Mr Abbott foreshadowed widespread wage restraint across the public service on Tuesday, citing the 1.5 per cent defence pay rise as much as the government could afford.
The Defence Force Remuneration Tribunal has signed off on a three-year pay deal with a 1.5 per cent increase for defence's 57,000 full-time uniformed personnel and 20,000 reservists and the loss of some leave days and allowances.
It is likely to be less than inflation over the next three years.
Listen: Stephanie Anderson speaks with Nadine Flood.
The offer has been labelled as insulting by the Defence Force Welfare Association, but Mr Abbott has defended the deal and its “substantial additional allowances” for troops serving abroad.
Mr Abbott said he would like to pay serving defence personnel more, but said there would be restraint across the whole of the public sector.
“There’s going to have to be very tight pay restraint across the public sector, including the defence personnel,” he said.
“I regret that, but you can’t do as much with a $40 billion deficit than you could with a $20 billion surplus. Obviously, until we get the budget back under control, there has got to be general pay restraint across the public sector.”
“This is a really radical and aggressive approach from government”
Community and Public Sector Union National Secretary Nadine Flood said thousands of public sector workers were voting on strike action, saying that staff would not “simply not going to sit back and accept losing most of their current rights”.
Ms Flood said the government’s approach had been “really radical and aggressive”.
“Unlike soldiers, public sector workers are allowed to fight back,” she said.
“They can bargain and they can take industrial action… and that’s where we’re at today.
“We are seeing a massive protected action ballot in the Department of Human Services with more than 15,000 staff voting on taking industrial action at the moment. In the Department of Veterans’ Affairs, we’ve just lodged in Fair Work for them to move towards a protected action ballot.”
The ADF pay deal comes into effect on November 4.
Defence Force Welfare Association National President David Jamison previously labelled the offer as “insultingly low”.
In a statement issued on Monday, the retired Colonel said it was “a strange way to reward ADF members for the dedication and hard work”.