Premier Daniel Andrews warns of pain after Covid borrowing causes spiralling debt

Daniel Andrews has delivered grim news ahead of Victoria’s budget, predicting “some pain” as the state curbs its spiralling debt racked up during Covid.

Premier Daniel Andrews warns of state budget pain. Picture: David Crosling

Premier Daniel Andrews says the state’s spiralling debt will cause Victorians “some pain” at this month’s state budget as he continues to reign in the “enormous amount of money” borrowed during Covid.

With Victoria’s net debt projected to reach $165bn by 2026, Mr Andrews said the total borrowed during repeated Covid lockdowns and ongoing restrictions would hurt Victorians.

“(One part of the) budget is that we have to pay back that Covid debt and lay down a plan to pay back Covid debt over time … it can’t be done in one year, but it has to be done,” he said.

“We borrowed money, an enormous amount of money, we had to, to save jobs and to save lives.

“And just as there was really no option but to get that money then, there’s no option but to pay it back, and that’s exactly what we’re going to lay down and plan to do.

“That will mean there’s some pain, not everybody will like that, but that’s what has to be done.”

With the state already paying $10m a day in interest to claw back the debt, Mr Andrews defended his plan, arguing it was Victorians who had placed their trust in him to move the state forward.

“We weren’t elected to do the popular thing, we were elected, re-elected and then re-elected again to do the right thing,” he added.

“That’s what our budget will lay down, keeping our promises, delivering our positive plan and outlining a plan to repay that Covid debt, that emergency credit card that we had to use to get through the worst of times, but for the best of reasons.

“There really wasn’t a choice then and it’s certainly not a choice now.

“You must pay this back, and that’s exactly what we will outline in just a couple of weeks time.”

Originally published as Premier Daniel Andrews warns of pain after Covid borrowing causes spiralling debt