Liberal MP locks horns over corporate tax cuts and concessions for big banks on budget eve edition of ABC’s Q&A

This article is more than 2 years old

This article is more than 2 years old

The federal Liberal MP Tim Wilson has said “you can live on Newstart”, the government unemployment allowance which has not been increased in real terms since 1994, but acknowledged it’s not easy.

Wilson made the comment as a panellist on the budget-eve edition of the ABC’s Q&A program on Monday night, echoing comments from the Liberal MP Julia Banks last week that she could live on $40 a day, “knowing that the government is supporting me with Newstart looking for employment”.

“People on Newstart often get other support measures and other concessions available to them, some from the state government and some from the federal government,” Wilson said. “The social safety net is not supposed to be a hammock where people get accommodated to it.”

While Wilson said it was possible to live on Newstart, he conceded it would be difficult and was not “an easy lifestyle”, and that people were not supposed to be on it long term.

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For a single person without a dependent the means-tested allowance is worth an average $38.98 per day, equating to about 40% of the minimum wage. But Wilson said increasing the allowance in the budget would mean taking money from somewhere else.

Fellow panellist, the GetUp! co-founder Jeremy Heimans, said the government’s proposed $65bn in corporate tax cuts for big companies would be “a fantastic place to take the money”, a comment that was met with audience applause.

ABC Q&A (@QandA) When will the Newstart rate be lifted to support people who are out of work? @TimWilsonMP @jeremyheimans & @LeylaAcaroglu respond #QandA pic.twitter.com/MzMYKlVAzp

The Labor MP Linda Burney said she could not live on $40 per day.

“Forty dollars a day for families, when you have to cover all the utilities, mostly rent, and just buying food is almost impossible,” she said. “People who are on a social service payment should not be seen as bludgers and dole bludgers and cheats. They should be seen as people that need the support of government.”

Liberal MP Julia Banks' claim she could live on $40 a day rebutted by Business Council Read more

Labor has not committed to increase the allowance, saying it would conduct a review of the overall social security system if elected. The Australian Council of Social Service and Deloitte Access Economics are among the groups to have recommended an increase to the Newstart allowance.

The social scientist and entrepreneur Dr Leyla Acaroglu said moving people off Newstart was about more than just creating jobs.

“There has to be the available skill set,” she said. “A lot of people end up on Newstart not because they don’t have the job availability but it’s because [they] don’t have the skills a lot of the time to meet these types of jobs your government is putting in place.”

The banking royal commission was also a topic raised to the panel. “We’ve seen the NAB make billions in profits and sacking thousands of workers at the same time,” an audience member said. “Why should Australians further subsidise the big banks and other big businesses through billions in tax cuts?”

Quiz: how much do you know about surviving on Newstart? Read more

But Wilson said tax cuts were not subsidies and that banks would not be be getting any special treatment through the corporate tax cuts.

“The reality is that tax applies to everybody equally,” Wilson said. “You have a company tax structure that covers all companies. It doesn’t discriminate.”

ABC Q&A (@QandA) Why should Australians further subsidise the big banks with tax cuts? @TimWilsonMP & @LindaBurneyMP respond #QandA pic.twitter.com/hpRRIZz7FT

Asked why it was not possible to frame legislation so that tax cuts weren’t applied to the banks, Wilson said the government “could technically do that”.

“But would we apply different rates of tax on individuals based on whether we or what they’ve done in the past? It’s not an appropriate way to design tax.”



Heimans said people were “deeply sceptical” of institutions like banks for good reason and that “people are going to turn away from the big banks and figure out ways to do these things peer to peer”.

“Real wages are stagnant, while corporate profits go up 20% a year, and we’re stuck having the debate about business tax cuts,” he said. “We can do better as a country.”