We asked federal MPs if they could live on Newstart

A Liberal MP sparked outrage by claiming she could live on $40 a day.

A Liberal MP sparked outrage by claiming she could live on $40 a day.

Turnbull government MPs have refused to say whether they could live on $40 a day – about the current rate of Newstart – as the nation debates welfare payments ahead of next week’s budget.

Liberal MP Julia Banks was accused of being out of touch after she claimed she could on live on $40 a day “knowing that the government is supporting me … looking for employment”.

On Thursday, as the Business Council of Australia (BCA) rejected Ms Banks’ claim by arguing the payment should be increased, The New Daily surveyed all lower house MPs on the current rate of Newstart.

Politicians were asked whether they believed they could live on $40 a day, whether the payment should be increased, and if they had ever relied on unemployment benefits to live.

Of the 150 lower house MPs, only 22 MPs responded, including three crossbench MPs and 19 from Labor. None of the 76 Coalition MPs responded.

All MPs who responded said they could not live on $40 a day and all but one argued the payment should be increased.

Some Opposition MPs did not answer whether they had ever lived on Newstart and a few replied with identical responses.

Opposition shadow ministers and backbenchers pointed to the need for a “root and branch” review of all welfare payments first, which Opposition Leader Bill Shorten announced on Wednesday.

Four MPs said they had received welfare payments at some point in their life before they were a politician.

Labor MP Anne Aly, who backed an increase, said she found herself on the single parenting payment after a violent marriage and had “raised two young children on $400 a fortnight”.

“It was very difficult to make ends meet and there is nothing more heartbreaking than knowing that you cannot provide for your children and nothing more humiliating than having to halve your shopping at the counter because you can’t afford it,” she told The New Daily.

Greens MP Adam Bandt, who wants the payment increased by $70 a week, said he lived on the dole for about a year after finishing his law degree and moving to Melbourne.

“It helped me survive and make ends meet, but that was almost 20 years ago when the government was still treating unemployed people like human beings,” he told The New Daily.

Mr Bandt said he tried to live on Newstart for a week in 2013 after Labor’s then Families Minister Jenny Macklin said she could live on $35 a day.

“By the end of the week I was $80 in debt,” he said.

Ms Macklin said on Thursday: “No, I don’t believe that I could live on $40 a day.”

Tasmanian Labor MP Ross Hart said he thought it was “demeaning” to debate “whether any of us could live on Newstart at the current rate of $40 per day”.

“The fact is, those currently on the Newstart allowance have no choice as to whether they could live on the allowance,” he said.

The anecdotal evidence was that most do not manage on the allowance, he said.

Independent MP Andrew Wilkie said politicians who claimed they could live on Newstart were “conveniently ignoring the fact that they’ve already paid their mortgage and private health insurance”.

Rebekha Sharkie of the Centre Alliance – formerly Nick Xenophon Team – did not say the payment was too low, but backed an inquiry into Newstart.

The rate of Newstart has not been increased in real terms under Labor or the Coalition for more than two decades, with the last increase coming in 1994.

Currently, a single person receives $545.80 a fortnight (about $39 a day) while someone with dependent children receives about $3 more per day at $590.40.

The base salary for an MP of almost $200,000 is equivalent to $548 a day, or 14 times the rate of Newstart. Politicians also receive a $285 per day travel allowance when they are in Canberra.

Asked on Thursday if he could live on $40 a day, Finance Minister Mathias Cormann said only that the payment was about “getting back to work as soon as possible”.

“Many people move on and off Newstart as a transitional measure. Many people on Newstart also receive income from other sources,” he said.

“The proposition that somehow Newstart allowance should be an ongoing income on an ongoing basis, that is not right.”

Ms Banks, the Member for Chisholm in Melbourne’s eastern suburbs, has six properties in an investment portfolio shared with her husband and brother, her register of interests shows.

BCA chief executive Jennifer Westacott on Thursday backed calls from welfare groups and prominent Deloitte economist Chris Richardson for the payment to be increased.

“You cannot live on $39 a day,” Ms Westacott told ABC radio.

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