JobMaker was meant to support 450,000 jobs. The real figure is just 1 per cent of that

By Exclusive by business reporter Daniel Ziffer
JobMaker was a key announcement in the federal budget delivered in October 2020, intended to boost the COVID recession recovery. (ABC News: Nick Haggarty)

One of the key elements touted in the October 2020 federal budget, JobMaker promised $4 billion over two years in taxpayer funds to pay employers to hire workers under the age of 30.

The hiring credit paid employers up to $200 a week for creating new jobs for people aged 16 to 29 years who were on JobSeeker, Youth Allowance or the Parenting Payment, and $100 a week for 30- to 35-year-olds.

"New hires must work for at least 20 hours a week. All businesses, other than the major banks, will be eligible," Treasurer Josh Frydenberg said in his speech.

But previously secret Treasury documents from the middle of this year reveal that just 5,278 people had been hired using the JobMaker hiring credit, or around 1 per cent of the original budget forecast.

Treasury documents provided to the ABC under an FOI request. (ABC News: Alistair Kroie)

Big promise

The program was one of the big-ticket items in last year's federal budget, but the amount of people helped into work could be even lower than that number.

Documents from inside Treasury, released using the Freedom of Information (FOI) process further reveal that "the count of individuals may include an employee more than once where they change the employer who is claiming for them".

Treasury documents provided to ABC News under an FOI request. (ABC News: Alistair Kroie)

Between October 7 last year and July 6, 2021 there were 4,081 companies — described as 'entities' with an Australian Business Number (ABN) — that had a processed claim through the scheme.

Again, that could be overstating it.

"The number of entities with a processed claim form includes forms that may be subject to a payment suppression including for eligibility checks or compliance action, or have resulted in a nil claim," the document said.

The application only sought data back to February, but Treasury provided figures for the full life of the scheme up to July.

Access to three further documents about Treasury's response to the scheme was refused because they were linked to deliberations of the Cabinet, a select group of key ministers.

More employed than pre-pandemic

Mr Frydenberg pointed to the strength of the economy — and job creation — as a reason the $4 billion set aside for the JobMaker hiring credit was under-subscribed.

"With a world leading and stronger than expected economic recovery an estimates variation was made in the last budget, with Treasury estimating the hiring credit payments to total $93 million from 2020-21 to 2022-2023," he said.

Unemployment is at its lowest level in a decade — and powered past its pre-COVID rate faster than similar developed nations.

Another potential reason for the under-performance of JobMaker: a similar $3.9 billion wage subsidy that pays for half of the wages of a first-year apprentice (then 10 per cent of the second year and 5 per cent of the third). That scheme called Boosting Apprenticeship Commencements has been extended due to high demand.

Nothing in employment

The government department in charge of employment was asked for its assessment of the JobMaker program.

An FOI request made to the Department of Education, Skills and Employment for quarterly reports about the implementation of the JobMaker program, also known as the JobMaker Hiring Credit scheme, was refused.

The decision was made because "all reasonable steps have been taken to identify documents falling within the scope of your request" and none were found according to the person who was authorised to make the decision.

"I am satisfied that the documents you have requested do not exist," wrote Jacki, who did not give a surname.

The rejection of the request does not mean the department has not assessed the JobMaker program, just that the FOI application was unsuccessful.

Lack of take up 'hardly surprising'

From its creation, the government was warned the program was unlikely to succeed.

"The lagging take up of JobMaker is hardly surprising," said Dr Elise Klein, senior lecturer at the Crawford School of Public Policy of the Australian National University.

Dr Elise Klein OAM is a senior lecturer in public policy at the Crawford School, ANU. (ABC News: Rudy De Santis)

Senate hearings shortly after the budget suggested the program was only likely to create 10 per cent of the projected 450,000 job target.

Last month, an executive summary of an International Monetary Fund mission to examine the Australian economy noted the faltering scheme.

"While wage subsidies to support apprentices and trainees have been extended with high take-up, the JobMaker hiring credit program has played a relatively minor role thus far," the summary read.

"The program should be reviewed and reinstated, particularly if the labour market recovery is slow, to incentivise more widespread take-up to increase employment, retention, and skills development.

"Scaling up programs for career support to find jobs and acquire training should be also considered."

ATO was ready

Documents from the Australian Taxation Office (ATO), also obtained through the FOI process, confirm the low figures.

In a statement, a spokesperson said the Tax Office had been ready to deal with up to 450,000 applications but had waited to see the actual demand.

Discrimination potential

The age-based incentives concerned older job seekers.

Those concerns grew when documents from inside Treasury detailed examples where employers could sack experienced employees, replace them with workers earning just a third of the salary and get the taxpayer-funded JobMaker credit to make it cost no more.

The document stated the JobMaker credit "does not create an incentive for an employer to replace an older worker with several part-time workers". But the words were directly below a table that showed the opposite.

Internal Treasury emails, talking points and an 'issues register' listing problems with the scheme went further, outlining how employers could benefit from axing high-wage jobs and suggesting the department will "need to confirm" if the scheme is even legal under laws that aimed to prevent age discrimination.

In response to questions in February, a statement from Treasury contended that "any JobMaker hiring credit payments received by employers will, at most, only offset the increased payroll from the eligible additional new employees", and that there was "no financial windfall" to employers if they replaced one full-time employee with three part-time employees.

"The examples in the document are for illustrative purposes to demonstrate different circumstances in which an employer would be entitled to receive a hiring credit."

How you know this

Freedom of Information — also known as FOI — allows anyone to access documents created by government and agencies. Individuals can make applications about their own information stored by the entity, or about issues that interest them.

Costs may apply. Search 'FOI' on the website of the agency or department you'd like to get information from.


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