About 10 "creatives", from musicians to theatre crew, incensed by the federal government's first budget in May, have created a three-metre puppet which will have red LED lights and a smoke machine delicately inserted in its rear end.

The man behind the idea, early childhood teacher Matthew Armstrong, said the aim was to make a policy rather than personal point.

"The intent of the whole puppet is not to demonise Mr Abbott, just to present a character with pants on fire," Mr Armstrong said.

"There's been some times where's there been some gross puppeteering around ... and [older activists I've spoken to] said, 'don't play the person really hard'."

The puppet head, made from lightweight foam and complete with an unmistakeable Abbott grin, still had to have a painted muslin skin added when Mr Armstrong joined two others to finish the construction on Friday morning.

To add some drama, the mask-wearer at the rally will repeatedly rip up velcro-bound signs echoing Mr Abbott's "no cuts" pre-election promises.

Mr Armstrong, who said he's no longer a union member, offered the puppet for the Unions ACT-organised Bust the Budget rally at the lawns of Parliament House from noon.

Speakers will include St Vincent de Paul chief executive John Falzon and the Refugee Action Committee's John Minns.

The Coalition has been widely attacked for breaching promises with policies including a $7 GP co-payment, an increase to the fuel excise, and future changes to the pension age and rates.

The government has said the measures are necessary to return the budget - which has a $49.9 billion deficit this year - to surplus by 2018-19.