Australia and New Zealand are among the top countries with remarkable governments maintaining "fiscal responsibility" in spite
an era of budget deficits and debt restructuring.

The two countries supassed the United States and United Kingdom in a study of fiscal management called the Sovereign Fiscal Responsibility Index made by Stanford University to gauge how industrially developed nations and developing economies are in practicing prudence amidst mounting pressure on budgetary allocations and spending.

Australia and New Zealand were classified as leaders in "fiscal responsibility" among top industrial and developing nations that include Estonia, Sweden, and China.

The United States was ranked 28, along with Ireland and Italy, at 29 and 27, respectively.

"There is great potential for a fiscal crisis in many countries, including the United States, if they don't start addressing the structural deficit challenges that lie ahead," said David Walker, the former chief US government auditor who oversaw the creation of the index in a related report by Agence France Presse.

"The index also shows that countries that engage in dramatic and comprehensive reforms can dramatically improve their fiscal prospects," said Walker.

"New Zealand ranks number two after engaging in such reforms in the early 1990s when it faced a currency crisis."

The SFRI weighed 34 members of the Organisation of Economic Co-operation and Development and the four rising "BRIC" economies - Brazil, Russia, India and China - on a mix of current fiscal strength, fiscal sustainability over the next 40 years, and transparency in fiscal governance.

Unsurprisingly, countries with high reserves, low debt and balanced budgets generally ranked high.

Powerful economies with high sovereign debt levels like the US, Japan, Germany, and France were all in the bottom third.

Britain, which has slashed spending to work its way out of fiscal crisis, was ninth.

"Countries such as Australia and New Zealand that have implemented strong fiscal rules have seen declining debt levels and reasonable government spending," Walker said.

"They reveal the power of good fiscal governance," the AFP report said.