One In Five Companies Pocketing JobKeeper Actually Boosted Profits
A staggering fifth of JobKeeper payments made to major listed companies in Q2 2020 went to businesses that actually boosted profits during the pandemic, fresh figures reveal.
According to corporate governance advisory firm Ownership Matters, 66 of Australia’s top 300 ASX listed companies claimed a total of $1.38 billion in JobKeeper payments for the six months ending December 2020.
Of the 66 companies, a total of 58 reported positive earnings during the quarter and around 50 per cent of this group told investors profits were actually better compared to pre-pandemic levels, the Sydney Morning Herald reports.
In short, millions of taxpayer dollars were handed out to profitable companies which did not need it.
Ownership Matters director Dean Patsh said of the figures: “Some shareholders have been hit in the bum by a JobKeeper rainbow — 90 per cent of companies that got the subsidy were making money, but it’s staggering that 50 per cent of those who pocketed $284 million for the half, were making more money than they were in 2019.”
Many major companies have been under pressure to hand back the millions paid on JobKeeper after reporting positive earnings and growth, including CE retailer Harvey Norman.
Owner Gerry Harvey has bluntly said he will not pay back the subsidy, instead claiming it would technically pay it back via the higher taxes paid on profits.
Labor MP Andrew Leigh has been a vocal critic of companies pocketing JobKeeper, particularly after Harvey Norman raked in $644 million in profits for the half-year.
“I anticipated that Harvey Norman would report a $500m profit for the half-year. Turns out that it was a stonking $644m,” Leigh said.
“Australian taxpayers gave Harvey Norman & franchisees $22m in JobKeeper. They don’t need a cent of it, and should repay it today.”
JobKeeper critics have argued the subsidy was not intended to help companies boost profits or to continue paying out fat executive bonuses.
Some companies have vowed to return JobKeeper funds, including Super Retail Group, Nine Entertainment and Dominos.