Liberal MP Julia Banks is being challenged to follow her words with action after she said on ABC Local Radio Melbourne she could live on $40 per day following calls to raise the Newstart and Youth Allowance.

The challenge came from 22-year-old Sherri Prendergast, who has been on a Youth Allowance worth $400 per fortnight for six years.

Debate about the generosity of these two welfare payments began earlier this week when respected economist Chris Richardson called the payments “unnecessarily cruel” and called for them to be raised by $50.