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Scott Morrison and his British counterpart Boris Johnson have struck a free trade deal between Australia and the United Kingdom.

The pair are preparing to outline the details after sealing an in-principle agreement over dinner at 10 Downing Street.

The deal will pave the way for more Australians to live and work in Britain and offer exporters more market options.

It will also scrap a requirement for British backpackers to work on Australian farms before extending their visas.

This could create issues for producers who need seasonal workers to pick crops and regional pubs and clubs who rely heavily on working holiday makers.

But the Nationals say they have secured an agreement to guard against labour shortages, which will be separate to the UK trade deal.

Several key sticking points needed to be overcome before the initial agreement could be reached.

Agriculture proved to be the major obstacle with squabbles over Australian lamb, beef and dairy products.

Trade Minister Dan Tehan talked up the UK pact during a coalition party room meeting in Canberra.

"Our aim is to have the best deal outside of the deal with New Zealand. The negotiations have been hard fought," he said

Agriculture Minister David Littleproud was slightly more circumspect, telling reporters it was another feather in Australia's cap, but not one that would rival trade with Asia and the Middle East.

The UK is Australia's fifth largest trading partner, with two-way goods and services valued at $36.6 billion, and its second biggest investment partner.

Mr Tehan said Australian dairy producers were limited to an import quota of 44 grams of cheese per person every year, while the average Briton consumed 125 grams of cheese per week.

"What's more, they are missing out on eating the best lamb chops, the best steak in the world and washing it down with the best glass of Australian wine that you could imagine," he said.

Ahead of the formal announcement, the prime minister made a free trade pitch to business leaders from both countries.

He said it was the most substantial deal done since the UK withdrew from the European Union.

"As the United Kingdom moves into a completely new generation of their trading relationships with the world, who better to start that journey with than Australia?" Mr Morrison said.

He described the UK joining the common European market decades ago as a devastating blow to Australian producers.

"The Brexit that has occurred is an opportunity for us to pick up where we left off all those many years ago and to once again realise the scale of the trading relationship we once had."

Deputy Opposition Leader Richard Marles said Labor had concerns about agricultural exports and visa conditions for farm workers, which the party would work through in time.

He urged Mr Morrison to crack on with the deal, having spoken about it since 2016.

"The government has been talking about this. What we actually want to see is for them to get this deal done. When they do we'll obviously have a good look at the detail."

© AAP 2021

Queensland is aiming to return to surplus within four years after the pandemic as the government uses a new accounting method to cut debt forecasts.

State Treasurer Cameron Dick has slashed the forecast 2020/21 deficit of $8.6 billion to $3.8 billion in his 2021/22 budget on Tuesday.

The deficit will be progressively trimmed until there's a small $153 million surplus in 2024/25.

"I'm not ordering any coffee mugs yet, but Queensland will be back in black," he told reporters.

Mr Dick said the bottom line had improved due to better than expected economic growth of 3.25 per cent in 2020/21, compared to 0.25 per cent forecast just six months ago.

Higher growth has led to forecast revenue from tax, GST receipts and property sales being $60.4 billion in 2020/21, $4.1 billion more than forecast.

The treasurer has also used a new accounting method to help trim debt forecasts.

The Queensland Titles Registry, valued at $7.8 billion, will be transferred into the state's Debt Retirement Fund.

About $6 billion of registry's value and its ongoing revenue will be an asset to offset state debt.

Total debt is now forecast to hit $95.8 billion in 2020/21, down from the $102.2 billion predicted just six months ago.

Debt will reach $127.3 billion in 2024/25, compared to the $129 billion by 2023/24 predicted in the last budget.

Mr Dick denied he was "cooking the books", saying NSW and Canada's Quebec province used the same accounting method.

"This is not new, it's new for Queensland, but this is an important measure that we are taking to bend back that debt profile and give Queenslanders value for the assets that belong to them," he said.

Mr Dick said the remaining $1.8 billion from the Titles Registry transfer will be siphoned off for housing, renewable energy and an Indigenous treaty.

There will be $1 billion for a new Housing Investment Fund and $500 million for a Carbon Reduction Investment fund to support land restoration projects.

The final $300 million will be put into a fund to roll out the state's Indigenous treaty.

The budget delivers $22.2 billion for health, including $482 million to relieve pressure on capacity and elective surgery waitlists, in 2021/22.

