The national lead at KPMG Motor Industry Services, Steve Bragg, told GoAutoNews Premium: “These changes will help to save jobs and provide some certainty for the automotive industry.
“Under the previous criteria, the industry was facing a situation in which very few, if any, automotive dealers would have been able to qualify to access JobKeeper past September 27.
“The changes are very welcome, especially in Victoria where dealers are facing an extremely difficult period. It is very unclear what lies ahead for the industry for the next six to 12 months,” Mr Bragg said.
Steve Bragg
“These changes apply nationwide and recognise that many employers experienced some improvement in trading conditions towards the end of the June quarter, but will again experience a significant decline in the September quarter.
“Such businesses may not have been eligible for the JobKeeper extension under the proposals announced on 21 July.
“An immediate action point for employers currently receiving JobKeeper is to review whether they can prospectively receive JobKeeper for additional workers, given that today’s announcement allows workers who were first employed between 2 March 2020 and 1 July 2020 to be eligible from the current fortnight ending 16 August.
The key changes to the JobKeeper extension proposals are:
- To qualify for JobKeeper 2.0 for the first extension period (from 28 September 2020 to 3 January 2021), employers will only have to show that the requisite decline in turnover occurred in the September quarter, compared with the same quarter in 2019. The June 2020 quarter is no longer a relevant test period for JobKeeper 2.0.
- To qualify for JobKeeper for the second extension period (from 4 January 2021 to 28 March 2021) employers will only have to show the requisite decline in turnover for the December 2020 quarter, compared with the same quarter in 2019. The original announcement on 21 July had indicated that an employer would need to show the necessary decline in turnover for each of the three quarters ending June, September and December 2020.
- JobKeeper fortnights commencing from 3 August (i.e. including the remainder of the original JobKeeper timeframe) workers employed as of July 1, 2020, will be eligible for JobKeeper. This means that workers who commenced with their employer between 2 March and 1 July will be eligible during the remaining four fortnights of the original JobKeeper period, and also during the extension periods.
- Today’s announcement clarifies that an employer does not need to have been eligible for the original JobKeeper program in order to qualify for one or both of the extension periods. So an employer that first satisfied the decline in turnover test for the September quarter would be eligible for the first extension period under JobKeeper 2.0 even though it had not previously been eligible.
The federal government has reacted to the evolving health situation and this announcement paves the way for a significant number of additional employers to be able to benefit from the extension to the JobKeeper program.
It will be necessary for the Treasurer to issue a new legislative instrument in order for the extension to the JobKeeper program to take effect, and some amendments to legislation may also be required when parliament resumes. We expect that these details will become public towards the end of August.
One talking point that remains with the JobKeeper extension is the fact that employers will not know for certain that they have met the decline in turnover test until after the commencement of the period for which they would like to claim the subsidy.
This may impact workforce planning and be a barrier to the community receiving maximum benefit from the program. KPMG has drawn the attention of the treasury to this issue.
Access Government fact sheet here.
By John Mellor
Read More: Related articles
