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Richard Cowan, Bo Erickson, Andy Sullivan and Katharine Jackson

US Congress approves bill to avert government shutdown

The Senate passed a stop-gap government funding bill minutes after the midnight deadline. (AP PHOTO)

The US Congress has passed spending legislation in a down-to-the wire burst of activity that will avert a destabilising government shutdown before the busy holiday travel season. 

The Democratic-controlled Senate early on Saturday in an 85-11 vote passed the bill to continue government funding 38 minutes after it expired at midnight. 

The government did not invoke shutdown procedures in the interim.

The bill will be sent it to White House, where President Joe Biden is expected to sign it into law.

The package had earlier cleared the Republican-controlled House of Representatives with bipartisan support.

President-elect Donald Trump and Elon Musk
Donald Trump and Elon Musk threw Congress into disarray with their budget demands.

The late-night vote capped a frantic week in which President-elect Donald Trump and his billionaire ally Elon Musk defeated an initial bipartisan deal, throwing Congress into disarray.

The final version stripped out some provisions championed by Democrats, who accused Republicans of caving in to pressure from an unelected billionaire who has no experience in government.

Congress did not act on Trump's demand to raise the debt ceiling, a politically difficult task, before he takes office on January 20.

The federal government spent roughly $US6.2 trillion ($A9.9 trillion) in 2023 and has more than $US36 trillion in debt, and Congress will need to act to authorise further borrowing by the middle of 2025.

The legislation would extend government funding until March 14, provide $US100 billion for disaster-hit states and $US10 billion for farmers, and extend farm and food aid programs due to expire at the end the year.

Some Republicans voted against the package because it did not cut spending. 

House Speaker Mike Johnson said the party would have more influence in 2025, when they will have majorities in both chambers of Congress and Trump will be in the White House.

US Speaker of the House Mike Johnson
Lawmakers would look at Donald Trump's demand on the debt limit in 2025, Speaker Mike Johnson said.

"This was a necessary step to bridge the gap, to put us into that moment where we can put our fingerprints on the final decisions on spending," he told reporters after the House vote, adding Trump supported the package.

A government shutdown would have disrupted everything from law enforcement to national parks and suspended pay cheques for millions of federal workers.

A travel industry trade group warned it could cost airlines, hotels and other companies $US1 billion a week and lead to widespread disruptions during the busy Christmas season. 

The package resembled a bipartisan plan that was abandoned earlier this week after an online fusillade from Trump and Musk, who said it contained too many unrelated provisions, such as a pay raise for lawmakers and a crackdown on pharmacy benefit managers.

Republicans struck most of those elements from the bill, including a provision limiting investments in China that Democrats said would have conflicted with Musk's interests.

Trump has tasked Musk, the world's richest person, with heading a budget-cutting task force but he will hold no official position in Washington.

Musk wrote on his social media platform X that he was happy with the package. 

US House Minority Leader Hakeem Jeffries
Democrats "have successfully advanced the needs of everyday Americans", leader Hakeem Jeffries said.

"It went from a bill that weighed pounds to a bill that weighed ounces," he posted.

House Democratic Leader Hakeem Jeffries said his party still achieved some of its goals and prevented Republicans enacting a debt-limit hike that would make it easier to cut taxes.

"We have successfully advanced the needs of everyday Americans, but there are still things to be worked on and we look forward to that fight in the new year," he told reporters.

Trump's demand to lift the debt ceiling was resoundingly rejected by the House - including 38 Republicans - on Thursday.

Johnson said lawmakers would look at the issue in January.

The federal government last shut down for 35 days during Trump's first White House term over a dispute about border security.

Previous fights over the debt ceiling have spooked financial markets, as a US government default would send credit shocks around the world. 

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