The Morrison government has earmarked $600,000 to plan for a new diplomatic estate in Canberra, despite the Canberra Liberals promising to scuttle the deal if elected.
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The Commonwealth and ACT governments agreed in March to trade a section of bed in Lake Burley Griffin's West Basin for horse paddocks in Curtin, in order to expand Canberra's diplomatic estate.
The ACT government plans on reclaiming the section of the lake as part of its long-awaited West Basin redevelopment.
However the Canberra Liberals have pledged to unpick the deal if elected at next weekend's ACT election, after a backlash from horse owners and local residents.
The money, contained in Tuesday's budget, suggests the federal government intends for the deal to go ahead, despite the opposition from the local Liberal branch.
It will come from the National Capital Authority's existing budget portfolio.
The authority has searched in vain for more land for embassies for years, with a lack of available sites forcing it to turn away countries looking to establish a diplomatic presence in Australia's capital.
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According to the National Capital Plan, new embassies should be built in places which were prestigious and close to Parliament House as well as other embassies, which effectively limits the options to blocks of land in the tightly-held inner-south.
