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Report on the 2019–20 Budget Estimates

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Report on the 2019–20 Budget Estimates PARLIAMENT OF VICTORIA Public Accounts and Estimates Committee Report on the 2019–20 Budget Estimates Parliament of Victoria Public Accounts and Estimates Committee Ordered to be published VICTORIAN GOVERNMENT PRINTER October 2019 PP No 83, Session 2018-19 ISBN 978 1 925703 80 1 (print version), 978 1 925703 81 8 (PDF version) Committee membership CHAIR DEPUTY CHAIR Lizzie Blandthorn Richard Riordan Sam Hibbins Pascoe Vale Polwarth Prahran Gary Maas Danny O’Brien Pauline Richards Narre Warren South Gippsland South Cranbourne Tim Richardson Ingrid Stitt Bridget Vallence Mordialloc Western Metropolitan Evelyn ii Public Accounts and Estimates Committee About the committee Functions The Public Accounts and Estimates Committee is a Joint Parliamentary Committee constituted under the Parliamentary Committees Act 2003 (Vic) (the Act). The Committee comprises of nine Members of Parliament drawn from both the Legislative Assembly and the Legislative Council. The Committee scrutinises matters of public administration and finance to improve outcomes for the Victorian community. Under the Act, the Committee is required to inquire into, consider and report to the Parliament on: • any proposal, matter or thing concerned with public administration or public sector finances • the annual estimates or receipts and payments and other budget papers and any supplementary estimates of receipts or payments presented to the Assembly and the Council. The Committee also has a number of key statutory responsibilities in relation to the Auditor-General and the Victorian Auditor-General’s Office. The Committee is required to: • make a recommendation to the Parliament on the appointment of the Auditor-General • make a recommendation to the Parliament on the appointment of the independent performance and financial auditors to review the Auditor-General and Victorian Auditor-General’s Office • consider the Auditor-General’s budget every financial year • consider the Auditor-General’s draft annual plan and audit priorities • have a consultative role on draft performance audit specifications. Report on the 2019–20 Budget Estimates iii About the Committee The context of the Committee’s work on the budget estimates is illustrated below. Public Accounts and Estimates Committee (PAEC) Public Accounts Estimates Oversight Follow up of Victorian Scrutinise budget papers Victorian Auditor-General reports (budget estimates) Auditor-General’s Oce (VAGO) Conduct inquiries into Review the outcomes Parliamentary Budget any aspect of public achieved from budget Oce (PBO) administration or expenditure and public sector finances revenue raised iv Public Accounts and Estimates Committee About the Committee Secretariat Dr Caroline Williams, Executive Officer Jessica Strout, Lead Analyst, Budget Estimates and Outcomes Dr Marianna Stylianou, Lead Analyst, Public Accounts and Audit (until 6 August 2019) Igor Dosen, Acting Lead Analyst, Public Accounts and Audit Janithri Wickramaratne, Analyst, Budget Estimates and Outcomes Dr Krystle Gatt Rapa, Research Assistant Amber Candy, Desktop Publisher and Administrative Officer Steven Vlahos, Consultant Contact details Address Public Accounts and Estimates Committee Parliament of Victoria Spring Street EAST MELBOURNE VIC 3002 Phone 61 3 8682 2867 Email [email protected] Web https://www.parliament.vic.gov.au/paec This report is available on the Committee’s website. Report on the 2019–20 Budget Estimates v Contents Preliminaries Committee membership ii About the committee iii Contents vii Acronyms and terms xv Chair’s foreword xix Executive summary xxi Recommendations xxxi 1 Introduction 1 1.1 Terms of reference 1 1.2 Background 1 1.3 Objectives 1 1.4 Process 2 1.5 Report structure 2 1.6 Acknowledgements 3 1.7 Implementation of Committee’s previous recommendations 4 1.7.1 2017–18 budget estimates 4 1.7.2 2018–19 budget estimates 5 2 2019–20 Budget Overview 7 2.1 Introduction 7 2.2 Budget strategy and priorities 8 2.3 Significant changes to the State Budget 9 2.3.1 Net debt to gross state product no greater than 12% over the medium term 9 2.3.2 Large scale infrastructure projects 9 2.3.3 Revised accounting standards 9 2.4 Economic outlook and risks 10 2.4.1 Outlook 10 2.4.2 Risks 11 2.5 Revenue 14 2.5.1 Revenue projections 14 2.5.2 Grant revenue 15 2.5.3 Taxation revenue 19 2.5.4 Motor vehicle taxes 22 2.5.5 Gambling taxes 23 Report on the 2019–20 Budget Estimates vii Contents 2.5.6 Sales of Goods and Services 23 2.5.7 Dividends 23 2.5.8 New revenue initiatives 24 2.6 Output expenditure 24 2.6.1 Components of output expenditure 25 2.7 Asset investment 27 2.7.1 Government infrastructure investment 27 2.7.2 Key components of government infrastructure investment 