Labor has put forward a compromise to pass $6 billion in savings that includes scrapping the one-off baby bonus to new parents.

Comment has been sought from the Federal Government, however, The Australian Financial Review reports that the Government has already agreed to dump the proposed bonus as part of the compromise with Labor.

The Nationals have previously strongly opposed moves to reduce the payment.

The savings measures in the Government’s so-called omnibus bill are closer to going through Federal Parliament, but will not include cuts that would have affected the lowest income-earners.

It means the most vulnerable — those on Newstart, disability payment, carers and the aged pension — will be shielded because they will not lose the money originally intended as compensation for the carbon price.

Labor frontbencher Stephen Jones told ABC’s RN program it was possible to achieve budget repair by targeting higher income earners.

“I don’t believe that we should be going after the poorest people in the community to fund savings.”

“I think Labor has within it the capacity to find savings in alternative areas.”

The Government has been amenable to the change despite originally demanding Labor pass the savings in full.

Mr Jones said they could strike a deal this week.

“How about we look at different sorts of savings, you will get our full support [and] we will sit down and work through the night to make it happen, and hopefully by the end of the week you could have the Senate debating this,” Mr Jones said.

Labor against cuts to child dental scheme, AM understands

Finance Minister Mathias Cormann and shadow treasurer Chris Bowen have been working through the compromise plan.

The Coalition has reserved its right to introduce a new bill to scrap the energy supplement — but splitting them out from the omnibus bill gives it a much better chance to pass.

AM understands Labor also decided not to support cuts to the child dental scheme, and it wants to wind back the cuts to the Australian Renewable Energy Agency (ARENA).

Opposition sources say the aim is for ARENA to retain a key role supporting research and development at the CSIRO and universities.

Greens senator Rachel Siewert said she was sceptical about Labor’s compromise proposal and annoyed the two major parties refused to allow a public senate hearing.

“We were deeply concerned when Labor joined with the Government and ensured that there wasn’t proper scrutiny of this bill,” she said.

“If they are supporting the majority of these schedules, they obviously want to see the back of this bill.

“They want to see it through quickly, the same as the Government wants to see it through quickly. Nothing happening here, move along folks.”

– with The Australian Financial Review