Australian and New Zealand businesses pressured over misuse of COVID-19 subsidies
Some businesses in Australia and New Zealand are facing mounting pressures from investors and politicians for handing out multimillion-dollar bonuses and dividends after receiving COVID-19 subsidies from their respective governments.
Premier Investments – an Australian retail group that owns the Smiggle and Peter Alexander brands – saw profits rising by 29% to A$137 million (US$102.2 million) in the 2020 financial year.
However, the business accepted almost A$70 million (US$52.2 million) in wage subsidies from Australia, New Zealand and the UK, reported the Financial Times. The group has also reportedly withheld rental payments to landlords.
Andrew Leigh, MP for Australia’s opposition Labor party has called on the business to return the subsidies.
Over in New Zealand, more than 17,000 businesses in New Zealand have voluntarily repaid NZ$524 million (US$369.56 million) in subsidies following a recent call by the country’s Prime Minister Jacinda Ardern “to do the right thing” if their company performance was better than expected.
New Zealand has handed out more than NZ$14 billion (US$9.87 billion) in wage subsidies so far, while Australia paid out A$70 billion (US$52.2 billion) as at September. Companies in both countries are eligible for subsidies to help them pay staff wages.