Both houses of federal parliament have been recalled to sit on April 18 to consider government legislation reinstating a building industry watchdog.
Malcolm Turnbull has announced both houses of parliament will be recalled on April 18 to discuss the Australia Building and Construction Commission legislation.
Mr Turnbull announced the move in a press conference in Canberra on Monday morning.
On the advice of the prime minister, Governor-General Peter Cosgrove has used his constitutional powers to recall both houses of parliament for a three-week sitting from April 18.
Mr Turnbull said if the senate fails to pass the ABCC and registered organisations legislation, which would allow for higher penalties for union corruption, there will be a double dissolution election.
"The go-slows and obstruction by Labor and the Greens on this key legislation must end," Mr Turnbull said.
"This is an opportunity for the Senate to do its job of legislating rather than filibustering."
The budget has been moved forward to May 3 to allow for the potential double dissolution election.
If there is a double dissolution election it will be on July 2.
"I make no apology for interrupting senators' seven-week break to bring them back to deal with this legislation," Mr Turnbull said.
Mr Turnbull said he made the decision to recall parliament on Sunday night.
He told reporters there had been a cabinet phone-in minutes before he announced the decision.
Labor and the Greens have been firm in their opposition to the industrial laws, saying the government shouldn't be singling out one industry and that the building commission's powers go well beyond a court.
The government needs six crossbench senators to pass the bills, but months of talks have been unsuccessful in delivering all of their votes.
Independent Nick Xenophon said he would support the ABCC with amendments.
"We should just get on with it," he told reporters in Melbourne.
The latest Newspoll has the coalition ahead of Labor 51-49 per cent on a two-party basis, but Mr Turnbull's net personal approval has crept into negative territory for the first time.
If the Senate passed the ABCC bill and another imposing tougher governance measures on trade unions, there would be no double-dissolution election, Mr Turnbull said.
"What we are doing here is giving the Senate ample time - this is three weeks - this is plenty of time to consider the bills, and pass them," he said.
"If they don't want to pass the bills then they should resolve to reject them and then the decision will be left to the Australian people."
Deputy Prime Minister Barnaby Joyce said the coalition was ready for an election.
"We have been basically in campaign mode, making sure that people clearly understand our message for quite some time," he told reporters in Sydney.
He denied the government was bullying senators into passing the legislation.
"We have every right to expect that this process, for the ABCC, is expedited."
Liberal Democrats senator David Leyonhjelm said he would vote for the registered organisations bill.
"But I do not intend to make up my mind about the ABCC bill until I hear whether the government is willing to accept amendments and how other senators respond to the government's ultimatum," he told AAP on Monday.
The senator has previously called for a sunset clause on the operation of the ABCC, but the amendment was narrowly rejected.
But if the federal government was to negotiate "in good faith" the ABCC could be passed.
"However, the crossbench senators are all extremely angry with the government over its changes to the electoral laws," he said.
The Liberal Democrats would welcome a July 2 double-dissolution election and are aiming to win a Senate seat in each state.
Changes to Senate voting practices passed the upper house last week following a marathon 28 hours of debate.
The reforms, which will change the way the voters elect senators, effectively restrict minor parties from picking up seats through complicated preference deals.
The changes will be in place if there is a double dissolution election in July.
Early budget called
Treasurer Scott Morrison, who will be handing down his first budget, had told Sydney's 2GB radio only an hour earlier the budget would be on May 10.
Mr Morrison was defending a decision to end the tax levy on high-income earners next year, while leaving open the door to company tax cuts but not a reduction in personal income taxes.
The two per cent impost on people earning more than $180,000 was introduced in the 2014/15 budget in a bid to reduce the budget deficit, but it was always going to be temporary.
"If you were to change that you would actually have to put their taxes up again," Mr Morrison said.
Labor says the prime minister has put politics ahead of policy in moving the budget forward a week to May 3 and threatening a July 2 double-dissolution election.
Shadow treasurer Chris Bowen says Malcolm Turnbull's decision to bring forward the budget is all about politics and nothing to do with the economy or tax reform.
It is the first budget to be brought forward since Arthur Fadden's in 1952.
Cabinet Secretary Arthur Sinodinos has indicated the government is leaning towards a company tax rate cut rather than the once-promised personal income tax cuts as part of an overall package.
While Mr Morrison avoided confirming that was the case, he did say the government had to do things that drove investment.
"If we don't drive investment, we can't drive growth and that means we can't drive jobs," he said.
There wasn't a lot of room in the budget and when the government opted against raising the GST rate it meant the opportunity for major changes in income tax were "largely removed".
"You can't pay for something with nothing," Mr Morrison said.
Bills at the centre of PM's double dissolution threat
- Restores Australian Building and Construction Commission created by Howard government and dismantled by Labor.
- Replaces the Fair Work Building Industry Inspectorate.
- Gives a commissioner power to obtain information and/or documents.
- Prohibits unlawful strikes.
- Creates Registered Organisations Commission, an independent watchdog to monitor and regulate trade unions and employer associations.
- Increases fines and creates criminal offences for dodgy union and association bosses.
- Increases disclosure obligations on organisations and their officers.