Treasurer Tim Pallas’ bold plan to kickstart Victoria
Victoria is set to accrue an eye-watering level of post-coronavirus debt, but Treasurer Tim Pallas says he won’t chase a surplus at the expense of the overall strategy. SEE THE EXTRAORDINARY LIST OF WHERE OUR MONEY IS GOING.
Victoria
Don't miss out on the headlines from Victoria. Followed categories will be added to My News.
Tim Pallas is well aware he’s about to deliver his legacy budget.
No matter how many more budgets the Treasurer goes on to deliver he knows Tuesday’s, his sixth, will be the most important.
But rather than feel overwhelmed by the enormity of the task, he says it's a privilege.
“I sort of see it as a great opportunity, and a great honour,” he says.
“I get the opportunity to be part of the recovery on the resurgence in the Victorian economy.”
Mr Pallas knows that recovery from a disastrous year, plagued by bushfires and the coronavirus pandemic, will be a herculean task.
Victoria is bracing for record debt levels, to soar to $154 billion by 2023-24.
In a year of uncertainties, the fact of more economic pain ahead is something Mr Pallas is sure of.
He has refused to sugar-coat Victoria’s economic situation throughout the year, and says its not yet over.
“I can tell you we’re going to have a very good 2021, but we’re not through the worst of the year, would be my guess,” he says.
“The economy will rebound and show enormous levels of capacity going forward.
“But we’ve still got a few months to get through yet and, ultimately, every Victorian has to know this government has their back.”
While the budget will outline the government’s formal road map to economic recovery, work has been underway for months.
Billions of dollars have already been poured into recovery efforts.
Victoria is set to accrue an eye-watering level of debt, and Mr Pallas says it will be sometime before we see a surplus again.
But he says he won’t chase a surplus at the expense of the overall strategy.
“We recognise that we have to show people the pathway through this and give them an appreciation of the government’s grand strategy that we’ll get to see,” he says.
“But I’m not going to push this too hard, and therefore derail all the growth we’re doing in generating the economy.”
The Treasurer has ruled our sweeping tax reforms in this year’s budget.
While the NSW government has announced an overhaul to property taxes, similar moves have been categorically ruled out here.
Although the treasurer was coy when asked about payroll tax cuts, hinting that changes could be coming.
For Mr Pallas the immediate priorities are jobs and targeting necessary investments to help companies get back up and running.
“My priority at the moment is focusing in on the immediate repair work the government has to do.”
He says three things are needed for an economy to operate effectively: population growth, productivity and participation in the labour market.
With migration and the international student sector now ground to a halt, the budget will focus on productivity and participation.
“We do have to do more to drive productivity in the economy,” he says.
“And you’ll see interventions from the government, in this budget that will be very much focused on what more we can do.
“We’ve seen a very substantial decrease in participation in the labour market, particularly women, particularly young people.
“And what we know is the longer people are out in the labour market, the more difficult it is to utilize and bring them back in.
“So, it makes economic sense to employ strategies that facilitate that.”
Big spending on infrastructure will form a huge part of this plan.
Already the government has unveiled $2.2 billion for the first phase of Stage One construction on the Suburban Rail loop.
A $169.6 million initiative to offer free kinder to Victorian families in 2021 is all about encouraging more participation in the labour market.
Other initiatives, including a tourism voucher scheme and bill relief for struggling families, are aimed at easing the toll of a horror year.
“And there’ll be more to come,” Mr Pallas says.
“We recognise that there are some things that we can do that can assist people in terms of managing their budgetary situation that can also help business and economic activity.
“So we’re trying to get that sweet spot where you get the multiplier effect of those policy interventions.”
Mr Pallas says while he understands concern about Victoria losing its AAA long-term credit rating, it’s not a priority.
“I genuinely understand that this is an issue that would focus people’s minds. And
“But I would make the point that a credit rating is all about the capacity to borrow, you’re only rated for the purpose of borrowing.
“If you can’t borrow now, you’ve got to wonder why you would ever accumulate it.”
While there’s more pain ahead, Mr Pallas is confident things are already looking better.
He’s buoyed by higher than national average business and consumer confidence and a view that the pandemic is looking increasingly under control in this country.
“There will be a pretty substantial spring back in terms of the economic activity, we’ll see that happen now, it’s already underway.
“2021 is going to be a great year.”
BUDGET SPENDING PLAN:
– $5.3 billion for biggest social housing package in state’s history
– $2.2 billion for the Suburban Rail Loop
– $1.6 billion to support students with disability
– $868.6 million additional boost for mental health
– $797 million for the major household energy efficiency program
– $474 million to protect Victoria’s environment and invest in parks and zoos
– $465 million for Victorian Tourism Recovery Package
– $400 million for Stage 3 of the Shepparton Line Upgrade
– $272.4 million to upgrade the Great Ocean Road and inland routes
– $235 million for jobs in mental health, family violence, child
protection and disability
– $169.6 million to make kinder free in 2021
– $155 million to set up the National Centre for Infectious Diseases
in Melbourne
– $120.9 million so patients can recover from illness or surgery at home
– $84 million to transform Werribee Zoo into Australia’s leading open range zoo
– $65 million for new Victoria’s agriculture industry strategy
– $50 million to upgrade facilities and learning spaces at Victoria’s
agricultural colleges
– $44.1 million upgrade to facilities and infrastructure along the
Great Ocean Road
– $40 million to fully fund Stage 5 of the Kardinia Park redevelopment
– $36.6 million to upgrade Whitten Oval
– $23 million to build a new visitor centre and biodiversity sanctuary
at Wilsons Prom
– $21 million for sports vouchers to get kids active
– $20 million for zero-emission bus fleet business case
– $18.5 million for the Gippsland Tourism Recovery Package
– $15.5 million to upgrade Richmond FC facilities
– $10.3 million to upgrade tracks and infrastructure along the Murray
River Adventure Trail
– $7.3 million for the Danny Frawley Centre for Health and Wellbeing
– $7.3 million for Arden St upgrades and new changerooms
– $6.7 million to create a National Centre for Photography in Ballarat
– $4.9 million to upgrade the Mallee Silo Art Trail
READ MORE:
INSIDE PLAN FOR RESSURECTED HOTEL QUARANTINE
MELBOURNE AIRPORT RAIL LINK FULL ROUTE REVEALED
THE BIG CHANGES AT THE ‘G TO MAKE IT COVID-SAFE
Originally published as Treasurer Tim Pallas’ bold plan to kickstart Victoria
Westpac breaks silence on drought
Three of the Big Four banks ruled out using drought declaration as a way of dodging farmer aid. Now Westpac has spoken for the first time.
Horse farms home to Melbourne Cup champions for sale from $3m
Some of the state’s top horse training farms have hit the marker, many of which were the grounds where Melbourne Cup champions lived and trained. SEE INSIDE.