Grants program saga

GOVERNMENT policy is always a blunt instrument — a reality which became crystal clear to Australia’s travel agent community in early December when details of the highly anticipated COVID-19 Consumer Travel Support Program were announced. Initially greeted with elation, as the outcome of months of desperate grass-roots lobbying, the acclamation soon turned to angst as advocates highlighted a range of issues around how the scheme was being implemented.

To the Government’s credit, the rollout of the scheme was at light speed, with a full submission process put in place within two weeks of the $128 million program’s announcement. But that was when the rubber hit the road, as it became clear that wide disparities in how the industry lodged its Business Activity Statements (BAS) would result in similar divergences in the amounts paid out under the scheme.

In order to simplify access to the money, the tiered program was based on the “Total Sales” figure which is included in an entry labelled G1 on BAS returns. Unfortunately — and understandably — some in the industry have always included their gross TTV here — while others have apparently correctly instead recorded their actual agency revenue.

And because this figure is basically a statistical collection by the Government, rather than actually impacting tax payable, others haven’t bothered to put anything in the G1 box, meaning their payments under the grants scheme equated to nothing at all.

The issues meant that a typical travel agency, turning over say $4.5 million in total sales (i.e. commission revenue of $450,000 based on average industry returns) might receive either $100,000, or $11,000, or zero. Suggestions that the industry should be pleased to be getting anything at all were derided by many travel agents, and eventually even AFTA agreed that the program was “deeply flawed”.

In the early stages of the program’s rollout there was much social media chatter and even advice from some head offices about whether it was possible to retrospectively amend this crucial G1 figure — and those who managed to do it quickly and lodge their grant applications before Christmas will have received much more than was intended under the scheme. However as soon as bureaucrats returned to work after the holiday break, an amendment to the program swiftly closed this loophole — presumably because they realised that the $128 million wouldn’t stretch nearly as far as they had hoped.

Compounding matters was a planned IT upgrade on a key part of the grants application portal for almost two weeks over the holiday period — and despite protestations from AFTA and other lobbyists to authorities high and low, it now appears extremely unlikely that anything will change. The hamfisted confusion has led to finger-pointing left, right and centre, but it now appears it may be best for the industry to move on to pushing for an extension to the JobKeeper program as the next front for influencing the Government.

 

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