Treasurer Josh Frydenberg will have a “big bang” announcement on budget night, a cabinet minister says, amid speculation the federal government is considering wage incentives for businesses to take on more workers.

David Littlepround declined to comment directly on reports of the possible incentives, saying Mr Frydenberg would “reveal all” when he handed down the budget on October 6.

“The treasurer will want to have a big bang on election night,” he told the Nine Network on Monday when asked about the speculation.

“I know he likes a good announcement.”

Meanwhile, a new advertising campaign has been launched urging Mr Frydenberg not to bring forward legislated tax cuts in the budget.

The government has flagged it is considering bringing forward personal income tax cuts scheduled for 2022 and 2024.

But the ad campaign initiated by the Australia Institute think tank and backed by 40 prominent Australians – including two former Reserve Bank officials, a former Liberal Party leader and the head of the welfare lobby group ACOSS – says they won’t provide the economic stimulus the government is looking for.

Institute research released in recent weeks suggests the cuts will benefit higher income earners, who are more likely to save rather than spend the extra cash.

“We’ll need substantial stimulus for an extended period,” former Reserve Bank deputy governor Stephen Grenville says.

“Cutting top-rate income tax would be a weak stimulus which undermines the equitable and progressive tax structure we’ll need when the COVID crisis is over.”

Former federal Liberal leader John Hewson said the coalition naively believed tax cuts were good politics.

“But they won’t be as they increase inequality and fail to ensure job security and increasing wages with our economy still struggling to exit recession,” Dr Hewson said.

Institute executive director Ben Oquist said taxes were an investment in society.

“Those calling for tax cuts today will be calling for service cuts in the future,” he said.

The campaign will air from Monday on Sky News and commercial television.