The 2025-26 Victoria State Budget, presented on May 20, 2025 by the new Treasurer Jaclyn Symes MP, is a forward-looking fiscal plan addressing economic recovery, infrastructure, and social equity. The budget balances fiscal repair with social investment, emphasizing infrastructure, healthcare, and climate action while offering targeted cost-of-living relief. However, debates persist over debt management and revenue policies. Though the state elections are 18 months away, no doubt, the budget’s eye is on the goal for a fourth term for Labor.
Presenting the budget the Treasurer in her speech said:
“With my first Budget, we are firmly on track to deliver on the Government’s fiscal strategy.
The Budget delivers an operating surplus in 2025-26 – the first since before the pandemic – with average surpluses of $1.9 billion over the forward estimates.
By the end of the forward estimates, net debt is declining as a proportion of the economy.
These fiscal outcomes and our economic plan will help to ensure Victoria’s economy continues to grow strongly and creates good secure jobs.
This is the beginning, not the end.
Families and businesses are carefully considering every dollar. They rightly expect their government to do the same.”
Premier Jacinta Allan addressing the media at the media lockout (prior to the budget presentation) today while delving into her own family situation in Bendigo said, she understood how it was necessary for a family to overcome cost of living in different sectors. This, she said, was reflected in this years budget which envisages steps that will cut expenses with free transport for those below 18, free pharmacy care, among other steps which she detailed.
The main takeaways of the budget:
1. Economic Management
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Deficit Reduction: Aims to narrow the budget deficit through economic growth and moderate spending, with a long-term path to surplus.
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Debt Strategy: Focus on managing rising debt levels via asset recycling (e.g., leasing public infrastructure) and prioritizing high-return investments.
2. Infrastructure Investment
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Major Projects: Continued funding for the Suburban Rail Loop, Metro Tunnel, and North East Link. New commitments to regional rail upgrades and road safety improvements.
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Regional Development: Investment in rural transport, healthcare facilities, and renewable energy hubs to boost regional economies.
3. Healthcare
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Hospital Upgrades: $2.3 billion allocated to expand emergency departments and regional hospitals.(Nine new hospitals)
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Mental Health: Additional funding for the Royal Commission’s recommendations, including local mental health services and workforce training.
4. Education and Skills
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School Modernization: $1.5 billion for new schools and upgrades, focusing on STEM facilities.
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TAFE and Training: Free TAFE courses expanded to priority sectors (e.g., renewable energy, aged care) and incentives for apprenticeships.
5. Climate and Energy
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Renewables Push: $800 million for offshore wind projects, household solar/battery subsidies, and grid modernization.
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Flood Resilience: Funding for levees and drainage systems in flood-prone regions.
6. Cost of Living Relief
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Energy Rebates: One-time $500 power bill relief for eligible households.
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Transport Concessions: Extended discounted public transport fares for seniors and students.
7. Housing Affordability
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Social Housing: $1 billion to build 4,000 new social housing units.
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First Home Buyers: Increased stamp duty exemptions and a regional homebuyer grant.
8. Revenue Measures
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Land Tax Adjustments: Higher taxes on high-value investment properties; exemptions for primary residences.
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Digital Services Levy: New tax on tech giants’ revenue generated in Victoria.
9. Public Sector Wages
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Wage Increases: 3% annual raises for nurses, teachers, and public servants, tied to productivity reforms
10. Multicultural communities
- More than $100 million to promote and strengthen the state’s diversity, heritage and culture.
