The two waves of the COVID-19 pandemic in Victoria and the devastating wildfires last summer have severely hit the state’s economy, with a forecast deficit of $ 23.3 billion in the 2020-21 state budget.
Treasurer Tim Pallas announced today that the state posted an operating deficit of $ 6.5 billion in the 2019-20 year, which will become a projected deficit of $ 23.3 billion in the 2020-21 financial year.
State government net debt is also forecast to increase to $ 154.8 billion by the year 2023-24, with net debt in the year 2020-21 at a colossal $ 86.7 billion.
Total revenue in 2020-21 is expected to be 4.2% lower than in 2018-19.
Despite the alarming numbers, sparked mainly by the devastating effects of COVID-19, the Victorian government stressed the message that the budget was aimed at creating jobs and reviving the economy as part of a long road to recovery.
“2020 has been difficult. The hardest year most of us will ever experience,” Pallas said in today’s message from his treasurer.
“He’s asked more of us than we could have imagined. He tested us in ways we never thought we could.
“It’s about building a strong recovery and an even stronger future for our state.
“A budget to repair, recover and make ourselves stronger than before.”
The state’s Jobs for Victoria initiative will be the lynchpin of its economic recovery plan, with $ 619 million injected into the plan to help hundreds and thousands of Victorians looking for work.
The Victorian government expects the package to create 400,000 new jobs by 2025.
The cash injection includes $ 250 million to help companies hire at least 10,000 Victorians through a six-month wage subsidy.
The positions would be for Victorians who have been hit the hardest by the pandemic, including young people, laid off workers and people who have been unemployed for a long time.
Sectors hardest hit by COVID-19, including hospitality, tourism, lodging, creative industries and retail, will also be supported through $ 2.6 billion in grants that are part of the Business Support Fund.
Some mega $ 2.9 billion has also been set aside for the state’s COVID-19 response.
Other major winners include affordable and social housing, with a large cash investment of $ 6 billion to be invested as part of Victoria’s large housing development to build more than 12,000 new affordable and social housing.
Prime Minister Daniel Andrews predicted there would be another “substantial investment” in education in mid-2021.
“There has been a lot of damage, a lot of pain in these last eight to 10 months,” Andrews said.
“As our state recovers, we want to provide students with the fantastic new learning spaces they deserve.”