Retailer Harvey Norman has revealed it repaid $6m in jobkeeper wage subsidies in August after it posted record profits in the 2020-21 financial year.
The furniture, electrical and white goods retailer announced the move in its annual report on Tuesday following a long-running campaign by Labor and others to shame companies that claimed jobkeeper, only to improve their financial position, to voluntarily repay the money.
However, the repayment is less than a third of the estimated $22m the company and its franchisees claimed in total.
On Tuesday Harvey Norman announced a profit before tax of $1.183bn for the year ended 30 June 2021, an increase of $521m from the previous year, up 78.8%. Excluding the impact of property revaluation, profits were still up $415.8m or 66.4%.
A footnote in the annual report states that in August “all of the wages support and assistance received by controlled entities in Australia of $6.02m … was repaid to the federal government via the Australian Taxation Office”. That included $3.63m for the 2021 financial year and $2.39m for the 2020 financial year.
Although Harvey Norman repaid all the wage subsidies for its “controlled entities”, the shareholder lobby group Ownership Matters has estimated that when franchisees are included the retailer and its stores claimed about $22m.
Harvey Norman announced it will give its shareholders a further 15c dividend per share, bringing the full-year dividend to 35c per share.
Shareholders will receive $436m, of which chairman Gerry Harvey is expected to receive $140m as the majority shareholder.
In a statement, Harvey said: “The solid results delivered in the 2021 financial year [are] a testament to the strength and resilience of the integrated retail, franchise, property and digital strategy, and its ability to adapt and transition to the challenging retail landscape and continue to navigate the uncertainties presented by Covid-19.”
Companies qualified for jobkeeper wage subsidies on the basis of an anticipated downturn in revenue of 30%, but there was no obligation to repay if revenues exceeded expectations.
According to research by Ownership Matters, 34 of Australia’s largest companies claimed jobkeeper wage subsidies in the second half of 2020 despite actually improving their earnings on pre-pandemic levels, pocketing a total of $284m.
Harvey Norman joins a list of 21 publicly listed companies that have repaid or promised to repay more than $300m in jobkeeper.
Labor’s shadow assistant minister for treasury, Andrew Leigh, said six months ago Harvey had “flatly refused to repay” jobkeeper.
“Harvey Norman has given us the best advertisement for more transparency into the secretive, rorted jobkeeper scheme,” Leigh said.
In parliament the independent senator Rex Patrick, Labor and the Greens have spearheaded a push to require companies earning more than $10m to declare if they received wage subsidies, as private companies are generally not required to do so.
The Greens have gone a step further, introducing a bill for the money to be repaid.
The treasurer, Josh Frydenberg, has resisted the calls for more transparency, citing support from business groups including Australian Industry Group, the Australian Hotels Association and the Council of Small Business Organisations of Australia.
Frydenberg has said that companies that choose to repay jobkeeper are free to do so and the government has at times praised them but never lent its voice to calls on other companies to join them.
In September last year the head of the Business Council of Australia, Jennifer Westacott, said companies receiving jobkeeper should not give executive bonuses and should think twice before paying dividends.
