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Centrelink payments won’t rise as part of negotations to pass stage three tax cut changes, PM Anthony Albanese says

Anthony Albanese has ruled out an increase to welfare payments in exchange for crossbench support to ensure the passage of the government’s proposed changes to stage three tax cuts.

Under a reworked scheme unveiled by the prime minister on Thursday, anyone earning less than $150,000 will receive a larger tax cut while those earning more are in line for a smaller benefit than previously promised.

The changes to the original stage three tax cuts that were first implemented by the coalition will need to pass parliament before they are due to come into effect in July, with the government needing the support of the Greens and crossbench.

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The prime minister has been criticised for breaking his original tax promise to higher income earners but said he stood by the proposed package which would deliver a tax cut to “every Australian”.

“We know that low and middle-income Australians are under financial pressure (and) it’s a responsibility of the government to do something about it,” he told reporters in Orange on Saturday.

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“That’s why the government has changed our decision … because of the persistence of inflation.

“We’re determined to do something about it, we have made the right decision for the right reasons.”

But Albanese said the government would not be renegotiating welfare payment rates in exchange for parliamentary support for the changes.

“What we have targeted here is middle Australia who are doing it tough, those middle-class working families who are doing it tough because of rising inflation and cost of living, this program is aimed directly and squarely at them,” he said.

“Every budget we give consideration (to welfare rates), but what we’re not going to be doing here is trading.”

The government is expected to introduce legislation for the tax changes when parliament returns for the year in the first week of February.

Crossbench support needed

Albanese indicated he may be willing to negotiate with the Senate crossbench to ensure the passage of the government’s changes to stage three tax cuts.

Under the reworked scheme unveiled by the prime minister on Thursday, anyone earning less than $150,000 will receive a larger tax cut while those earning more are in line for a smaller benefit than earlier promised.

The changes to the original stage three tax cuts that were first implemented by the coalition will need to pass parliament before they are due to come into effect in July, with the government needing the support of the Greens and crossbench.

Greens leader Adam Bandt has called for further changes to the tax cuts to ensure low and middle-income earners get greater financial relief.

Anthony Albanese has ruled out an increase to welfare payments in exchange for crossbench support of stage three tax cuts. Credit: AAP

Albanese said the changes to stage three were sensible, but he remained open to negotiations.

“It has the same costs across the forward estimates, but it is a better package being put forward,” he told reporters in Canberra on Friday.

“We’ll wait and see. We’ll wait for them to go through their mechanisms as well. We’ll talk with all of the crossbenchers.”

Bandt said despite the changes to stage three, they were not adequate to provide enough cost-of-living relief.

“We now have the chance … to really tackle inequality and the cost-of-living and housing crisis in this country,” he told ABC Radio on Friday.

“If we’re going to change the legislation, then we should do it in a way that really supports low and middle-income earners.”

Opposition Leader Peter Dutton has heavily criticised the tax changes, challenging the prime minister to call an early election on the issue.

However, the coalition has not indicated whether it would repeal the changes if it became the next government.

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