Source : the age
New treasurer, new(ish) premier, same old story. Jaclyn Symes’ first budget repeated this government’s previous inaction on its rising debt, forecast to reach $188 billion by June 2028. The following year, debt is forecast to reach $194 billion, 24.9 per cent of gross state product. This was Groundhog Day, without the laughs.
The budget again reprised the government’s lack of enthusiasm for significant reform, even in the face of its significant challenges. Once more, too, Premier Jacinta Allan has stuck to an increasingly Pollyanna approach to infrastructure spending.
The mantra of both the premier and Symes was that they were “focused on what matters most”. Given the state’s massive and still-growing debt, Victorians might have expected that is where the focus would sit. Not at all.
What mattered most to Allan and Symes, the headline act, was the surplus. In 2025-26, the government is expecting to deliver an operating surplus of $600 million, about $1 billion less than it forecast six months ago. This is projected to rise each year of the forward estimates to $6.2 billion, $7.9 billion, $6.6 billion and $5.8 billion. The $600 million is the first operating surplus since before the COVID pandemic.
As Symes said on Tuesday, numbers don’t tell the full story. This cuts both ways. The treasurer was at pains to highlight the measures the government is providing to ease the cost-of-living crisis. Free public transport for kids (worth $318 million), free weekend travel for seniors, free kinder care for three- and four-year-olds and $123 million to parents to help with school costs will no doubt be welcomed by recipients.
Weighed against this is the fact Victoria reneged on a commitment to fund by 2028 its full 75 per cent share of the Schooling Resource Standard, meaning $2.4 billion will be stripped from government schools.
It’s a similar story in health, where an extra $11.1 billion will go into the system over the next four years. Of this, $9.3 billion will go to hospital operating costs and $643 million will be for nine new and upgraded hospitals, including Footscray and Frankston hospitals. Many in the sector will see this as catch-up spending to fend off a damaging feud at a time when they are struggling to keep basic programs running.
The much-needed top-up to regional roads funding will also be viewed in a similar light. More, if limited, energy bill assistance to households, and more money for food charities, homelessness and those facing financial stress will help at the margins.
Symes made a point on Tuesday of saying the budget contained no new taxes. Businesses which are loudly decrying the pain of doing business in this state, may take small comfort in that. The treasurer justified this by saying that unlike Western Australia, which could just dig up money from the ground, Victoria had to rely on taxation. It is estimated tax revenue will hit $41.7 billion in 2025-26 and increase $6.2 billion over the next four years.
Part of the public compact in raising those taxes is that a government will live within its means. Running a skinny surplus, as this government is doing, while debt and interest keep ballooning is running ahead of a rolling boulder – and only just.
Much now rests on the report due by the end of June from former Department of Premier and Cabinet secretary Helen Silver’s review of the size and efficiency of Victoria’s public service. Up to 3000 public servant positions may go; there will be “back-of-house” streamlining. For instance, the number of business regulators will fall from 37 to 18 by 2030, saving $500 million over four years.
It’s a pity, then, that the government does not have the political will to discuss the elephant in the balance sheet. The Age has editorialised previously on the crippling cost to the state of the Suburban Rail Loop. As we have said before, we do not believe the SRL can justify its costs in the context of the state’s dire financial standing and greater infrastructure priorities. More than $34 billion could be better spent elsewhere.
That’s if somehow that cost is able to be maintained. Consider the mind-boggling latest news of a $136.7 million blowout and a further 18-month delay on the new public transport ticketing system.
Tuesday’s budget could have made a difference. Lamentably, the government has decided to place debt far, far away on the horizon. Out of sight, it hopes, and out of mind. It’s not good enough.
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