Assistant Treasurer Josh Frydenberg has accused the Labor opposition of bringing a new economic theory to Australia – “Ouzo Economics”.

Labor had described the Abbott government’s concerns over Australia’s debt as rhetoric and claimed it wasn’t a problem because the economy was in better shape than Greece, he said.

“Fortunately, on this side, we don’t subscribe to … Ouzo Economics,” Mr Frydenberg told parliament during a question time tirade on Monday.

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His comments came as Greece scrambles to implement reforms that will keep open its loan facilities under its European Union debt deal.

Treasurer Joe Hockey warned Australia should never want to get into a position like Greece where it was subservient to global bankers.

When a nation imported money from the rest of the world to fund growth, it was at risk of being exposed to the volatility of global capital markets.

“It makes you, in one sense, subservient to the bankers and the rest of the world,” he told parliament.

Mr Hockey’s warning came as the independent Parliamentary Budget Office joined a chorus of institutions in recent weeks raising their concerns over the state of the federal budget.

PBO chief Phil Bowen told a Senate estimates hearing the economy was at risk unless the budget was brought under control.

“This is not a situation we can continue to live with over the longer term,” Mr Bowen said.

The international economic outlook was “at the very least, uncertain” and a further fall in Australia’s terms of trade would affect the budget.

HSBC chief economist Paul Bloxham says the treasurer faces a balancing act in putting together his second budget.

Mr Hockey had to support economic growth in the short-term by not tightening the screws too far while setting out credible plans for consolidation and reform over the medium term.

But most importantly the treasurer must give businesses a clear sense government policy had direction.

Mr Bloxham said the economy lacked confidence and relying on interest rates was fraught with danger.

“Monetary policy is reaching its limits and may already be doing little to boost confidence,” he said in a note to clients.

– AAP