THE extension of the JobKeeper wage subsidy, along with its associated industrial relations flexibility, will help business owners make smart, fair decisions that will keep their doors open and staff employed, according to Employsure, Australia’s largest workplace relations advisor.

Prime Minister Scott Morrison has revealed that the Federal Government’s JobKeeper program will run at a reduced rate for another six months from the end of September, while JobSeeker will continue for at least another three.

"This extension of JobKeeper and the IR flexibility that comes with it, will give small business owners a sense of certainty to move forward and make smart employment decisions into 2021,” Employsure managing director Ed Mallett said.

"Our main advice to business owners right now is to fully understand the details of the amended scheme, its potential repercussions and to get professional advice on how to implement it across their business.

"Even more importantly, employers shouldn’t use it as a reason to bury their heads in the sand. Subsidy shouldn't be confused for sustainability, and if you need to make hard decisions about the viability of your business, don't delay the inevitable.”

The wage subsidy will initially be reduced to $1200 per fortnight (fulltime) and $750 (part time) from the end of September, and dropped again to $1000 per fortnight (fulltime) and $650 (part time) in January. Eligibility criteria will apply.

"Business owners need to be cautious about how this will work day-to-day,” Mr Mallett said.

“JobKeeper 2.0 will still need to go through Parliament to be legislated and that's where the real rules about this program will emerge.

"There will be the inevitable potholes that business owners will find frustrating. For example, the February before the pandemic is being used as a benchmark to assess ‘employee hours worked’. What if an employee was on leave in the February pre-COVID? Will seasonal businesses that operate off-peak in February be disadvantaged by not having enough financial support to get them through their peak season that occurs in December?

"These are all questions that get answered after-the-fact, leaving small business owners to navigate the confusion in the absence of clarity.

"JobKeeper has been successful and it is welcome news that it will continue, but it's not perfect and we can't pretend that JobKeeper 2.0 won't present pain points and frustrations for many business owners."

www.employsure.com.au

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THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell said small businesses are breathing a sigh of relief following today’s Federal Government announcement extending JobKeeper by six months.

“Thousands of small business owners across Australia will be sleeping better tonight, knowing JobKeeper will be maintained in its current form until the end of September,” Ms Carnell said.

“Small businesses will be comforted most by the Prime Minister’s remarks today that the Federal Government will continue to support small businesses who need it for the duration of this crisis.

“JobKeeper 2.0 will support small businesses from the end of September through until 28 March 2021," she said.

“From October to December the payment will reduce to a fortnightly rate of $1200 per full time employee and $750 for employees working 20 hours or less per week.

“From January until March that payment will reduce again to $1000 for full time workers and $650 for part timers.

“The payments are reducing at a reasonable rate, in line with predictions of economic recovery and trading conditions picking up. It’s generous support for small businesses, who can now plan ahead for at least the next six months," Ms Carnell said.

 “Small businesses, including sole traders, will need to prove their eligibility again in October and January by showing their turnover has fallen by 30 percent.

“Crucially it will allow struggling small businesses to continue operating and paying their staff. It will also keep small businesses connected to their staff, who have been stood down, so they can re-engage their team when the time comes to ramp up.

“We know that many of the small businesses struggling now were viable and strong just a few months ago and many have the capacity to recover from this.

“The government is providing the safety net these small businesses need to help them get to the other side of this crisis.”

www.asbfeo.gov.au

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WHILE the Government should be commended for the introduction of JobKeeper at such a critical time for Australia’s businesses and individuals, too many changes to its next phase will erode community confidence, warns the Institute of Public Accountants (IPA). 

“JobKeeper has achieved many of its intended outcomes including not adding to the jobless queues,” IPA chief executive officer, Andrew Conway said.

“It is understandable that there were some design flaws considering the short time given for its implementation. 

“However, there were also benefits and we need to ensure that we don’t throw the baby out with the bathwater; we should recognise what good has been achieved by this initiative.

“Notwithstanding making changes to JobKeeper at this point in the cycle, we would like to see the following:

• The way a new business, that commenced operations from January 1, 2020, reports on GST should not determine whether they are in or out of the JobKeeper scheme.
• Review of the declining turnover eligibility test.  JobKeeper 2.0 needs to be better targeted to support those who continue to suffer during this pandemic.
• Review the flat payment structure of JobKeeper and whether it should be a proportional payment. 

“All of the stimulus initiatives around Australia to date have not distinguished between viable and non-viable businesses.  The challenge for the government is to make this distinction to ensure JobKeeper 2.0 achieves the desired outcomes.

“There is also an opportunity for the government to provide direct assistance to adversely affected industries beyond September,” Mr Conway said..

About the Institute of Public Accountants

The IPA, formed in 1923, is one of Australia’s three legally recognised professional accounting bodies.  In late 2014, the IPA acquired the Institute of Financial Accountants in the UK and formed the IPA Group, with more than 38,000 members and students in over 80 countries.  The IPA Group is the largest SME focused accountancy organisation in the world. The IPA is a member of the International Federation of Accountants, the Accounting Professional and Ethical Standards Board and the Confederation of Asian and Pacific Accountants. 

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THE House of Representatives Standing Committee on Infrastructure, Transport and Cities will hold a videoconference public hearing on July 21 for its inquiry into options for financing faster rail.

The Committee Chair, John Alexander MP, said key stakeholders and industry experts will cover issues of rail priorities and practical approaches to financing infrastructure. The committee will hear from the Property Council of Australia, Infrastructure Partnerships Australia, the Urban Development Institute of Australia, and the Committee for Melbourne.

"The MTR Corporation, Spacecon Australia Consortia and Tipping Point will draw on their international experience to discuss how innovate international approaches could be utilised in Australia, he said."

Mr Alexander said a consistent message from groups is that it was  crucial that rail infrastructure planning be part of wider master planning and design of Australia’s cities and regions.

"I am looking forward to hearing from this diverse range of witnesses," Mr Alexander said.

Public hearing details

Date: Tuesday. 21 July 2020
Time: 9.30am to 4pm
Location: Videoconference

A program for the hearing is available on the Committee’s website.

The hearing will be broadcast live at aph.gov.au/live

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