Jeff Kennett: Dan, don’t burden our youth with out-of-control debt

With Victoria’s debt now approaching $200bn, the Andrews government must make major corrections to policy to focus on education, health and law enforcement.

I know from experience that it took my government the best part of seven years to reduce Victoria’s debt from $35bn between 1992 and 1999 to just $5bn.

Turning the ship of state around takes years of hard work and careful management.

With Victoria’s debt now approaching $200bn, you could argue it will take 46.6 years to get it back to just $35bn.

If there is a genuine effort to reduce the debt, undeniably it will require a very different approach from that now being taken.

The quality of services that a state government provides should always be its first priority, even when addressing the debt.

Bear in mind, the interest we are currently paying on the debt – money the government has borrowed in our name – is closer to $16m a day, or $112m a week.

In the same way we often say the only purpose of local councils is to manage rates, rubbish and roads, well, the same principle should apply to state governments.

Education, health and law enforcement … and everything else comes after those three.

I appreciate the challenge facing the Andrews government if it wishes to address the ballooning debt, but without major corrections to policy, the challenge will only get greater.

Premier Daniel Andrews must make major corrections to policy to address ballooning debt. Picture: Tony Gough

For instance, the state government recently announced a cutback from 117 to 37 in the number of “visiting teachers” it employed to assist students living with disability, many of whom had experienced learning issues because of Covid.

Last week the government reversed that decision, which I applaud.

It made sense, as the learning difficulties for so many children remain. It is never wrong to admit a mistake.

But the decision to remove those required teachers to save some money while spending billions more on infrastructure clearly indicated where the government’s priorities lay: concrete before students in need, or teachers required.

You could use that example in health, ambulance service, and our police force, with crime attacks increasing at an alarming rate in our suburbs.

The government must stop committing our funds using borrowed money on massive new infrastructure projects.

The obvious project to cancel is the Suburban Rail Loop and the authority set up to deliver a project that will cost hundreds of billions of borrowed dollars to complete.

Unless such decisive action is taken now, our debt will continue to increase, as will our interest payments on that debt, which in turn will reduce the money available for essential services.

The Suburban Rail Loop and the authority set up to deliver the project will cost hundreds of billions of borrowed dollars to complete.

The burden of the current policy of debt before people will, as a generalisation, not be borne by my generation, but by those who follow, Gen X, Millennials, Gen Z and Gen Alpha.

Millennials and Gen Z are already feeling the pain, and Gen Alpha will live in a very different Victoria than those before them.

All will be feeling the pain, and paying the price for the debt they will have inherited.

Some will argue they will be the ones most benefiting from the use of the infrastructure being built.

Maybe, but not at the price we have had to pay, and certainly not at the price of the fundamental and declining services for which the government is responsible – education, health and law enforcement.

I wrote last week about the increasing cost of housing and the lack of and cost of rental accommodation.

Some have described this as not a housing crisis but a housing emergency because of the social implications now emerging.

Is infrastructure more important than housing, education, health or emergency services?

Do we exist to serve our own interests or do we have a responsibility to those who follow?

The ALP is in office for the next three years, and it must exercise a change in priorities ASAP, or we as a state and community will be in no-man’s land and in all sorts of pain.

It is bad enough now for so many young Victorians, but their opportunities are shrinking, through no fault of their own.

Former federal Treasury head Ken Henry bemoans “an intergenerational tragedy” because of the tax burden being placed on Australian workers of the future.

Add to that the burden that will be placed on young Victorians because of state debt and you have the definition of Russian roulette.

I have lived through mild recessions, 17.5 per cent interest rates, the Global Financial Crisis
and Covid-19 lockdowns, but what we are facing now is even more serious.

It will be longer lasting and more damaging than anything we have experienced, unless in Victoria the government quickly changes some of its priorities and spending.

Sometimes experience counts.

Have a good day.