This budget will by no means be the only installment in the long-term restructuring needed to restore our economic health.

But this budget will bring us close to surplus, over the forward estimates and on track to a strong surplus within a decade.

This was the commitment we made, pre-election, and this budget keeps faith with our election commitments.

Prior to the election, we committed to abolish the School Kids Bonus that had nothing to do with education and the Income Support Bonus because these payments were a cash splash with borrowed money.

There are other one-off payments that should never have been introduced and are unaffordable at this time.

Prior to the election, we said we’d maintain school funding over the then forward estimates but explicitly refused to commit to Labor’s changes beyond that.

The best way to improve schools is to give local communities more say because parents and principals will be better than bureaucrats at getting the best possible value for taxpayers’ dollars.

Prior to the election, we said that we wouldn’t cut overall health funding but that we’d find ways of making health spending more efficient.

Part of that will be more price signals in the system with a strong safety net because “free” services to patients are certainly not free to taxpayers.

Prior to the election, we said that we wouldn’t cut the age pension. I want to assure vulnerable people that the age pension won’t be less tomorrow than it is today and that people turning 65 tomorrow are certainly not going to have to wait five years to retire.

I’m confident that pensioners will be better off because they’ll lose the carbon tax but keep the carbon tax compensation.

Still, with four out of five seniors on the pension, the number of workers per retiree dropping from five to three by 2050, and more than 1000 people becoming eligible for the age pension every single week, long term reform is essential and unavoidable.

To keep our commitments, there will be no changes to the pension during this term of parliament but there should be changes to indexation arrangements and eligibility thresholds in three years’ time.

There are other social security benefits where indexation arrangements and eligibility thresholds could be adjusted now.

Adjusting indexation slows the rate of increase and helps to ensure that a strong social safety net can be preserved for everyone’s future.

And everyone will benefit from the abolition of the carbon tax which damages our economy without helping the environment and which is costing the average household $550 a year.

I know that most families are doing it tough, including many families with above average incomes but with heavy commitments.

Not for a second would I label families as “rich” just because they are earning $100,000 a year. A teacher married to a part-time shop assistant with children to feed, clothe and educate is certainly not rich especially paying a capital city mortgage.

But the best way, the best way to help families on $100,000 a year is long-term tax relief and more business and job opportunities, not social security.

The changes in this budget will make the personal tax cuts much more likely in four or five years’ time.

Still, come budget night, I suspect that there won’t be many without a potential grumble – but involving everyone in repaying Labor’s spending binge is the only way to be fair.

The budget pain will be temporary but the economic improvement will be permanent.

I can assure you that everyone, everyone will be involved, including high income earners such as members of parliament.

I know that the tendency on budget night is to focus on “what’s happening to me” but we need to focus on “what’s happening to us” because everyone needs to be involved in fixing Labor’s debt mess if all of us are to prosper in the years ahead.

This will not be a budget for the rich or the poor; it will be a budget for the country.

It will be a nation building budget, even though it cuts spending, because you can’t build a nation by spending money you don’t have in ways that don’t build up your economic strength.

Everything about this budget is calculated to boost the long term strength of the economy; spending less on consumption so that we can spend more on capital including human capital in the areas at which we excel.

Business programmes will involve less bureaucracy and be more about backing businesses’ own judgment.

Training programmes will focus less on trainer priorities and more on employer needs.

Universities’ funding will shift but they will have much more freedom to innovate and to build on Australia’s strength as a magnet for students, teachers and researchers from around the world.

School leavers will be earning or learning – not becoming accustomed to unemployment.

Starting in this budget, for older people, for people with disabilities and women with young children, our aim is to maximise everyone’s ability to participate in the economy; it’s about driving change, but even more it’s about empowering choice.

And, of course, in a modern economy, that means more freedom to move around our cities rather than spending hours in some of the world’s longest parking lots.

This budget will fund our biggest ever national roads programme and make it easier for the states to fund the metro roads and rail that commuters need.

Now, I said earlier that budgets reveal the character of governments; they also show the mettle of countries.

This budget is about shifting our focus from entitlement to enterprise; from welfare to work; from hand-out to hand-up; from our own short-term anxieties to our nation’s long-term opportunities.

Government’s job is to make it easier for people to make big decisions: to build a house, to begin to study, to start a business, to employ someone or to save for the future – and to make it more likely that people will decide to have a go – because we can’t be a generous society unless we are also a productive one.

For the government, of course there are political risks in this budget.

But we owe it to our country; we owe it everyone who elected us to clean up the mess and to take decisions rather than to defer them.

Without a clear economic plan, our standard of living will decline; with this budget plan Australia can continue to be a beacon of prosperity, freedom and hope for the wider world.

Serious people and serious countries must be able to have an adult conversation about the choice that we face.

That’s what The Sydney Institute has invariably tried to promote and our country is the better for it.

For too long, governments talked about being economically responsible but squibbed the big challenges.

I don’t expect the government to be more popular the day after the budget but I do hope that we might have earned people’s respect for saying what we mean and doing what we say.