Australians are furious at this company, which gave its CEO a $2.5 million bonus with one hand, while accepting JobKeeper with the other.
Australians are furious at this company, which gave its CEO a $2.5 million bonus with one hand, while accepting JobKeeper with the other.

CEO pockets $2.5m while taking JobKeeper

Some of Australia's most popular retailers are being urged to pay back millions of dollars in JobKeeper pocketed amid bumper trading, while Nick Scali "hasn't gone far enough", a federal MP says.

The high-end furniture retailer earlier this week caved to public pressure and handed back $3.555m in wage subsidies after revealing how much it pocketed during the first half of 2020-21 while enjoying huge earnings growth.

Reporting a 99.5 per cent surge in underlying net profit last week, the company described the half year as an "exceptional" trading period due to "shifting consumer spending patterns" towards items for the home during the pandemic.

Nick Scali also increased the interim dividend payable to shareholders to 40 cents, up from 25 cents previously.

Opposition assistant treasury spokesman Andrew Leigh said the cashed-up retailer should go further and pay back the $3.915m in wage subsidies it received before June 30.

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"Nick Scali has gone halfway there to doing the right thing," Mr Leigh told NCA NewsWire.

"Consciences don't come in halves, and I think the right thing to do by the Australian community is for Nick Scali to hand back all of the JobKeeper money they received."

A spokeswoman for chief executive Anthony Scali declined to comment.

Mr Leigh said he received daily calls and emails from taxpayers angry about companies keeping the cash despite bumper results - particularly the retail sector, which fared surprisingly well as Australians poured cash they would otherwise have spent on travel and going out on shopping.

"They're (taxpayers) doing it tough and don't understand why the government wants to shovel cash to executive bonuses," he said.

"The one that really frustrates people is Premier Investments."

The group owns popular fashion brands including Just Jeans, Smiggle, Peter Alexander, Portmans and Jay Jays and has enjoyed record first-half earnings, partly due to a massive move to online shopping.

Solomon Lew’s Premier Investments is being urged to pay back JobKeeper.
Solomon Lew’s Premier Investments is being urged to pay back JobKeeper.

"They paid a $2.5m bonus to their CEO (Mark McInnes) - more than most Australians earn in a lifetime. They paid out a massive dividend, a third of which goes to their biggest shareholder, the billionaire Solomon Lew," Mr Leigh said.

"And they've seen their best ever profit year. Why Premier Investments needs government subsidies is beyond me.

"It really is Robin Hood in reverse."

Premier Investments was sought for comment.

The group said in its annual report it was eligible for a range of global government subsidy programs across seven countries, but in Australia, the profit loss in Victoria during the second wave store closures more than offset the support and it was not eligible to receive "JobKeeper 2" after September.

"The funds that the group received were used to support standing up its employees as stores gradually reopened under COVID-19-safe plans. This ensured that the group was able to fulfil the government's objectives of keeping people in jobs and connected to their employees amid a global pandemic," it said in the report.

Many retailers did far better than expected after the pandemic struck, as consumers went on a shopping spree, unable to travel or dine out.
Many retailers did far better than expected after the pandemic struck, as consumers went on a shopping spree, unable to travel or dine out.

Both Nick Scali and Premier Investments have also secured COVID-19 rent concessions from landlords.

Mr Leigh also took aim at the Harvey Norman franchise, which has had such roaring success during the health crisis it twice updated the Australian Securities Exchange with unaudited first-half earnings and looks set for a record result, expected to be confirmed late this month.

"Harvey Norman should have a look at repaying … their best ever profit year," he said.

The franchisor was sought for comment.

Mr Leigh congratulated Toyota, Iluka Resources and Super Retail Group, which owns brands including Supercheap Auto, BCF and Rebel Sport, for paying back JobKeeper.

He also said he had asked Treasurer Josh Frydenberg for an inquiry into the scheme, saying there was not enough transparency around it, particularly for private and overseas companies.

But he's not optimistic.

"Standing between the Liberals and a billionaire is a bad place to be," he said.

Mr Leigh's calls come as the decimated aviation sector repeatedly pleas for JobKeeper to be extended beyond March.

Originally published as CEO pockets $2.5m while taking JobKeeper


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