Flat White

Victoria keeps its Triple A rating for reckless budget bastardry

25 November 2020

4:06 AM

25 November 2020

4:06 AM

Having morphed its deadly 2020 Covid response ‘strategy’ into a popularity triumph with voters the Andrews Victorian government has delivered generational debt in its state budget — the scale of which is truly grotesque.

The government, via its comical Treasurer, Tim Pallas, trained a firehose of cash in the direction of Labor’s core constituencies; inner-city left elites, public sector employees, green zealots, gender and inclusion warriors, the public housing lobby, the unemployed and young.   

To put us off the scent that non-Labor aligned constituencies don’t matter there were multi-million dollar programs for aged care, disability services, transport, schools, hospitals and the like. Innovation was even mentioned.   Not visible were any initiatives remotely reformist in nature — particularly in regard to state taxation or public sector administration.

Treasurer Pallas gleefully bestowed on future generations of taxpayers a debt exceeding $150 billion by 2024.  Yes – $150 billion It’s a Tsunami of debt that will take decades to recede and may never be fully paid down.

At the very moment when public sector cost restraint is blindingly needed the Treasurer declared the government did not believe it should be “constrained” by the Covid-19 downturn, but rather “unleashed by opportunity.”

The diminutive Pallas went on to say,  “a year like no other really does deserve a budget like no other.”

Honestly, who writes this stuff? Presumably one of the Premier’s 50 plus communication functionaries in his Spring Street bunker. They must have had steam coming off their keyboards this week with more than 70 media statements spewing forth on budget day alone, each with their idiotic titles and lame ‘attributable’ Ministerial quotes. 

Consider that gross Victorian state product is down 4 per cent, revenues are down by 4.2 per cent relative to pre-pandemic levels and state tax revenue is down a staggering 11.3 per cent. 

Against this sudden and unplanned shock to the Victorian economy Andrews’ shameful ‘administration’ determined to ramp up public sector spending and employment along with debt with not the slightest concern for the future impact on people — real people with families and mortgages.

The state’s operating deficit of $23.3bn in the current financial year will only head south if the most optimistic of assumptions come good while Victorian net debt is forecast to rocket from its current $87bn to a whopping $154.8bn by mid-2024.

The artistry of this firehose budget, and of Premier Andrews, is its raw deceit of punters conveying as it does, a sense that anything is possible, the cash splash will see their aspirations met and the debt will take care of itself “given current low rates of borrowing.”   The entire artifice is built on forecasts and assumptions in the very year we know assumptions are massively unreliable. 

By 2024 — when current projected debt peaks — Andrews, Pallas and the majority of the artful dodgers currently in Cabinet will have gone.

Other political aspirants will be left to extricate the state out of the debt quagmire it will certainly be in.

Taxpayers will be required to support their kids and grandkids get a roof over their heads and secure a job against a backdrop of higher interest rates and higher taxes.   The sanctimonious, self-praising Andrews will blissfully have gone the way of all political leaders – elsewhere. 

Of all the elements in the budget announcements were these three horrific revelations: 

  • Victoria’s public sector wages bill is rising at roughly $3bn per year and by 2024 will have reached a sickening $37bn;
  • Public sector employee expenses will rise almost 10 percent in the coming year and will be $2bn higher than forecast only a year ago; and
  • The government has dumped its promised major project updates thus denying us knowledge of cost blowouts – which we know are endemic. 

Yet despite all this, in a jolly interview with the ABC’s Leigh Sales Daniel Andrews said in a straight face to camera, “I don’t have time for partisan politics.”   

From a leading exponent of the roughest of rough house partisan politics, this was an unfortunate remark from someone seeking the adoration of taxpayers.  

It confirmed for the doubters — Daniel Andrews cannot be and should not be trusted.

John Simpson is a Melbourne company director.

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