In accordance with Freedom of Information laws, the ATO has recently published a large number of internal documents relating to its administration of the JobKeeper program.
These documents provide some insight into the ATO administration of JobKeeper which was supported by an effective compliance program and robust governance arrangements.
However, the documents released under Freedom of Information only provide point in time data and insights which may not provide appropriate context or may be superseded by events or updates not available within the documents. As such, journalists reporting on the FOIs should be cautious in drawing conclusions from these documents. Journalists reporting on the FOIs are strongly encouraged to contact the ATO's Media Unit and consider the latest publicly available JobKeeper data.
In particular, journalists reporting on these documents need to be highly conscious of the differences between the ATO identifying a potential issue for further exploration, how many businesses were selected for a review on that potential issue, and ultimately how many of those businesses were actually in breach of that issue.
The documents illustrate how the ATO ensured payments were able to flow quickly to eligible businesses, while also ensuring the integrity of the scheme was maintained at all times. As would be expected, the ATO kept Treasury and the Treasurer's office regularly informed as to the status of the program, including the ATO's comprehensive compliance program.
Our aim was to make JobKeeper payments easy to access for eligible businesses, and extremely difficult to access for ineligible businesses. This aim was achieved.
The ATO redeployed about 3,000 staff to support the COVID stimulus measures. In relation to JobKeeper, we reviewed more than 114,000 entities to the value of approximately $12.5 billion. We also stopped more than $274m of invalid claims and an estimated $767 million of future flow-on claims through our pre and post payment reviews. Approximately $470m of over-payments were identified across the entire scheme of almost $89 billion, of which $194 million has already been recovered.
As part of the compliance program, we undertook comprehensive reviews of cases that forecast a decline in turnover and found the vast majority of taxpayers undertook the projected decline in turnover test in good faith. From our review of more than 1,600 entities across all markets, we found more than 95% were eligible. These entities were not chosen at random, but on the basis of perceived risk. In short, contrary to the perception that may be obtained from some recent reporting, false or bad faith estimates of turnover declines or manipulation of past BAS's were the rare exception. In these cases, the businesses were required to pay back any amounts they received. It is critical to distinguish between the number of entities chosen for review (high, as part of a comprehensive review program for this issue) and the number of entities which were identified as breaching eligibility rules and bore the appropriate consequences (low, less than 5%).
Some small businesses, which comprised the overwhelming majority of JobKeeper applications, were found to have made honest mistakes particularly during the initial stage of JobKeeper. In these cases, we have often determined not to seek repayments usually because the employers claimed it in good faith and passed it on to their employees.
Supporting this integrity work was the ATO's robust governance structures that ensured appropriate levels of oversight were maintained throughout the different stages of JobKeeper.
Multiple layers of review and senior oversight were established and evolved over time to ensure issues could be addressed in a timely and effective manner or be escalated across government as required. The ATO was also a member of the Treasury led JobKeeper Inter-Departmental Committee (IDC) from 23 April 2020 that was responsible for oversighting and guiding delivery of the JobKeeper Program.
Our approach was affirmed by the ANAO's independent review of the ATO's administration of the stimulus measures last year. The ANAO found the ATO had been effective in managing risks related to the rapid implementation of COVID-19 economic response measures.
In total, close to $89billion in JobKeeper payments were made to more than 1 million eligible businesses, which flowed onto more than 3.8 million individuals.
