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Future of $5.6b package in hands of Greens and independents

Bob KatterJULIA GILLARD’S $5.6 billion flood reconstruction package faces a rocky ride through Parliament with the Coalition implacably opposed to the $1.8 billion levy and independents and Greens in both houses all concerned about accountability, the nature of some budget cuts, and the lack of a permanent natural disaster fund.

The Opposition Leader, Tony Abbott, supported the $3.8 billion in budget cuts and project deferrals announced by Ms Gillard yesterday but reaffirmed his opposition to the levy.

He said the government should fund the entire $5.6 billion with budget cuts and said the Coalition would announce in the next few days where the extra $1.8 billion could be found.

”I strongly support urgent spending on flood reconstruction in Queensland and Victoria but the Coalition strongly opposes this unnecessary new flood tax,” he said.

The Western Australian Liberal Premier, Colin Barnett, defied Mr Abbott and supported the levy while Victoria’s Liberal Premier, Ted Baillieu, agreed the budget should be cut further.

Ms Gillard, who will introduce the legislation when Parliament resumes on February 8, accused Mr Abbott of hypocrisy given he took to the election a $3 billion paid parental leave policy to be funded by a levy on big business.

She said if Mr Abbott considered a levy good enough to fund an election promise, ”how could it not be good enough to fund the reconstruction of Queensland?”

In the lower house, the independent MP Bob Katter railed against the package, saying there should be a permanent disaster relief fund.

Fellow independents Tony Windsor, Rob Oakeshott and Andrew Wilkie said their minds were open and they wanted more detail. Mr Windsor said he still preferred a natural disaster fund to be funded by a continuing levy, and he needed to be convinced the money from Ms Gillard’s package would be spent wisely and where it was needed.

”I’m undecided,” he said.

In the Senate, Nick Xenophon said he wanted to study the detail and would need to be reassured that the money would be wisely spent. Steve Fielding concurred.

The Greens, who must approve the legislation in both houses, said they were ”open” to the flood levy but opposed to the axing and capping of carbon reduction programs.

”[We] will seek discussions with the government about alternatives, including deferring top-end corporate tax cuts as well as establishing a long-term disaster relief fund to face up to the reality of climate change,” the acting leader, Christine Milne, said.

One of the cuts included redirecting $350 million from the $800 million Priority Regional Infrastructure Program which was established as part of the deal to win the independents.

Mr Oakeshott said he did not consider this a breach of the deal by the government and Mr Windsor was also unperturbed.

The Queensland Labor MP Shayne Neumann, whose seat of Blair was ravaged by the floods, said Mr Abbott was being selfish and was out of touch with the desire of Queenslanders.

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