Falling confidence and retail sales, record high household debt and sluggish wage growth have not dampened the government's enthusiasm for consumption growth.
The federal government's forecasts for economic growth and a return to surplus have sparked a sceptical response from economists and ratings agencies.
Wage growth will leap from 1.8 per cent in the December quarter of 2016 to 3.75 per cent in 2020/21, according to the federal budget released on Tuesday.
The government believes the pick-up in wage growth will help boost consumption spending, which is critical to overall economic growth.
Gross domestic product is forecast to be 1.75 per cent in the financial year ending June 30, before leaping to 2.75 per cent in 2017/18 and rising to three per cent in 2018/19.
Moody's associate managing director Marie Diron said GDP growth was likely to be slower than the government's projection.
"Productivity growth has slowed in Australia, like in other high-income economies. We estimate that this slowdown is partly related to long-lasting factors that will continue to weigh on growth," she said.
"In turn, somewhat less strong growth will weigh on government revenues and will tend to raise expenditure compared with the budget projections."
The government has forecast a fall in unemployment of only 0.5 per cent, from 5.75 per cent to 5.25 per cent, between now and 2020/21.
In other words, the government expects wage growth to nearly almost double as the unemployment rate incrementally falls - which will be tough.
The government's optimistic projections of wage growth also expects a big rise in income tax to help rapidly cut the deficit.
Budget papers indicate the deficit, which is $37.6 billion for 2016/17, will fall to $21.4 billion in 2018/19 to just $2.5 billion in the following year.
The federal government then hopes to deliver a surplus of $7.4 billion in 2020/21.
Ratings agency Fitch also said the federal budget implies a faster reduction in the deficit than the group's forecasts had projected.
ANZ senior economist Cherelle Murphy noted tax receipts were forecast to rise from 23.2 per cent of GDP in 2016/17 to 25.4 per cent of GDP by 2020/21, while payments were expected to be stable around 25 per cent of GDP until 2020/21
"The small surplus in the underlying cash rate depended heavily on the return to stronger economic growth and new revenue raising measures," Ms Murphy said in a statement.
"There are downside risks to the revenue numbers, in our view, while on the spending side tight discipline will be required.