Former Reserve Bank board member Warwick McKibbin has suggested a new election may be needed to resolve the Senate impasse holding up vital budget savings, and has hit out at the political populism of the Greens and Palmer United Party.

And Bank of America Merrill Lynch economist Saul Eslake has suggested a mini-budget is ''one of the options the government needs to think about'' as consumer confidence falls, unemployment rises to 6.4 per cent and if the political uncertainty continues, which could potentially hit business confidence.

Treasurer Joe Hockey is scheduled to meet PUP leader Clive Palmer on Tuesday. Mr Hockey has rejected former Treasurer Peter Costello's call to drop the proposed $7 GP co-payment, declaring that budget critics should not write off important measures.

Professor McKibbin, who left the RBA in 2011 and is now a professor at ANU, said the crossbench had left Australia tackling longer-term fiscal challenges by blocking the savings. ''The politicking of minority parties has done damage to the economy and over time that can build up. Firms can't make decisions … and uncertainty is damaging consumer confidence. At a macro level, the budget is about right, we need to stabilise debt and trim back expenditure.''

The government ''needs to better explain why they have put in place measures'' such as the $7 GP co-payment, Labor's adoption of Tony Abbott's oppositionist strategy was ''good politics but has caused damage to the economy'', but ''it's the populist parties like Palmer or the Greens [blocking reform]'', he said.

''I would like to see a new election and a Senate truly representative of the Australian people.''

Mr Eslake said from a ''top down'' perspective, the budget had dealt with the growing long-term gap between expenditure and revenue, but questions about fairness remained.

Both Professor McKibbin and Mr Eslake said they considered a double dissolution unlikely.

Commonwealth Bank chief economist Michael Blythe said the Treasurer needed to be pragmatic about what could be passed ''either in negotiations, or in terms of recasting the budget''.

''When you add up what has been rejected by the Senate and what will be rejected, there won't be much left … business confidence has held up but business doesn't like uncertainty,'' he said.

HSBC chief economist Paul Bloxham said it was ''increasingly unlikely'' the budget would be passed in its present form, but rather than a mini-budget, the government should ''negotiate on the basis of what has been proposed''.

Mr Hockey has been meeting crossbenchers during the past fortnight to win support for about $40 billion in structural budget changes, including the proposed GP co-payment, the repeal of the mining tax and associated spending measures, the fuel excise increase and higher education changes.

''Most of the budget is actually already gone through the Parliament. We are now … dealing with the major policy issues that make the budget sustainable over the medium and long term,'' Mr Hockey told the ABC.

Is it too little too late?

Joe Hockey is right to argue the budget needs to be placed on a more sustainable footing over the long term. It is also correct that most of the budget has already passed through the Parliament.

But that's not the point. About $40 billion in structural savings including the $7 GP co-payment, changes to welfare, higher education, other social security measures and the restarting of fuel excise indexation (to say nothing of the mining tax and its associated spending measures) are outstanding.

But even as Hockey engages in belated cross-bench diplomacy, criss-crossing the country for the last fortnight, it's hard to escape the feeling that it may be too little, too late. Public debate on measures that carry the imprimatur of the Treasurer may be lost. If anything, the fallout from the budget has worsened as the weeks have passed.

Crossbench positions have hardened. Crucial time was lost when Hockey took a holiday in the first sitting week of the new Senate.

Hockey's friends argue the focus of that first week was always going to be the carbon tax, but it's hard not to wonder if an extra meeting or three might have helped.

Now, even as Hockey warns ''don't count you chickens'', his colleagues are conceding compromise will come. Education Minister Christopher Pyne has signalled that changes to the education package are possible and Health Minister Peter Dutton is working on the design of the GP co-payment.

As John Howard observed in June, to be convinced about the need for reform Australians ''want to be satisfied that it's fundamentally fair''. Thus far, the Treasurer has not made the case.