Australia

Number of Australians on JobKeeper revised down by 3 million due to 'significant' reporting error

Josh Frydenberg Source: SBS

Treasury has revealed the number of Australians receiving the JobKeeper allowance has been grossly overestimated.

The number of Australians receiving JobKeeper support payments during the coronavirus pandemic has been revised down from 6.5 million to 3.5 million. 

Treasury and the tax office revealed the reporting error in a joint statement on Friday afternoon. 

The error means the estimated cost of the scheme has been reduced from $130 billion to $70 billion. 

About 1,000 businesses made "significant errors" when reporting the number of employees estimated to receive help.

The most common error was reporting the amount of assistance they expected to receive rather than the number of employees expected to be eligible.

For example, instead of writing one eligible employee, businesses wrote 1,500 - the amount of money received each fortnight through the program.

Treasury officials provided evidence to a Senate inquiry into the government's coronavirus response on Thursday, saying $8.1 billion had been paid out through the program.

The $1,500 fortnightly payments began flowing to employers earlier this month and are legislated until the end of September.

The program is up for review in June.

The Morrison government has ruled out further extending the program to include casuals and migrant workers.

Treasury says its overall view of the labour market is unaffected by the reporting error, with expectations unemployment will rise to 10 per cent.

Opposition leader Anthony Albanese lashed the government over the mistake.
Opposition leader Anthony Albanese lashed the government over the mistake.
AAP

Treasurer Josh Frydenberg described the error as "good news", noting that there were "no consequences for JobKeeper payments that have already been made".

"It is welcome news that the impact on the public purse from the program will not be as great as initially estimated," he told the ABC.

Mr Frydenberg said the massive underspend was not a reason for the government to go and splash more cash.

"This revision by Treasury is not an invitation to go and spend more. All the money that the government is spending during the coronavirus period is borrowed money."

Labor leader Anthony Albanese said the government should have had in place "basic mechanisms to check on the forms that were coming in”.

"This is a mistake you could have seen from space, and this is a government that couldn't run a bath, let alone be good economic managers," he said.

Mr Albanese said the government had failed to ensure there was proper oversight of the scheme.

"This government won't accept responsibility for anything," he said.

"They have to accept their responsibility for this. It is their responsibility to have proper oversight over this program, and quite clearly, they haven't.

"It's been a hands-off approach and the government must accept responsibility for this."

Australian Taxation Office second commissioner Jeremy Hirschhorn said the incorrect numbers were only used for early estimates by businesses and not the final payouts.

"I stress that that was an estimate which we collected for analytical purposes only. It made not one difference to the amount we have paid, we have made no underpayments or overpayments."

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