27 2.8 Sustainability of finances 30 2.8.1 Borrowings 31 2.8.2 Net debt 31 2.9 Performance measures 32 2.9.1 Department performance statements 32 2.9.2 Snapshot of 2019–20 outputs and performance measures 33 2.9.3 Key changes in performance measures since the 2018–19 Budget 36 2.9.4 Proposed discontinued performance measures in the 2019–20 Budget 37 3 Whole of Government review 39 3.1 Overview 40 3.2 Intergenerational reporting 40 3.2.1 Current long term forecasting and projections for Victoria 40 3.3 Gender responsive budgeting 42 3.3.1 2019–20 Gender Equality Budget Statement 42 3.3.2 Safe and Strong: A Victorian Gender Equality Strategy 44 3.4 Contractors, consultants and labour hire arrangements 46 3.4.1 Current use in the public sector 47 3.4.2 2019–20 Budget savings 48 3.4.3 New guidelines on using professional services and labour hire 49 3.5 Fraud and corruption 51 3.5.1 Instances of fraud and corruption in the Victorian public sector 52 3.5.2 Managing resources to cover the cost of fraud and corruption 55 3.6 Advertising expenditure 56 3.7 Performance measurement 58 3.7.1 Issues arising during public estimates hearings 58 3.7.2 Analysis of new performance measures 58 3.8 Responsibility for outputs shared between portfolios 59 viii Public Accounts and Estimates Committee Contents 4 Department of Health and Human Services 61 4.1 Overview 62 4.2 Budget summary 62 4.3 Health portfolio: key issues 64 4.3.1 Free dental care for government school students 65 4.3.2 New community hospitals 66 4.3.3 Public private partnerships (PPPs) in Victorian hospitals 67 4.3.4 Unprofessional conduct among health professionals 68 4.4 Mental health portfolio: key issues 69 4.4.1 Critical mental health service demand 70 4.4.2 Addressing drug harms 71 4.4.3 Residential rehabilitation beds to treat substance misuse 72 4.5 Ambulance services portfolio: key issues 74 4.5.1 Fees for ambulance services 75 4.6 Disability, ageing and carers portfolio: key issues 76 4.6.1 Disability services workforce 77 4.7 Child protection portfolio 77 4.8 Prevention of family violence portfolio: key issues 78 4.8.1 Coordination efforts 78 4.8.2 Support and Safety Hubs—Orange Doors 79 4.8.3 Perpetrator responses 81 4.9 Housing portfolio: key issues 82 4.9.1 Commonwealth funding for housing and homelessness services 82 4.9.2 Housing for victims of family violence and the Victorian Housing Register 83 4.9.3 Public and social housing stock in Victoria \ 4.9.4 Homelessness programs 85 4.9.5 Public Housing Renewal Program 86 4.10 Department wide: key issues 87 4.10.1 Machinery of government changes 87 4.10.2 Funding sources for new and lapsing programs and initiatives 88 4.11 Performance measures 88 4.11.1 Child protection portfolio 88 4.11.2 Department wide: analysis of new and proposed discontinued performance measures 89 5 Department of Education and Training 93 5.1 Overview 93 5.2 Budget summary 94 5.3 Education portfolio: key issues 95 5.3.1 Commonwealth funding for Victorian schools 96 5.3.2 School infrastructure 98 5.3.3 Universal three year old kindergarten 101 Report on the 2019–20 Budget Estimates ix Contents 5.4 Training and Skills and Higher Education portfolios: key issues 102 5.4.1 Commonwealth funding for the vocational and educational training (VET) sector 103 5.4.2 Technical and Further Education (TAFE) 104 5.5 Department wide: key issues 109 5.5.1 Machinery of government changes 109 5.5.2 Employees who identify as having a disability 110 5.6 Performance measures 111 5.6.1 Training and Skills and Higher Education portfolios 111 5.6.2 Department wide: analysis of new and proposed discontinued performance measures 112 6 Department of Transport 117 6.1 Overview 117 6.2 Budget summary 118 6.3 Transport Infrastructure: key issues 119 6.3.1 Level Crossing Removal Program 120 6.3.2 Major infrastructure projects 121 6.4 Public Transport: key issues 126 6.4.1 Disability access 126 6.4.2 Punctuality of public transport services 128 6.5 Roads and Road Safety and the Transport Accident Commission (TAC): key issues 130 6.5.1 Towards Zero—road safety strategy and plan 131 6.5.2 Active transport infrastructure—cyclists and pedestrians 133 6.6 Fishing and Boating: key issues 135 6.6.1 Better Boating Fund 135 6.6.2 Target One Million 136 6.7 Ports and Freight: key issues 137 6.7.1 Port of Melbourne 137 6.8 Department wide: key issues 139 6.8.1 Machinery of government changes 139 6.9 Performance measures 140 6.9.1 Transport infrastructure portfolio 140 6.9.2 Department wide: analysis of new performance measures 141 6.9.3 Department wide: analysis of proposed discontinued performance measures 142 x Public Accounts and Estimates Committee Contents 7 Department of Justice and Community Safety 143 7.1 Overview 143 7.2 Budget summary 144 7.3 Attorney‑General portfolio: key issues 145 7.3.1 Fines Victoria 146 7.3.2 Aboriginal
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