Harvey Norman franchisees who yesterday delivered record revenues and profits are today facing a barrage of criticism after they failed to follow the lead of the Harvey Norman corporate and hand back millions in JobKeeper payments.
The Harvey Norman franchising operation recorded a record profit of $628.19 million, an increase of $279.60 million or 80.2%, from $348.59 in the previous year but despite this the individual owners of these stores have chosen to pocket millions in JobKeeper payments.
This is in sharp contrast to the Harvey Norman run and owned stores, who yesterday announced that they were handing back $6M in payments after billionaire Chairman Gerry Harvey spent six months flatly rejecting the notion of handing back any of the JobKeeper payments.
The amount did not include $14 million claimed by Harvey Norman’s privately owned franchisees who now appear to be giving the Federal Government a two-finger salute despite record revenues and profits.
One franchisee told ChannelNews “It appears that consumers don’t give a stuff whether we have pocketed money from the Government, why should we. We are now facing new problems and this money could come in handy in the future”.
They admitted that a major issue is concern over future stock supply especially when Harvey Norman stores reopen in ACT, NSW and Victoria following COVID lockdowns.
The retailer had previously resisted repaying the funds despite a massive jump in earnings during the pandemic, leading to significant public and political criticism.
Founder Gerry Harvey would not say why the company changed its mind. “I’m not going to talk about JobKeeper. Every time I open my mouth about JobKeeper I get into trouble,” he told Nine Media.
The JobKeeper scheme has come under increased scrutiny this month amid revelations hundreds of thousands of firms that used it actually increased their revenue during the pandemic.
Federal Labor MP Andrew Leigh, who has been one of the biggest critics of JobKeeper, said Harvey Norman’s repayment should lead to more transparency around the scheme. “Six months ago, Gerry Harvey flatly refused to repay. Does anyone imagine he would’ve repaid without huge public pressure?” he said.
In Question Time yesterday, Treasurer Josh Frydenberg said he would “welcome Gerry Harvey or any other major company that’s in the position to repay the JobKeeper payments back” and had said this earlier in the year.
He said the wage subsidy scheme had helped increase consumer confidence and had been described as “well-targeted” by Treasury and “remarkable” by the Reserve Bank.
“JobKeeper is perhaps the most remarkably successful economic support program this country has ever seen … and it’s contributed to the strong rebound in the economy that we saw at the end of last year and the start of this year,” he said.
