Wednesday, August 12, 2020

Paying the Privileged.

Companies are using millions of dollars in jobkeeper payments designed to keep Australian workers employed during the coronavirus crisis to help pay increased dividends to shareholders.

Stock exchange disclosures show that over the past week retailers Adairs and Nick Scali, and dental chain 1300 Smiles, increased their dividend payouts after receiving jobkeeper funding, and market observers expect additional shareholders to reap similar benefits as more companies report their results over the coming fortnight.

Shareholders pocketing big dividend payments include Nick Scali managing director Anthony Scali, who will collect about $2.5m, and 1300 Smiles founder Daryl Holmes, who is to receive a $1.8m payout – the same amount the company received in jobkeeper.

Peter Morgan, a former fund manager at Perpetual who is now an independent investor, said jobkeeper was supposed to keep employees in their jobs but there was “obviously money going out the door on a short-term basis, not only to reward shareholders but in a couple of cases there are principals who are clearly quite well-off”.

 Peter Whish-Wilson, the Treasury spokesman for the Greens told Guardian Australia that “Australians will see this as a rort. And they are right – this is corporate welfare, which is neither fair nor affordable.” 

One market observer said the jobkeeper program was “an invitation to abuse” that was amplified by the lack of transparency.

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