Tony Abbott did not dispute a warning from Deloitte Access Economics about the swelling deficit but played down the prospect of unpopular cuts. “What will be obvious on budget night is that this is a budget that is measured, responsible and fair,” the Prime Minister said.

“It will be a budget for small business and families but, as well as that, very importantly there will be a credible path back to surplus.”

Finance Minister Mathias Cormann said the downturn was the result of “global economic headwinds”, including the fall in iron ore and other commodity prices. “That is not something that is in the government’s control,” Senator Cormann said.

Mr Shorten acknowledged that “tough decisions” had to be made to repair the budget as he made a major speech on fiscal policy at the University of Sydney. He issued a passionate defence of Labor policies in response to hecklers who attacked the party’s policies on border protection and industrial relations. “There’s a big difference between a tough decision and (an) unfair decision,” Mr Shorten said as he declared fairness would be a key test for the budget.

Cabinet ministers will meet on Thursday to sign off on a budget that will be vital to Mr Abbott’s prospects after the attempted leadership spill in February. There are concerns the meeting has been limited to a one-hour video-conference at 5pm that will not give ministers enough input into major decisions. They see this as proof it will be a briefing on decisions already made by the expenditure review committee rather than an opportunity for ministers to have input into sensitive policy changes.

The expenditure review committee of cabinet — the so-called “razor gang” chaired by Mr Abbott and including Joe Hockey and Senator Cormann — will meet to canvass many of the budget decisions before the full cabinet discussion.

In a sign of the differences within the government, some said last week’s cabinet meeting left some budget proposals unresolved while others insisted that almost everything was nailed down and ready to be announced.

One source said the coming cabinet meeting was “unusually abbreviated” but another said it was standard practice to have a short meeting to put the finishing touches on the budget.

Any decisions on Thursday night to make significant changes to the budget would be difficult to implement given the budget papers would normally go to the printers the next day.

However, Labor once pulped and reprinted a document as late as the day before the budget.

Additional reporting: Simon King