Tasmania budget masks job cuts: Labor

Tasmania's Labor opposition claims the state's 2016/17 budget shows a "flimsy surplus" but hides inevitable public sector job cuts.

It's an assertion denied by Treasurer Peter Gutwein whose $5.5 billion economic plan, which shows a $77.3 million surplus, pegs wage increases to two per cent for government workers.

"I'm sorry to have to tell the Tasmanian people, the public servants, those teachers, nurses, fireys and police that Peter Gutwein has not finished yet - there are going to be more jobs to go and services to go," Labor leader Bryan Green said on Friday.

The opposition leader cited a budget assessment by ratings agency Moody's, which points to a widening deficit amid marginal increases in revenue over the forward estimates.

Meeting the targets set out in the budget would be challenging, the investment services agency said in a statement.

"Reductions in full-time employee positions would be required to meet these targets."

Mr Gutwein is standing firm on his budget measures and said a two per cent wage deal is fair and above CPI.

"The two per cent wages policy in the budget is fully funded, and there will be no new job cuts," he said.

Union demands for a greater pay rise would carve a $180 million hole in the budget outlook and mean a sacrifice in services, he added.

"If (unions) want to argue for more money ... then they need to start explaining what services they don't want."

In response to criticism, the government called on Labor to provide a credible alternative budget.

Mr Green will give the party's budget reply speech on Tuesday.

The Greens have also questioned the budget, deriding as a "sham" claims of a $50 million boost to frontline health services.

"The Treasurer is using tricky accounting to mislead Tasmanians ... there's actually only $13 million in new funding for health, including preventative health," party spokeswoman Rosalie Woodruff said.