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‘Completely blindsided’: Service NSW stalls JobSaver rule change following accounting backlash

Business

A spirited advocacy push from the accounting profession has resulted in the NSW government holding off on its unexpected plan to force businesses to retest their JobSaver eligibility every fortnight.

By Jotham Lian 12 minute read

The joint effort from the professional accounting bodies, and tax and bookkeeping associations comes after Service NSW informed businesses on Friday afternoon that they would be required to reaffirm their decline in turnover every two weeks, starting from September 10, to remain eligible for JobSaver payments.

The requirement change was made without consultation, resulting in backlash from the accounting profession and broader business community and sparking intense discussions with the NSW government.

By 9:30pm on Friday, Service NSW agreed to provide a grace period for the first fortnight to reaffirm eligibility.

Gavan Ord, senior manager business and investment policy at CPA Australia, said the grace period meant accountants and bookkeepers would not be required to retest their clients’ eligibility this fortnight, with payments continuing to flow from Monday.

“We were completely blindsided by the whole thing,” Mr Ord told Accountants Daily. “This is an example of why governments need to consult even on what they consider to be the smallest and most irrelevant thing.

“My understanding is that they thought this might just be a simple box ticking exercise, however, it is not.

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“They have to take into account the workload of accountants and bookkeepers because it is accountants and bookkeepers who will do this work. How will they meet their BAS and tax requirements when all their time is going to be spent on doing recalculation for the decline in turnover?”

The NSW policy change comes as the federal government faces scrutiny over its $90 billion JobKeeper program and how some businesses were able to continue receiving the wage subsidy despite improving their bottom lines. The JobKeeper rules were eventually tweaked to reflect an actual decline in turnover and were retested on a quarterly basis.

Robyn Jacobson, senior advocate at The Tax Institute, said she understood the desire to avoid another JobKeeper scenario, but urged the government to consult with the profession before implementing changes.

“There is a balance between upholding the integrity of the system and what is practically workable for the profession, who are the key intermediaries in the delivery of the financial support,” Ms Jacobson said.

“It was unhelpful that the details of this significant policy change were not communicated to the profession, and were not reflected in the guidelines at the time, before this was advised to businesses.”

What’s next after this fortnight?

The professional accounting bodies are expected to engage closely with the NSW government this week to consider workarounds for this new fortnightly eligibility retest.

Chartered Accountants Australia and New Zealand tax leader Michael Croker said members have been told to wait on further clarification from Service NSW.

Tony Greco, from the Institute of Public Accountants, said he was hoping that the NSW government would take into account the workloads imposed on the profession and was looking forward to working towards a balanced approach.

“We understand the need to reaffirm eligibility but equally the load on overworked accountants to facilitate this must also be part of the factors that need to be considered,” said Mr Greco.

“Fortnightly testing can be a time-consuming exercise depending on the clients’ level of record keeping sophistication.

“To make things worse, accountants find it difficult to charge for this service given the financial pressures their clients are experiencing as a result of health order restrictions placed on their businesses.”

For Sydney accountant Kevin San, the thought of retesting his clients’ eligibility every fortnight is hard to bear after spending weeks helping clients navigate JobSaver’s ever-changing guidelines.

“This is considerably more onerous than the reporting requirement for JobKeeper,” Mr San told Accountants Daily.

“It’s unrealistic for Service NSW to expect that the average small business owner will be able to do this, and it’s equally unrealistic to expect that accountants will be able to drop everything and set aside what might be several days every fortnight to assist clients with this.

“It’s not a matter of having to charge fees which struggling businesses can ill afford, but also the time commitment for accountants who are already overburdened and struggling with a backlog of work because of COVID, and the various grant systems.”

Jotham Lian

Jotham Lian

AUTHOR

Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.

Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.

You can email Jotham at: This email address is being protected from spambots. You need JavaScript enabled to view it. 

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