MILLIONS of dollars will be spent trying to halt the spread of radical Islam as part of a big-spending Federal Budget package to bolster national security.

Tuesday's election-year Budget will include hundreds of millions of dollars for national security as Labor tackles concerns it has gone soft on border protection following the flood of asylum seekers in recent months.

The Government will announce "preventative" measures to counter the growth of radical terrorist cells across Australia.

While the Government will be careful not to demonise Muslims with its policies, it is understood new programs will target the potential spread of radical extremism in the nation's jails.

Some states already have their own programs, aimed at stopping the rise of radical Islam in prisons. But the Budget is expected to outline a national scheme, with religious classes and better contact between inmates and their families.

With the Government hoping the Budget will help it regain much-needed momentum, the latest boat carrying asylum seekers was intercepted off the northwest of Australia - the 51st vessel detained this year alone.

Carrying 26 passengers and two crew, the small boat was the 119th intercepted since the Rudd Government softened the border protection laws in August 2008.

Labor will also use Tuesday's budget to help restore its electoral support base, targeting the vocal 100,000-plus veterans' community.

War veterans will pick up tens of millions of dollars as the Government moves to expand aged care services and compensate men damaged by chemicals and radiation.

Thousands of ex-military personnel - including 2500 exposed to Maralinga's toxic nuclear program - will receive generous pension entitlements as the Government tries to win over a key constituency.