NSW budget needs overhaul: opposition

The NSW opposition has called for a sweeping overhaul of how the state budget is set.

Fairfax has reported the opposition call comes ahead of an anticipated surge in state debt to meet the heavy infrastructure outlays anticipated for the next decade and following continuing blow-outs in project costs.

In a paper to be released on Monday, the opposition argues that the so-called fiscal gap resulting from the ageing population and the related rise in demand for services will place pressure on the state's finances.

Changes to the budget papers and a trend towards special payments made by the Treasurer, outside of the budget process, make it difficult to monitor government actions, the opposition says.

It highlighted the $25 million for the Lane Cove Tunnel operators for delaying the narrowing of Epping Road before last year's state election.

"The question remains as to whether the payments, which appear to be regular agency outlays, are in fact justified or whether they reflect sloppy or other mismanagement," the discussion paper states.

The pressure from the opposition over the state's finances follows the government's failure to meet several targets under the Fiscal Responsibility Act.