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Classifying JobKeeper payments in ABS Economic Statistics
In accordance with the 2008 System of National Accounts (SNA08) and additional international guidance from the International Monetary Fund (IMF) and International Labour Organisation (ILO), the Australian Bureau of Statistics considered two options for classifying and treating JobKeeper payments in ABS economic accounts:
1. as an other subsidies on production (SNA08 7.106)
2. as a social benefit (SNA08, 8.17).
Starting from a production perspective, production is “an activity, carried out under the responsibility, control and management of an institutional unit, that uses inputs of labour, capital, and goods and services to produce outputs of goods and services” (SNA08, para 6.2).
The labour element of production is supplied by employees or self-employed persons (SNA08, 7.29).
Employed persons are involved in production and part of the labour force, which 'consists of those who are actively prepared to make their labour available during any particular reference period for producing goods and services within the production boundary' (SNA08, 19.17).
Some employers receiving JobKeeper payments will be actively involved in production and some will not. When an employer continues to pay someone, even if working zero hours, they are regarded as having a formal job attachment and employed as receiving a wage or salary (SNA08, 19.23).
This then leads to the decision to treat JobKeeper payments as an ‘other subsidies on production’. It should be noted that this will be kept under review as further information becomes available on JobKeeper payments.
'Other subsidies on production' consist of subsidies except subsidies on products that resident enterprises may receive as a consequence of engaging in production. (a) subsidies on payroll or workforce: these consist of subsidies payable on the total wage or salary bill, or total work force, or on the employment of particular types of persons such as physically handicapped persons or persons who have been unemployed for long periods (SNA08, 7.106).
Employers in receipt of JobKeeper will be receiving an ‘other subsidy on production’. This will be passed onto eligible employees as a salary or wage.
Salaries or wages will continue to be classified as either compensation of employees or gross mixed income for e.g. self-employed persons. These payments demonstrate a formal job attachment.
In contrast, social benefits are 'received by household intended to provide for the needs that arise from certain events or circumstances', for example, sickness, unemployment, retirement, housing, education or family circumstances. Social benefits may be provided under social insurance schemes or by social assistance (SNA08, 8.17).
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