Treasurer Joe Hockey says its understandable the states are upset about his first budget and he will be working closely with them.

Treasurer Joe Hockey insists the states and territories furious over his budget are simply “entering into a dialogue”.

The federal government wants to pull $80 billion from health and education funding over the next decade.

State and territory leaders are up in arms over the changes and have called an emergency COAG meeting in Sydney this Sunday.

Queensland Premier Campbell Newman said on Friday if the states don’t hang together they’ll be “hung separately” by the Abbott government.

But when asked if the states were “whingeing”, Mr Hockey said: “No”.

“They’re entering into a dialogue, it’s perfectly understandable, this is the nature of things,” he told reporters in Brisbane later on Friday.

“We are going to work closely with the states in the future.”

When pushed on Mr Newman’s specific comments, the treasurer refused to be drawn.

“Well, I didn’t hear him say that,” Mr Hockey said.

“I understand the pressures the states are under but I think they understand the pressure that we’re under.”