THE Baillieu government's budget surplus was built on a series of ''risky'' decisions to siphon hundreds of millions of dollars from publicly owned agencies, the Auditor-General has warned.

In a blow to the government's financial management claims, a report tabled in Parliament says the strategy of ripping cash from publicly owned entities that sit outside the budget accounting framework - including water authorities, WorkCover and the Transport Accident Commission - to deliver promised surpluses is threatening the financial viability of those agencies.

''Relying on agencies outside the [general government sector] to support … revenue is a risky strategy,'' warns the audit report, which was tabled on Wednesday.

It says the approach depends on the ability of the agencies to raise revenue from consumers or go into debt to pay ''dividends'' to the government.

This ''potentially could risk the financial sustainability of those agencies''.