Victoria is easily the nation’s most indebted state with the lowest credit rating.
Victoria’s debt is expected to blow out to $247.2 billion by 2027, up from $55.2 billion in 2019:
Victoria’s ballooning debt is based on waste.
Victoria spends excessive sums on bureaucrats, particularly at the executive level.
Victoria’s public service increased in size by 59% over the 15 years to 2022-23, easily outpacing the state’s population, which grew by 29% over the same period:
Source: The Australian Financial Review
Over the same 15-year period, Victoria’s public service wage bill grew by 152%, the nation’s largest increase:
Source: The Australian Financial Review
Victoria’s “Big Build” infrastructure projects are also running well over time and over budget, which is adding to the state’s budget woes.
For example, Victoria’s North-East Link was first expected to cost $15.8 billion but is now forecast to cost $26 billion – a $10 billion cost overrun.
Victorian Premier Jacinta Allan’s foolish decision to sign the first major contract for the $200 billion Suburban Rail Loop (SRL), against the explicit advice of infrastructure experts, will ensure that Victoria’s debt problems deepen.
The SRL other major infrastructure projects have been justified on the basis that Melbourne’s population is projected to grow to 9.0 million by 2056 on the back of permanently high net overseas migration.
These projects, therefore, should be considered a direct cost of immigration.
Hilariously, only 18 months after signing the first contract to build the SRL, the Victorian Government is now looking to defer the project amid a funding black hole. Yet, the government plans to sign the second major tunnelling contract:
Treasury briefings in recent weeks have raised the prospect of the rail line’s construction milestones being rejigged, pushing back some spending further down the track to free up space for other infrastructure priorities…
One option raised by the Department of Treasury and Finance is to push back some of the project’s major works, spreading the spending on SRL East over a broader time frame…
The Allan Government has locked in $11.8 billion, leaving a funding black hole worth up to $20 billion…
But the government insists the project will continue, with tunnelling to start in 2026 — the same year as the next state election — and the line open to passengers in 2035.
The Saturday Herald Sun can also reveal that the next major contract — for tunnelling between Glen Waverley and Box Hill — is set to be inked this month.
The Labor state government seems intent on bankrupting Victorians with massive boondoggle infrastructure projects that will bury residents in debt for decades to come.
