Due to external economic shocks, Victoria's revenue forecasts over the next four years will be $8.3 billion lower than was forecast in late 2010. This is a bigger financial hit than that which occurred during the 2008 global financial crisis.

 

The Budget attempts to build on measures announced last year to put Victoria's finances back onto a sustainable path through further savings of $1 billion over four years. Measures taken include:

 

  • limiting Parliamentarians' pay increases to 2.5 per cent for the next twelve months and a freeze on their allowances;
  • limiting senior public servant salary increases to 2.5 per cent;
  • a further reduction of 600 public service positions; and
  • additional departmental efficiencies.
  • The 2012-13 Budget delivers surpluses exceeding $100 million each year growing to $2.5 billion by 2015-16.

 

The government's fiscal strategy will stabilise net debt to six per cent of GSP by June 2016.

 

Through this budget, the  Government has prioritised the following:

 

  • The Government will cut WorkCover premiums by an average of three per cent from July 1 this year.
  • As part of the Government's manufacturing blueprint A More Competitive Manufacturing Industry, the 2012-13 Budget delivers $58 million to boost productivity and assist Victorian manufacturing businesses to compete in the global economy.
  • The Government will invest a further $1 billion over four years to support future economic growth with a better educated and skilled workforce, to increase productivity and workforce participation.
  • The budget provides $13.7 billion to Victoria's hospitals and health system in 2012-13. $1.2 billion is provided over four years in additional funding for health and aged care services. Funding has also been provided for major hospital upgrades in metropolitan and regional Victoria.
  • A $200 million school capital program will fund new schools and important facility upgrades.
  • The 2012-13 Budget also delivers $1.4 billion in new funding for early childhood development, education and training and $336 million to better protect Victoria's most vulnerable children.
  • The 2012-13 Budget delivers on important new infrastructure projects, including $42.2 million for the Western Highway, $35.5 million for the Ballarat Western Link Road and additional regional rolling stock.