But Mr Hockey's attempt to win over the crossbench, which has seen him criss-cross the country for the past fortnight to meet individual senators, was derailed on Wednesday after the Treasurer suggested the restarting of fuel excise indexation was a progressive taxation measure and that ''the poorest people either don't have cars or actually don't drive very far in many cases''.

Economists, welfare groups, the federal opposition and the crossbench immediately criticised the claim, pointing out that poorer people spent a higher proportion of their incomes on petrol.

Following a budget meeting with Palmer United Party leader Clive Palmer, Mr Hockey also suggested ''in net terms out of the budget, it is strongly arguable that pensioners are going to be better off'' because the inflation rate is higher than average male weekly earnings.

Mr Hockey signalled willingness to compromise on some of the budget's most contentious measures, such as the $7 GP fee, as he argued ''everyone is being slugged'' in the budget.

''What we are now at is the point where we are building the structural changes in the budget such as the co-payment in Medicare, such as the higher education changes and some of the welfare changes,'' Mr Hockey said.

''Either we make the decisions now or you end up doing what [Premier] Campbell Newman and [Treasurer] Tim Nicholls have had to do in Queensland, and that is take emergency action in order to address the problem you inherit.''

Labor leader Bill Shorten seized on Mr Hockey's comments as evidence he ''didn't realise how rotten his budget is'' and labelled him the ''cigar-chomping Foghorn Leghorn'' of Australian politics.

''It is almost as if the Treasurer believes that poor people should be sleeping in their cars, not driving their cars,'' he said.

A June Australian Automobile Association submission to a Senate inquiry flagged concerns poorer people would pay the most for a fuel excise rise and that ''research indicates that the people who use their cars most frequently are in the outer metropolitan areas and rural and regional areas, where there are lower incomes, less jobs, and little or no access to public transport''.

St Vincent de Paul Society chief executive John Falzon said Mr Hockey's claim was ''completely fallacious''.

And Grattan Institute economist John Daley said the fuel tax was regressive insofar as it hit the poor proportionally harder but that Mr Hockey was correct to argue that the well-off spent more on fuel in whole dollar terms.

He said Australia might need an austerity budget ''eventually, if we do nothing'' to address a budget deficit of 3 per cent of GDP but that ''if he means by the end of the year, that's clearly not true''.

Late on Wednesday, Mr Hockey stood by his comments, criticised the ''hysteria'' they had generated and argued there was ''a clear trend in Australia: the higher the household income the more fuel taxes are paid by the household''.

The Treasurer pointed to Australian Bureau of Statistics data that showed in absolute terms, richer households spent more than poorer households, and that poorer households owned fewer cars than affluent ones.

On Mr Hockey's comments, Mr Palmer said: ''I think we need to be sensitive to all of the people in the country, that there are a lot of people doing it hard.''

Mr Palmer also said his party still believed students should pay less for university, not more, and that his party still had concerns about the GP fee.