Economic policy
Ms STALEY (Ripon) (14:17): My question is to the Treasurer. In a rising interest rate environment, why has the government exposed Victorians to a net debt of more than $160 billion, more debt than New South Wales, Queensland and Tasmania combined?
Mr PALLAS (Werribee—Treasurer, Minister for Economic Development, Minister for Industrial Relations) (14:17): I thank the member for Ripon for her question. The one thing that Victorians can count on: we will use our balance sheet to ensure that Victorians are well catered for and protected against the trepidations of a global pandemic. Thirteen billion dollars of support this government has given to households, to businesses—well, directly to businesses; households of course have also had considerable support from this government. To give you an illustration, in the November 2020 budget and the May 2021 budget we managed to spend some $76 billion of increased effort in order to ensure that we were resourcing our healthcare system, in order to ensure that we were adequately resourcing our pandemic fight. And through all that we have managed to produce the fastest growing economy in the nation.
Mr Andrews: And the lowest unemployment rate.
Mr PALLAS: Of course the Premier quite rightly observes that our unemployment rate, at 3.7 per cent, is in fact almost 3 percentage points below that which we inherited from those opposite, the great economic managers who would not know what an economy was. They are so obsessed with the fact that this government has, quite deliberately, used countercyclical investment to grow economic activity in the state. If you look at the turnaround in our budget, it is nothing short of phenomenal—in the last 12 months a $23 billion turnaround in material circumstances in our budget. Indeed if you looked at the New South Wales budget you will have noticed that the deficit that they are identifying for the 2022–23 financial year is $11.26 billion, compared to our deficit of $7.864 billion. The other point that I would make to the member is: look at the entirety of the debt, because the ratings agencies look at a thing called gross debt. They look at gross debt, not net debt. And why do they look at it? Because in New South Wales they have this habit of basically filtering away a lot of their debt in their public non-financial sector. You might know about it—it is called Transport Asset Holding Entity—and all the difficulties that they had associated with that through their Auditor-General. We of course have an Auditor-General that signs off on our accounts, and we can demonstrate that this state is in a very strong position going forward.
Ms STALEY (Ripon) (14:20): In 2025–26 the government will have racked up over $23 000 in debt for every single Victoria. This is more than three times the debt per capita of Queensland and far above that of New South Wales. What is the government’s debt repayment strategy?
Mr PALLAS (Werribee—Treasurer, Minister for Economic Development, Minister for Industrial Relations) (14:21): I thank the member for Ripon for her supplementary question. If you think our debt is of such traumatic circumstances, you should look at what is going on in the federal budget. Poor old Jim Chalmers. He has inherited a catastrophe—five times greater levels of debt than the state of Victoria. Let us not forget that this government used its balance sheet in order to invest in infrastructure that grows the economy and protects jobs—actually creates jobs. Indeed we have been in a position where we can demonstrate to the people of Victoria that we did exactly what the Reserve Bank governor said and exactly what every other state and territory Treasurer agreed had to happen, which was use your balance sheet and use your capacity to protect the wellbeing of your state—and that is what we did.