THE extension of the JobKeeper wage subsidy program will provide a further “airbag” for the Australian economy, according to the Property Investment Professionals of Australia (PIPA).

The Federal Government has announced that the JobKeeper program will be extended until the end of March next year, but with reduced fortnightly payments and stricter eligibility criteria.

PIPA chairman Peter Koulizos said the wage subsidy extension would help to soften the economic blow from the pandemic.

“We need to accept that the economic impact of COVID19 is going to be significant,” Mr Koulizos said.

“However, if the various stimulus initiatives and financial support packages hadn’t been implemented, then the fallout would have been severe. In essence, these measures are providing an economic airbag to help slow down, and soften, the impact that we all know is coming.”

Mr Koulizos said a similar strategy of stimulus initiatives was employed during the GFC that ultimately resulted in the Australian economy avoiding a recession.

“Those stimulus packages were vital in keeping people employed during that protracted global downturn,” he said.

“This time, it’s clear we won’t be able to avoid a recession, but these programs will help to prevent our economy languishing for the long-term.”

The tightening of JobKeeper eligibility criteria announced today would also mean that the wage subsidy would be targeted to the people who really need it, Mr Koulizos said.

“The extension, as well as the continuance of mortgage repayment pauses, will benefit homeowners, landlords and tenants who continue to need financial support over coming months,” he said.

Mr Koulizos said the wage subsidy extension also provided some much-needed preparation time for people whose employment was looking tenuous.

“The JobKeeper extension gives people more time to organise alternatives, such as retraining or studying, if their current job is not secure,” he said.

“It also gives people time to breathe and prepare – rather than starting to panic about how to financially survive post-September.”

About PIPA

Property Investment Professionals of Australia (PIPA) is a not-for-profit association established by industry practitioners with the objective of representing and raising the professional standards of all operators involved within property investment.

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THE INQUIRY into food pricing and food security in remote Indigenous communities will hold further public hearings over two days this week.

Julian Leeser MP, Chair of the House of Representatives Indigenous Affairs Committee, said the Committee would hear from key stakeholders from the Northern Territory and New South Wales including Land councils, other Indigenous peak bodies and agencies, leading academics, the Northern Territory Government, and key industry players such as Woolworths and Metcash.

"The collective expertise among the witnesses who will appear is extensive, and I look forward to hearing the insights they will share," Mr Leeser said.

"It is very important that the committee gets a thorough understanding of the food pricing and food security issues that are affecting remote Aboriginal communities. We look forward to hearing from witnesses about what dynamics are involved and what can be done to improve the situation."

The hearings will be conducted via telephone and video links due to social distancing requirements relating to COVID-19. Full programs are available at the inquiry website.

Public hearing details

Date: Thursday 23 July
Time: 9am to 5pm AEST
Location: Via conference call

Date: Friday 24 July
Time: 9am to 2.20pm AEST
Location: Via conference call

An audio broadcast will be accessible at aph.gov.au/live

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A PARLIAMENTARY inquiry into the impact of COVID-19 on Australia’s defence, trade and international relations will turn its attention to public health at its next public hearing.

Senator David Fawcett, Chair of the Parliament’s Foreign Affairs, Defence and Trade Committee, said the pandemic had exposed problems in Australia’s pharmaceutical and medical equipment supply chains.

Senator Fawcett said,  “Although our health system is amongst the best in the world, it can’t function without reliable supplies of drugs and equipment, especially during severe public health events like the pandemic.”

Witnesses from Aspen Medical, an Australian-owned health services supplier, and the Public Health Association of Australia will give evidence on aspects of Australia’s healthcare response to the pandemic.

Full terms of reference for the inquiry are on the Committee website. Submissions can be made until 24 July 2020.

Public hearing details

Date: Thursday 23 July
Time: 3pm – 4.30 pm AEST 
Location: By teleconference

The hearings will be audio streamed live at aph.gov.au/live

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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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THE Australian Small Business and Family Enterprise Ombudsman Kate Carnell has urged small business owners to do their homework, before taking out a loan.

The warning comes as the Ombudsman’s office issued its second ever notice of refusal to mediate under section 74 of the Act, against lender Prudent Capital Pty Ltd.

Ms Carnell said her office received a request for assistance from a small business in dispute about its loan with Prudent Capital, however Prudent Capital refused to engage in mediation and proceeded to take direct action against the small business.

“I am extremely disappointed by the refusal of Prudent Capital to engage in mediation and seek to resolve the dispute in a fair way and I continue to encourage Prudent Capital to reconsider its refusal,” Ms Carnell said.

“The dispute involved allegations that Prudent Capital applied substantial interest and penalties to the loan that increased through its own delays. It was also alleged Prudent Capital acted in ways that obstructed the small business from refinancing.

“This serves as a timely and critical reminder to small businesses to ensure the lender is an AFCA member before taking out a loan. Small business borrowers can only access a free and independent dispute resolution process for their financial complaints if their lender is an AFCA member," Ms Carnell said.

“Not all lenders are AFCA members – in fact many are not – and small businesses need to be aware of the risks.Access to funding continues to be a major issue for small businesses. It’s crucial they make the right choices when it comes to managing their finances.

“I would encourage small businesses to go to their trusted accredited financial adviser before making any big decisions.” 

www.asbfeo.gov.au

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