BETWEEN $4 billion and $5 billion will be wiped from carbon tax revenue as the government warns of "unprecedented" cuts to pay for Julia Gillard's disability and education reforms.
The Daily Telegraph has learned the government has confirmed in the past few days, in a series of recent high level briefings, that the revised forecast for the world carbon price in today's Budget would be between $12 and $15 a tonne.
This would virtually halve the $10.5 billion originally estimated to be raised annually by the tax by 2015 - when the government believed the price would be closer to $29 a tonne.
Despite the further hit to the Budget, Treasurer Wayne Swan will today announce a budget first - a 10-year funding program for the national disability insurance scheme and the Gonski education reforms, which will cost $15 billion a year combined when fully implemented.
"These are reforms that are long overdue and Labor will ensure they are funded through the next decade," Mr Swan said last night.
"The fact that we're taking this extraordinary step shows how critical we believe DisabilityCare and school reforms are. In the current environment of dramatic revenue shortfalls, funding these reforms means finding significant savings."
The savings will be made in the face of other major cuts to offset the carbon tax collapse.
Already the government has been forced to scrap a second round of household compensation tax cuts worth $1.8 billion, due to come in on July 1, 2015, to weather the collapse in the European carbon market.
The Daily Telegraph has learned no further cuts to promised family compensation will be made.
The budget will also contain an expected $40 billion to $50 billion, five-year infrastructure plan for the country, as the second instalment of the Nation Building program.
While the Coalition claimed a forecast of $15 a tonne by 2015 was optimistic, sources confirmed the government had said during a private briefing that the new Budget forecast would be between $12 and $15 a tonne.
The carbon tax debacle comes on top of a $17 billion collapse in other revenues and the failure of the mining tax.
Not all the government's savings are locked in, with the Coalition claiming a record $30 billion in cuts, taxes or levies are yet to be legislated or regulated. Shadow finance minister Andrew Robb claimed the government would deliver phantom savings until they were passed.
But with only four sitting weeks left before the election, the Coalition claims many of the savings may never be realised and will leave a poison pill for the Coalition if it wins government.
Despite many savings being held up in the parliament by the Coalition, it appears likely billions of dollars in budget cuts could fail to be passed before the September 14 election.
The savings yet to be passed include the raising of the Medicare levy, cuts to higher education, the cuts to the private health insurance rebate, a range of income and business tax changes, and superannuation cuts, which will need to be passed through parliament.
"If Labor doesn't get re-elected they've planted all of these 'poison pills' for the Coalition to deal with in cleaning up their record debt
http://www.dailytelegraph.com.au/news/alp-to-use-5-billion-in-carbon-tax-revenue-to-pay-for-ndis/story-fni0cx4q-1226641525611
