With Australia’s most vulnerable grappling under cost-of-living pressures, raising pension and income support payments by $100 a week has strong justification. This would deliver $26 billion yearly to five million Australians, from Age Pensioners to JobSeeker recipients, alleviating financial burdens for those struggling with essentials and potentially boosting the economy through increased grassroots spending.
But how to fund such a massive outlay without breaking the budget? By targeting tax loopholes that have long benefited the wealthy – superannuation concessions, negative gearing, family trusts, and franking credit refunds – this plan seeks to redirect billions from the top to the bottom, offering a fairer economic balance in the wake of the Albanese government’s 2025 election landslide.
At what cost?
To estimate the cost, we need to determine how many Australians are receiving pensions or income support payments and then calculate the annual cost of a $100 weekly increase per person. Pensioners and income support recipients in Australia include those on the Age Pension, Disability Support Pension, Carer Payment, JobSeeker Payment, Parenting Payment, and other similar payments. A March 2025 budget statement notes that “more than five million Australians” receive social security payments. A $100 weekly increase per person translates to $5,200 per year, so for 5 million recipients, the total annual cost is $26 billion.
To fund this $26 billion annual increase, we need to identify tax concessions or loopholes exploited by the wealthy that could be redirected. Superannuation tax concessions cost around $60 billion this financial year, with the top 20% of income earners receiving about 60% of the benefit. Capping concessional contributions at $20,000 (from $30,000) and taxing earnings in retirement phase for balances over $3 million at 15% could save $18-23 billion annually.
Negative gearing and the capital gains tax (CGT) discount cost $20 billion annually, with the top 10% of income earners claiming 70% of negative gearing benefits. Abolishing negative gearing for future investments and taxing capital gains at the full marginal rate could save $15–18 billion. Family trusts cost $4.2 billion in forgone revenue, and taxing trust distributions at a flat 45% for incomes over $190,000 could raise $3–4 billion.
Refunds of excess franking credits cost $5.3 billion, and capping them at $10,000 per person annually could save $2–3 billion. Together, these reforms could raise $38-48 billion annually, more than covering the $26 billion needed. (What will we do with all that money left over? Here’s an idea: add another $50 a week to pensioners and income support recipients.)
Removing negative gearing and CGT discounts could cool the property market, improving housing affordability for younger Australians, while super reforms might discourage excessive saving in super but still preserve benefits for most. These reforms target the top 10% of income earners (over $190,000), who’ve benefited from recent tax cuts like the $5,065 annual cut for those earning over $190,000 in the 2025 budget, while pensioners have seen modest increases (e.g., $3.10 fortnightly for JobSeeker in March 2025). Wealthy lobby groups will resist, but with the Coalition in disarray after their election loss, Labor’s 87-seat majority might push these reforms through.
Summarising
Cost of Increase: A $100 weekly increase for all pensioners and income support recipients (approximately 5 million Australians) would cost $26 billion annually.
Funding Options: This could be funded by reforming tax concessions for the wealthy, including:
- Superannuation tax concessions reform: $18-23 billion.
- Abolishing negative gearing and the CGT discount: $15–18 billion.
- Taxing trust distributions at a flat rate: $3–4 billion.
- Capping franking credit refunds: $2–3 billion. These measures could raise $30–40 billion annually, covering the cost and potentially leaving surplus for other needs.
This approach prioritises fairness by redirecting benefits from the wealthiest Australians to the most vulnerable, addressing systemic inequities in the tax system.
So many winners
With an extra $100 per week, families, especially those on payments like Parenting Payment Single, would likely prioritise essentials like kids’ clothing. Low-income households often allocate about 5% of their budget to clothing, so with an extra $5,200 per year, a family might spend $260 on clothing, translating to $1.3 billion nationwide if all 5 million recipients follow suit (no pun intended). This injection would be a lifeline for retailers, especially small businesses in regional areas where JobSeeker recipients are hit hardest. Retail workers might get more hours, suppliers could see demand rise, and logistics companies might feel the bump. With a multiplier effect of $1.50–$2 per dollar spent, that’s $2–$2.6 billion added to the economy from kids’ clothing alone.
