Josh Frydenberg says payments of $75 for singles and $125 for couples will go to nearly 4 million welfare recipients

This article is more than 1 year old

This article is more than 1 year old

The Coalition will offer one-off payments to nearly 4 million welfare recipients in Tuesday’s budget, a cash splash of $285m purportedly to help cover energy bills.

The payments of $75 for singles and $125 for couples will go to 2.4 million pensioners, 744,000 disability pensioners, 280,000 carers, 242,000 single parents and 225,000 veterans and their dependents – provided legislation is passed by 1 July.

The Australian Council of Social Service has blasted the Coalition for excluding people on the unemployment benefit, Newstart, from the one-off payment while Bill Shorten labelled it an “election con”.

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The treasurer, Josh Frydenberg, announced the one-off “energy assistance payment” on Sunday, as Labor warned the budget would be a “highly political document” and promised, if elected, it would reset after the election with a fresh mini-budget.

The shadow treasurer, Chris Bowen, told the ABC’s Insiders program that Labor would deliver an economic statement between July and September to “reset the economic settings” and update forecasts before return to the normal budget cycle from May 2020.

With Tuesday’s budget expected to show a return to surplus in 2019-20, the Morrison government is keen to use the economic statement as a springboard for re-election. It is expected to announce tax cuts for low and middle-income earners and an infrastructure package to bolster its stocks in key marginal seats.

Facebook Twitter Pinterest The 2019 budget papers roll off the presses in Canberra on Sunday in preparation for Tuesday’s budget. Photograph: Mike Bowers/The Guardian

Frydenberg told Channel Nine’s Today program the budget would “ease the cost of living pressure, fund infrastructure that is going to bust congestion in our cities and unlock the potential of our regions and it is going to guarantee funding for the essential services of hospitals, schools, drugs on the PBS, [and] disability support”.

The treasurer did not rule out further income tax cuts, promising taxes would “always be lower under the Coalition”, despite the fact Labor plans to double the income tax cut for 10 million Australians.

The finance minister, Mathias Cormann, told Sky News the energy payment “will give cost of living pressure relief to pensioners and eligible welfare recipients and it will help them meet the cost of their power bills”.

The Acoss chief executive, Cassandra Goldie, accused the Morrison government of “ignoring the people who are doing it the hardest” on Newstart.

“This one-off payment excludes people on the lowest incomes and pales in comparison to the ongoing benefits to be reaped by those on high incomes from the Morrison government’s existing high-end tax cuts worth billions.”

Shorten told reporters in Melbourne that the payment – worth $1.45 a week – was “better than nothing, but it’s not an energy policy … it’s an election con”.

News Corp reported the proposal was first put forward under the former prime minister Malcolm Turnbull and was originally going to be part of his plans to reduce power prices before he was dumped. It repeats a one-off payment made in 2018 under a deal with Nick Xenophon.

In the 2018 budget, the Coalition attempted to cut an energy supplement for new welfare recipients worth $365 a year for singles and $550 for couples but was forced to back down when the measure was blocked by the Senate.

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A spokesperson for the social services minister, Paul Fletcher, said: “The one-off payment is limited to those who don’t have the opportunity to work or earn additional income.”

Cormann defended the Coalition’s record on power prices, arguing they were “much lower than they would’ve been if we hadn’t abolished Labor’s carbon tax” and lower than they would be under Bill Shorten’s 45% emissions reduction target in the electricity sector.

Cormann pointed to the Coalition’s efforts to improve power prices through standard default pricing and to crack down on abuse of market power, a measure contained in the “big stick” legislation shelved until after the election.

Bowen said although the budget was expected to return to surplus, the government had not taken “tough decisions” to improve the bottom line but rather ridden “a wave of very good international economic circumstances”.

On income tax cuts, the shadow treasurer said the government “has a lot of catching up to do” to improve on Labor’s offering.

“We have 75% bigger tax cuts than the government earned for every Australian who earns less than $125,000 a year – that’s 10 million Australians,” he said.

Bowen warned that on Tuesday the Coalition would deliver “a campaign launch, not a budget”. He said history indicated the government would have to downgrade its heroic wage growth assumptions, because he said wage growth was now at “record lows”.

On Saturday the government moved to lance another budgetary boil, announcing it had approved price rises for disability services, allowing $850 million more to be spent from the national disability insurance scheme in 2019-20.

The Australian reported the government will push ahead with plans to shift unspent funds from the national disability insurance agency to the social services department, an accounting trick to allow it to boast of a larger surplus.