The Abbott government has given itself room to halve its $2.55 billion emissions reduction fund over the next four years.
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In a budget that delivered deep cuts to environment funding, the government will also reap at least $2 billion in savings through the scrapping of environmental agencies, including the Australian Renewable Energy Agency (ARENA), and $400 million in cuts to Landcare.
Axing the $1.3 billion ARENA takes with it another election promise, the delivery of 1 million solar roofs as part of the government's Direct Action climate policy to replace the carbon tax. The solar roofs policy has received no funding over the forward estimates.
The proposed cash flow for the emissions reduction fund will raise eyebrows, with projected funding of about $1.1 billion over four years instead of the promised $2.55 billion.
The budget overview says the government will spend $2.55 billion over 10 years instead of four as originally promised.
The budget allocates just $75 million to the emissions reduction fund in 2013-14, $300 million in 2015-16 and $355 million in 2016-17.
When Environment Minister Greg Hunt revealed the white paper for the emissions reduction fund shortly before ANZAC day, he announced there would be $300 million in funding for its first year alone.
The fund is the centrepiece of the government's Direct Action policy to deliver 5 per cent in emissions cuts on 2000 levels by 2020.
Mr Hunt was adamant on Tuesday that the government was still fulfilling its promise to pay $2.55 billion to polluters that reduce their emissions as he retained the authority to enter into contracts worth $2.55 billion over the next four years.
The reduced cash flow reflected the government's plan to pay polluters "flexibly over time" and only when they could show a genuine reduction in emissions.
"The Australian government has today delivered on its pledge to provide $2.55 billion to establish the emissions reduction fund from 1 July 2014," he said.
According to the Mid-year economic outlooks figures, the budget will take a $7.4 billion hit over four years if the new Senate votes to repeal the carbon tax after July 1.
Savings of $21 million will come from axing the Australian Water Commission, but the budget will fulfil an election promise to set up a "green army", with $525 million over four years from existing Landcare funds for young people to take on environment projects.
The budget delivers $40 million over four years for a plan for protecting the Great Barrier Reef, but cuts $2.8 million from the Great Barrier Reef Marine Park Authority.
