Federal budget 2023: The ayes will have it but gas tax hike could blow up

Major initiatives in Labor’s second budget are set to gain the support of parliament, despite the Greens threatening to oppose a $2.7bn tax hike on offshore gas projects.

Treasurer Jim Chalmers at the National Press Club in Canberra on Wednesday. Picture: NCA NewsWire / Martin Ollman

Major initiatives in Labor’s second budget – including a $2.85-a-day increase to JobSeeker – are set to gain the support of parliament, despite the Greens threatening to oppose a $2.7bn tax hike on offshore gas projects.

Greens leader Adam Bandt on Wednesday confirmed his party would support the $40-a-fortnight increase to JobSeeker, a $1.9bn expansion to the single parenting payment and a 15 per cent lift to the maximum rate of commonwealth rent assistance, while vowing to try to make the changes more generous.

But Mr Bandt, whose party controls 11 Senate seats and shares the balance of power, said the government could not rely on its support for its proposed changes to the petroleum resource rent tax, under which a 90 per cent cap would be introduced on the use of deductions that can be offset.

“The Greens will obviously push for more money to go into people’s pockets,” Mr Bandt said.

“We’re not going to stand in the way of those who are doing tough getting a small bit of extra money in their pocket.

“What the government cannot take our support for granted on is their proposed changes to the gas tax. The gas corporations are lining up, pushing the parliament to pass the gas tax because they know it lets them off the hook and they get to pay next to nothing at all while the burden is shifted onto everyday people.”

While the Greens are preparing to fight the government on the PRRT, a senior Coalition source said the opposition would likely support the reforms – which have already received backing from the oil and gas industry.

Peter Dutton said he would announce on Thursday the ­Coalition’s position on JobSeeker and the single parenting payment expansion, which is due to help around 57,000 families, but he conceded single mums deserved all the help they could get.

“Of course they do,” he told ABC TV. “There are millions of families ... single parent families, families with kids who are $25,000 worse off under this government,” he said. “There are lots of people that deserve support because Labor has created a huge cost-of-living crisis. In this budget they put upward pressure on ­interest rates at exactly the wrong time.”

Some of the big-ticket health measures, including a $3.5bn tripling of the bulk-billing incentive, cheaper scripts and $2bn in new listings on the Pharmaceutical Benefits Scheme, won’t need legislation in order to take effect.

But a 15 per cent increase to the tobacco excise over three years and crackdown on vaping, including introducing plain packaging, restrictions on flavoured e-cigarettes and new controls on imports, will need to pass the Senate.

Mr Bandt said the Greens would consider the measures but the Nationals are pushing for nicotine vapes to be sold legally at shops without a prescription, meaning the vaping overhaul could face resistance.

The Jacqui Lambie Network and independent Victorian ­senator Lidia Thorpe had no strong objections to the welfare increases, PRRT changes, vaping and smoking crackdown or establishing the Net Zero Transition Authority, which also requires legislation.

One Nation leader Pauline Hanson said she could understand why the government was giving a “modest” increase to JobSeeker recipients but was concerned net debt continued to grow.

She rejected the expansion to the single parenting payment and the Net Zero Transition Authority, which the budget says will “promote orderly and positive economic transformation associated with decarbonisation and ­energy system change in regional areas, including support for ­impacted workers”.