TWO Labor elders have blasted a deal by major political parties to pay themselves up to $60 million extra for election campaigns, while a senator said it showed Parliament House was "rotten to the core" and he would like to see it "implode".

Former minister John Faulkner said he was "ashamed" of the Government's deal with the Coalition, telling a meeting of MPs the ALP was "diminished and tarnished" by it.

Former Caucus chair Daryl Melham said it was "wrong" and difficult to justify political parties giving themselves a huge increase after making savage Budget cuts.

Democratic Labor Party senator John Madigan said politicians were "the dregs of the Earth" who cut money for single mothers and universities and complained about debt, but then gave themselves more money out of the public purse.

"They're laughing in their party rooms and it shows the contempt they have for ordinary people struggling with their everyday expenses and bills," he told the Herald Sun.

"This place is rotten to the core. I'd like to see it implode. There's no empathy, no compassion. They are so disconnected from the people. It's just sickening, this place.

"They wonder why people hate their bloody guts and we have a high informal vote. I've run over better rabbits than these people."

Country independent Rob Oakeshott said voters should be angry.

"Australia's politicians can't reach a bipartisan agreement on funding reforms for our children's education, but they have reached a cosy little agreement on electoral funding reforms that will boost their coffers by almost $60 million."

Labor and the Coalition are planning to give themselves an "administration fee'' of $1 a vote costing taxpayers $58.1 million extra over four years on top of the existing $2.47 a vote candidates receive under public funding if they get more than a 4-per-cent primary vote, which cost $53 million for the 2010 election.

The package also requires all donations over $5000 being disclosed every six months, down from the existing $12,100 annual threshold but much higher than Labor's policy of $1000.

Any single donation of $100,000 or more must be reported within 28 days.

Government ministers Mark Dreyfus, Gary Gray, Anthony Albanese and Mark Butler backed the package.

Opposition spokeswoman Bronwyn Bishop indicated the Coalition supported the deal.

Mr Gray said the extra money would "add a pillar of support to the integrity of the system'' to guard against parties being beholden to a small number of donors and would create "greater integrity not less''.

Senator Madigan, who is giving away his recent $44,000 pay rise to help manufacturing and farming, said it was a farce.

"Single mothers can't have anything and there's no money for kids for dental. We tell people to innovate and be a smart country and then we cut money for universities.

"The Coalition is going on about debt but say we'll give ourselves a bit more money out of the public purse. They want more and they're never satisfied.

"They'll all fall in together. The Greens will put on a pantomime but they won't be handing it back.

"These politicians are all about their own super and perks and free flights. We pay a fortune and we get the dregs of the Earth.

"If political parties need more why don't they put their hands in the own pockets and use some of their pay rise.''

The Greens said they would only support the $1 a vote deal if there was a cap on corporate donations and a limit on election campaign expenditure.

Originally published as MPs slammed over $60m election deal