Federal MP Clive Palmer, whose party is likely to hold the balance of power in the new Senate, has indicated he will not support the government’s Direct Action climate change policy.

But Environment Minister Greg Hunt is confident the coalition’s Direct Action plan will pass the Senate because funding is now tied to the budget. He says attempts by opposing senators to block the budget could cause a constitutional crisis.

The government wants to replace the carbon tax with the multi-billion dollar Direct Action plan, which would pay polluters to voluntarily reduce their emissions, while enlisting a “Green Army” to plant trees.

Mr Palmer says the government’s move to tie the plan to the budget is “nothing short of blackmail”.

“They are doing this really as a tactic, like little kids wanting to get their way,” he told reporters in Brisbane.

Mr Palmer says the policy is a waste of money and wants the funding re-directed to the age pension.

In a series of tweets Mr Palmer wrote:

Supporting aged pensions is more important than supporting token campaigns like Direct Action. #auspol

— Clive Palmer (@CliveFPalmer) April 21, 2014

The rights of our pensioners are more important and surely have greater priority #auspol

— Clive Palmer (@CliveFPalmer) April 21, 2014.

Mr Palmer has previously expressed scepticism about the science behind climate change, and in a recent interview with the ABC’s Lateline he said “nature” could be made to limit its carbon emissions.

While the Abbott government may get funding for direct action through, it will need the Palmer United Party (PUP) senators to help repeal both the carbon and mining taxes from July.

Mr Palmer said the coalition may not get it.

“If they’re going to adopt a tactic like that we’ll have to reconsider our position when it comes to the mining tax and the carbon tax,” he said.

Mr Palmer claims direction action is a “token gesture”, a waste of money and a coalition “slush fund” to appease consultants and lobbyists.

He says the money allocated for the policy should be used for pensions, which could be under review in the main budget.

But while he’s against Direct Action, Mr Palmer said PUP would support a national inquiry on climate change.

With AAP, ABC