Govt won't budge on ADF pay deal

The Abbott government is staring down outspoken senator Jacqui Lambie as she vows to oppose outright its legislative program until a defence force pay deal is overturned.

The Palmer United Party senator is angry at the "insulting" deal which delivers a lower-than-inflation annual pay rise of 1.5 per cent.

She intends to vote against all government bills and has urged Labor, the Greens and other crossbenchers to follow suit.

But there's no indication she even has the support of PUP leader Clive Palmer or her party colleagues in the Senate.

Treasurer Joe Hockey insists the government does not have the money to offer Defence personnel more than the amount determined by an independent tribunal.

"Threats don't work with this government," he told reporters in Adelaide on Friday.

"We have to live within our means, and everyone is making a contribution."

Some public servants will not be getting any pay rise and others have been offered a one per cent increase.

Government leader in the Senate Eric Abetz described Senator Lambie's threat as improper.

"That's like cutting off your nose to spite your face," he said, adding all senators should assess each piece of legislation on its merits.

The government has relied on Senator Lambie's vote to help secure upper house support for repeal of the carbon and mining taxes.

Last week she and other PUP senators agreed to pass the coalition's $2.5 billion Direct Action climate plan.

Her initial response to the Defence pay deal - calling for veterans to turn their backs on government MPs at Remembrance Day services - has not gone down well with Mr Palmer.

That doesn't worry Senator Lambie.

"It's getting to the point I just don't care what Clive Palmer's position is on this at the moment," she said.

"If he had a conscience he'd stand right beside me and our troops and our veterans."

Mr Palmer says he opposes the pay deal but will not use memorial days to make a political stance.

Neither he nor PUP's Senate leader Glenn Lazarus have indicated where they stand on their colleague's blanket ban on government legislation.

"Clive will have to decide whether he wants to see his party separated in the Senate," Senator Lambie said.

Opposition Leader Bill Shorten, while sharing the senator's frustration about the pay deal, said he did not entirely agree with her course of action.

"If Tony Abbott really valued our soldiers, pilots and navy personnel he'd pay them properly."

Senator Lambie says her vote-no policy would make her job easier because most of the government's legislation was not "flash" anyway.