Joint Statement - Labor’s Mid-Year Budget Update – more debt, more taxes, no plan

Joint Statement – Labor’s Mid-Year Budget Update – more debt, more taxes, no plan

Bridget Vallence, Shadow Minister for Finance

James Newbury, Shadow Treasurer

The Allan Labor Government’s Mid-Year Financial Report confirms that Victoria’s budget is spiralling further into crisis, with debt surging, interest payments ballooning, and reckless spending damaging the State.

Shadow Treasurer James Newbury said the figures in today’s report expose Labor’s complete failure to manage Victoria’s finances, proving that more taxes, more borrowing, and more waste are the only tools in their economic playbook.

Remarkably, Labor has already blown through 66 per cent of its budgeted increase in net debt. If this trend continues, Victoria will record a blowout in net debt of over $4 billion this financial year.

“The Allan Labor Government has taken Victoria from the financial powerhouse in Australia, to a poorly managed State that is being actively monitored by the credit rating agencies ,” Mr Newbury said.

“In just six months, Labor has borrowed another $15.7 billion, pushing net debt to a staggering $146.8 billion – increasing the net debt to Gross State Product ratio from 22.0 to 22.9 per cent.

“What’s more alarming is that this Government is ignoring every warning from credit rating agencies, who have made it clear that Labor’s financial recklessness risks a further downgrade.”

The cost of Labor’s debt is skyrocketing, with interest expenses blowing out to $3.3 billion in just six months, a 27 per cent increase from last year.

Meanwhile, public sector wages have surged by $1.5 billion, already hitting 51 per cent of the annual budget in just six months – further proof that Labor’s spending is completely out of control.

Shadow Minister for Finance Bridget Vallence said the latest financial report makes it clear that Victoria’s economic security is under serious threat.

“Despite debt skyrocketing, the Allan Labor Government keeps borrowing more, with no strategy to pay it down,” Ms Vallence said.

“Labor is on track to blow its debt forecast yet again, and that means Victorians are facing the very real risk of even higher taxes – adding more to the cost-of-living pressures faced by already struggling families.”

Victoria’s record tax revenue, which has increased by $1.3 billion in just six months, has done nothing to fix the budget, with the Government still running a $3.9 billion deficit. Instead of getting spending under control, Labor continues to make the wrong choices – racking up debt while delivering less for Victorians.

“Labor can’t manage money, and now Victorians are paying the price,” Mr Newbury said.

The Liberal and Nationals will continue to hold the Allan Labor Government to account and fight for real budget repair – so Victoria can once again be a state of opportunity, not one sinking under the weight of Labor’s debt and mismanagement.

Bridget Vallence, Shadow Minister for Finance

James Newbury, Shadow Treasurer