Tony Abbott to Warn of Carbon Pay Cuts

TONY Abbott will use tomorrow's resumption of parliament to renew his attack on Labor's carbon tax by using Treasury economic modelling to warn it will slash wages.

The Opposition Leader will time his attacks to coincide with speculation about Julia Gillard's leadership as he seeks to put pressure on the government in the first sitting week of the year.

As the Coalition released its economic briefing notes yesterday, Labor ministers counter-attacked, with Wayne Swan condemning the opposition's pledge to relieve mining magnates such as Gina Rinehart and Clive Palmer of Labor's mining tax but refusing to implement a disability insurance scheme.

Mr Abbott spent much of last year attacking Labor over its carbon tax of $23 a tonne, which will take effect from July 1.

Sources confirmed yesterday Mr Abbott would return to the issue in parliament this week, with the Coalition economic note warning that the carbon tax would cause "a large and continually growing fall-off" in gross domestic product.

"On Treasury's own modelling, the cumulative loss of output will be $32 billion by 2020 -- and that's in real 2010 dollars (ie the figure is not being driven by inflation)," the paper says.

"What's more, this will rise to the enormous figure of over $1 trillion by 2050."

The opposition claims the carbon tax would cut real wages by 1 per cent by 2020.

"To put this figure in perspective, for someone on current average adult full-time earnings (approx $70k), this would be equivalent to a cut in their salary of around $600 a year," it says.

Coalition sources said the figures would form the basis of the opposition's attack in question time this week.

But the Treasurer said the Coalition stand was "weak and pathetic", and told ABC television the media was fanning the leadership speculation that has prevented Labor gaining traction on other issues in the past week.

Industrial Relations Minister Bill Shorten joined in, accusing the Coalition of concealing its workplace policy and of wanting to damage workers by introducing greater industrial "flexibility".

"When conservatives use the term flexibility, they actually mean that if you're poor . . . it's time to take a pay cut," Mr Shorten told the Ten Network's Meet the Press.

"Why is it . . . Coalition DNA says the only way the rich can get richer is with low-paid workers getting penalty-rate cuts?"

Mr Abbott, who has been wary about announcing industrial relations policies for fear of sparking Labor claims he would return to the Howard government's Work Choices regime, said Labor's Fair Work Act had caused problems with flexibility and militancy in the workplace and was damaging the nation's economic productivity.