Sea of surpluses in Victorian budget

Victoria will get “surpluses as far as the eye can see” as it rings up more than $8 billion over the next four years, Treasurer Tim Pallas says.


But he admits a key project will not go ahead unless the federal government stumps up the money.

A $1.2 billion surplus for this financial year will be unveiled in Tuesday’s budget, with average surpluses of $2.4 billion over the forward years, Mr Pallas said on Monday.

Along with debt being kept below the level the Labor government inherited from its coalition predecessor, Victoria has a greater capacity for infrastructure investment, Mr Pallas says.

“We’ve increased our level of infrastructure investment from around about $4.9 billion to $10.1 billion in this budget,” Mr Pallas said.

“Imagine how much more we could do if the federal government were interested in partnering with the state of Victoria instead of playing politics?”

A state and federal stoush is looming over a $1.45 billion regional rail revamp announced by Premier Daniel Andrews on Sunday, to upgrade the Gippsland and Warrnambool lines and a new Surf Coast line.

Mr Andrews only told Prime Minister Malcolm Turnbull about the project that day, Public Transport Minister Jacinta Allan spoke to her federal counterpart on Saturday evening, and now the two governments are squabbling over the cash.

The money is owed under the asset recycling scheme after Victoria sold the Port of Melbourne lease for $9.7 billion.

The $1.45 billion is included in Tuesday’s budget but the projects will not go ahead without the commonwealth funds, Mr Pallas said.

Before the election, the government promised no new taxes but it now says it will not increase taxes to fund election promises.

Two tax changes, for investment properties and new cars, were announced on Saturday and together are set to bring in $120 million a year.

The money will be used to “improve services and improve our offering around capital investment”, which Mr Pallas conceded were election promises.

“But everything we are doing now is far and away in excess of anything we offered at the last election,” Mr Pallas said.

Tackling family violence will be a key part of Tuesday’s budget and new schools are also expected to be funded.

Earlier on Monday, $26.5 million was committed to boosting the improvement in ambulance response times.

Shadow Treasurer Michael O’Brien criticised Labor for smaller surpluses than what was left to them and wasting money on infrastructure business cases.

“Victorians are seeing talk, they’re seeing higher taxes and charges, they’re not actually seeing the work being done that makes their life better,” he told reporters.