Angus Taylor could learn from Fraser and Menzies

The welfare and tax policies proposed by Angus Taylor contrast with approaches once advocated by Liberal prime ministers Malcolm Fraser and Robert Menzies, writes Max Costello.

ON MAY 14, 2026, Federal Opposition Leader (and future Liberal Prime Minister) Angus Taylor He said a government he leads would do this denying social security benefits to non-citizens (age pension, unemployment payments, rental assistance, etc.), including permanent residents.

Taylor also flagged indexation of the income tax scale. But he can learn a lot from two real Liberal Prime Ministers.

Malcolm Fraser on the social welfare rights of citizens and non-citizens

Malcolm Fraser and his team knew very well that nation states cannot unilaterally determine all the rights of citizens (and non-citizens) – human rights; as most such rights had already been defined by the United Nations (UN) since its establishment in October 1945.

In a wide variety of human rights “instruments” such as conventions, treaties, and agreements, the rights of a country’s people and the obligations of that country’s government are set out in numbered “Articles.” An instrument comes into force once a country’s government “ratifies” it, thus making the country a “State Party” to it. A Clause in each document provides that the Party agrees to comply with its obligations.

In early 1976, Liberal Prime Minister Malcolm Fraser approved the UN’s agreement. International Covenant on Economic, Social and Cultural Rights (ICESCR), (see below) has committed Australia to making “social security” available to everyone, not just citizens. (Didn’t Angus Taylor know this?)

“Developing countries” are the only State Parties exempt from making certain provisions. ICESCR Rights of non-citizens: Article 2.3 Says they don’t have to provide it all ‘economic rights for non-citizens’. But all developing countries must implicitly provide full rights to everyone, including non-citizens. Such a right ‘Social security including social insurance’ (Article 9). Accordingly, Mr. Taylor’s announcement was as follows: ultra powers – beyond power, devoid of all authority.

But Article 9 has many friends. ICESCR There are so many Articles containing rights that no State Party can implement them all immediately; The Convention therefore permits and requires the gradual “realisation” (provision) of rights, in accordance with the “progressive realization” principle of Article 2.1.

Accordingly, Australian governments, which have had 50 years so far to achieve progressive delivery, should already have provided all the necessary measures. ICESCR The rights of everyone in Australia. But they didn’t. Worst example: Governments have not honored these awards since the 1980s Article 11The obligation to ensure that everyone has adequate food, clothing and shelter.

To state the obvious: most people (citizens or not) who are denied these rights will certainly need access to social welfare.

Article 11 states:

1. States Parties… recognize the right of everyone to an adequate standard of living, including adequate food, clothing and shelter for himself and his family, and to the continuous improvement of living conditions.

Accordingly Australia’s prosperity 2023: data insightsp. 91:

‘About 2.2 million Australians [some presumably citizens?] ‘At some point in their lives they have been left without a permanent place to live.’

Non-citizens need a visa to enter and stay in Australia. Some visa conditions deny access to certain visas ICESCR Rights despite government obligations to “everyone.” Most people denied such rights receive short-term bridging visas.

Depending on which type of bridging visa a non-citizen has, their application may be rejected. Article 11 rights, as well as some or even all of the following rights: work (Article 7); social security (Article 9); the highest attainable standard of physical and mental health—in the minimalist sense, Medicare (Article 12); and education (Article 13).

Non-citizens are deprived of both employment and social security rights (money); They may remain homeless, poor and hungry, or die.

The denial of rights should end with the legislation of a national Human Rights Bill, which not only declares all human rights instruments ratified by Australia to be part of Australian law, but also ensures that these rights are enforceable in court (in civil law). This would give everyone a “fair right.”

As for housing:

a major federal funding increase in the rate of public housing construction;

Some of the 1 million houses that were vacant on the night of the 2021 Census were advertised for rent and 7.4 million unused bedrooms — The August 2026 census is likely to find much higher figures; And

Changing planning laws to allow small, self-contained, portable, affordable homes to be built in large front or rear gardens.

Such actions can help anyone, even a newcomer, to have or find a safe place to live much quicker.

To be viable, tax indexation needs a steep, Bob Menzies-style progressive tax scale

It is good policy to index the federal income tax scale to avoid hidden tax increases through “grade creep”, but the only type of scale that makes this work is the one that the founder of the Liberal Party chose in 1950.

Liberal Leader after winning the 1949 Election Robert MenziesAfter becoming Prime Minister, he sensibly chose to maintain a highly progressive income tax scale via his Labor predecessor’s 29 tax brackets.

But at the same time, the top tier tax rate (75%) did not apply until incomes reached 18 times the average full-time male earnings, so the scale was fair. That’s the positive lesson for Angus Taylor.

Unfortunately (the negative lesson is) it did not “index” the Menzies scale; has steadily increased the brackets’ dollar range limits to accommodate earnings increases. Thus, as incomes rose in the 1950s and beyond, more and more taxpayers moved their earnings into higher brackets.

Undersecretariat of Treasury 1985 Draft Whitepaper Looking back at the Menzies era on tax reform, he noted that by 1984-85 the top marginal rate at the time had fallen to just 1.6 times the average full-time male earnings.

Such a “gradual shift” made the scale even more unfair, but at the same time it generated more and more income.

The current income tax scale (see table below) is not fair enough to be “indexable”: it is barely progressive (five brackets) and the top rate of 45% is equivalent to 1.7 times the average full-time male earnings ($111,685 in 2025).

Moreover, for a scale to be indexable, it must also increase income sufficiently to offset the complete absence of insidious income increases from group shifting.

Albanese’s Labor Government may well propose “better indexing”. How? By enacting a “Menzian” (very progressive and fair) tax scale.

But at the same time, this scale should not only give low- and lower-middle-income earners (the majority of income taxpayers) a set of reduced tax rates, so they allocate more of their own income to cover cost-of-living increases (vote winners), but also give higher earners a set of tax rate increases they can afford and are necessary to maintain an adequate income stream.

There is now a widening and growing gap between rich and poor. Australian Financial Review ‘Rich List’ Recently announced for 2026:

The top 178 rankings on the ‘Rich List’ are estimated to carry an estimated wealth of $1 billion and above. The total wealth of all 200 participants… now stands at $707.25 billion; ‘That’s a step up from last year’s $667.8 billion and a huge jump from the $197.3 billion total just 10 years ago.’

Accordingly, the highest rate, 75%, should not be cut until revenue reaches tens of billions. In explaining such a scale, it should be explained how and when indexing will be done. And a unique promise would be made: “Through indexation, the scale of my government will be permanently fair.”

The rationality, equality and farsightedness of such a scale may confuse the Opposition.

Max Costello LLM is a retired WorkSafe Victoria prosecuting lawyer and lecturer in Employment Law at RMIT University, Melbourne. He co-authored submissions to Senate committees on the health and safety of refugees and is the author of:Offshore Crimes‘.

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