Coalition MPs are expecting Peter Dutton to one-up Anthony Albanese on cost-of-living relief after voting against Labor’s income tax cuts, as the opposition leader prepares a “very significant announcement” in Thursday’s budget reply speech.
A new plan to preserve more gas for domestic use and further housing policies could also be unveiled as the Coalition’s election pitch finally starts to take shape after weeks of internal angst about its lack of big-ticket promises.
The opposition leader will deliver his formal budget response on Thursday night, which will double as an election pitch as speculation swirls that the prime minister will launch the campaign as soon as Friday morning.
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Internal expectations of a significant new Coalition cost-of-living policy rose after Dutton and the shadow treasurer, Angus Taylor, moved quickly to oppose Labor’s new $17.1bn income tax cuts included in Tuesday’s budget.
Dutton labelled the tax cuts – which amount to $10 a week when fully implemented in 2027 – as a “cruel hoax” and a “bribe” as the government rushed them through parliament.
The tax cuts were expected to pass the Senate late on Wednesday night.
The treasurer, Jim Chalmers, said on Wednesday that the Coalition’s stance “beggars belief”.
“Today they voted for higher taxes on Australian workers,” Chalmers said.
Coalition MPs who spoke to Guardian Australia on the condition of anonymity anticipated Dutton would now move to outgun Labor on household help, possibly with the offer of even more generous income tax cuts.
“The backbenchers and marginal seat holders will be looking for lower tax policies,” said one Coalition source, who was hopeful the decision to oppose Labor’s tax cuts meant Dutton was preparing “our own bigger plan”.
The Coalition initially promised it would go to the election with a package “in keeping” with the original Scott Morrison-era stage-three tax cuts, after Labor overhauled them early last year.
Dutton had walked back that commitment in recent months, arguing that further tax cuts would depend on the state of the budget.
But Labor’s surprise budget announcement put the Coalition in a bind, given it had promised taxes would be lower under its watch.
Speaking on Wednesday morning, Dutton said the budget reply speech would include a “very significant announcement” to deal with cost-of-living.
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“We want to restore the dream of home ownership, we want to make sure that we can properly defend our country and keep Australians safe and address the crisis that exists at the moment across the economy in many ways,” he told ABC News Breakfast.
Speculation was growing that Dutton would also announce a new policy to shore up domestic gas supply, framed as a short-term solution to bring down power prices until the Coalition’s promised nuclear reactors were built from the mid-2030s.
The opposition was reportedly preparing an offshore gas reservation scheme that could require producers set aside more supplies for domestic use in exchange for faster environmental approvals.
Gas reservation schemes already exist in Queensland and in WA.
The Nationals leader, David Littleproud, said Dutton’s Thursday speech would outline a “clear energy plan for the short term, which is using Australian gas, your gas, to bring down your electricity price and your grocery bill”.
While the gas industry would welcome Coalition policies to fast-track environmental approvals, there was unease about the prospect of a reservation scheme.
The chief executive of Australian Energy Producers, Samantha McCulloch, warned government interventions and retrospective policies into the market “do enormous damage to investment confidence, trade relations and market operations”.
“We urge all parties to work with industry on considered policies that provide certainty and stability in order to attract the critical investment in new gas exploration and development needed for Australia’s long-term gas security,” she said.
