IS Victoria’s 2024/25 State Budget a positive plan for the future or a “horror budget”? Does it offer nothing, or does it instead show great restraint? As usual, it depends on who you ask.

Just like last year, there were no major announcements prior to the ‘budget lockup’ on Tuesday morning, during which journalists were given budget papers to look through over a number of hours prior to Treasurer Tim Pallas handing down the budget in parliament at 1pm.

Before Tuesday, Victorians arguably knew more about the federal budget, which will be handed down next Tuesday, than the state budget.

Premier Jacinta Allan talks to reporters about her first budget in the top job.

For Wellington, there probably isn’t much that could compare to last year’s bombshell announcement to end the native timber harvesting industry years earlier than originally intended.

As part of the state’s transition out of native timber harvesting, funding is provided to finalise the wind up of the timber industry, including the cessation of VicForests on June 30 2024 ($11.1 million in 2024/25, plus the $145.7 million the previous year). The budget also funds the Future Forests ($116 million over four years) to manage more than 1.8 million hectares of state forest previously used for timber harvesting.

Speaking with the Gippsland Times at Tuesday’s lockup, Premier Jacinta Allan said “this is a recognition that this has been a difficult transition for those communities.”
“(The funding) provides support for those communities,” noting the sector had been a “big employer” in the timber towns.

“That’s why we’re providing ongoing support for the harvesting sector.”

Net debt will hit $135.9 billion in June, and is expected to be $156.2 billion by June 2025, eventually hitting $187.8 billion by 2027/28.

Interest payments on state debt by 2027/28 will total $9.38 billion, which is $26m a day.
The deficit for 2024/25 has increased from $1 billion to $2.2 billion. A surplus of $1.5 billion is forecast for 2025/26, hitting $1.9 billion in 2027/28.

Treasurer Tim Pallas gives his budget speech before answering questions from reporters on Tuesday. Photos: Stefan Bradley

The theme of the budget is ‘Helping Families’ – you may remember last year’s as ‘Doing What Matters’ – and the centrepiece of this is the School Saving Bonus, providing $400 for kids at government schools, and eligible concession card holders at non-government schools.

The money will go towards helping 700,000 students with uniforms, camps, excursions and sporting events at school.

“This is my first budget as Premier. And I’m proud to say, it’s a Budget that’s all about helping families,” Ms Allan said.

“Right now, things are tough for a lot of Victorian families. With this Budget, we’re delivering cost of living help, investing in the services and support that Victorians rely on, and setting our state up for a strong future.

“Interest rates are higher, and the cost of groceries and everything else continues to go up. The costs of learning – things like uniforms, camps and excursions can really add up.

“That’s why we’re helping families with our $400 School Saving Bonus. It’ll take pressure off the family budget and make sure kids have everything they need to learn.”

Speaking of schools – there is no money for the new Sale College.

Infrastructure spend is down and certain projects have been delayed. For regional rail, $133 million will go towards stations, VLocity trains and train stabling yards, and $60.5 million over four years for regional road upgrades.

Some $133 million was allocated to support Victoria’s regional rail network, including operating newly delivered train stabling yards, stations and VLocity trains.

The budget allocated $60.5 million regional road upgrades over the next four years, but a group representing farmers said it did not go far enough.

Not much for Wellington in health, but many locals would be familiar with Latrobe Regional Health, with its $44 million in funding arguably the biggest Gippsland win.

The money will go towards staffing the expanded Traralgon hospital facilities that include 44 inpatient beds, 14 medical and surgical beds, a new emergency department resuscitation bay, and a medical imaging pathology unit.

If Gippslanders were hoping to jump on a train at Sale and eventually end up at the upcoming Melbourne Airport railway station, that will be further down the line than originally expected. The Treasurer told journalists there will be at least a four-year delay, unless the airport backs down soon from its demand for compensation and for the government to build the station underground.

“Believe me, we are not doing either of those things,” Mr Pallas said, urging the airport to be a “good corporate citizen”, rather than a “car park operator”.

Responding to the budget, opposition leader John Pesutto, who was born in Traralgon, said: “This budget is the culmination of a decade of financial mismanagement under Labor.”

“With record debt, record interest, record taxes, service cuts and poorer outcomes – it’s clear Labor cannot manage money and Victorians are paying the price.

“Whilst this budget makes cuts to health, education, disability, housing and basic community infrastructure projects, Labor arrogantly presses ahead with a $216 billion train line for Melbourne’s south-eastern and eastern suburbs. The priorities are all wrong.

“Premier Jacinta Allan’s first budget has failed to change the direction of our state, failed to address the mismanagement of the past decade and failed to make life easier for Victorians.”