The Victorian opposition has pledged to legislate a cap on government debt if elected, as both major parties pitch themselves as the solutions to the state’s healthcare crisis.
- Shadow Treasurer David Davis says a cap is needed to rein in “growing and spiralling debt”
- A ceiling is a key part of the opposition’s economic platform in the lead-up to the November 26 vote
- The government has promised upgrades worth half a billion dollars to the Monash Medical Centre if re-elected
The Coalition’s proposed debt cap is a major part of the Liberal-National’s Long-Term Economic Plan for Victoria, expected to be a pillar of the upcoming election campaign.
According to the May budget, net debt is expected to sit at $101.9 billion at the end of this financial year and is forecast to account for more than a quarter of the state’s economy by the 2025-26 financial year.
“That debt is so large, it’s bigger than the combined debt of New South Wales, Queensland and Tasmania,” Shadow Treasurer David Davis said.
Mr Davis said a cap on borrowing was needed to “deal with Victoria’s growing and spiralling debt and increasing taxes”.
He again criticised the government for its blowouts on major infrastructure projects, which have cost over $30 billion more than initially forecast.
The government’s budget plan is centred around bringing the state back to an operating surplus by 2025-26, then addressing the debt.
Part of that plan relies on projections that inflation will reach 3 per cent on the last financial year, before easing to 2.5 per cent on average in 2022-23 — far behind the real-world inflation rates currently biting across Australia.
“That will cause real challenges [in] servicing that huge debt,” Mr Davis said.
Both major parties have promised a huge spend on responding to the state’s healthcare crisis if elected in November.
The Coalition has pledged no new taxes and no further debt.
Instead it has said it would fund health promises by diverting funds from other projects — such as scrapping the Suburban Rail Loop and its associated Cheltenham to Box Hill rail line.
The first phase of the proposed Long-Term Economic Plan for Victoria would include receiving updated debt estimates from Treasury, running an audit of major infrastructure projects and setting an appropriate debt cap to be legislated through parliament.
Under the policy proposal, any government would need to seek parliamentary approval to raise the ceiling and would be required to produce an annual debt report.
Premier Daniel Andrews said the nature of passing budgets through parliament meant that approval process was already in place.
“There’s parliamentary approval that’s required every year,” he said.
“I suppose the difference is that our budgets have more money for health, more nurses, more midwives, more ambos.”
Health promises continue with government’s $560m Monash Medical Centre plan
Meanwhile, the governing Labor Party is promising a major upgrade of the Monash Medical Centre in Melbourne’s south east in its latest election pitch.
If re-elected, Mr Andrews said his government would invest between $510 million and $560 million in a massive upgrade to the complex.
The upgrades would include a new seven-storey tower above the emergency department, which has also been recently upgraded, containing up to five new operating theatres and 34 new beds.
The government said that would allow for up to 7,500 extra surgeries each year.
A new intensive care unit with capacity for 28 beds, six additional birthing suites and 108 new inpatient beds are all part of the pledge.
Health Minister Mary-Anne Thomas used the announcement to criticise the Coalition for cuts and closures under the Kennett government of the 90s, and the more recent Baillieu-Napthine administration.
“What we saw under the previous Liberal government were cuts to our health services, a war with our nurses and paramedics, no respect for our healthcare workers,” she said.
Figures released by the government showed more than 26,000 new healthcare workers had been recruited since Labor came into power in 2014.
The government plans to train and recruit an extra 24,000 healthcare workers in a bid to reduce massive waitlists and staff shortages, which have been exacerbated by COVID-19.
David Davis said the premier had “added another $560 million of spending on the Victorian taxpayers’ credit card — without saying how he will fund it”.