Mr Swan said the budget, which delivered a $21.7 billion surplus, had been put together in challenging circumstances.

"It meets all of our commitments, it fights inflation and it invests in the future," Mr Swan said.

"It puts behind us the politics of short-termism that has characterised politics for a long time in this country and puts in place a plan for the future."

He said the core plank in this first Labor budget was a $40 billion investment to modernise the economy, and invest in first world infrastructure, education and health.

"It's a very substantial commitment to modernise the Australian economy, to expand the productive capacity of the Australian economy and to make sure that in the future we can look our children in the eye and say we did the right thing by Australia when the government changed."