Opposition leader Tony Abbott has shown a breathtaking lack knowledge of economics in his response to the federal budget, Prime Minister Kevin Rudd said in Brisbane.
Mr Rudd received a rapturous reception from unionists at a meeting of the Liquor Hospitality and Miscellaneous Union "My political opponents said the way to end this is to do what they did in New Zealand," Mr Rudd said.
"He said New Zealand has emerged from this just fine, can I just say that shows such a fundamental lack of knowledge in economics that it is breathtakingly frightening.
"If the New Zealand employment rate was replicated here hundreds of thousands of Australians would have lost their jobs."
Mr Rudd said the government had acted on the economy and made a difference.
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The Rudd government has honed in on Tony Abbott's reluctance to say how much money a coalition government would cut from Labor's $16.2 billion schools building program.
The opposition leader in his budget reply speech on Thursday night signalled a restructure of the stimulus program, with money going directly to schools rather than through state governments.
"The simple truth is he doesn't believe in funding for new school halls and classrooms," Education Minister Julia Gillard said on Friday.
When asked whether the pot of money would be the same size, Mr Abbott told ABC Radio: "Well, look, I'm not going to give you that absolute commitment."
But he did say the quantum of building will be "just as big".
Ms Gillard said the opposition leader would need to tell the students, parents and teachers in each electorate he visits which school projects are on his hit list.
She also warned that Mr Abbott was planning a return to Work Choices after the opposition leader reiterated the coalition planned to tinker with Labor's industrial reforms, including unfair dismissal laws and its workplace agreements.
"He loves Work Choices and he wants to bring it back, that was absolutely clear from the speech," she said.
Mr Abbott denied the claim, but said freedom as well as fairness was needed in Australian workplaces. The coalition wanted to avoid "union bullies" running vital projects on the northwest shelf.
Mr Abbott said the Rudd government's industrial relations policies had undone the reforms of the Keating and Howard governments, taking Australia back to the 1970s.
But he said the coalition's industrial relations policies were "absolutely not" a return to Work Choices. "Whatever happens, no one can be worse off; no one can be forced from one agreement on to another agreement," he said.
ACTU president Sharan Burrow said Mr Abbott's plan to ease unfair dismissal laws would allow employers to dictate pay and conditions through individual contracts. "He has brazenly committed the Liberal party to giving back to employers the power to sack workers unfairly," she said.
Mr Abbott defended his proposal to phase out 12,000 public service positions through natural attrition.
Their ranks had swelled by 20,000 since Labor came to power in 2007 without tangible benefits, he said. Financial Services Minister Chris Bowen was dismissive of the measure, saying it lacked detail and analysis.
"That's just a sound bite, that's not a saving," he said.
