Budget on trajectory to balance: Morrison

Treasurer Scott Morrison insists the federal budget is on a trajectory towards balance not greater deficits.

Government expenditure as a proportion of GDP will begin to decline in 2016 after peaking, while net debt will peak next year and decline from that point.

"By international standards though, our debt does remains modest, but by our own standards as a coalition government we greatly lament the level of debt we currently have," Mr Morrison told the Bloomberg Summit in Sydney on Wednesday.