Wednesday, 18 March 2026

 Rachel WESTAWAY (Prahran) (17:31): I grieve for Victorians who are feeling the significant pressure of the cost-of-living crisis. Every family in Prahran knows what it feels like right now – in fact every Victorian knows what it feels like right now. The weekly shop costs more. You go to the supermarket, you look at your bill, and there are very few people that could honestly say they walk away being pleasantly surprised. The energy bills arrive – the DLs, the window-faced envelopes – and you wince before you open them. You wonder whether your lease renewal is going to break you. The question people are asking quietly around kitchen tables, in the queue at the supermarket and across the state is a simple one: why is it this hard and who is responsible? The cost-of-living crisis in Victoria is not an act of God, it is an act of this government. The truth is that this government has made deliberate choices, not bad luck and not global headwinds but choices: a decision to spend without discipline, a decision to tax without restraint and a decision to borrow without consequence, at least for those making the decisions rather than those left paying for them.

Let us start with where we actually are. Victoria’s net debt is projected to reach $165.8 billion by June this year. By 2029 it will climb to $192.6 billion. Interest payments on the debt are already running at more than $1 million every single hour – $1 million every single hour in debt – every hour, day and night. That is not an abstraction, that is money that cannot go to hospitals, cannot go to schools, cannot go to public transport and cannot go to the services that the families in Prahran and across the state rely on. This government is not helping families, it is mortgaging their children’s futures to pay for its own mistakes. When the Treasurer stands at the dispatch box and talks about fiscal responsibility, Victorians are entitled to look at those numbers and ask a straightforward question: if the management has been responsible, why is the debt higher than in any comparable jurisdiction on earth? Why did the credit rating agency S&P Global find that Victoria is the most indebted subnational government across Australia, Canada and Germany combined? Victoria’s public service has expanded by 59 per cent over the past 15 years. The state’s population grew by 29 per cent over the same period, so how does that make sense? The public sector wage bill has increased by 152 per cent. That is not an investment, that is expansion without accountability, and every Victorian family is now servicing that bill.

Victoria’s debt has grown by 415 per cent since 2014. The economy grew by 29 per cent. Someone has to pay the difference, and that someone is us. The government is going to say that it is focused on cost of living. It has said that in every single budget. It said it when it introduced the mental health and wellbeing levy. It said it when it introduced the COVID debt levy. It said it when it doubled the Emergency Services and Volunteers Fund charge from July of last year. And it is saying it again now, while interest payments consume more of the budget every single quarter.

Victorian state and local government taxes now sit at $6348 per person per year. That is $654 more than the national average. That is 11.5 per cent above every other state and territory. Victorians are the most heavily taxed people in this country, and the gap is simply not narrowing. Tax revenue is forecast to grow at 4.7 per cent per year over the forward estimates. Wages are not growing at 4.7 per cent. Household budgets simply are not growing at 4.7 per cent. Social services or security payments are not growing at that amount, and most Victorians will say that their salaries simply are not growing at that amount. Victorians pay $654 more in state taxes every year than the national average, and this government wants more.

What does that look like in practice? Let me give this chamber a concrete and recent example: the congestion levy. From January of this year this government has nearly doubled the parking levy in inner Melbourne. The category 1 rate for the CBD has jumped from $1750 to $3030 per space. The category 2 rate, which now captures part of South Yarra, Richmond and Prahran, has risen from $1240 to $2150 – that is a 73 per cent increase – and it has been expanded into suburbs that were never previously covered. The government says that this is about reducing traffic congestion and about encouraging people to go onto public transport and use that. The argument might have some merit if it were 2019, but parking volumes across 16 key Melbourne CBD sites have already come down 12.3 ‍per cent since then. Fewer people are driving in. The congestion that this levy was designed to address has already been significantly reduced, but the revenue collection continues regardless. They have nearly doubled the parking tax and dragged Prahran into it. Less congestion, more tax – draw your own conclusion.

This is not about congestion; the numbers make that clear. Since the congestion levy was introduced in 2005 and 2006, revenue from it has increased by 1162 per cent, from $19.1 million to a projected $222 million this financial year. Not one dollar of that extraordinary revenue increase has been directed to local councils to fund genuine transport alternatives, cycling infrastructure or community services. Every dollar flows to Treasury to service debt that this government has created. The Property Council of Australia has put it plainly. The City of Melbourne, the City of Yarra and the City of Stonnington have all publicly opposed this increase in levy. The Lord Mayor of Melbourne said it directly: this is the wrong time for a tax increase in Melbourne. Stonnington has calculated that the levy will cost their municipality more than $4 million in this financial year alone. That is $4 million not going to local parks. It is not going to local community programs or aged care services that residents in my electorate depend on.

