THE Gillard government will scrap its voluntary internet filtering grants program to save $9.6 million over three years.
A combination of reasons led to the decision, including moves by Telstra, Optus and Primus to voluntarily block child abuse websites.
"Consultation with industry has identified limited interest in the grants due to the increasing range of filtering technologies readily available to online users, including browser and search engine filters," the government says in the 2011-12 budget papers.
"Savings from this measure will be redirected to support other government priorities."
Labor intends to introduce mandatory ISP internet filtering -- a policy championed by Communications Minister Stephen Conroy -- once a government review is completed.
Treasurer Wayne Swan's fourth budget today is aimed at delivering $22 billion in savings to meet the government's surplus target in 2012-13.