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No retreat from our promises: Morrison

AAP logoAAP 19/12/2016

Treasurer Scott Morrison says the federal government is getting spending under control, but admits there is more work to be done.

More than $22 billion worth of savings have been legislated since the July election, leaving Mr Morrison optimistic of returning the budget to surplus by 2021.

"There is more work to be done," he told reporters in Canberra on Monday following the release of the mid-year budget review.

While the statement shows a small improvement in this year's financial position to a deficit of $36.5 billion, the bottom line worsens by just under $11 billion over the next three years.

Mr Morrison said the government needed partners in parliament to support its savings efforts to restore the budget to balance.

"We will continue to work with everyone in the Senate to complete the budget repair program but we have made significant progress, we are heading in the right direction," Finance Minister Mathias Cormann said.

Mr Morrison said he didn't want to repeat Labor's mistake of forecasting budget surpluses and not achieving.

"These are the projected outcomes on the cash balance based on the information that is currently before us and the best assessments we can make of that," he said.

"On the best information we have able to us, the government's plan to return the budget to balance is projected to be in 2021 and that is something that says our plan remains on track."

Mr Morrison insisted revenue, as a percentage of the economy, was higher than the long-run average.

"So I don't think it is a good plan to overtax the economy, undermine growth and, therefore, undermine the revenues that would come from that growth."

On expenditure, the treasurer insisted spending had been brought under control.

The critical contribution since 2013 was a slowing in the rate of growth in expenditure, he said.

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