Cabinet meets in Sydney to discuss budget

Prime Minister Malcolm Turnbull and his cabinet are meeting in Sydney to discuss the May 3 budget and election strategy.

Federal cabinet is meeting in Sydney on Tuesday, just a month ahead of Malcolm Turnbull's first budget as prime minister.

The meeting is expected to confirm key directions for the May 3 budget as well as policies to be rolled out ahead of a possible July 2 double-dissolution election.

It comes as the latest Newspoll put Labor in the two-party preferred lead 51-49 for the first time since Mr Turnbull ousted Tony Abbott in September.