Despite slump, government remains hopeful

A slowing economy has forced the federal government to slash the size of the budget surplus they were banking on for the next four years. Treasurer Josh Frydenberg delivered the first update on the state of the budget since being re-elected in May, revealing the nation's finances are under pressure from drought and falling tax takes.

Scott Morrison (left) and Finance Minister Mathias Cormann (right) ahead of handing down the Mid-Year Economic and Fiscal Outlook. Source: AAP