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$50b needed to deliver Budget surplus
$50b needed to deliver Budget surplus

The Government and Opposition will have to deliver the biggest Budget surpluses in history if they are to honour their pledges to erase the debts incurred fighting the global financial crisis.

A surplus near $50 billion, that in dollar terms would dwarf the previous record of $19 billion set by Peter Costello and Wayne Swan in the 2007-08 financial year, may be necessary in coming years.

The Opposition yesterday came under pressure over its promise to deliver a surplus after shadow finance minister Andrew Robb said there were doubts over the state of the Budget.

"Well, it just depends," he said. "As I say, there's so much uncertainty around the numbers."

It forced shadow treasurer Joe Hockey to say there was no doubt over the Opposition's commitment to a surplus, but he qualified it depended on the Budget figures.

"So as we said at the last election, based on the information and numbers provided at the last election we absolutely stand by it - the commitment to have a surplus next year," Mr Hockey said.

The Opposition is scouring the Budget to find spending cuts, with increased pressure because of spending promises made by leader Tony Abbott.

It is also under pressure because of the problems with its Budget figures before the 2010 election after Treasury found an $11 billion hole in its claims.

Prime Minister Julia Gillard has ramped up her rhetoric in recent days on the Federal Government's forecast of a $1.5 billion surplus for 2012-13 after a $37 billion deficit this year.

Treasurer Wayne Swan said the Opposition's stance on a surplus was a farce, and the Government was firm in its commitment.

"I produced a mid-year (Budget) review which nails our flag to the mast," he said.

But a breakdown of the Budget shows the huge challenge facing Mr Swan and Mr Hockey.

Net debt is expected to be about $135 billion before it is paid down by 2020-21. To pay that debt purely through Budget surpluses requires surpluses peaking at 1.8 per cent of GDP by the turn of the decade.

The biggest surplus was delivered by the Whitlam government in 1973-74, at 1.9 per cent of GDP.