The government is getting ready to pull the plug
The number of workers collecting JobKeeper wage subsidy has fallen to a little over 1.5 million between October and December 2020, new data from the Australian Taxation Office (ATO) showed.
The figure is much lower than Treasury’s estimated 2.2 million recipients predicted to stay on the programme by the end of 2020. It also continues the downward trend that began in Q4 last year.
Treasurer Josh Frydenberg believes the results prove the federal government is ready to pull the plug on wage support, which was extended to 28 March.
Read more: Treasurer says JobKeeper dip signals recovery after COVID-19
“These improvements have been broad based across the country and we have seen encouraging signs across all sectors,” Frydenberg said.
The government will now direct its focus on the economic recovery plan, which will include measures such as “tax cuts, business incentives, the JobMaker Hiring Credit and a record investment in skills and training,” the treasurer said.
As the COVID-19 crisis ravaged industries in 2020, 3.6 million workers were signed onto the JobKeeper programme by their employers between April and September. Businesses that received the subsidy had to demonstrate their revenue for the period had declined by a certain percentage.
Read more: JobKeeper extension: What you need to know
With sectors gradually reopening in the last quarter, however, more companies have been able to take their workers off the scheme. From 1.63 million recipients in October, the number has dropped to 1.54 million in December. The majority (87%) of those who remained on JobKeeper during that quarter received wage support of $1,200, the ATO recorded.
By state, Victoria represents the largest share of JobKeeper recipients, with 626,000 in Q4 2020. This was followed by New South Wales, 490,000; Queensland, 259,000; and Western Australia, 107,700.
Dr. Steven Kennedy, secretary to the Treasury, expects job cuts to take place once JobKeeper ends.
“I’d expect it would mean there are some peoples whose employment won’t be present, job losses that would come with that,” Dr. Kennedy said at a hearing in parliament.
But with the economy “recovering faster than what we anticipated,” he is hopeful more opportunities will open for working Australians.
