Greens to give Labor power to block debt ceiling increase

THE Opposition and The Greens will unite to block the Abbott Government's moves to raise Australia's debt ceiling by $200 billion.

A bill to lift the debt ceiling from $300 billion to $500 billion is expected to be introduced on Thursday, with the government fearing a limit of $400 billion will be reached by 2016.

The opposition from both Labor and The Greens could see the bill delayed until the new Senate forms in July 2014.

But there have not been any public guarantees from the incoming Senators that they would support the new debt ceiling.

Prime Minister Tony Abbott on Tuesday also said a ceiling of $500 billion might not even last, admitting he had Treasury advice the government's own ceiling would be reached by 2017.

He went as far as accusing Labor of "Tea Party" tactics, alluding to the recent United States debt ceiling debate, which almost saw the nation default on its debt obligations.

But Labor, which did not raise the ceiling before the election, is set to move an amendment to limit the ceiling to $400 billion.

Opposition Leader Bill Shorten on Wednesday quoted Mr Abbott from 2012, when he said the government had to justify raising the debt ceiling.

"I think we do need to take a very, very seriously critical look at this issue of the debt ceiling," Mr Abbott said at the time.

Greens Leader Senator Christine Milne said the minor party would support Labor's amendment, without more information on the government's budgetary position.

Sen Milne has previously hit out the government's decision to delay the mid-year economic outlook until December, when it is usually released in October each year.

She said Mr Abbott had played political games in opposition, but was now "expecting us to swallow whatever he dishes up".

Topics:  debt ceiling economy federal politics

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