Labor targets Govt over PM's retirement plans

The Federal Opposition has used Question Time to attack the Government over the Prime Minister's retirement plans.

With the Prime Minister revealing plans to step down during the next parliamentary term if he wins Government, Labor's has rushed out a television advertisement suggesting John Howard's succession plan is confusing.

"He says he'll go, as long as you're kind enough to let him stay long enough to be Prime Minister, one more time," the commercial says.

Labor's Anthony Albanese targeted Mr Howard in Parliament suggesting he made an internal party deal to make an announcement about his plans.

The Prime Minister insists there was no secret agreement.

"We will not be living any lies like Bob Hawke and Paul Keating Mr Speaker," he said.

Mr Howard says it is up to the Liberal Party not him to gift the leadership to Peter Costello after acknowledging that if re-elected, his next term would see a new Liberal leader take the Prime Ministerial role.

Speaking on Sky News, Treasurer Peter Costello has denied a deal was done with the Prime Minister about his retirement plans.

"We had a discussion about all of this last year as you know. I said then that I would go to the election as Deputy Leader and Treasurer and that's been my position ever since," he said.

"He's made his announcement this week. Which he decided to make and I think that opens the way for a good joint campaign."

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Labor targets Govt over PM's retirement plans