Budget peace breaks out in Canberra -- Coalition, Labor strike deal on $6.3 billion in savings

Australian federal treasurer Scott Morrison. Photo by Ryan Pierse / Getty Images (File)

Compromises from both major parties mean the federal government will announce $6.3 billion in budget savings today.

The Coalition has agreed to wind back a $1000 payment to single income families with a child under one year and who are eligible for family tax benefit part B, but it will not proceed with plans to remove carbon tax compensation elements of future welfare payments.

The AFR also reports the government has diluted plans to cut $1 billion from renewable energy agency ARENA. It means the agency will now survive for the next five years with no cuts.

Here’s a summary from a statement issued by Treasurer Scott Morrison:

Amendments to the Bill include:

• Progressing the government’s reforms to Dental Services through separate legislation;
• Restoring $800m of ARENA funding over five years ($550m over forward estimates).
• Removing the Energy Supplement only for new recipients of Family Tax Benefit Part A, Family Tax Benefit Part B and the Commonwealth Seniors Health Card.
• Adding a new schedule which limits access to the FTB Part A end of year supplement to families earning less than $80,000 per annum.

The Government will seek to progress the remaining components of both the energy supplement and family tax benefit savings measures through separate legislation.

The Government has also agreed to adopt a Labor pre-election savings measure and as such will no longer proceed with the 2015-16 MYEFO measure that provided an additional payment of Family Tax Benefit B to families of children under one year of age.

Today the Turnbull Government has made immediate and tangible headway in the 45th Parliament towards balancing the Budget.

Of course there is more work to be done and the Government will continue to work with all Parties and individual members and senators represented in the Parliament to secure the passage of all the savings measures reflected in the Budget.

The government’s so-called “omnibus” savings bill containing the agreed measures should now pass parliament quickly.

The AFR has more >>

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