Labor has said Treasurer Joe Hockey (left) is largely to blame for a blowout in the budget deficit. Deputy Liberal leader Julie Bishop blamed Labor for the budget deficit and said the government was doing all it could to repair the damage. "We're begging Labor to take some responsibility for leaving us with the worse set of financial accounts of any incoming government in Australia's history," she told ABC radio. She rejected suggestions Mr Hockey had been sidelined by the appointment of the new head of the prime minister's department, Michael Thawley. Mr Thawley has reportedly been asked to rethink the government's economic strategy - interpreted by some as a loss of confidence in Mr Hockey. "Joe Hockey's the treasurer and Joe's responsible for the budget and will continue to be so," Ms Bishop said. Shadow treasurer Chris Bowen said Prime Minister Tony Abbott's alibi for breaking election promises was restoring the budget. "His alibi doesn't stack up," he told reporters in Canberra. If the mid-year fiscal update included measures already rejected by parliament, the mini-budget "will not be an accurate reflection of Australia's financial books," he said. Mr Bowen pledged Labor would release its policy proposals and budget savings "way in advance" of the next federal election. Parliamentary secretary to the prime minister Josh Frydenberg conceded the budget was in a very difficult state. "Yes we're dealing with falling iron ore prices but it's not like we were bequeathed a golden legacy of budget surpluses," he said.