Mr Newman told the Committee for the Economic Development of Australia that wages rates were "very high" by international standards and that corporate welfare such as support for the car industry was like "giving aspirin to the terminally ill".

The Prime Minister's business adviser also called for a return of WorkChoices-style industrial relations reform and said Labor's commitments to "better schools" funding and a national disability insurance scheme – both policies that the Coalition supported – were unsustainable.

Asked whether he agreed that wages were too high, Mr Pyne told ABC radio that Mr Newman's job was to "give frank and fearless advice to the government" but it did not mean that the government would always agree with him.

"That's what it is, it's advice," Mr Pyne said. "It doesn't mean that the government will always take it . . . He's entitled to his opinions."

Mr Pyne said that he did not believe it was "a perfectly sustainable position to argue that people's wages are too high".