AS IT HAPPENED: Angus Taylor delivers budget reply speech, shares vision for 'fairer, freer, and better Australia for all'; Independent senator defects to Labor; PM defends investment properties

That concludes our live coverage tonight of Angus Taylor's budget reply speech. You can find more at 9news.com.au and we will continue to bring you reactions to his plans for a Coalition government.

Joyce is asked whether One Nation would consider being a junior party in the Coalition, such as the role the Nationals currently play.

He says the right-wing party would be prepared to work with those parties but not to the extent of entering a formal Coalition.

"What we would do is we would offer supply and confidence to people who would take on board our policy structure," he tells the ABC.

"We do not want the prizes. We do not want the ministries. So you can keep all the prizes, but there'll be certain policy outcomes.

"For instance, scrapping the climate change department and or climate change policy and reallocating those resources to where they better suit Australia."

Senator Barnaby Joyce accuses Taylor of "basically reading off the One Nation script".

He says immigration must be linked to the skills the country needs in certain areas, while making sure people from "febrile" areas of the world are "precluded".

"As what we've said all the way along, we look at a stocktake of what Australia can absorb," Joyce told 7.30.

"As we know we've been bringing in about the population of Canberra a year. It sort of waned a little bit lately, but we just didn't have the houses, we didn't have the schools. We certainly didn't have the dams, we didn't have the universities, we didn't have the hospitals.

"And it's Australian people who are waiting in emergency departments and you know, fighting."

Joyce says he wouldn't have stayed with the Coalition even if it had adopted harsher immigration policies like these.

Asked if Taylor has "stopped the flow" towards One Nation with this speech he responds simply: "No".

Taylor also won't put a number on how much his plan to index the bottom two income tax brackets to the inflation rate would cost the budget.

"Well, the biggest thing is what it's going to cost hardworking Australians," he says, claiming a typical worker on $70,000 would be $250 better off in the first year, $500 better off in the second year, $750 in the third and $1000 in the fourth

" … This is the thief in the night. This is actually how Labor generates revenues."

He says the policy will cost "what is necessary to alleviate those numbers that I just outlined".

"The number will depend on the inflation rates we see close to the election, and we will put our costings closer to the election," he says.

Australia's migration system is a little bit more complicated than just setting a cap and saying no one else can come in once that figure is reached.

It depends on various different "streams" as well as how many temporary visaholders are leaving, as well as the number of New Zealanders, who have special privileges, are arriving and even Australians who might come home.

Taylor says international student numbers is "one area that is obvious for us to look at".

"What is clear is that the number of students in this country has been at record levels," he says.

"This government lost control of that situation."

He refuses to rule in or out cuts to working holiday visas, something the Nationals oppose because of how important those visitors are to fruit picking and other regional industries.

Taylor promises a concrete overall migration number closer to the election but says it will be "below 200,000".

ABC's 7.30 host Sarah Ferguson pushes Taylor to put a number to his claim that he is proposing "one of the biggest cuts to immigration in Australia's history".

"What's your number?" she says.

He refuses to lay out a specific figure but says it will be 70 per cent down from the peak year after the pandemic (550,000) and 40 per cent down from current levels (295,000 based on the prediction in this year's budget).

"The truth is, the right number will depend on how many houses get built," he says.

"I mean, this is the whole problem.

"This government thought that they could pick the right number without knowing how many houses that we're going to get built, and the truth is, not enough houses have been built for the numbers they said."

Taylor has denied he's laying out a plan to stop One Nation's momentum and defended his opposition to welfare for permanent residents.

"It's about putting Australian citizens first, and that's the duty of a government, to put Australian citizens first," he tells the ABC's 7.30.

"And I think it's extraordinary that at a time like this, the government has cut support for older Australians' private health insurance, and yet there is welfare for non Australian citizens."

He says he's not forcing anyone to become a citizen but claims the status would be "meaningless" if it didn't provide other privileges.

"We're saying that if you want access to the privileges, which we believe should be privileges of citizenship, you need to become a citizen," he said.

Taylor, who became leader of the Liberals in February, has urged Australians to believe in his promise of a better government.

"Believe in a prospect of a fairer, freer and better Australia," he said.

"That Australia is worth fighting for, now more than ever, and the fight starts tonight."

Taylor was met with a standing ovation from his side of the chamber.

One of Taylor's core policies is delivering 400,000 more homes, which he said will be core to immigration and will result in "one of the biggest cuts to immigration in Australian history".

"We will invest $5 billion in supporting infrastructure like roads, water, power, and sewerage. With such infrastructure supported, we will unlock 400,000 new homes," he said.

"As I said, we will cut red tape, which will take up to $70,000 off the cost of a new home."

Taylor said his plan to tie migration numbers to houses would cut down migration rates.

He added that he would deport 70,000 "overstayers" from Australia.

Taylor said the government is stealing from taxpayers through bracket creep and said he would index the bottom two income tax brackets at the inflation rate.

"The higher Labor's inflation goes, and the longer it lasts, the more the government takes from you," he said.

"This is a stealth raid on Australians working hard to get ahead.

"Under a Coalition government I lead, this will end."