The Hon. Michael O’Brien MP Treasurer of Victoria 9 May 2014

Building a Better Victoria Victorian Budget 2014|15

Bringing expenditure growth under control

20

00

-01

2

00

1-0

2

20

02-

03

2

00

3-0

4

20

04

-05

2

00

5-0

6

20

06

-07

2

00

7-0

8

20

08

-09

2

00

9-1

0

20

10

-11

2

011

-12

2

01

2-1

3

20

13

-14

2

01

4-1

5

20

15

-16

2

016

-17

2

017

-18

3.6 2.8

3.1 3.9 4.0

9.4

COALITION AVERAGE: 3.1% P.A.

BUDGET AND FORWARD ESTIMATES AVERAGE:

2.6% P.A.

PE

R C

EN

T

ANNUAL EXPENDITURE GROWTH 12.6

LABOR AVERAGE: 8.0% P.A.

0.7

2.1

6.4

10.5

5.9 6.8 7.3

7.7 7.7

5.9

Source: Department of Treasury and Finance

2.7

Building a Better Victoria Victorian Budget 2014|15

Responsible financial management

Source: Department of Treasury and Finance

2014-15 BUDGET ECONOMIC AND FISCAL AGGREGATES

Unit of measure

2013-14 Revised

2014-15 Budget

2015-16 Estimate

2016-17 Estimate

2017-18 Estimate

Net result from transactions (operating result)

$ billion 0.9 1.3 3.0 3.2 3.3

Net debt $ billion 21.5 23.4 18.5 19.0 19.5

Net debt to GSP per cent 6.1 6.3 4.7 4.6 4.5

Government infrastructure investment

$ billion 5.2 7.5 7.1 6.4 6.4

Real GSP growth per cent 2.00 2.50 2.75 2.75 2.75

Employment growth per cent 0.75 1.25 1.50 1.50 1.50

Unemployment rate per cent 6.25 6.25 6.00 5.75 5.50

Population per cent 1.8 1.8 1.8 1.8 1.8

Building a Better Victoria Victorian Budget 2014|15

Surpluses funding record infrastructure program

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00

-01

2

00

1-0

2

20

02-

03

2

00

3-0

4

20

04

-05

2

00

5-0

6

20

06

-07

2

00

7-0

8

20

08

-09

2

00

9-1

0

20

10

-11

2

011

-12

2

01

2-1

3

20

13

-14

2

01

4-1

5

20

15

-16

2

016

-17

2

017

-18

5.8

7.5

4.5 5.3

LABOR AVERAGE $3.4B P.A.

COALITION AVERAGE $5.4B P.A.

BUDGET AND FORWARD ESTIMATES AVERAGE: $6.8B P.A.

$ B

ILLI

ON

7.1

5.0

GOVERNMENT INFRASTRUCTURE INVESTMENT

1.6 2.0 2.2

3.1

4.4

2.7 3.3

6.4 6.4

5.4 5.4 5.2

Source: Department of Treasury and Finance

Building a Better Victoria VIC TORIAN BUD GE T 2014 - 15

RE

L A

T IV

I T Y

20

09

-10

20

10

-11

20

11-

12

20

12

-13

20

13

-14

20

14

-15

1.10

QUEEN S L AN D

1.05

1.00

N SW

0.95

0.90 VI C TORIA

0.85

The distribution of GST revenue remains inequitable

Building a Better Victoria Victorian Budget 2014|15

Infrastructure highlights

• $8.5b - $11b Melbourne Rail Link

• $8b - $10b East West Link – Western Section

• $2b - $2.5b Cranbourne-Pakenham Rail Corridor Project

• Up to $850m CityLink - Tulla widening

• Additional $685m to deliver the Metro Level Crossing Blitz

• Up to $220m Murray Basin Rail Project

• $73m Shepparton Law Courts

Building a Better Victoria Victorian Budget 2014|15

Positive tax reform to further support jobs

Source: Department of Treasury and Finance

• Cut payroll tax rate to 4.85 per cent from 1 July 2014, benefitting 39 000 employers

• Lowest payroll tax in Australia for businesses with payrolls from $4.7m - $26.7m

• Duty on life insurance also abolished from 1 July 2014

• Combined tax cut of $250m over four years

Building a Better Victoria Victorian Budget 2014|15

10

11

12

13

14

15

2010-11 2014-15

$ b

illi

on

The 2014-15 health output funding budget is 21 per cent higher than the 2010-11 budget

Health funding

Source: Department of Treasury and Finance

(Budget) (Budget)

Building a Better Victoria Victorian Budget 2014|15

250

350

450

550

10-11 14-15

$ m

illio

n

Schools-related capital funding

School capital funding

Source: Department of Treasury and Finance

(Budget) (Budget) The 2014-15 budget for school capital is 43 per cent higher than the 2010-11 budget

Building a Better Victoria Victorian Budget 2014|15

600

750

900

1,050

1,200

1,350

2010-11 2014-15

$ M

illio

n Training Delivery Budget*

(Budget) (Budget)

The 2014-15 budget for training delivery is 51 per cent higher than the 2010-11 budget

VET funding

Source: Department of Education and Early Childhood Development; Department of Treasury and Finance

*excludes concessions expenditure

Building a Better Victoria Victorian Budget 2014|15

Building a safer Victoria

• $33m to construct new police stations

• $783m investment in fire services

- CFA funding up 2.5 per cent to $457m

- MFB funding up 3.1 per cent to $326m

• $29m for 78 new CFA fire vehicles

• Corrections system expansion including:

- Additional 871 prison beds

- Infrastructure upgrades at Beechworth Correctional Centre and Langi Kal Kal Prison

Source: Department of Treasury and Finance

The Hon. Michael O’Brien MP Treasurer of Victoria 9 May 2014