Tony Abbott has backed away from his early election threat, declaring he is confident the Government can negotiate with a hostile Senate to pass tough Budget measures.
The Prime Minister also defended the failure to tell voters before last year's election about plans for a Medicare co-payment, saying you "don't have all your good ideas at once".
Foreign Affairs Minister Julie Bishop bore the brunt of the Budget backlash yesterday when students jostled and heckled her at the University of Sydney.
Police and security shoved demonstrators out of Ms Bishop's path as about 200 students besieged her to protest against the Government's plan to deregulate university fees and increase student loans.
While Mr Abbott said on Wednesday that he would not cop the Senate frustrating the Government and warned crossbenchers they risked losing their seats in a new poll, Opposition Leader Bill Shorten used his Budget reply speech on Thursday night to taunt the PM to call a double-dissolution election.
"If you think that Labor is too weak, bring it on," Mr Shorten said as he outlined Labor's plan to oppose billions of dollars in Budget savings measures.
Mr Shorten yesterday ruled out compromising to lower the $7 Medicare co-payment.
Mr Abbott said he would work with "responsible members" of minor parties and independents to ensure the Government's policies were implemented.
He said the co-payment was a long-term structural reform that would put some modest price signals into the health system and raise money for the medical research fund.