Eligible businesses can expect help in paying up to six million employees, with the Federal Government guaranteeing $1500 per person, per fortnight, between now and the end of September.
We asked some of our Australian team for their initial observations, based on the information to hand at launch. You can read the full story here:
EY Chief Economist Jo Masters: “Being stood down and paid some income, as opposed to losing your job, implies there is a job on the other side, that there will be a job ready and waiting rather than having to hunt and compete for one, which in turn helps with confidence levels.”
EY workforce specialist Matt Lovegrove: "What it might do is make employers reconsider stand downs and focus on re-training their employees for the 'new normal', effectively subsidising the reskilling of their people for the 'Next' and 'Beyond' horizons. That would be a win for all - individual businesses, industries and the nation as a whole.”
EY empolyment tax specialist Frank Klasic: "The employer just gets a subsidy from the Federal Government, so other on-costs such as payroll tax and WorkCover may also need to be budgeted for by employers unless those specific on-costs are legislated by the States to exclude this payment, which is unlikely."
EY Oceania Tax Policy Leader Alf Capito: "The eligibility rules require careful attention, and we expect the ATO to do integrity checks on employer eligibility."
New Zealand launched its own 12-week wage subsidy scheme two weeks ago, but was forced to amend the program after confusion about how much of the subsidy had to be paid through to employees. Unlike Australia, the New Zealand program is not administered through its Tax Office although its roll out is instructive for Australia. NZ Private Client Team leader Darren White says he saw 95 per cent of his clients sign up immediately.
“Right from the get go we were receiving quite genuine enquiries from clients who were perplexed about whether they were obliged to pay the full subsidy through to employees, particularly where some employees were ordinarily earning less than the subsidy amount on a weekly basis.
“They also wanted to know if they were they able to use any funds they received that was beyond that employee’s wage, to help other employees who would normally get more."