Australia's fiscal position is becoming increasingly untenable, even if current debt and deficit metrics remain low by global standards, TD Securities has warned in a strongly worded note to clients.

"The government is borrowing record amounts to consume, not invest - a ticking fiscal time bomb," the investment firm's chief Asia-Pacific macro strategist Annette Beacher said on Tuesday.

TD Securities expects $100 billion of new bonds to be issued every year over the next three years at least, as the inability to fix the budget due to populist stonewalling sparks an "explosion" of government bonds.

Her warning comes a week after Treasurer Scott Morrison raised a scenario where no budget savings were passed in parliament, warning that if combined with a further deterioration in economic parameters the fallout would be a trillion dollar debt burden over the next decade.