Scott Morrison has set up a high-level bushfire recovery agency as more lives were lost and hundreds more homes torched over the weekend, with the government no longer able to guarantee a budget surplus because of the economic hit from the ongoing disaster.

With the repair bill to run into the billions of dollars, Mr Morrison ruled out imposing a levy on taxpayers but Treasurer Josh Frydenberg is poised to announce as early as Monday initial funding to rebuild communities following a cabinet meeting.