Treasurer Joe Hockey says the economy is growing below trend after the release of the latest national accounts data.

Treasurer Joe Hockey says the latest economic growth figures point to another deterioration in the federal budget.

Gross domestic product (GDP) expanded by a modest 0.6 per cent in the September quarter and for a below trend annual growth rate of 2.3 per cent.

“Combined with other economic data it is clear that the nominal growth forecasts in the PEFO will not be reached,” he said, referring to the pre-election fiscal outlook.

“This points towards a further deterioration in the budget bottom line.”

Mr Hockey said the September figures showed what sort of economy the coalition had “inherited” from Labor.

“The fact is the economy is stuck in second gear,” he told reporters in Canberra on Wednesday.

“We have inherited an economy with below trend growth, rising unemployment and a deteriorating budget.”

He said 0.6 per cent quarterly growth was “not good enough to be able to deliver the jobs that people want”.

Mr Hockey said the government had a repair job to do, as well as an economic plan to implement.

“We need to speed up the Australian economy and I would say to our political opponents `now is not the time to oppose the repeal of the carbon tax … or the mining tax’,” he said.

“Now is not the time to play silly games in relation to the budget, because these figures clearly illustrate the fact that budget has deteriorated significantly.”

He said Labor was holding up $18 billion of budget savings the coalition had promised during the election.

Asked if there would be deep cuts in the May budget, Mr Hockey said: “We’re not obsessed with cuts, we’re obsessed with getting the budget back into good shape, into robust shape”.

“We’re obsessed with growth and job creation.

“If you all asked me 12 or 18 months ago would I inherit this, I would have said `no, it would have to be better than that’.

“But over the last 12 months, so much of what has been promised has not been delivered, and this is what we inherit now.”

Mr Hockey said the government had to “fill the hole” left by the slowing in mining investment.

“What we’ve got to do is find ways to stimulate the non-mining side of the economy,” he said.

“That means re-tooling the nation.”

Infrastructure investment would be a major way to do this.

“That’s going to be a driver of productivity growth,” he said.

“I want to give Australians hope that tomorrow is going to be better than today.”

But Mr Hockey did not rule out cutting public sector spending, saying Australians would have to wait to find out about his plans in the mid-year budget update.

The update is due before Christmas.