TRANSCRIPT: TELEVISION INTERVIEW - SKY NEWS - MONDAY, 6 APRIL 2020

E&OE TRANSCRIPT
TELEVISION INTERVIEW
SKY NEWS WITH KIERAN GILBERT
MONDAY, 6 APRIL 2020

SUBJECT: Coronavirus; wage subsidy; Parliament.

KIERAN GILBERT, HOST: A lot to talk around ahead of this brief sitting of Parliament but one of the most important really in the nation’s history when it comes to that legislation and I want to ask you particularly about this anomaly that Andrew Clennell reported on. If a business has a turnover of $1 billion and their turnover drops by 20 per cent, or even 40 per cent, they won’t get the JobKeeper allowance. A business with a turnover of $800 million, even if they’ve got a profit of $200 million, would still get that assistance. Do you see a problem here with the way the government’s structured it, should it be done on profits?

TONY BURKE: This is one of the key challenges with how they’ve designed it, in that they’ve designed it based on downturn rather than on profit, and then you’ve got a very hard edge, it’s a cliff where if you’re a dollar above a billion or a dollar below a billion in turnover as to the extent of the downturn that you have to have. So, they have designed it that way, it’s going to create all sorts of anomalies, I don’t want that to get it the way of the fact that on Wednesday, we will get legislation through, on Wednesday when parliament sits, to make sure that there’s a wage subsidy. But there is no doubt that there’s a whole lot of design features that the government’s got here that if they were allowing the parliament to sit more often there’d be a whole lot of mistakes that will happen, that we would have been able to iron out and that’s one of the reasons why we’re engaging early and pointing out some of the design flaws that are there. Because you can understand you don’t want to create a situation where there’s an incentive for a business that, say they’re at 28 per cent downturn, you create this bizarre incentive that if they can get their downturn two per cent higher, all of a sudden they get a wage subsidy for their staff. There’s a whole lot in the way it’s been designed that will create some really strange anomalies which at this point we think, oh well, so what, let’s just get it done, and we’ll get it done, but what that means on the other side is you’ve got a whole lot of workers who look at each other and they’re in seemingly identical situations, one gets a subsidy for their wage and the other doesn’t.

GILBERT: Yes well indeed if you’ve got two people, as Andrew said there, on $60,000 a year, one works for a small and medium size business, the other works for a big company who might have had a 30 per cent downturn just like the small business did, but they wouldn’t get the JobKeeper. They’d have to go back to basically the Newstart or the Job Seeker allowance.
 
BURKE: You’ll see a similar thing where workers who’ve been in pubs, if the pub’s owned independently because of the shut down almost certainly the pub is going to have a 30 per cent downturn. But there’s a whole of hotels owned by Woolworths, and those workers are in the exact same situation, they’ve been shut down for the exact same reason, but Woolworths, because their supermarket division is doing so well at the moment, almost certainly you can’t imagine them qualifying. Now if this was a payment to the business that would make sense, but when it’s meant to be a payment to the worker that flows through to keep their connection with the business during this time. Two people in an identical job shut down for an identical reason, one during the stand down will get $1,500 a fortnight and keep a relationship with the employer and the other won’t.

GILBERT: And that’s the key point isn’t it because the government’s trying to keep that relationship between the worker and the employer so, regardless of the size of the employer, you want that connection to remain - so will you will be pushing for a flat 30 per cent mark for all companies?

