Wednesday, 27 November 2024

Victorian Auditor-General’s Office

Auditor-General’s Report on the Annual Financial Report of the State of Victoria: 2023–24

Bev McARTHUR (Western Victoria) (17:32): I rise to comment on the Auditor-General’s Report on the Annual Financial Report of the State of Victoria: 2023–24, released on 22 November and tabled in the Legislative Assembly and the Legislative Council yesterday. From page 1 it is clear that this is the kind of report the government would have liked to release at 5 pm on the Monday before the Melbourne Cup public holiday if they had had any say over it. I intended to take a few quotes from the Auditor-General’s conclusions and speak around them, but the report is so clear and so categorically bad that it barely needs added political spin from me. Page 1 reports that:

The general government sector (GGS) incurred another operating loss this year of $4.2 billion. This brings accumulated losses over the last 5 years to $48 billion.

Further down, an explanation – confirmation of a point made by those on this side of the house constantly in recent years:

Operating expenses increased by $3.7 billion compared to 2022–23 because of higher public sector employee costs and other operating expenses.

A $3.7 billion increase in a single year – it is no wonder that:

Interest expenses on debt also increased by $1.7 billion due to new or refinanced borrowings at higher interest rates. The interest expense now makes up 6.1 per cent of the GGS operating revenue and is expected to increase to 8.8 per cent by 2027–28.

That is all money down the drain. It does not pay for a single nurse or teacher. It does not educate Victoria’s children or pay to fix our roads. It does not even build infrastructure. It is debt interest, pure and simple. It is money which comes straight out of the pockets of all Victorians who pay tax and goes directly into the pockets of the investors, often foreign investors, who own our debt – every single cent of it. As the report notes, this will only get worse if the government continues its course. It says:

Prolonged operating losses and ongoing fiscal cash deficits are not financially sustainable, largely because they lead to higher debt levels than otherwise and indicate underlying structural risks.

The conclusion is clear. If we skip through to page 18, the Victorian Auditor-General’s Office reports:

… the state has not articulated a clear plan for long-term fiscal management. Current strategies are short term, reactive and do not address both the existing financial challenges and emerging financial risks …

This is not even the latest bad news. The report is already outdated and not in a good way. Since May’s budget the government has already been forced to announce a $1.5 billion hospital bailout and yet further Metro Tunnel blowouts halfway through the year, and next year’s report already looks set to be worse. Some recent headlines on Victoria’s economy say it all: ‘What the hell has gone wrong with Victoria?’, ‘“Embarrassing”: Victorian households fall behind Tasmania’ and ‘How Victoria became a poor state (and the 16 charts that prove it)’. There is just one odd one out: ‘Victoria is an economic powerhouse that leads the nation’. Yes, you heard that right: ‘Victoria is an economic powerhouse that leads the nation’. I was surprised too, until I noticed the author’s name: one Mr Tim Pallas. You cannot deny that he is a gifted comic, with a skin thick enough to withstand the loudest hecklers, at least I hope so. If he truly believes what he wrote, we have got worse still to come. So I recommend the report to the Treasurer, as I do to the rest of this house.