Ali's Choice wrote:People's thoughts on the government's $130 billion wage subsidy announcement today?
1. This was announced too late. Labor has been pushing for it for weeks and the UK and NZ + other countries jumped onto it almost immediately. By the time the announcement was made, the company I work for has had 4 weeks of massively falling sales. We had already made close to 100 workers redundant. Now there are a 100 additional people queuing at 1.5 metres apart outside Centrelink.
2. The process to bring back into the company, the workers that were made redundant is too hard. We've paid notice, redundancy and leave entitlements, as well as PAYG to the ATO. Unwinding this is a farking nightmare and the easiest option is to leave them unemployed.
3. The $1,500 is for a fortnight's wage and is pre-tax. It is a flat rate regardless of how much you currently earn. Therefore you could have someone doing 20 hours a week earning $400 a fortnight. They will get $1,500. At the same time, you could have someone on $65,000 a year (the average wage?) and they will only get $1,500. I suspect that the Govt did it this way to make it easier to administer, but we have a super duper Single Touch Payroll system that reports almost live data to the ATO so they know how much people actually earn. Therefore they could easily pay as a % or earnings capped at $x.
4. The $1,500 per fortnight is $39,000 per year pre-tax. It also doesn't attract super. I don't know about you guys but I cannot feed the mouths under my roof for this amount.
5. The cash for this is not expected to flow until May. This means that businesses have to find the cashflow for a month at the minimum to keep this going. I'm guessing that due to the demand, cash won't be seen until the end of May as their systems will be overwhelmed.
6. Casuals aren't covered unless they've worked 12 months. Most visa types aren't covered. Thankfully they cover the Kiwis working with me.
7. There isn't a lot of information out there about how to apply this payment. There's confusion about whether it simply represents a direct payment or whether it is a wage subsidy. Based on whatever guidance is out there, it seems to be a mixture of the above depending on whether you are stood down or keep on working. If treated as a subsidy, a business can make its employees take leave and keep the subsidy. While it's cashflow neutral, this benefits the company from a balance sheet perspective.