How much do you need to earn to be rich in Australia?

HOW many thousands do you need to accumulate before you can claim to be rich? The answer might surprise you.

THE class war seems to be back with both sides of politics claiming they understand the Aussie battler.

But do they really?

Prime Minister Malcolm Turnbull appears to have the battlers on side, describing them as “aspirational” and justifying the government’s plan for personal tax cuts as rewarding people who “have a go and get ahead”.

It’s a picture that Labor rejects, saying its plan is better for working- and middle-class Australians.

The question is, are the politicians in any position to understand how ordinary people live?

As analysis by Fairfax last year showed, 49 per cent of Liberal MPs were political staffers before they were elected. Most of the rest had been business managers, executives and company directors.

Labor isn’t any better. About 55 per cent had worked as staffers, while 40 per cent were former trade union officials.

Both party leaders also like to talk up the fact that they didn’t have privileged upbringings, but it seems they were far from living on the breadline either.

While Mr Turnbull was raised by a single father, he attended the prestigious Sydney Grammar School, one of the most expensive in Australia, which this year had fees of more than $35,000.

Similarly, Labor leader Bill Shorten likes to talk up his working-class roots but he attended the Melbourne private school Xavier College, which this year cost more than $28,000 for senior students.

To put this into perspective, the average weekly wage for an adult in Australia working full-time as of November 2017 (before tax) was $1567.90. Sending a child to Sydney Grammar would see almost half of this ($673 a week) go to school fees.

In fact a survey done by Crikey in 2013 found 82 per cent of then-prime minister Tony Abbott’s Cabinet went to private school and 53 per cent of Mr Shorten’s shadow frontbench did the same.

The Turnbull Government’s plan to help “low and middle income earners” will give tax relief to those earning up to $200,000 from 2024.

Labor says it will focus its tax cuts on those earning $125,000 or less.

But do politicians — and many Australians — have a warped view of what constitutes “middle-class”? Here are some statistics.

OUR MEDIAN INCOME

If you noted down every Australian’s income and then ranked them from highest to lowest, the median would be the number exactly in the middle.

If you’re a full-time worker and you earn more than $1261 a week (before tax and superannuation) then you are earning more than half of all other workers, aged 15 years and older. This equates to $65,577 a year.

Of course, the numbers vary depending on what state you live in, and whether you live in a city or regional area.

Those living in the ACT were paid the most, followed by Western Australia and the Northern Territory.

If you live in a capital city, median wages are generally equal or higher than the state medians, except in Darwin.

Perth had a median wage of $1400, while Brisbane’s was $1305 and Sydney had a median of $1304 ($67,808 a year before tax).

If this seems low, you’ll be even more surprised when you include those working part-time in the mix.

This lowers the median pay to $1019 a week ($52,988 a year), according to the Australian Bureau of Statistics (ABS).

Meanwhile, the top 10 per cent of employees earned more than $2109 per week. If you’re on a salary of $109,668 a year or more, you are actually in the top 10 per cent of all workers (including full-time and part-time employees).

The large majority of workers (about 75 per cent) earn less than $78,624 a year before tax.

Around 25 per cent of employees earn less than $660 per week, and around 50 per cent of employees earn between $660 and $1512 per week.

OUR AVERAGE WEEKLY EARNINGS

To gain another perspective, you can also look at the average weekly income. In Australia it was $1567.90 (before tax), according to the latest ABS statistics for November 2017.

The ACT had the highest average weekly earnings at $1801 a week.

This was followed by Western Australia on $1740, then Northern Territory on $1642 and NSW on $1582.

SO WHAT DO POLITICIANS GET PAID?

Keeping in mind that the top 10 per cent of Australians get paid $109,668 a year or more, politician wages start to look very healthy.

Even a humble backbencher gets paid $203,030 as a base salary. Politicians get extra if they have other roles such as being a parliamentary secretary or minister. A minister who sits in Cabinet gets $350,226 and the Prime Minister gets $527,878.

While the figures pale next to the $5.7 million that the average ASX100 chief executive receives, it puts the nation’s politicians right among the country’s privileged.

However, it’s clear that many politicians don’t appreciate how good they’ve got it.

It recently emerged that Liberal senator Lucy Gichuhi told a Kenyan talk show last January that her $200,000 salary was “not a lot of money”. However she later conceded it was “reasonable” compared to other Kenyan politicians.

If you are on $200,000 you get $136,768 after tax (according to the Australian Taxation Office calculator). This gives you approximately $2630 a week.

Of the 10 million workers in Australia last year, just over one million earned more than $109,668 — receiving about $1566 a week after tax.

Many may be surprised at how little people need to earn to sit in the top 10 per cent of Australia’s workers. Others may be surprised how few workers actually earn this amount. But when facing a “class war” it helps to be reminded of who the rich actually are.

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