If you listen to Chief Minister and Treasurer Andrew Barr, the territory has moved far from the shadow of the Abbott era, and can bank on more spending from Canberra's major employer.

The picture is a happy one: economic growth of 3.25 per cent this year, followed by 2.75 per cent in 2017-18 and slightly lower figures after that. It's a wave the government says it will ride towards a small surplus of $9.7 million in 2018-19, expected to grow into more significant sums later on.

As always, the Commonwealth's spending on its public service workforce is the undertow to all of these figures. Because the APS has lifted its hiring freeze and further swingeing cuts aren't expected, the Barr government has decided it's safe to embark on its more ambitious projects.

Regardless of the improving economic outlook, the government may well have done so anyway. It has trumpeted its fiscal strategy of running deficits in poorer conditions as a winner. It says the expansion of economic growth across a broader base of revenue sources has validated its investment during the dark years.

There are signs that the ACT economy is diversifying, and its greatest friend will be population growth, something of a phenomenon for the territory in coming years. While Canberra has about 400,000 people now, it's expected to become home to 428,000 by 2020, remarkable growth by any standards.

The surge in new Canberrans - from both natural growth and, to a lesser extent, international migration - is stimulating the household consumption and retail spending breathing life into the ACT's private sector and giving it scope to expand. That's a welcome development. The less Canberra's economic health relies on APS spending, the better.

The government evidently understands the infrastructure challenges this population and economic growth poses. But while it plans to spend more on roads and expand its light rail project, a question for this and future budgets will be to what extent taxpayers are willing to shoulder the burden of government spending to accommodate the city's growth.

Those who don't see its benefits in some way will be less enthused, and their implicit pact with the government supporting its current approach to taxing and spending will be in jeopardy.

Rising costs including property rates and commercial rates, up 7 per cent and 6 per cent respectively, aren't anything to sneeze at.

Car registration fees will rise 5 per cent and car parking fines will jump 6 per cent, all adding to the strain on household budgets.

Mr Barr believes running deficits during economic downturns has been a winner, but voters will decide in coming years whether the pain of rates rises and cost of living increases needed to consolidate the budget are worth it.