Life is getting even harder for Victorians as new budget figures today confirm the state’s dire financial position continues to deteriorate under Jacinta Allan, says the state opposition.
Labor has driven Victoria’s debt to record highs, with net debt now forecast to soar to nearly $178 billion by 2027, an increase of more than $6 billion since projections in the May budget, a statement from the state opposition added.
Victorian Government net debt remains higher than New South Wales, Queensland and Tasmania combined.
The horror debt forecast comes as cost blowouts on major projects climb to at least $38.8 billion and Victorians are paying 53 new or increased taxes since Labor was elected in 2014, including on schools, health, jobs, rents and holidays.
Under Jacinta Allan, the trend of greater debt and higher taxes has continued with today’s Budget Update confirming;
– A $6.4 billion increase in net debt to a total of $177.8 billion by June 2027.
– A $96.5 million increase in interest repayments in 2023-24, with interest repayments to reach $24 million per day by 2026-27.
– Total taxation revenue will increase by an average of $1.1 billion each year, largely driven by increasing payroll and land tax.
Leader of the Opposition, John Pesutto, said: “The dire state of Victoria’s finances are only worsening under Jacinta Allan.
“While Jacinta Allan continues to waste billions on major project blowouts, everyday health, transport and education services continue to be neglected.”
The state government has gone ahead and signed the Suburban Rail Loop Project contracts. Premier Jacinta Allan announced on Tuesday the state government had signed contracts with a consortium of global tunnelling experts to build 16 kilometres of twin tunnels between Cheltenham and Glen Waverley for SRL East.
That is despite the federal government committing just $2 billion of the $35 billion first stage for the project. A third or up to $12 billion of the $35 billion first stage cost is expected to come from “value capture” from new taxes, yet to be designed.
The total cost of the project will be in excess of $125 billion.
While Premier Allan told the media that Prime Minister Anthony Albanese called the SRL “one of the most exciting projects in the country”, his Infrastructure Minister Catherine King’s office insists “any further investments in suburban rail will be subject to Infrastructure Australia processes”.
Victoria is the milking cow of the federation
Victorian Treasurer Tim Pallas has accused federal Labor of treating the state like the “milking cow of the federation”, with just 1.6 per cent of new priority infrastructure spending reaching Victoria.
The complaint follows the federal government’s mid-year economic fiscal outlook (MYEFO) announcement by the federal government which showed a $40 billion improvement to its bottom line over the next four years. This improvement in the federal bottom line is partly driven by rising tax revenue.
The federal government also announced an extra $11 billion towards priority infrastructure over the next decade.
Less than 1 per cent of that, $101.8 million, will go towards Victoria – mostly to duplicate the Western Highway between Ballarat and Stawell.
According to the Victorian treasurer Tim Pallas, the state should receive a share in $4.2 billion for road safety programs and believes we will end up getting only 1.6 per cent.
“It’s wrong that we constantly are the milking cow of the federation,” Pallas said.
“That is nothing short of ludicrous. No, it’s worse than that, it is a dismissive way to treat Victorians.”
“What we’ve seen in MYEFO is, effectively, the Commonwealth government reverting to the bad behaviour that we’d seen from the previous government. We’d expected better,” Pallas added.
In the MYEFO update, South Australia benefited from an extra $2.7 billion, while Queensland will receive another $2.4 billion. Another $1.1 billion will go to projects in Western Australia, $200 million was put towards the Northern Territory, $152.6 million was for the ACT, and $115.8 million will go to NSW.
Tasmania was the only state or territory to receive a smaller boost than Victoria, with an extra $2 million.
Pallas said Victoria should be receiving 26 per cent of federal investment to match its population.
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