BURKE: What we’ve been doing, and we’ve only got some of the legislation very late last night and we still don’t have all of the legislation, so we’re still working it out. We’re pleased that the government’s given us access to what they have, and I don’t think the delay is the government playing a game, I think it’s genuinely they haven’t written it yet. So the chance to iron out all these sort of anomalies is to have the conversation now about who would miss out. And by doing that to give the government time to be able between now and Wednesday to start tinkering and making changes because it’s not like this goes through and parliament’s back next week and we can fix it.  They’ve made a decision that parliament will meet very, very rarely. Officially between Wednesday and the 11th of august, nothing is scheduled to sit, and so you do have challenges in fixing this after the event and also you’re simply not going to have the well prepared amendments and thought through and lengthy debate that would normally improve legislation. None of that’s going to happen. There’s not going to be a parliamentary inquiry, we’re just getting it done on Wednesday. So now is the time to have those conversations because the key is the most important people to keep their relationship with the employer are the people who are relying on the job for their livelihood. But what we’re going to see in a whole lot of households is we’ll find that parents who have a casual job find they don’t get the continued relationship with the employer even thought that job has been supporting the entire household and yet they’ll have kids who’ve had a job for a year and a half at the local food court doing a three-hour shift on a Saturday and all of a sudden they’re going to have their wage multiplied to $1,500 a fortnight. We didn’t call for the government to do that part of it, that’s a decision that they’ve made, but effectively the most important thing with a wage subsidy is that you subsidise wages and every time the people who miss out, every time that’s put to Christian Porter, his response is to say “yeah that’s true but there’s other people who might only earn $70 and suddenly they’re going to get $750 a week”. That’s no compensation for the people who are seeing their livelihood disappear during this time. That’s no compensation for them and they’re the ones who at the end of this, that’s a critical moment, and the reason you do a wage subsidy, at the end of this you want them to have kept their relationship with their employer because after other down turns there’s been a whole lot of people when that relationship’s broken, who’ve never managed to return to the workforce.

GILBERT: Yes and I guess the point is, whether it be that argument on the casual worker who’s been with an employer for less than a year or that other element where the threshold hits in terms of the size of the business, whether it should be done on turnover, or profit, to be a more accurate assessment, either way you want them to be flexible over the next 48 hours. Because if you’re spending $130 billion, you want to get it right, you don’t want to then see companies slashing workforces by thousands over the coming days because you didn’t listen.

BURKE: Yes, and there’s a couple of ways that they’re spending money that’s unexpected. I spoke about the examples where it’s a wage multiplier, that’s unexpected. The other one that’s unexpected and they really shouldn’t be doing is paying a wage subsidy at the same time that the worker isn’t receiving a wage, they’re just running down their leave entitlements. The taxpayer gets no benefit out of that. That’s just creating an incentive for employers to get people to run down leave and we’re not actually paying for anything. It’s just money going to a balance sheet and the government’s already put in measures that it said were for cash flow. Whenever you do something quickly, there’s going to be examples that are not going to be great, but the principle surely should be the more someone is relying on the income the more determined we should be to keep the relationship with their employer. That ought to be the principle. At the moment because of the way they’ve designed it, either you might miss out on that even though your household’s reliant on the job you might miss out because of the organisation of your business that you work for, it might be because the business you work for is a subsidiary of a parent company, it might be because you’ve been working every day in this job but you’ve been there for ten months and not for 12. I appreciate it when Christian Porter says they’ve got to draw a line somewhere, they do. But when you get these sorts of anomalies, it’s fair to say right now they haven’t drawn the line in the smartest way and there’s time to fix it.

GILBERT: And just finally before you go, as much as the extra few hundred dollars a fortnight for JobKeeper vis a vis the Job Seeker allowances, that’s important, but the most important thing is to keep that connection, as the PM has said repeatedly, between the worker and the employer, and if there are amendments to be able to achieve that, surely the government will consider it, and I guess you’ve already said you’re going to pass this thing regardless, so they’ve got that goodwill there haven’t they?

BURKE: That’s right. And this is why I was stunned when Christian Porter went on the attack this morning. I mean really, the Australian people don’t want to see us having a brawl at the moment. They want to see us working together and getting things done for them. So where there’s a way it can be improved, we’re going to explain it, and we should. And the government should be listening and we should be making sure that at the end of this we get something that works. Because the lines you just attributed to the Prime Minister, yep and he has been saying that, and as you know we were saying that for the period when they were flatly ruling out doing a wage subsidy. We’ve now got to the point that something we called for the government’s said they will do, let’s do it in the smartest way, and not descend the way the Attorney-General tried to this morning into some absurd political game so that we can pretend that one side of politics is wanting to block something that we’re all in support of.

GILBERT: Mr Burke, appreciate your time, thanks.

BURKE: Great to be back.

ENDS