Queensland's books are expected to be back in black within the next four years, with Treasurer Cameron Dick predicting the state will return to a $153 million surplus by mid-2025.

Handing down his second budget, Mr Dick said a better than anticipated economic recovery after the COVID-19 pandemic had improved the state's fiscal outlook.

"Our deficits are narrowing because jobs are coming back," he said.

"We had forecast that this year and last year we would see the biggest deficits in Queensland history.

"While last year's deficit remains the largest, this year's deficit will now be smaller than that in the Newman LNP government's first budget."

Last year's delayed budget projected the state's total debt would reach almost $130 billion and post a deficit of $1.39 billion in the 2023-24 financial year.

Today's budget showed Queensland's total debt was now forecast to hit $122.6 billion by 2023-24 and $127 billion by 2024-25.

'Queensland is roaring back'

The state's books will remain in red for the next three financial years before returning a $153 million surplus by 2024-25.

Reaching surplus is dependent on several key factors including keeping expenses growth below 2 per cent, which is something Labor has achieved once in the past 14 years.

The Queensland Government last achieved a budget surplus in 2018-19 when its net operating balance was $985 million.

Premier Annastacia Palaszczuk said the state's economy has recovered faster than expected.

"Queensland is roaring back, you cannot hold a Queenslander down," she said.

"The Queensland economy is coming back bigger, stronger and faster than any of us could have expected.

"Today we are delivering a traditional Labor budget focusing on health, education and housing."

Risks to outlook

Mr Dick said revenue would improve by $11.7 billion over the forward estimates compared to what was predicted last December.

When compared with last financial year, taxation revenue was expected to increase by $1.49 billion, GST revenue will go up by $807 million, and royalties and land rent was likely to rebound by $674 million.

The 2021-22 budget has flagged several risks that could impacts the state's economic outlook including any delays in a timely global vaccine rollout and ongoing geopolitical and trade tensions.

Revenue from fines and forfeitures is forecast to grow by 39.3 per cent in 2021-22, partly driven by the introduction of cameras to detect drivers using mobile phones or not wearing seatbelts.

Earlier this year, Mr Dick announced fees and charges would increase by 1.7 per cent from July, which kept the indexation rate in line with the state's Consumer Price Index.

Big spending on health, education

Mr Dick said the budget would include $22.2 billion for health over the next four years, including a $2 billion hospital building fund to combat growth pressures across the sector.

The government has set aside $462 million this financial year for the COVID-19 health response, which includes mandatory quarantine costs.

The budget contains $16.8 billion for education with $913 million set aside to fund 10 new state schools expected to open in 2023-24.

About $29.3 million over two years will go towards Queensland's preparations to host the 2032 Olympic and Paralympic Games if its bid is successful.

The government has also set aside $300 million to support Queensland's Path to Treaty.

Investment to address housing stress

The Queensland government already had a 10-year framework from 2017, to spend $1.6 billion over 10 years to build around 5,500 social and affordable homes.

Today's budget outlines the establishment of a $1 billion Housing Investment Fund — drawn from the increased valuation of the Queensland Titles Registry — to contribute $160 million in extra funding over four years in a bid to increase supply.

The budget also outlines a $1.9 billion spend over four years to increase supply of social housing and upgrade the existing portfolio.

Ms Palaszczuk said the investment aimed to address housing stress in Queensland communities.

"This will add more than 6,000 homes," Ms Palaszczuk said.

"We've listened to what people are saying and we will build the necessary housing."

Mr Dick said the money would allow the government to accelerate commitments and build 6,365 new homes over four years.

He said between 2017 and 2025, there would now be a total of 8,845 homes built.

As of September last year, there were 26,397 households waiting on Queensland's Public Housing Register.