South Australian Treasurer Kevin Foley has targeted the state's public service, slashing jobs and benefits in his ninth budget.
Mr Foley said the measures were part of the government's strategy of taking the necessary pain in-house rather than have it impact more broadly on taxpayers.
His budget forecasts a $389 million deficit in 2010/11 before returning the state's finances to the black with a $55 million surplus in 2011/12.
The surplus is forecast to rise to $370 million in 2012/13, at the same time total state debt peaks at $3.8 billion.
The government has outlined a package of savings worth $1.5 billion over four years with the bottom line to benefit to the tune of around $2 billion once extra revenue measures worth $478 million are factored in.
Mr Foley said his budget was the appropriate response to an economy still emerging from the impact of the global financial crisis and made no apologies for taking a tough line with the government's own workforce.
"What I've tried to do in this budget is minimalise the impact on families and I've taken the burden of the cuts and the pain internally into government," he said on Thursday.
"I think that's a good outcome." In other measures the government will spend an extra $502 million on health but will also save $316 million over four years by improving the efficiency of the state's hospital and cutting some outpatient services.
It has axed the $4000 bonus for first home buyers buying an existing home but has doubled the bonus to $8000 for those who build new homes.
Speeding and other traffic fines will be increased to raise an extra $48 million and the mining sector will be asked to pay more with an increase in royalties from 3.5 per five per cent for a $65 million budget boost over three years.
The government has also maintained its commitment to infrastructure spending including the Adelaide Oval redevelopment, railway upgrades, hospital improvements and the major South Road project.
But it steered well clear of many unpalatable recommendations from it razor gang and will not close the Repatriation Hospital in Adelaide or any country hospitals, schools or police stations.