Media Release By The Federal Government On Estimated Balance Payment For 2009/2010
25 February 2011
Late last week there was a Media Press Release in relation to the estimated payment amount for 2010 EMDG payments which are to be made in June 2011. This is what we call the second tranche payment.
If your grant entitlement is greater than $27,500 for 2010 (as many of you know) you get paid via a spilt payment system which is simply a reflection of the EMDG money being capped at $150M. Because it is a rules based scheme all eligible clients are to be paid a grant & therefore some rationing methodology needs to apply.
For 2010 applications the amount of money for EMDG actually was reduced by the Rudd/Gillard Government from $200M in the past, as part of the 2010 election cycle last year we were unable to get Labor to match the Coalition’s promises to correctly fund EMDG at $200M. Fiscal responsibility and the need to balance the budget was the given reasons at that time and they remain the same now. It’s just the same spin.
In short the estimated second tranche payment to be paid in June will be in the range of 45 to 65 cents in the dollar of what it should be. This is actually as expected and predicted by us but a little disappointing to say the least. Clients should work on 55 cents as a guide.
If you were to get a $100K grant payment your total payment will be reduced to about $64K a reduction of some 36% of what you actually spent.
Ms Elliot also stated that the Government commitment to return the budget to surplus the total funding of the scheme has returned to its historical average. More Spin, it has been cut by $50m from the previous year, it is as simple as that.
We will continue to lobby directly to them.
2011 year grants paid in 2012 will be paid in full. This is not because any new money but the recent changes in eligibility of the scheme, the high exchange rate, lingering effects of the GFC and recent political unrest and natural disasters means demand for the scheme will reduce which will mean that the need to ration funds will dissipate.