financiallyresponsible 2000-01 Victorian Budget Overview sociallyprogressive The Secretary Department of Treasury and Finance 1 Treasury Place MELBOURNE VICTORIA 3002 AUSTRALIA Telephone: +61 3 9651 5111 Facsimile: +61 3 9654 7215 Website: www.budget.vic.gov.au 2000-01 Budget Paper set includes: Budget Paper No. 1 - Treasurer’s Speech Budget Paper No. 2 - Budget Statement Budget Paper No. 3 - Budget Estimates Budget Overview Published by the Department of Treasury and Finance © State of Victoria 2000 This book is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act. ISSN 1 440 - 6969 Published May 2000 by authority Contents Treasurer’s message 3 2000-01 Budget: delivering in full 4 Responsible financial management 5 Growing the whole State 5 Delivering improved services 6 Restoring democracy 7 2000-01 Budget overview 8 Budget highlights — for all Victorians 10 Budget at a glance 12 Lower business taxes 13 A strong economy 14 Growing Victoria infrastructure reserve 15 Better education and training 16 A healthy Victoria 17 A safer community 19 Improved roads and public transport 20 Budget Overview 01 - 0 200 1 2000-01 Budget Overview 2 Treasurer’s message The Bracks Labor Government is committed to providing a sound financial platform for delivering improved services and promoting growth for all Victorians. At the last election my team promised to This budget also marks a further step deliver on four key pillars — responsible towards restoring openness and greater financial management, promoting growth accountability in government. In a world across the whole State, delivering first, the Auditor-General has improved services and restoring independently reviewed the budget — democracy. setting new standards in financial transparency and accountability. This budget — the first budget of the Bracks Labor Government — provides By delivering this platform, the budget the substance of this commitment. lays the foundation for the economic and social development of Victoria for the This budget — as was promised — is a next four years. financially responsible and socially progressive blueprint for Victoria. The 2000-01 Budget outlines the plan that will enable the whole State to grow, A substantial operating surplus has been enhancing the competitiveness of retained to protect Victoria against Victorian businesses and improving economic downturn, ensuring that taxes services. can be reduced while services are improved. This budget is for all Victorians. It sets a framework that enables the benefits of a Steve Bracks competitive business environment to be Treasurer shared across all regions — so that Victoria can grow together. It delivers long overdue improvements in the key areas of education, health and community safety. Budget Overview 01 - 0 200 3 2000-01 Budget: delivering in full The Bracks Labor Government was I delivering improved services, particularly elected on a policy program built on four in the key areas of education, health key pillars: and community safety I responsible financial management, I restoring democracy through open and including maintaining a substantial accountable government. budget operating surplus In the 2000-01 Budget, the Government I promoting growth across all of Victoria delivers on its election commitments — in full. Meeting election promises in full Election promise Key decisions Responsible financial management I Substantial budget operating surpluses over the next four years I Net financial liabilities to decline Growing the whole State I $1 billion Growing Victoria infrastructure reserve established I Business taxes to be cut by at least $200 million by July 2003, including $100 million from July 2001 I $170 million Regional Infrastructure Development Fund established I Living Regions, Living Suburbs Support Fund initiated to assist local development I Greater focus on promoting regional investment I Better transport links between non-metropolitan areas and Melbourne I Victorian Economic and Social Advisory Council to be established Delivering improved services I Education funding boosted to reduce class sizes, enhance student services and broaden training opportunities and skills I Extra health funding provided for more hospital beds, more elective surgery, and extra home and community-based care I 800 additional operational police I 100 extra train station staff and 100 new tram conductors I Upgrades to road, tram and train services Restoring democracy I Independence and powers of the Auditor-General restored 200 I 0 Auditor-General reviews the budget for the first time - 01 I Budget Overview Compensation for victims of crime restored I Common law rights for seriously injured workers being reinstated 4 Responsible financial management - Budget sector net financial liabilities are forecast to fall from 10.9% of GSP The Government’s budget strategy is to as at June 1999 to 7.7% of GSP by provide a sound and stable financial June 2004. State government net debt basis to promote growth across the is expected to decline from $6.2 billion whole State. A sound financial position is to $4.7 billion over the same period. also essential to ensure that improved services can be provided to all Victorians. Growing the whole State One of the Government’s key election The Government is keen to ensure that all commitments was to maintain a Victorians share in the benefits of the substantial budget surplus. The first State’s economic prosperity. Bracks Labor Government budget The Government’s plan to promote delivers on this promise. growth and raise living standards - A budget operating surplus of throughout the whole State includes: $592 million is forecast for 2000-01, I Linking Victoria — an integrated and surpluses averaging more than transport infrastructure program to $450 million are projected in revitalise the State’s roads, rail and port future years. transport Responsible financial management also I Skilling Victoria — a program that involves keeping state liabilities at recognises the importance of education prudent levels. Victoria’s triple-A rating and training to long-term growth was affirmed by Standard & Poor’s on prospects and individual aspirations 20 December 1999, and awarded by Moody’s Investors Services on I Connecting Victoria — a strategy for 8 February 2000. The Government is developing the State’s information and committed to maintaining this rating. communications technology industry and sharing the benefits of these The 2000-01 Budget further reduces state technologies across the entire Victorian liabilities. community. Substantial budget surpluses Liabilities falling Budget sector operating surplus Budget sector net financial liabilities (excluding Growing Victoria) 1999-00 1998-99 1999-00 2000-01 2000-01 2001-02 2001-02 2002-03 2002-03 2003-04 2003-04 0 300 600 900 1200 1500 13 14 15 16 17 $ Million $ Billion Budget Overview 01 - 0 200 5 The Government has also taken a I $80 million contribution to cut train number of initiatives to enhance the travel times between regional centres competitiveness of Victoria’s business and Melbourne environment. I $120 million to upgrade the Geelong - The Budget establishes a new Road, with matching funding to be $1 billion Growing Victoria provided by the Commonwealth infrastructure reserve (further details Government. on page 15). More detail on major new asset - Business taxes are scheduled to be investments in each region are provided cut by a minimum of $200 million per on pages 10 and 11. annum by July 2003, including $100 million from July 2001. Delivering improved services - A $170 million Regional Infrastructure The Government is determined to Development Fund has been improve services for all Victorians, established to enhance services in particularly in the key areas of education, rural and regional areas. health and community safety. - A $35 million Living Regions, Living The Government has taken action to Suburbs Support Fund will operate to target resources towards key service assist local economic and social delivery initiatives in 2000-01, including: development. I extra funding for education to reduce - The Government has provided class sizes, enhance student services $18 million to strengthen regional and broaden the range of training development organisations and better available promote regional investment. I increased health funding for more - Regional TAFE colleges will be hospital beds, more elective surgery, and provided with $17 million over four more home and community-based care years to take account of the additional I 800 new operational police by the end on-costs faced by these regional-based of 2002-03 TAFEs. I 100 extra train station staff and The Government has also acted to 100 new tram conductors improve transport links between regional Victoria and Melbourne, which will assist I upgrades to road, tram and train rural and regional areas in attracting new services. residents and industries. Significant new 200 transport projects will commence from 0 - 01 2000-01, including: Budget Overview 6 Restoring democracy The Government has also introduced new financial responsibility legislation, The Bracks Labor Government has setting new standards in government pledged to return Victoria to open, transparency and accountability. transparent and accountable government. The Auditor-General has been given new powers to review the budget financial The Government has moved swiftly to statements, providing confidence that strengthen the powers of independent