Wednesday, 9 March 2022

Department of Treasury and Finance

Budget papers 2021–22

Mr DAVIS (Southern Metropolitan—Leader of the Opposition) (17:26): I want to raise matters around the state budget and where that state budget now sits. Clearly the budget update pinged the fact that debt was growing out of control in this state, the major projects had not been properly controlled and the major projects had blown out in cost right across a large front, whether it be the West Gate Tunnel, the Metro Tunnel, smaller projects like the Mordialloc bypass or the raft of many different projects. Today a further bell has been rung on this. The ratings agencies, and in particular Standard & Poor’s, have drawn attention to the huge increase in state government debt. Unfortunately Victoria wins a very bad prize with respect to this. We are the one with the largest increase in debt. We are the one that agencies have singled out as being the weakest state going forward into the future, the state that has not been able to control its costs. The S&P credit analyst Martin Foo is reported as saying today:

… the rise in debt was being driven by a fall in revenue, pandemic-related spending as well as a huge increase in large infrastructure programs.

The article states:

Victoria’s gross debt is expected to quadruple between 2019 and 2025.

Mr Foo said almost all states were facing an increase in debt that is on track to reach $500 billion …

across the states, Victoria having far away and the biggest share of that—bigger than our population share, much bigger New South Wales, much bigger than Queensland and coming earlier from a base that was lower. That is because this government has failed to control the costs of these major projects. They have failed to scope the projects properly from the start. This is leaving Victoria with a very significant debt overhang. We are seeing taxes forced up, whether they be land taxes or stamp duties—right across the raft of taxes—and 40 new and increased taxes, despite the promise that was made to the Victorian people on the night before the election in 2014 when Daniel Andrews said there would be no new and increased taxes. He looked down the barrel of the camera and he made that solemn promise to every Victorian. That is what Daniel Andrews did on election eve in 2014. In fact what has happened is the taxes have gone up and up and up—massive, massive increases in taxes that are actually hurting Victorians and hurting Victorian families. Victorian families have less to spend on their own expenses because of the high taxes they are facing in Victoria. Young families find it very hard to get into a home because of the massive taxes.

This government, let us be clear, in recent weeks have thought they would bring forward a new tax, a $20 000 clobbering on every median house price in metropolitan Melbourne, a $20 000 thump on every family trying to get into those family homes, and a huge hit, $12 000, on a median-priced property in country Victoria, and their plan was also to clobber people through increased rates.

Mr Leane interjected.

Mr DAVIS: You were not standing up. We heard, Minister, before yesterday—

The ACTING PRESIDENT (Mr Bourman): Mr Davis is entitled to be heard in silence. It would be really awesome if we could pull that off, Minister.

Mr DAVIS: I do pick up the interjection from the minister. What we learned in this chamber the other day is that he had not consulted with councils before deciding to give social housing operators a rating holiday. He had not consulted with them prior to that. This would have forced council rates up, the rates that are levied on everyday Victorians. We heard that in the City of Yarra, for example, they were going to pay another $79 per household—$79 per household in increased rates to cover the rate holiday that was planned by this government. So that was a huge clobbering that ordinary families were going to have to pick up, and up to $20 000 on a median house in Victoria.

Now, make no mistake, this government will bring back that tax if it is re-elected. People will get a very clear decision at this state election in November. They will have the Liberals and Nationals on one hand, who will not put this tax on, and they will have Labor and Daniel Andrews and Tim Pallas on the other, who will bring back this nasty tax. We saw today the failure of the government to produce the modelling—they were going to give the modelling to the industry groups, but they did not do that—the nasty modelling that shows how much it would hurt young families trying to get into a home.

So what we see is the massive increase in debt called out by the ratings agencies today, hurting families, hurting individuals— (Time expired)