Monty Python could not do better. Education Minister Christopher Pyne described himself as a fixer as his higher education reforms went down in flames again in the senate. It is becoming a metaphor for the government. The incompetence of its political management is almost incomprehensible. Many on its own backbench are close to despair.

Senate Independent Nick Xenophon says Pyne reminds him of the Black Knight in Python’s Holy Grail. As he lost each limb to an opponent’s sword, the delusional warrior scoffed that it was just a flesh wound. Politically armless and legless, Pyne is promising to ride again. He will present his university deregulation bills for a third time after the budget. By then, of course, the senate and the universities should know how big a funding cut they will be in for. In a futile and puzzling attempt to remove all distractions from the senate crossbench, he split the 20 per cent cut from the bills while at the same time flagging there will be new savings identified in May.

For a government desperate to re-establish its credibility, Pyne’s performance is a major setback.

For a government desperately needing to re-establish its credibility, Pyne’s performance is a major setback. On the weekend he tied $150 million in funding for an important research program, the National Collaborative Research Infrastructure Strategy, to the passage of his higher education changes. Without these savings the program couldn’t continue. If 1700 scientists lost their jobs, his logic went, the senate would have to wear the blame.

The outrage of crossbench senators went off the seismic scale. The minister was accused of childish bullying. The silliness of the tactic was compounded when on Monday he ditched the link, claiming the $150 million was small beer given that the government spends $9 billion annually on research. On Sky News, David Speers asked, “So you were wrong yesterday?” Pyne replied that he was absolutely right yesterday and has cleverly found savings somewhere else but wouldn’t say where. He said where he found them was not really the concern of his interrogator. The intrepid Speers reminded the minister it was taxpayers’ money. It was in this context Pyne claimed to be a fixer – never mind the pejorative connotation of the word. The interview was such a zinger that the Labor opposition distributed a transcript within minutes of it ending. That’s when you know, or should know, that you have made a fool of yourself.

The gyrations were all in vain. The senate by a greater majority than before voted down the bill. Labor’s Kim Carr was scathing. He said the minister should resign for constantly changing his mind and being totally inconsistent: “The minister for higher education ... has to enjoy the confidence of the country. This is beyond humiliation, this goes to competence, it goes to capacity to secure future changes.”

But Pyne is not alone in his miscalculations in dealing with the senate, particularly the eight crossbench senators. Tony Abbott slammed them as “completely feral” in his party room. One of them, Liberal Democrat David Leyonhjelm, took offence even though he was one of the three who supported the Pyne legislation. He insisted the independents were not a party, did not caucus, rarely met, and dealt with issues on their merits. Abbott thought better of his spleen venting when asked about it at a news conference. He narrowed it to Labor and the Greens.

The senate is more unpredictable than ever with the collapse of the Palmer United Party bloc. The mercurial Clive Palmer has been denied his pivotal role. Sweetheart deals with the government such as the Future of Financial Advice (FOFA) reforms are a thing of the past. Senators Jacqui Lambie and Glenn Lazarus resented Palmer’s high-handedness, committing them on one occasion to change their vote as a division was beginning. Both have quit the party. Now ministers have to corral six of the eight any time Labor and the Greens decide to vote down a measure. The difficulty there, according to one Labor senate strategist, is akin to a developer trying to buy eight houses in a street. It’s often the last holdout who gets the best deal. And make no mistake, the independents all want to maximise their clout and moments in the sun.

Labor is bemused by the government’s clumsiness. The government’s senate leader, Eric Abetz, has on occasion lashed out at the crossbench in the chamber rather than trying to keep them on side. The reversal on the FOFA reforms particularly riled Abetz. Now that Lazarus has left the PUP kennel, the opposition is more than happy to give him advice and counsel on issues. In this, of course, they often bump into Xenophon, who is busily laying the foundation for his new Nick Xenophon Team party. Whether Lambie or Lazarus are interested remains to be seen but the opposition believes the demise of the Palmer United Party in the senate makes it easier for it to play a schmoozing role than before.

While the government’s minority in the senate is no threat to its survival, it is a threat to its standing. Already it has done great damage to the Coalition’s claims of being a better economic manager than the Rudd–Gillard–Rudd governments. It is in grave danger of looking like the lamest of lame duck administrations, a put-down Abbott’s chief of staff Peta Credlin directed at Barack Obama. She had no sympathy for the United States president’s travails with a Republican-dominated congress. For Labor’s part, they are surprised Abbott doesn’t play a greater personal role in dealing with the crossbench. Building support for big changes requires patience, communication, compromise and serious policy development. The Pyne education changes – reforms is too kind a word – are a template for what not to do.

The universities can’t be blamed for wanting to free themselves from the uncertainties of political whims when it comes to funding. But the government was wrong to let them write its policy. It miscalculated the political odium higher fees would rouse in the community. Changes that look like putting a university education out of the reach of kids from lower-income families were never going to fly easily, and a lot more work needs to be done by Pyne before he brings his package back. A Xenophon-inspired inquiry would be a good start. Dumping the 20 per cent funding cut is another idea that could help.

Of course, the huge broken promise that underlies the crumbling edifice of these policies was in the context of repairing Labor’s “debt and deficit” mess. Here the prime minister, the treasurer and other ministers are struggling to keep a coherent message. Economist Stephen Koukoulas took to Twitter to remind us: “Abbott doubles budget deficit in Year 1: Now says budget in better position than inherited.” The prime minister tried to gee up his party room with the prospect of a return to budget surplus within five years. He later clarified that it would be almost in balance in that time frame. Never mind that the recently released Intergenerational Report (IGR) presumed all of Joe Hockey’s budget measures being implemented. Indeed, an embattled PM struggling to hold on to his job has contributed to their dismantling. And even on the rosy IGR scenario it still forecast deficits out 40 years. That same report assumed iron ore to be more than $107 a tonne; it’s currently trading at $56 a tonne and continuing to be a wrecking ball with revenues and forecasts.

Labor’s Bill Shorten says this year’s budget will be all about last year’s. It is almost unprecedented for a budget to still be dominating the headlines a year after it was delivered. Rectifying that will be no easy task, especially as Abbott is promising the government is not going to repair its budget this year at the expense of the family budget. Whatever that ends up meaning. He says it will be prudent, frugal and responsible. At the same time he is promising a tax cut for small business and a childcare package that the relevant minister believes will need more spending.

Abbott says he’s a glass-half-full man economically and that his government has made “a lot more progress than people think” as fiscal repairers. He claims 80 per cent of the budget has been passed and $30 billion in savings has been banked. Doesn’t quite gel with his characterisation of Labor and for that matter the Greens being nothing more than obstructionist wreckers. But then, he says Labor was heading the nation in the direction of Greece. “Ouzo economics” the new buzz words. Shadow treasurer Chris Bowen rejects the attack as inflammatory and irresponsible. He blames such hyperbole for damaging economic confidence. He says in 2012 the OECD showed Athens’ debt was 164 per cent of GDP while Australia’s was 42 per cent. Hellenic unemployment was 26 per cent; Australia’s, 6 per cent.

This budget has the added burden of being Abbott and Hockey’s last chance to impress the electorate and their representatives on the Liberal backbench. One long-serving MP says a budget has never turned a poll around. Nor has a black knight without arms or legs ever won a joust.