School bonus back in as mining tax axed

Finance Minister Mathias Cormann announced the deal in the Senate on Tuesday. Photo: Alex Ellinghausen

Finance Minister Mathias Cormann announced the deal in the Senate on Tuesday. Photo: Alex Ellinghausen

The Abbott government has moved to cut short  debate on the mining tax after clinching a deal with the Palmer United Party to repeal the tax but keep the associated compensation.

The opposition and the Greens have lashed out at what Labor's leader in the Senate Penny Wong called "a stealth attack" on the Senate.

The deal means millions of workers will not receive a promised boost to their superannuation, with the PUP agreeing to let the government delay the increase to improve the bottom line.

Compulsory super, currently set at 9.5 per cent of an employee's wages, had been set to increase to 12 per cent by July 2019.

PUP has made a deal with the government that will sacrifice that increase in order to keep spending associated with the mining tax.

The amendment circulated says the superannuation guarantee will not increase to 12 per cent until on or after July 1, 2025.

An amendment moved by Labor, with support from the Greens, called for the government's proposal to go to an inquiry.

PUP senator Glenn Lazarus told the Senate the deal would keep the schoolkids bonus in place to December 2016, low income super contributions until June 2017 and the low income bonus until December 2016.

Treasurer Joe Hockey and Palmer United leader Clive Palmer appeared in the chamber to shake hands as the amended bill was presented.

Labor and the Greens attacked the government for what Senator Wong called "a dirty deal".

"We have another deal…another dirty deal where they try to ram through the chamber just like we've seen before," she said.

Greens Leader Christine Milne called the move to gag debate on the amended bill "contempt for the Senate".

"I can't remember a time when we had amendments dropped on the desk with no attempt to explain what they mean," she said.

Senator Milne called the deal "an absolute disgrace" that would hurt the super entitlements of millions of working Australians.

"This is exactly what the Australian people were concerned about at the prospect of a mining billionaire coming in here."

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