I am not an economist but I seem to understand that surpluses are not saved but simply disappear. Investing in anything from the govs point of view is rally just buying something and the money goes somewhere and is not a surplus. Also that saving for a "rainy day" anyway by an entity that can create its own money seems to an irrelevancy and a waste of a large mattress. The government even if it could save for a "rainy" day or simply created more money the constraint in the future is exactly the same, it is not money (as the govt has unlimited supplies of the stuff) but real resources. If we are not investing sufficiently now in say, education and infrastraucture then in twenty years no matter how much money the government has or can create the real resources will be not there.

I am interested in a more educated view of this "surplus"

SURELY THE INCOMPETENCE OF PETER COSTELLO SHINES THROUGH TO HAVE SUCH A SURPLUS, MEANING AUSTRALIANS WERE ROBBED MORE IN TAXES THEN WAS JUSTIFIED?

Lets makes something very clear, the powers to raise taxes is for one thing only, to provide monies for the budget passed by the parliament for that financial year.
As the Framers of the constitution made clear, any surplus is to be returned to the States, as it was overburdening those citizens.
It is not and never was constitutionally permissible for the Prime minister to have some political slash funds for elections.

As for tax relieve, what a nonsense.

Reality is that taxes can only be raised for the budget passed by the Parliament, and at the end of the financial year all tax laws technically seize to exist.

On that basis, the Parliament must pass new tax laws and/or extend old tax laws year after year for them to remain applicable.

People are simply conned about tax relief, as if they are getting something. Again, tax can only be justified upon the appropriation bills (budget) having been passed. If the budget is not passed no tax can be collected wither.

See also my website http://www.schorel-hlavka.com about these and other constitutional issues. Keep in mind it takes some time to download the page due to the extensive volume on the website.