval of One Nation.

That saw independent senator Rex Patrick move a motion in the Senate ordering the tax commissioner to hand over the information.

Mr Jordan refused, citing public interest immunity.

The Senate rejected his argument and again demanded that the information be handed over on Friday last week, but Mr Jordan again refused.

Now Mr Jordan is being warned that he could be fined or jailed under the Parliamentary Privileges Act for failing to comply with the Senate orders to publish the JobKeeper information.

In citing public interest immunity, Mr Jordan said there were about 10,000 taxpayers across a range of entities including public, private, individuals, sole traders and trusts that the information related to, and many of them had given their information to the ATO on the basis it would remain confidential.

Making it public, he argued, would discourage “the essential flow of information needed for the efficient and effective administration of a self-assessment tax system”.

Federal Treasurer Josh Frydenberg also lodged the federal government’s own claim for public interest immunity, saying that publishing the details of private firms “would undermine public confidence” in tax law and administration.

Mr Frydenberg said the private businesses provided the government with tax details on the basis that the government would “take all steps necessary to protect their information and maintain confidentiality”.

He said “strict tax secrecy laws” restricted both the use and sharing of that confidential information and “upholding these laws is therefore vital to the continued confidence of Australians”.

Mr Frydenberg stands by the government’s decision to allow firms to join JobKeeper based on an anticipated decline in turnover.

The Treasurer told ABC News Breakfast on Thursday that at the time the stimulus measure was announced, the economy was “staring into the abyss”.

“We needed to give businesses confidence to hold on to their workers,” he said.

“We needed to give businesses confidence to keep the doors open where they could.  As a result, Jobkeeper was a key part of that very strong [economic] recovery.”

Treasurer has no power over Senate

But Senator Patrick has asked the Senate to begin contempt proceedings against the tax commissioner for his failure to respond to a lawful order.

“A final order by the Senate to the tax commissioner must be complied with and it would set an unacceptable precedent were the commissioner’s non-compliance with the order be allowed to pass,” Senator Patrick said.

“Failure to comply with a final lawful order of the Senate is a contempt.”

He said the public interest immunity claim did not stand since the Senate request was not about private information, but rather about the use of a taxpayer subsidy.

Senator Patrick has now lodged a motion referring the matter to the Senate Standing Committee on Privileges, which will then make a decision about how to proceed.

“Whilst the Treasurer had attempted to intervene on August 26, by advancing his own public interest immunity claim, the Senate order was not directed at the Treasurer and he has no power to countermand an order of the Senate,” Senator Patrick said.

“This is an important matter that must be resolved.

“The Parliament, empowered directly by voters, is supreme. There is a lot at stake. I will now commence the process of asking the Senate to refer the tax commissioner to the Privileges Committee of the Senate.

“The Senate has the power under the Parliamentary Privileges Act to fine or jail a person who fails to comply with a lawful order it has made.”

An ATO spokesman told ABC News Mr Jordan “respects the powers of the Senate and the critical function it undertakes” but “the commissioner finds himself in an unprecedented situation given the government has lodged its own claim for public interest immunity in respect of the documents sought under the order”.

“It is the commissioner’s understanding that if the government’s claim for public interest immunity is accepted by the Senate, it will have the practical effect of relieving him of his obligations to provide documents in response to the order.”

While companies have not been made to repay JobKeeper, individuals on Centrelink are being forced to pay back money, with the Senate revealing more than 11,000 Australians have received Centrelink debt letters informing them they must pay back $32.8 million in debt related to COVID-support payments.

‘Biggest waste of taxpayer money’

Labor’s Dr Leigh said New Zealand had already taken steps to publicly publish similar data, and there was no reason why Australia should not follow suit.

“I hope the commissioner does hand over the information, and we will also be pursuing amendments in the Senate to try and force the government to change the law, so as to require a public register,” he said.

He said the previous attempt to do this had failed in the Senate because One Nation changed its position and voted against it.

“They were firm supporters of transparency but [they] now seem to only favour transparency if the information is already public,” Mr Leigh argued, noting the transparency laws passed by the Senate only applied to public companies already legally obliged to disclose the information.

Dr Leigh said there was a need to bring transparency to what he described as the biggest waste of taxpayer money in Australian history.

“Never before has the government wasted $13 billion,” he said.

“The JobKeeper scandal needs to be uncovered.”

“We need to know how on earth the Liberals allowed $13 billion to walk out the door to firms that didn’t need it without saving a single job.

“It’s very clear that the Australian public wants the information, and that it’s not unreasonable to be asking medium and large-sized businesses that received JobKeeper to have that published online.”

Asked whether it was unprecedented for the tax commissioner to defy a Senate order and for the government to then also come out and do the same thing, he said: “We’re firmly on the side of public transparency on this.”

“This is a question of whether you’re for an open and transparent regime or a secretive closed one,” he said.

Some companies have been paying back overpayments after public outrage. Retailer Harvey Norman this week announced it had returned $6 million after months of controversy.

To date, about 90 per cent of JobKeeper subsidies that have been returned to the government have come from publicly listed companies.

By business reporters Nassim Khadem and Gareth Hutchens (Original ABC Article)