The coalition's plans to dump the carbon and mining taxes if it wins government are causing a storm with the release of formerly secret coalition documents.
Coalition documents leaked to the Seven Network on Thursday showed Opposition Leader Tony Abbott's promise to axe the controversial taxes and implement tens of millions of dollars in spending cuts, would leave a $70 billion shortfall.
Critics have pounced on the supposed shortfall, but the Coalition says that without the compensation the government had planned, the Coalition would come through ok.
The Prime Minister is demanding answers.
"What's the opposition proposing to do? Not pay pensioners for two years, not pay anyone medicare for four years? That's the size of the black hole we are talking about," Ms Gillard told reporters in Perth.
The leaked document says it will cost $27 billion to scrap the planned carbon tax and the $8 billion worth of pledged tax cuts.
Opposition Leader Tony Abbott said on Macquarie radio that without the carbon tax, there was no need for compensation.
"These aren't spending cuts so much, they're savings to the public because the public won't have to pay the carbon tax, the public won't have to pay the mining tax and it is good for people if taxes are lower."
"We will oppose it in Opposition and we will rescind it in government, and if it needs a double dissolution, that's what it will take", the ABC reports Mr Abbott as saying
BROWN UPS THE ANTE
On Friday, Greens Senator Bob Brown said such policies would have a detrimental impact on Australia in the current economic malaise.
"Would not (Opposition Leader) Tony Abbott's ascent to government in these circumstances put Australia into a recession?" he asked in Canberra on Friday.
"What will be the impact on the nearly one million small businesses in this country if this sort of economic irresponsibility were to be given a go on the Treasury benches."
Senator Brown insisted Mr Abbott submit coalition policies for costing by Treasury and the finance department.
"He has to explain how he is going to make up that $70 billion over the forward estimates," he said.
WE'LL FIND SAVINGS
Earlier Joe Hockey refused to confirm the figures, but told Seven its budget would not be hurt as the coalition would find savings.
"It's not a cost if you abolish a tax. You collect less tax, you spend less money therefore it's not a cost to taxpayers," Mr Hockey said.
"The government - Liberal or Labor - will spend $1500 billion over the next four years," he said.
"That's a massive amount of money and therefore finding $50 or $60 or $70 billion is about identifying waste, identifying areas where you do not need to proceed with programs."
And he guaranteed that under the Liberal party, government would be smaller.
"There will be less tax, there will be less government expenditure, but you will have smaller government as a percentage of the economy."
Government minister Tony Burke said the opposition would not be able to make up the shortfall through cutting programs.
"If you're going to have to find that much in cuts, you're either going to have significant increase in taxes, significant cuts to the pension. They're the only ways you can find that sort of money," Mr Burke told Seven.
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