Victoria’s budget deficit forecast has blown out by $500 million (US$321 million) in 10 days after the state government spent up on flood recovery and a sports sponsorship deal before the election.
The Department of Treasury and Finance released the state’s Pre-Election Budget Update on Thursday, 10 days after Treasurer Tim Pallas unveiled the Victorian Economic Fiscal Update.
It shows Victoria is on track to post a deficit of $10.2 billion this financial year, up from the $9.7b estimate in the earlier report.
The rise has been put down to the Andrews government setting aside an extra $500 million to meet the “immediate needs of flood-affected communities and support the emergency response”.
Hundreds of millions in flood-related funding was announced and allocated last month at the peak of the widespread weather event.
It also accounts for Visit Victoria’s $15 million sponsorship agreement with Netball Australia, unveiled the day before the government entered the caretaker mode.
Net debt projections have marginally risen for this financial year ($115.6b to $116b) and to June 2026 ($165.4b to $165.9b), while forecast tax revenue for 2022/23 remains unchanged at $678m.
Shadow Treasurer David Davis said the coalition’s long-term economic plan would end spiralling debt and higher taxes.
“By reining in (Premier) Daniel Andrews’ record debt, a Matt Guy government will deliver financial relief to hard-working Victorians right across the state,” he said.
Labor has been approached for comment.
It comes after the premier promised 100 neighbourhood batteries would be installed across Victoria if Labor is re-elected on November 26.
In Melbourne’s outer east on Thursday, Andrews announced his government’s plan to spend $42 million to set up the batteries.
“We think about 25,000 households will benefit from this,” Andrews told reporters at a bowls club in the seat of Bayswater, held by Labor on a wafer-thin margin.
Fifteen of the batteries will initially be installed in Melbourne and 13 in regional Victoria, with the location of the rest to be confirmed at a later date.
The batteries are expected to triple the number of Victorian homes with access to storage, allowing more to return surplus solar-generated electricity to the grid through feed-in tariffs.
Liberal Leader Matthew Guy again focused on health on Thursday.
Speaking at Monash IVF in Clayton, Guy said if elected, the coalition would cover the cost of IVF and egg freezing for women with serious medical concerns.Some 750 women and girls with cancer, endometriosis and other gynaecological conditions would be eligible for grants of up to $7000.
“We want to take away that cost for young women and girls who might need to avail egg freezing into the future,” Guy told reporters.
It is expected the program will cost $21 million over four years.
