Shadow treasurer Joe Hockey has defended the coalition's $31.6 billion of proposed savings, saying Labor's accusations that they don't add up are "dead wrong".
Labor says an analysis, using previous advice from Treasury, Finance and the Parliamentary Budget Office (PBO), of the costings that were released on Wednesday showed a $10 billion "black hole".
Mr Hockey called it "even more lies" from a desperate party that has nothing positive to say ahead of the September 7 election.
And the departments have taken the unusual step of clarifying their role in the matter.
"At no stage prior to the caretaker period has either Department costed opposition policies," the Treasury and Finance secretaries said in a joint statement.
They also pointed out that different costing assumptions would "inevitably" result in different financial outcomes.
Parliamentary Budget Officer Phil Bowen also issued a statement, saying all confidential PBO costings were prepared on the basis of policy specifications provided by the person requesting the costing.
He said it was "inappropriate" for a party to claim a costing done for them showed the true cost of another party's policy.
Treasurer Chris Bowen said Labor had asked for specific costings that "were based on the best publicly available information about opposition policies".
But shadow assistant treasurer Mathias Cormann said Labor's allegations about coalition costings had been "exposed as the lie that it is".
"Kevin Rudd and his economics team were slapped down by the secretaries of Treasury and Finance, they were slapped down by the Parliamentary Budget Office," he told Sky News on Thursday.
Earlier Prime Minister Kevin Rudd questioned the truthfulness of Opposition Leader Tony Abbott.
"It is quite clear that there is now a massive $10 billion hole in the $30 billion they are claiming," Mr Rudd told reporters in Melbourne on Thursday.
"This is a $10 billion fraud on the Australian people."
Mr Abbott said his figures were produced by the PBO and validated by three distinguished public finance experts - Geoff Carmody, co-founder of Access Economics, Len Scanlan, former Queensland auditor-general and Professor Peter Shergold, former secretary of the department of Prime Minister and Cabinet.
"Let's be very clear, Mr Rudd has got all of his own figures wrong, now he is getting our figures wrong too," Mr Abbott told reporters in Sydney.
"When it comes to budget figures, when Mr Rudd's lips are moving you know he is not telling the truth."
Labor pointed to a document from April in which the PBO estimated more than 20,000 public service jobs would need to go to deliver the $5.2 billion claimed by the coalition.
Mr Hockey said this advice not only used quite different assumptions, it pre-dated the Pre-election Economic and Fiscal Outlook and his own costings from the PBO.
"It is plainly dishonest of the government to assert that its figures represent a costing of the coalition's position," he said in a statement.
Labor also raised questions over the coalition's assumptions over not proceeding with Labor's low income superannuation contribution, and savings measures linked to scrapping the carbon tax.
Mr Bowen said "history was repeating" itself after the coalition's 2010 costings were found to have an $11 billion black hole after the election.
The coalition has promised to release a full list of its election promises, both savings and expenditure, next week.
