Corporate profits

Billions of ‘JobKeepers’ boosted Australian business profits while casual workers were cut

The first year of the COVID-19 pandemic produced the largest direct transfer of public money ever to increase corporate profits, at the direct expense of the working class.

More than half of the $ 89 billion in federal JobKeeper wage subsidies paid during the initial period of the pandemic went to companies, whose turnover did not fall to the level required to be eligible on the program, many of whom have increased incomes.

Unemployed workers outside an office in Central West Sydney Centrelink in March 2020 [Source: WSWS Media]

During the same period, nearly a quarter of a million low-paid casual and part-time workers lost their jobs, exposing fraud that the program was focused on protecting jobs.

This is the reality shown by two recent reports.

One, an analysis by the Parliamentary Budget Office (PBO), found that JobKeeper’s payments worth $ 38 billion went to companies that did not experience sustained downturns, more than $ 20 billion. of dollars having gone to companies that have recorded increases in revenue.

That $ 38 billion represented 53% of the $ 72 billion examined by the PBO, and the $ 20 billion represented 27% of the total.

It was not a mistake or nonsense of the Liberal-National coalition government, as the media and the Labor Party opposition have described it. This was the expected result of massive donations, with the lion’s share going to some of the biggest companies, not the workers, hundreds of thousands of whom have yet to lose their jobs.

To be eligible for the program, the government said most businesses would have to prove at least a 30% drop in revenue due to the pandemic. However, these requirements were quickly relaxed to allow employers to qualify through a projected reduction in turnover.

The allegedly qualified companies were also allowed to stay in the program for up to six months, until the end of September 2020, receiving $ 1,500 per employee every fortnight.

The overpayments were glaring. The data showed that $ 1.3 billion even went to companies whose revenue tripled in the months they claimed the payments from JobKeeper, while an additional $ 1.3 billion went to companies that have doubled their turnover.

Additionally, the Treasury Department warned Treasurer Josh Frydenberg in mid-June last year that 15% of the JobKeeper companies sampled had increased revenue by April 2020. He insisted that the money had to keep flowing.

Eligibility was finally tightened in late September 2020 and, again, early January 2021, forcing companies to demonstrate a real slowdown to stay in the program.

Even then, the government insisted that no business would be forced to pay back a dime – a stark contrast to its use of private debt collectors to track down welfare recipients, who were allegedly overpaid. In fact, the government still vehemently defends the regime and refuses to identify the companies that have benefited from it.

According to previous research from Ownership Matters, 34 of the largest companies claimed grants from JobKeeper in the second half of 2020, despite improving their revenues from pre-pandemic levels, pocketing a total of $ 284 million.

Some of the companies that benefited the most from JobKeeper included Qantas and Virgin Airlines, real estate developers Mirvac and AV Jennings, shipping center owner Vicinity Centers, construction company Lendlease, retailers Premier Investments, Nick Scali , Adairs, Accent Group and Harvey Norman, the Star Entertainment casino operator. , car dealership AP Eagers, and medical device producer Cochlear.

As a further twist to benefit the wealthy, the most exclusive private schools have also secured large donations, many despite the increase in profits. About 700 schools received $ 750 million between them. They included the Kings School in Sydney, where tuition fees exceed $ 33,000 per year, which received $ 7 million, and the richest school in the country, Geelong Grammar, which benefited to the tune of $ 10.7 million. millions of dollars. All of this was in addition to billions of dollars in funding, provided by the government’s special agreements for private schools.

Dozens of the country’s wealthiest churches and religious groups have also benefited, while remaining in surplus. In total, approximately 3,500 religious entities received $ 627 million. Initially, priests and other religious practitioners were not eligible for JobKeeper, but Frydenberg changed the rules in May 2020, to ensure they could receive the money.

Despite criticizing aspects of JobKeeper’s payments – calling them “waste” – the Labor Party has promised business owners that they can keep the financial aid they wrongly received during the pandemic. “Let me be unequivocal: Labor will not require any company to reimburse a single penny from JobKeeper,” Deputy Leader Richard Marles reiterated last month.

This is in line with the general Labor Party argument to the financial elite that a Labor led government would best protect its interests, and consistent with the role of the union backed Labor Party in offering the subsidy program. wages and enforcing job cuts, working hours and paying that involved.

The other recent report, from the Center for Future Work at the Australia Institute, found that casual workers have suffered the brunt of the pandemic, being eight times more likely to lose their jobs than permanent staff.

The loss of 175,000 casual jobs from May to August of this year accounted for 72 percent of all jobs lost. Likewise, those who worked part-time, whether casual or permanent, suffered 166,000 job losses, or 68% of the total.

The report also highlighted the low pay of casuals, with a median hourly wage of around $ 28, or 26% less than permanent staff, despite the absence of other rights like paid time off.

The report criticized the government’s withdrawal of economic backers, saying it would “force people to return to jobs that may not be secure” and encourage the spread of COVID-19, as casuals run out of sick leave and have more difficult to isolate.

The corporate and government campaign to lift all safety restrictions in the event of a pandemic and to place workers in potentially dangerous, low-paid and insecure jobs is only intensifying. Last month, Frydenberg announced the government would phase out current inadequate levels of income support, two weeks after each state and territory achieved 80 percent adult immunization.

The government expects “businesses to reopen” and “people to get back to work” once restrictions are relaxed, the treasurer said. Frydenberg claimed that COVID disaster payments cost the government $ 1 billion per week.

Even if that were true, it would be considerably less than the money handed over to big business each week through JobKeeper, which the Coalition and Labor refuse to claw back.

The JobKeeper program, like all multibillion-dollar COVID-19 “boost” programs in Australia and around the world, has been another historic transfer of wealth to big business.

Unless this offensive is defeated, the working class will continue to bear the economic burden of the pandemic, through job losses and attacks on wages and conditions, and will be forced to pay the price of subsidies via subsidies. austerity measures, while companies and their wealthiest shareholders reap the benefits.

Combating this onslaught requires a break with Labor and the unions, which function as the political and industrial police force of the business elite.

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