What’s in the 2022 federal budget for Victorians

Victoria has scored a $3.4bn road and rail cash injection in the Budget, but GST arrangements have some saying the state has been “short-changed”.

Victoria’s share of GST is tipped to dive despite predictions that the state will soon be the fastest-growing in the country once again.

And Victoria still lags other states when it comes to federal infrastructure funding, despite a $3.4bn road and rail cash injection in Tuesday’s budget.

Josh Frydenberg trumpeted spending $17.9bn on “new and existing projects” to help support jobs across the nation.

This includes $1.5bn for a freight terminal and connecting roads to the north of ­Melbourne, $920m towards an outer-metropolitan rail line, and $102m for local projects.

The Treasurer also defended his home state’s GST allocation, which is to be $25bn less than NSW over the next four years.

Budget forecasts show that while Victoria’s population is tipped to soar faster than every other state within two years, its GST share will increase more slowly next year than NSW, Queensland, Western Australia and the Northern Territory.

Treasurer Josh Frydenberg defended Victoria’s GST arrangements.

On a per-capita basis, Victoria will also get less per person than every state except Western Australia, with GST-related payments tipped to rise from $17.5bn in this financial year to just over $21bn in 2025.

And while NSW is forecast to receive $11.9bn more in ­payments from the Commonwealth than predicted in last year’s budget, Victoria will receive just $3.8bn extra.

Premier Daniel Andrews and Treasurer Tim Pallas hit out at the federal government this week over GST arrangements, saying the system did not account for the effect of the pandemic on Victoria.

Premier Daniel Andrews hit out at the federal government this week over GST arrangements. Picture: Andrew Henshaw

Transport Infrastructure Minister Jacinta Allan also accused the federal government of short-changing Victoria.

Ms Allan said $2bn out of $3.4bn in Victorian “new” infrastructure spending was announced a year ago.

The Morrison government budget again committed $4bn to the cross-city road tunnel East West Link, axed by the Andrews government in 2015.

The budget also committed to support Victoria’s 2026 Commonwealth Games bid.

The Bahramis family say they wanted more childcare subsidies in the budget. Picture: Jake Nowakowski

Asked if Victoria was being dudded on the GST, Mr Frydenberg said: “Certainly not.”

“There is $11bn of increased GST payments that are being made in this budget and obviously GST is flowing at higher rates to Victoria,” he said.

“What I have been very clear about is the GST arrangements are set and that means there will be a review at the appropriate time by the Productivity Commission.”

Mr Frydenberg said the government was investing record amounts in road and rail.

“In this year’s budget, we have committed $17.9bn towards new and existing projects in each state and territory,” he said.

“Through the budget, the government’s rolling 10-year infrastructure investment pipeline will increase from $110bn to over $120bn, a new record.

“These projects will deliver the infrastructure Australians need, supporting tens of thousands of jobs, keeping commuters and freight safe and moving, and driving our economic growth.”

Originally published as What’s in the 2022 federal budget for Victorians