Another $480 million will be spent on Queensland's COVID-19 response in the current financial year.

Education has an allocation of $18.3 billion, including about $1.4 billion for 10 new state schools and upgrading facilities at existing schools.

About $1.9 billion will be spent on social housing over four years, in addition to the new housing fund.

"This budget is a traditional Labor budget, focusing on what Queenslanders need," Premier Annastacia Palaszczuk said.

Another flagship budget item is an extra $1.5 billion for the Renewable Energy and Hydrogen Jobs Fund.

The funding will be for government-owned firms to set up new renewable or hydrogen projects or enter public-private partnerships.

The budget also allocates $100 million for a Business Investment Fund and $320 million over four years to help upskill and train disadvantaged people to enter and stay in the workforce.

However, capital spending will be cut by $147 million from last year's $14.835 billion as COVID-19 stimulus is wound back in 2021/22.

Mr Dick said there would be $52.21 billion for capital expenditure over the forward estimates.

© AAP 2021

Queensland is aiming to return to surplus as the state government uses a new accounting method to cut debt forecasts.

State Treasurer Cameron Dick says better than expected growth will help cut the 2020/21 deficit to $3.8 billion, compared to $8.6 billion forecast.

The 2021/22 budget deficit of $3.4 billion will then be trimmed until there's a $153 million surplus in 2024/25.

"The four largest governments in Australia - the Commonwealth government, the NSW government, the Victorian government, and the Queensland government - all went into deficit to respond to COVID-19," Mr Dick said on Tuesday.

"Today, only one of those four governments is returning to surplus - the Palaszczuk Labor government."

Mr Dick said the bottom line had improved due to growth of 3.25 per cent in 2020/21, compared to 0.25 per cent forecast.

Revenue from tax, GST receipts and royalties will be up at $60.4 billion in 2020/21, $4.1 billion more than forecast, and $63.66 billion in 2021/22.

The treasurer has also used a new accounting method to help reduce debt forecasts.

The Queensland Titles Registry, valued at $7.8 billion, will be transferred into the state's Debt Retirement Fund, with the registry and its ongoing revenue to become an asset to offset state debt.

Total debt is now forecast to hit $95.8 billion in 2020/21, reaching $127.3 billion in 2024/25.

Mr Dick denied he was "cooking the books", saying NSW and Canada's Quebec province used the same accounting standards.

"This is not new, it's new for Queensland, but this is an important measure that we are taking to bend back that debt profile and give Queenslanders value for the assets that belong to them," he said.

Shadow Treasurer David Janetzki said he didn't believe the registry was worth more than its NSW and Victorian counterparts.

"You need to find a pretty big sucker to pay over of that magnitude and the treasurer has found himself," he told reporters.

However, ratings agency Moody's backed the government's accounting measures and debt-servicing ability levels.

"Notwithstanding the rising debt burden, Queensland remains the only Australian state to maintain fully funded superannuation liabilities and continues to retain ample levels of internal liquidity," Moody's said in a statement.

Mr Dick said $1.8 billion from the Titles Registry transfer will be siphoned off for new housing, renewable energy and Indigenous treaty funds.

The budget delivers $22.2 billion for health, including $482 million to relieve pressure on capacity and elective surgery waiting lists, in 2021/22.

Another $480 million will be spent on Queensland's COVID-19 response in the current financial year.

Education has an allocation of $18.3 billion, including about $1.4 billion for 10 new state schools and upgrading facilities at existing schools, in 2021/22.

There will be $53 million spent social housing and a $1 billion housing fund from which earnings will be used to pay for housing projects.

"This budget is a traditional Labor budget, focusing on what Queenslanders need," Premier Annastacia Palaszczuk said.

Another flagship item is an extra $1.5 billion for the $500 million Renewable Energy and Hydrogen Jobs Fund.

Earnings from the $2 billion fund will be used for government-owned firms to set up new renewable or hydrogen projects.

The budget also allocates $100 million for a Business Investment Fund and $320 million over four years to help train for the workforce.

However, capital spending will be cut by $147 million from last year's $14.835 billion as COVID-19 stimulus is wound back in 2021/22.

Mr Dick said there would be $52.21 billion for capital expenditure over the forward estimates.

© AAP 2021