Catherine King says it’s too early to talk about ‘economically irresponsible’ measures that come in 2024-25

The Labor frontbencher Catherine King says the party remains “concerned” about the cost of the third stage of the tax cut package, but says it is too early to commit to repealing the measure.

King, who took over the infrastructure portfolio from Anthony Albanese following the 18 May election, defended Labor’s decision to back the full $158bn tax cut package despite holding concerns it was “economically irresponsible”.

Labor sided with the Coalition when the tax package came to a vote in the Senate on Thursday after its bid to amend the legislation to hive off the third stage was unsuccessful.

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“We thought it was important to make sure that we got money into people’s pocket, but clearly we remain concerned about stage three, particularly given five years from now we do not know what the economic circumstances are going to be,” King told the ABC’s Insiders program.

“The government’s claiming that somehow or another they’re magically going to find $9bn in the year that they start to kick in, and not cut any services. Now, that’s just a nonsense.”

Labor holds concerns that about a third of the $95bn cost over the decade of the third stage would flow to those earning more than $180,000, and had been divided internally over whether to block the entire package when presented with the “all or nothing” option.

After the passage of the bill through the parliament, the first stage that provides a payment of up to $1,080 for low- and middle-income earners will begin flowing from next week.

When asked why Labor would not commit immediately to repeal the third stage if it won the next election – as it had done in the previous parliament when it opposed earlier tax cuts – King said it was “too early to talk about it”.

“These are tax cuts that come in 2024-25 – we don’t know what the economy will be doing, we don’t know what the fiscal circumstances will be,” she said.

“The Liberals will have policies at the next election, we’ll have policies at the next election … and we’re three years away from an election.”

Amid slowing economic circumstances, King said the government needed to focus urgently on bringing forward “shovel-ready” infrastructure projects, pointing to calls from the Reserve Bank governor, Philip Lowe, for more fiscal stimulus.

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“There are projects … (that) are shovel-ready, which should be invested in now and the government should bring those forward,” King said.

“That’s important for productivity and it’s also important for making sure that we get some stimulus into the economy now as well.”

King also pressured the government over the low amount of the Newstart payment, which has not been increased since 1994 in real terms, saying that she did not believe there was a politician in the country who thought the current rate was a “liveable income”.

“It simply is not. We obviously went to the election saying that we wanted to review it, (but) we lost the election,” she said.

“We’re three years away again from another election and being able to do something about it.”