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Treasurer Joe Hockey sweats it out on Q&A

Treasurer Joe Hockey admitted it was a 'painful' budget and that he wanted to make sure 'the pain applies as fairly as possible across the electorate', on his solo appearance on ABC's Q&A.

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Treasurer Joe Hockey has accused Labor of blocking $40 billion in savings as the government called on the opposition not to oppose its budget measures unless it wants Australia's economy to "fall apart".

A day after the Abbott government suffered a collapse in the polls for breaking its election promises, Mr Hockey went on the attack and said Labor was actually preventing the government from keeping its word with voters.

Treasurer Joe Hockey has warned Labor risks Australia's prosperity if it opposes the Coalition's budget measures.

Treasurer Joe Hockey has warned Labor risks Australia's prosperity if it opposes the Coalition's budget measures. Photo: Alex Ellinghausen

The government briefly received some much-needed ammunition on Tuesday, with ratings standard agency Standard & Poor foreshadowing that Australia's AAA credit rating could be reviewed if substantial cuts were not made to the budget.

The ratings agency has since told ABC Radio it has no plans to review the nation's credit rating.

"If there were to be a downgrading of Australia's sovereign credit rating it would have an impact on every household that borrows money, either through a mortgage or credit card," Mr Hockey said on Tuesday.

Mr Hockey said Labor was "emphatically opposing" $40 billion in savings, including $5 billion in savings that the opposition itself had proposed heading into the last election.

He said Labor was opposing $13.4 billion in savings the Coalition took to the election, including money to be recouped from the repeal of the mining tax.

The Treasurer said the opposition had since signalled it would block another $3.5 billion in savings associated with the $7 Medicare fee, $1.3 billion that would be raised from a rise in pharmaceutical contributions, the $4.1 billion that would come from the fuel excise and $5 billion in changes to higher education.

"It is one thing for Labor to be the complaints desk of the nation but they also have a responsibility because they have the numbers in the Senate to block the initiatives of the government," Mr Hockey said.

The Treasurer also had a warning for crossbenchers who have signalled they too will oppose budget measures, such as pension changes and a fuel tax hike.

"I would say to Bill Shorten, I say to the independents in the Senate, think very carefully about your actions because ultimately if you decide to turn down savings and you offer no sensible or credible alternative, it will have an impact on every household in Australia through higher interest rates and higher taxes down the track," he said.

The government has taken a hammering in the polls over a suite of broken election promises, including a pledge not increase taxes or cut education and health spending.

Prime Minister Tony Abbott borrowed from John Howard on Monday by introducing the term "elemental" promise to argue that the budget kept the government's core commitments such as axing the carbon tax and bringing the countries finances under control.

Mr Hockey said on Tuesday that the opposition was now stopping the government from seeing that through.

He said the Coalition had been up front with the Australian people about plans such as cutting the school kids bonus and scrapping the mining tax.

"Bill Shorten's now preventing us from keeping our promises," he said.

"He is so outraged about what he believes to be our broken promises, he is doing everything he can to stop us keeping our promises."

Shadow treasurer Chris Bowen said Mr Hockey’s complaints were laughable when, in opposition, he had opposed “tens of billions worth of structural savings.”

Mr Bowen said Labor would work constructively with the government to implement budget measures that were fair and reasonable, but the party would not rubber stamp broken promises on Medicare, pensions and higher education fees.

He called for perspective from Mr Hockey, adding that the budget proposals Labor would oppose added up to less than four years of expenditure on the government’s “extravagant” paid parental leave scheme.

“Budgets are all about supporting and growing the economy, guided by a government’s values and priorities,” Mr Bowen said.

“In office, Labor implemented saving measures worth over $180 billion, making the budget cumulatively better off by over $300 billion by 2020-21.”

On Tuesday, former treasurer Wayne Swan hit out at his successor's first budget.

In a speech to the Transport Workers Union national conference on the Gold Coast, Mr Swan said he was "enraged" by the impact the budget would have on pensioners and low and middle income earners.

He said is "certain" that Mr Abbott knew he would break his promises not to cut education, health, the ABC and SBS and not to change pensions and the GST "when he made them".

Mr Swan also attacked Mr Hockey's "sloppy" budget process.

"So many of their cruel decisions appear to be cobbled together very late in the budget process," he said.

"So sloppy is it, they appear to have stuck it together at the last minute with a bit of Clag glue."

Mr Swan, who now sits on the backbench, described the budget as a "shambles".

with Judith Ireland

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