Prime Minister Scott Morrison says Australia should welcome the savings made apparent by the $60 billion JobKeeper reporting error, which will ultimately save them money.
The government admitted on Friday its JobKeeper wage subsidy scheme to assist business and workers through the COVID-19 pandemic will now be $70 billion rather than $130 billion and will now only cover 3.5 million people rather than 6.5 million that had been forecast.
"There are many things you don't know in the middle of a crisis and when you're designing programs and schemes the size of JobKeeper, there were many unknowns and Treasury did the best they could to estimate what the cost would be," Mr Morrison told reporters on Sunday.
While admitting the government's fault, he said JobKeeper was designed to work alongside JobSeeker and other support programs, which together would support more than five million Australians.
"Sure the estimate was overstated and the process with the taxation office to keep us updated on that had a flaw in it, we acknowledge that, I acknowledge that," Mr Morrison said.
But he said the error meant Australians wouldn't have to borrow as much money.
"This is not money that is sitting in the bank somewhere, this $60 billion, this is money that would have otherwise had to be borrowed against the taxes that future generations would pay and so the result of this is that the program will cost not what it was estimated to cost.
"That means for the taxpayer, their debt levels will be lower, their interest bill will be lower and the government will be able to ensure it will continue to provide the many other essential services without the burden of that greater debt."
Labor's Katy Gallagher on Sunday called on Treasurer Josh Frydenberg to front a Senate inquiry to explain the embarrassing reporting error, while frontbencher Penny Wong said it was a "$60 billion black hole in the economic credibility" of the government.
Labor Senator for South Australia Penny Wong. Source: AAP
"We can't trust anything Scott Morrison or Josh Frydenberg say about the economy or the budget, and perhaps worse has been the failure to front up and take responsibility," Senator Wong told ABC's Insiders program.
"What I would say to Josh, this is your opportunity to front up and explain the $60 billion blunder to the parliament and to the Australian people."
The government has shown little sign of plans to use the .
"It means that businesses are in better shape than we might have anticipated when those original forecasts were put in place," cabinet minister Angus Taylor told Sky news on Sunday.
"It does mean that we're in a better position as we work our way towards recovery."
However, the government is under pressure from Labor, unions and advocacy bodies to expand the scheme to casuals and other groups not covered by the $1,500 per fortnight payment and extend it beyond its current end date in September.
Minister for Energy Angus Taylor. Source: AAP
Mr Taylor said a review into the program would go ahead in June and all of those issues would be looked at.
"The Labor party are out campaigning saying we should spend more money. They have never seen a dollar they don't want to spend," he said.
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