The Andrews government is attempting to blame everyone but themselves for Victoria’s record debt levels, but a cursory look at the state’s books over the past nine years shows their case doesn’t stack up.
When Labor came to power in 2014, they inherited $21.8bn of debt from the Napthine government – a sum that Treasurer Tim Pallas indicated he was happy to see almost triple when he announced ahead of the 2018 election, and well ahead of the pandemic, that he would double the debt ceiling to $60bn, or 12 per cent of gross state product, to fund major infrastructure projects.
As The Australian revealed last week, the Victorian Department of Treasury and Finance attributes a grand total of $35.8bn to “coronavirus-related costs” over the 2019-20, 2020-21 and 2021-22 financial years, meaning Covid-related spending will account for less than a third of Victoria’s projected debt levels of $116bn by the end of the current financial year, and just over a fifth of the $165.9bn of net debt the state is projected to reach by 2025-26.
Much of that $35.8bn is questionable in terms of its relevance to the pandemic, given that it includes $690m
for the government’s “big housing build”, $110m for $250 “power saver” vouchers for households, $94m for community sport, and tens of millions for household and industry clean energy projects.
But even allowing for the most generous definition of “Covid-related”, that leaves $25.3bn, or more than 40 per cent, of debt accrued by the Andrews government since 2019-20, which is unrelated to Covid.
The situation is set to get worse, with state debt projected to increase by another $49.9bn by 2025-26, amounting to an extra $75.2bn in debt accumulated in the six years from 2019-20 that was not part of the plan ahead of the pandemic, but is not Covid-related.
We don’t need to look far for some of the key sources of this escalating debt.
Every major project has blown out by billions, and the public service wage bill – at $33.4bn for 2022-23 – is $7.2bn or 27 per cent higher than the $26.2bn forecast in the 2019-20 budget, up from $19bn when Labor won government.
A government that has mismanaged the state economy this badly should be on its knees.
Instead, Victorians are being let down by a rabble of an opposition led by a man whose handling of his denuded and divided partyroom has been so poor that he is facing the ultimate sideshow of defamation proceedings in the Federal Court.
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