The idea of a $100 weekly boost for Australia’s poorest offers a glimmer of hope amid rising living costs. By redirecting $26 billion from tax loopholes that have long favoured the wealthy, this plan not only puts money back into the hands of those who need it most but also promises to revitalise the economy through increased spending on essentials. It’s a bold step toward fairness, shifting resources from the top to the bottom at a time when the Albanese government holds the reins firmly. While challenges like economic adjustments and political resistance loom, the potential to lift millions out of financial strain – and give local retailers a much-needed boost – makes this proposal worth fighting for.
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As a pensioner, this would lift me well above the poverty level; no way to get it from a neoliberal government though.
“To fund this $26 billion annual increase, we need to..” scrap AUKUS.
“By redirecting $26 billion from tax loopholes that have long favoured the wealthy, this plan not only puts money back into the hands of those who need it most but also promises to revitalise the economy through increased spending on essentials.”
Exactly.
There is no evidence that tax cuts for the wealthy go back into the economy in total.
Much of it is invested in speculative financial instruments.
Because they already have all they need.
But every extra cent going to a pensioner is immediately re-circulated.
Agree and there is no need for extra or special taxes, but more compliance of existing revenues; but our RW MSM and influencer will focus on the former and avoid the latter &/or blame ‘immigrants’.
Related to both the latter, whether refugees, international students or new permanent migrants, our media focuses on and blames ‘foreigners’…..
However, no one bats an eyelid at the untaxed or diverted revenues by subsidiaries of ‘foreign’ MNCs, especially fossil fuels, mining, BigTech and digital services; not to forget ‘wedge’ left by Morrison & Johnson ie. AUKUS when no one understands what it’s supposed to achieve?
Take budget monies away from better spends?
A nice suggestions by Micheal for the Haves , the Have nots and the in betweens ,
Wealth distrubution and the checks and balances are way out of whack with different Political Parties from state and federal implementing their rorting schemes and havens , These Rorts needs to be more exposed and more explained , Micheal may be rattling some medium to very wealthy people .But lets face it ,They have been living in luxury and in their comfort zones ,while the poorer demograpic just barely scrap through on a day to day Basis ,,….. INequality and social income inbalances ,The system is rigged towards the rich and the Middle ,Even blind freddy can see it !!!!….
Its time to address Poverty, The last time they did that was in 2002 /2003 , a short while later a Book came out from the SENATE – Called , (SENATE enquiry into POVERTY 2002/ 2003 ) with over 70 recommendations for all different classifications of welfare recipients , But sadly , its still gaining Cob webs in the Parliment Library going un- Heeded !.. whilst Poverty is left to fester ,,………….!
MY suggestion would Be AXE – Work for the Mole – Dole and replace it with – JOB CREATiON INVESTMENT – Work Force Mulitpler Employment Schemes , Run similar to the Old RED SCHEME ,but much more intensive and Long term focused – If 700,000 Un-employed people were suddenly offered a full-time at the Minimum wage or better, The taxes would be $150 -$200 a week from their full wage,, this could raise about 1 billion dollars a week in revenue and 4 billion a month and around 40 billion a year ,,All that by Investing in the Unemployed !!! , as it stands ,people on Work for the Dole ,do not pay any Taxes ..so thats a huge waste of tax payers money just by running the broken miserable wretch of a thing with no taxes in income returned!!!!!..( The Punitive Perpertrators of Poverty – keep recycling this misery on the Poor with NO Vision for a better tommorrow for this DEMOGRAPHIC !!! )
BY introducing JoB CREATION INVESTMENT programmes for all welfare people it would be boosting the morale and dignity and releasing Taxes paid from Income ,,A win win situation for the Unemployed and the ECONOMY !! ( A JOB CREATION INVESTMENT- WORK FORCE MULTIPLER EMPlOYMENT SCHEME on a Permanent basis is long over Due from the Miserable train wreck that is WORK FOR THE MOLE – Fair go for ALL , Not just Some which is in synchronisation with Micheals suggestions ABOVE …