Treasurer Wayne Swan is convinced that bringing the budget back into the black in 2012/13 as previously promised is the right thing to do for the economy, although it will involve undertaking significant savings.
Treasury is forecasting a slim $1.5 billion surplus in 2012/13, which will be a massive turnaround from a predicted $37.1 billion deficit in 2011/12 - figures that will be updated when Mr Swan hands down his fifth budget on May 8.
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But Australian Institute of Company Directors CEO John Colvin believes that while the aim of government should be to get the budget in surplus, he is not convinced that it should go flat out to achieve it next financial year.
Over time there was a better chance of the economy picking up, and a better chance of not causing problems by taking out large amounts of funding.
"In that way, over time you will get to your surplus and you probably get there quicker than probably damaging some of the economy on the way through," Mr Colvin told a conference in Sydney.
He said businesses did not pay off all their debt that would leave areas of their operations exposed.
Mr Colvin was presenting the results of the institute's latest sentiment index which found almost 60 per cent of the 554 chairmen and executive and non-executive directors polled did not believe a surplus was vital now, particularly if global economic volatility intensified.
Only 26 per cent of respondents said it was essential.
The survey ranked global economic uncertainty as the chief economic challenge facing businesses, followed by a high Australian dollar and then industrial relations concerns.
The impact of a minority federal government as a challenge to business fell to fourth, having been ranked number one in the November 2011 survey.
Still, 78 per cent of directors maintain the government lacks an understanding of business, down from from 83 per cent previously.
Nearly 90 per cent of directors still believe the performance of the government is negatively impacting consumer confidence.
Forty-five per cent felt the national broadband network was a bad thing for the economy, down from 55 per cent previously, while 43 per cent now see it as a good investment, up from 35 per cent.
At the same time, respondents were less negative about the carbon tax with just 16 per cent now saying it was a major challenge facing business, down from 31 per cent.
However, more than 60 per cent still think it will be a negative for business.
"There is a degree of resignation that it's on its way," Mr Colvin said.
"Business are getting on with the job of dealing with it, but they are still quite concerned about the impact it will have."
