Treasury secretary takes responsibility for $60bn jobkeeper bungle
Treasury secretary, Steven Kennedy, said that he takes responsibility for the $60bn “estimates” variation” on jobkeeper, and backs Cormann’s explanation about parameters changing (because health results were better than expected).
The Covid-19 committee then heard from the ATO commissioner, Chris Jordan, on the second error – that the ATO believed many more employees were covered due to errors in employers’ responses.
Jordan said that a small number of the 900,000 businesses made errors such as putting their phone numbers, ABN or bank account details into the employees covered field, and some put in 1,500 or multiples of 1,500. He said 0.1% of employers appeared to think the field was asking for “the amount payable to rather than the number of employees”
He said, although many categories of error were picked up:
We did not build rigorous analytics behind that field that asked for the estimated number of employees that businesses had [claimed for].
Jordan said the ATO told treasury about the error on 21 May, before the public update on 22 May.
Explaining why it took so long to detect, the ATO said that the numbers enrolling in jobkeeper “seemed to be on trajectory consistent with estimates …but once began to confirm employees covered, we identified within a fortnight the numbers were less than expected”.
The ATO conducted outreach to big employers, and believed the discrepancy was due to big employers not completing the second stage of their application (confirming which employees they were claiming for). Eventually, it “became evident” there was another factor: the employers mis-entering the number of employees.
Jordan said this “temporarily obscured the size of a demand driven program” but did not result in incorrect payments.
Cormann defends $60bn jobkeeper “estimates variation”
The finance minister, Mathias Cormann, is before the Senate Covid-19 committee – explaining that the $60bn underspend in the jobkeeper program (from $130bn to $70bn) was an “estimates variation … not an accounting error as it has been falsely described by some”.
Cormann explained the government was “expecting the worst” and was “prudently planning for the worst” but the variation was due to “substantially changed” parameters – as the health outlook was much better than expected.
He said:
It is a usual estimates variation in relation to a demand driven program.
The size [of the variation] is a function of the high degree of uncertainty, and the potential size of the program. Importantly, the revised cost estimate was much lower not much higher than anticipated … a very good thing.
It is important that we erred on the side of prudence, rather than put ourselves at the risk of a potential deteriorating situation [in which case] we might have been forced to make estimates variation in the other direction, which would not have been good for confidence.
The health minister, Greg Hunt, is speaking in Queanbeyan.
“What we have seen now is that in the last four hours, as the states and territories have made their announcements, on the adviceI’ve just had from the NationalIncidence Centre, there have been so far no cases of community transmission,” he says.
“I want to repeat that. On the latest advice I have, so far, there have been no cases of community transmission, two cases overseas acquired. That explains why our border protections remain so fundamental. Fifty-nine cases in the last seven days.
“Of those, 69% have been detected through the hotel quarantine or our border protection processes.”
Hunt says the CovidSafe app has now been downloaded 6.2m times.
The NSW premier was also asked about reports that Sal Navarra, who owns the Sydney wedding venue company Navarra Venues, claimed he was going to “reopen to any numbers” next month.
“We are reopening and we are reopening to any numbers,” Navarra reportedly said in an Instagram post, linking his decision to the recent Black Lives Matter protests.
Gladys Berejiklian said authorities would “absolutely” punish any businesses that flout the rules.
Can I say, can I just ask everybody to please be patient. There isn’t much more to wait in terms of making sure that every aspect of businesses that have felt restricted will have some pressure released in the near future, so long as all of us keep doing the right thing.
Wedding venues in NSW are currently restricted to 20 guests, compared with 50 for cafes and clubs.
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Mutual obligations for welfare recipients return today.
There are now about 1.6 million people receiving the unemployment benefit jobseeker. Before the pandemic, the figure was about 700,000.
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The NSW premier, Gladys Berejiklian, was giving a press conference just now. She was pressed on comments from her police minister, David Elliott, who said yesterday that police would not approve future permit protests that did not comply for the health guidelines.
Does she agree with Elliott? She says:
Well, obviously that is what we’ll look at. Because we want people to respect the health orders.
But she adds:
I think we need to draw a line in the sand in what happened on the weekend. It wasn’t just what happened in Sydney, it happened all across Australia.
And as disappointing as it was, we need to draw a line in the sand and move forward.
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We have a total of two new cases in Australia today. The last time that occurred was Saturday.
As NSW authorities noted, both new cases in that state today were from returning overseas travellers.
You have to go back to 29 February for the last time there were no new cases reported in Australia.
The NSW premier, Gladys Berejiklian, says the two new cases in NSW were from overseas, which means “there were no extra or new community transmission cases overnight”.
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Western Australia reports no new Covid-19 cases
Mark McGowan says there were no new cases of Covid-19 in WA.
“And that means at this point in time we’ve had 599 cases across the state,” the premier said. “The latest advice I have is no one is in hospital across the state with Covid.”
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NSW reports two new Covid-19 cases
NSW has recorded two new cases of Covid-19, bringing the total to 3,114.
A statement from NSW Health said there were 66 cases now being treated. No patients were in intensive care.
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