Billions of dollars of the government’s proposed budget savings are under threat with Labor declaring opposition to more than half of their welfare reforms as the Greens revealed they would oppose the indexation of the fuel excise.



However, the government has gained support from Labor on some measures, such as lowering the income threshold for Family Tax Benefit (FTB) B from $150,000 to $100,000 and stopping students receiving the Youth Allowance while travelling overseas.

The lowering of the FTB B income threshold for the primary earner is estimated to save $1.2bn over four years, while cutting youth allowance to students travelling overseas, unless it’s for study or a family crisis, will save $153.1m over five years, according to the budget papers.

The government gagged debate on Tuesday in the lower house on the two social security bills, which introduce 20 welfare measures, in a bid to push them through the new Senate next month. The government has already failed to pass the bills in time for some of the measures to take effect from July 1 but is trying to rush them through the House of Representatives so the new Senate will pass them quickly.

The Labor party has for the first time declared their position on almost all of the welfare reforms listed in the two bills, opposing more than half of the measures, putting their passage through the Senate in doubt. Petrol excise indexation is another key budget decision that faces defeat in the Senate, at a cost to the Abbott government’s budget of $2.15bn over the next four years.

The Greens had said they would support the measure, but they now say that was because it was potentially a tax on pollution, but would not amount to that if the Abbott government spent all the money on new roads. It would then amount to a tax on poor families without access to public transport.

"This is purely about revenue raising for roads," the Greens leader, Christine Milne, said, denying she had been rolled by her party on the issue.

One of the most controversial social security measures, to strip income support for months at a time from people under 30, looks unlikely to be passed into law, with the conservative Family First senator-elect, Bob Day, joining the chorus of people opposed to it.

On Tuesday the opposition moved to amend the bills in the lower house to remove: the stripping of income support from unemployed people under 30, the raising of the pension age to 70, the axing of the seniors supplement, the freezing of the payments rates for Family Tax Benefits and the stripping of FTB B from families once their youngest child turns six.

The Australian Council of Social Services (Acoss) has previously recommended scrapping the seniors supplement, worth about $800 per year to Commonwealth Seniors Health Card (CSHC) holders, calling it an “inequitable and wasteful program” which benefits relatively well off older people.

Labor has also declared it opposes cutting the Parenting Payment; extending the waiting period for certain payments, including the dole; changing the indexations of the Age Pension, the Disability Support Pension, Veterans’ pension and the Carer payment; axing the Pensioner Education Supplement; raising the age of eligibility for Newstart to 25; freezing FTB indexation; and removing backdating of the Disability Pension for Veterans.

Explaining its support of the other measures, the shadow minister for families and payments, Jenny Macklin, said the party supported measures that are responsible savings “without leaving vulnerable Australians worse off”.

As well as cutting the Youth Allowance to students who go overseas and lowering the eligibility threshold for FTB B, Labor will support including untaxed superannuation income in the assessment for the CSHC; pausing asset tests for student payments, pensions and working age allowances; scrapping relocation assistance for students moving from one major city to another; and ending indexation of the Clean Energy Supplement.

Macklin did not say if the party would support or oppose reviewing recipients of DSP who became eligible between 2007 and 2011.

Cutting welfare to unemployed people under 30 for months at a time has garnered opposition from many corners of the Senate with Day, the Greens and the leader of the Palmer United party, Clive Palmer, all publicly denouncing it.

Day said he would only support the measure if the government also changed industrial relations laws so young people did not have to abide by an award.

“[The] Newstart [change] in particular is the one that disturbs me the most,” he said.

“We have a crisis of jobless youth. If [social services minister] Kevin Andrew was really serious about unemployed young people instead of telling them the job they should be going for they would let them decide what’s best for themselves.”

Day said young people should be able to opt out of industrial relations agreements and accept conditions that suit them, such as lower rates of pay for taking a job closer to home.

“I will not support changes to Newstart without allowing young people to opt out of IR. What gives anyone the right to tell someone how they should work?” he said.

Day also attacked the government for not giving incoming senators more support, saying the Coalition wanted the crossbenchers to look like they did not know what they were doing.

“They’re starving us of information so they can build ammunition to make us look stupid,” he said.

Day said he had been sent no bills and would be sent to “Senate school” for two days next week before taking his seat the following week and being expected to vote on complicated legislation.

“There’s no contact and it makes it really, really hard for new senators. I think it’s planned that way … so all the new senators look stupid and the government can justify changing the rules,” he said, referring to government proposals to change Senate voting so people could not be elected on a tiny percentage of the vote.

Day also called the raising of the pension age “completely unnecessary” but said the changes to indexation of the pension, DSP and carers’ allowance were “sensible”.

Palmer reaffirmed his opposition to taking young people off income support for months at a time when contacted by Guardian Australia.

Independent senator Nick Xenophon and Democratic Labor party senator John Madigan are both uncomfortable with aspects of the bills but have said they will study them carefully before declaring how they will vote.

“The devil is in the detail. I am reviewing my position on many aspects of the budget,” Madigan said. “This is a family-bashing budget that will hit hard families, pensioners and Australia’s less well-off. We’re working through the budget line by line, word by word, amount by amount. We will be suggesting alternatives to the government, and better ways to do things. Will they listen? Time will tell.”

In the new Senate the government needs six of the eight crossbenchers to support it when Labor and the Greens are opposed to legislation, including three of the PUP senators and the Motoring Enthusiast party senator-elect, Ricky Muir, who has signed a memorandum of understanding with PUP.

The Liberal Democratic party senator-elect, David Leyonhjelm, did not return calls but has previously declared support for the welfare reforms

