Setback ... Treasurer Wayne Swan. Credit:Andrew Meares New figures published on Thursday show the federal coffers were hit hard by a plunge in commodity prices, which caused the budget balance to deteriorate by near $3 billion. Opposition leader Tony Abbott said the government’s failure to deliver a surplus was a broken promise by Labor as serious as its decision to introduce a carbon tax after promising not to before the last election. ''What this demonstrates is you just can’t trust this government to manage the economy and you just can’t trust this govt to tell the truth,'' Mr Abbott told reporters in Sydney. ''It is a failure of trust. We will pursue this government every single day until the next election on its failure to deliver a surplus.''

While the mining tax appears to have raised some revenue – contrary to media reports – it is understood the weakness in tax receipts was more severe than the government had forecast in its recent mid-year budget review. The government had forecast a surplus of $1.1 billion for 2012/13. In October, the month in which the government received its first instalment of company taxes from the September quarter, tax receipts were $3.9 billion behind where the government had forecast in May. Mr Swan said further cutting spending to achieve a surplus would endanger jobs and growth. ''We don’t think it’s responsible to cut harder or further to fill a short term 2012-13 hole in the budget,'' Mr Swan said.

''At the end of the day I don’t care about the political outcomes, I care about the economic outcomes,'' he said. ''‘The course of action I’m talking about today really comes very much, I guess, to the core of my values and the values of the Labor Party.'' Government spending was also weaker than expected, but this was not enough to prevent the budget balance weakening to a deficit of $12.3 billion, about $3 billion worse than forecast. Mr Abbott said it was important to deliver a surplus to ease cost of living pressures. ''When it comes to the economy, this is a government that just doesn’t get it,'' Mr Abbott said.

''This is a government that has competely failed on economic management.'' Mr Swan said the lower than expected profits had not only been in the resources sector, but also in other industries affected by the strength of the Australian dollar. ''What we’ve seen is a sledgehammer hit our revenues,'' he said. The figures released today show the mining tax appears to have raised some revenue, contrary to media reports. Resource rent taxes – which include the mining tax and the petroleum resource rent tax – raised $500 million in the month, up from $213 million in September.

The increase is likely to have been driven by the mining tax, but the government is not specifying how much mining tax was raised in order to protect the confidentiality of taxpayers. Mr Swan repeated the worsening in the government’s budget bottom line was due to revenue falls rather than increased government spending. He said the ratio of spending to gross domestic product (GDP) was 23.8 per cent in 2012/13, which was below the average spend of the previous Howard government, and would remain around 24 per cent of GDP over the forward budget estimates. ''We will continue to exercise spending restraint, even in the face of continuing volatility and uncertainty in the global economy,'' he said. The treasurer said that since 2009, the government had offset all of its new spending commitments and the next budget for 2013/14 would continue to exercise spending restraint.

''‘When we are funding new priorities and new Labor reforms, including the National Disability Insurance Scheme and the Gonski school reforms, we will do that by changing priorities within the budget.'' The government first talked about bringing the budget back to surplus in 2012/13 in 2010. ''So through this whole period we have kept making responsible savings to fill what has been an emerging and growing revenue hole,'' he said. ''But things are a bit different now and that’s the main point I want to make today. ''At this stage I don’t think it would be responsible to cut harder or further in 2012/13 to fill a hole in the tax system if that puts jobs or growth at risk.''

The ''real economy'' remained resilient, he said. The treasurer said he believed the government was taking the responsible course of action in the current economic circumstances. ''If the worst thing people say is we got the economics right again but fell short on the politics, I would say, so be it,'' he said. ''At the end of the day I don’t care about the political outcomes, I care about the economic outcomes.'' Mr Swan said the government would allow the budget’s automatic stabilisers take their course.

The Institute of Chartered Accountants said it had always maintained there was no need to push for a budget surplus in 2012/13. ''It was always going to be much more important that we protect the weak sectors of our economy rather than artificially manipulating our budget numbers to deliver a theoretical surplus,'' the institute’s Yasser El-Ansary said said in a statement. ''Today’s admission confirms the inevitable - a surplus could not be reached without a massive and very significant cut to budget spending, which would be devastating from an economic perspective.'' The government now should consider how to step in and help prop up the weaker parts of the economy, Mr El-Ansary said. A partner at Deloitte Access Economics, Chris Richardson, said the figures showed a significant blow-out in the gap between the budget forecasts and actual tax collections.

''October was the month in which China's slowdown started to bite the budget,'' Mr Richardson said. ''Although it's still not impossible to get a surplus, there's a clear gap there, and the government would have to make a bunch of decisions pretty fast, or pull the plug. That choice is now looming large and probably coming soon.'' The figures also provide the first clues as to how much mining tax was paid during its inaugural September quarter. Resource rent taxes – which include the mining tax and the petroleum resource rent tax – raised $500 million in the month, up from $213 million in September. The increase is likely to have been driven by the mining tax, but the government is not specifying how much mining tax was raised in order to protect the confidentiality of taxpayers.

Loading The financial statements are not directly comparable with the mid-year economic and fiscal outlook, published in October, but it is understood the slump in revenue is weaker than expected within the government. with AAP