Treasurer Joe Hockey has reiterated that increasing Australia's debt ceiling will be a priority for the new parliament.
Speaking in the United States, where President Barack Obama's administration is battling to lift its legislated allowable level of government debt, Mr Hockey said Australia faces its own deadline.
"We will have to increase the debt limit to prevent Australia breaching the debt limit before Christmas," the treasurer told Sky News on Sunday.
A bill to raise the national debt ceiling beyond $300 billion is expected in parliament's early sitting days, which are not yet scheduled.
Mr Hockey said debt would near the current limit in December.
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Australia's budget continues to "haemorrhage" as the country faces a period of volatility, Mr Hockey said.
Paying down debt and driving economic growth is the government's aim, he added.
"We need to lay down a medium-term path that lifts the growth rate of Australia and inoculates us against what will be a fairly volatile period over the next few months and perhaps the next three to four years," Mr Hockey said.
The latest Department of Finance figures show the federal budget was $10.56 billion in deficit in the first two months of the 2013/14 financial year.
The statement for July and August showed the deficit was $1.25 billion larger than predicted in the May budget due to lower receipts.
A pre-election budget update released by Treasury and Finance in August forecast a $30.1 billion deficit for 2013/14, wider than the $18 billion predicted in the May budget.
Mr Hockey stood by the government's claims of a "budget emergency" and said the government continues to search for a solution.
Economic growth was the best road to recovery and the government will focus on attracting private investment in major infrastructure projects.
"If we rely on the current trajectory, we are going to see economic growth at below trend," Mr Hockey said.
The treasurer said there is a "vast pool" of private sector money and Australia should be capitalising on opportunities.
