SYDNEY (Bloomberg) -- Prime Minister John Howard said the Australian budget surplus for 2007-08 will be “very strong,” and the government's spending plans won't put pressure on interest rates.

Treasurer Peter Costello will present the Liberal-National coalition government's annual budget on May 8 in Canberra. In December, he forecast a surplus of $9.7 billion ($8 billion) for year ending June 30, 2008. “The budget will be responsible, laid against the backdrop of a very strong surplus,” Howard said in an interview with Nine Network's Sunday television program in Sydney Sunday. “It will not be a budget that will exert upward pressure on interest rates.”

Howard, trailing the opposition Labor Party in opinion polls, must call an election by mid-January 2008. His coalition government has reported nine years of budget surpluses since it won office in 1996, and income tax cuts of $73.1 billion in the past three years.

Australia's central bank raised interest rates three times in 2006, taking the benchmark to a six-year high of 6.25 percent to curb inflation. The Reserve Bank of Australia will leave borrowing costs unchanged on May 2, according to all 26 economists surveyed by Bloomberg News.

Howard said Labor leader Kevin Rudd was “inexperienced,” with “no plan” to manage Australia's economic future. Howard, 67, said he would keep serving as prime minister as long as the Liberal Party wanted him to and as long as it was in the party's “best interest” to do so. “There are a lot of things I want to do and I have a lot of energy,” Howard said. “I also have a lot of experience.”

Labor's support rose two percentage points to 59 percent and the coalition's fell the same amount to 41 percent, according to the poll of 1,164 people published on April 17 in the Australian newspaper.