Outgoing National Australia Bank chairman Michael Chaney has urged the federal government to get the budget in the black to boost consumer and business confidence.
Mr Chaney said Australia hadn't had a debt to GDP problem, but people were starting to realise that in the next five to 10 years the nation would have an unhealthy 35 to 40 per cent debt to GDP ratio.
"It's really important for the government in the budget next year to map out a credible return to surplus over the decade because unless you have that I think you then have a reduction in consumer and business confidence and that feeds through into lower economic activity and higher unemployment," Mr Chaney told reporters after NAB's annual general meeting (AGM) in Perth on Thursday.
Mr Chaney said the national economy was "mixed" and growing below trend, with the struggling resources state of Western Australia now in the slow lane.
"The good thing is unemployment has fallen rather than risen and I think it's evidence of real resilience in the economy that even though we've had this major downturn in resources, other things are coming in and taking its place," Mr Chaney said.
"In resources, things have turned down and it's getting harder by the week in WA, but in the rest of the economy, in services, tourism, education and so on it's really picked up.
"In the consumer area of WA its tough and getting tougher."
He believes people will take the US Federal Reserve's interest rate increase "in their stride" as rates slowly rise.
In his last AGM after 10 years at the helm, he brushed off a barrage of questions from climate change activists concerned about NAB's financing of polluting industries.
"That was mild compared to the activism 10 years ago at Wesfarmers on the forests," Mr Chaney said afterwards.
He said the bank would continue to support electricity generators and would not look at new ways of financing companies in the future despite mounting pressure.
Mr Chaney also refused to support quotas to increase female participation on company boards.
He added that the length of time it had taken to exit the company's UK assets had been one of the disappointing aspects of his tenure as chairman.
NAB is disposing of its Clydesdale Bank and now wishes to focus on its Australian and New Zealand operations.
Mr Chaney now chairs Perth-based Wesfarmers and said he was leaving Australia's largest business bank in good shape.
The bank's new chairman, former Treasury Secretary, Ken Henry paid tribute to Mr Chaney and said the past 10 years had not been easy for financial institutions around the world.
"NAB is clearly a stronger company today than it was 10 years ago," he said.