The congestion levy revenue has increased by 1162 per cent since 2005. Not one dollar goes back to the communities paying for it, and that is simply not fair. It is what I grieve for. And who ultimately pays for this? Not the building owner, not in the end. This cost flows through to the tenant. It flows through to the business, and when it flows to the business, it flows on to the price of everything that business sells. It flows to the consumer. It flows to the family trying to get through the week.

The small business owner on Chapel Street is already navigating vacancy rates that have become a genuine crisis. They are operating in an environment where foot traffic is recovering, but costs are not easing, and now they face higher outgoings from a parking levy that their landlord must pass on – on top of the emergency services and volunteer fund levy that effectively doubled the variable charge on their property from July last year and on top of the short-stay levy, a COVID debt land tax surcharge and an expanded vacant residential land tax. Since 2022 this government has introduced or expanded at least five new taxes and levies on households and businesses. Every single one flows through to the consumer. Every new levy on business is a new cost for families. Since 2022 this government has introduced or expanded at least five new taxes and levies. Every single one ends up in your shopping basket.

Let us now turn to payroll tax, because the picture there is, simply, complex and similarly unfair for businesses trying to grow and employ people in this state. The government has pointed to its increase in the payroll tax–free threshold to $1 million from July of last year as evidence that they are on the side of small business. And yes, approximately 6000 businesses will no longer pay payroll tax as a result and a further 22,500 will pay less. I acknowledge that it is a step in the right direction, but context matters. Victoria currently operates with 33 separate state-based taxes, levies and charges. Eighteen of those sit specifically on property ownership, investment and transactions. No other jurisdiction in this country comes close to that level of complexity or that combined burden. For any business with a payroll of above $5 million, there is no threshold relief at all, with two additional surcharges applying on top of the standard rate once Australian wages exceed $10 million. Victoria has 33 state taxes; 18 of them are just on owning a property. This is not a tax system. It is an absolute ambush.

These are not abstract numbers. They are the businesses that employ our neighbours, the businesses that anchor our high streets and activity centres. When those businesses face a tax environment that is materially more expensive than New South Wales or Queensland, they face a question that has a very clear answer. Analysis consistently shows payroll tax costs in Victoria are higher than those of states at comparable wage levels, and the consequences are absolutely visible. In 2023 and 2024 Victoria recorded a net interstate migration loss of 15,847 people – that many people leaving our state. That was the worst result of any state in the country. Queensland gained 34,788 interstate migrants in the same period. Western Australia attracted 11,000. Capital is growing people; businesses are following people. This government’s response when people and businesses choose to leave – what is it? To add another levy to those who remain. Victoria lost 15,847 people to interstate migration last year, the worst result in the country. People are voting with their feet.

I want to be very direct about what all of this means for the people that I represent. Prahran is a community of extraordinary diversity and energy. It includes South Yarra, St Kilda, Windsor, parts of Southbank and parts of Armadale. It has high streets, markets and community facilities and small businesses that define the character of inner Melbourne. It is a community with people at every stage of life, of every kind of income and in every kind of housing arrangement. Right now, across all of these different circumstances, the single most consistent thing I hear is it is getting harder for all of us. It is getting harder, and they cannot budget – not easier, harder. The weekly budget is tighter, the lease renewal came with a shock, the energy bill was higher than expected and the car trip to work costs more than it should. People are asking whether any of it is going to get better. Across Prahran, South Yarra, St Kilda and Windsor the single thing I hear most is this: ‘It’s getting harder, it’s not getting easier. We can’t afford it. How much more do we absolutely have to chop from our budget?’

This government wants to take credit for cost-of-living support, but $2.3 billion in cost-of-living measures in a budget where interest payments alone are running at more than $1 million every single hour is simply not a relief. It is not even keeping pace. It is a public relations exercise funded by the same families it claims to be helping. The most damning evidence is not the debt number or the tax rating, it is the migration data that I mentioned before, it is the business insolvency data, it is the investment data. When people have the choice and the means, they are choosing to be somewhere else. This is the clearest possible signal that the policies of this government are failing the people of this state, seeing Victorians leave the state and businesses leave the state. When people have the choice, they are choosing to leave Victoria. That is not a statistic; it is a verdict, and it is fact.

The Liberal Party will offer a different path, and it starts with fixing the finances, because if we do not fix the finances in this state, we cannot fix the crime issues and we cannot fix property investment or even proper health issues.