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Victorian Budget 22/23

Victorian Future Fund

In this Budget, we are establishing the Victorian Future Fund to manage the fiscal impact of the pandemic and deliver positive outcomes for Victorians, by reducing the debt burden on future generations.

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The Fund will support the state’s debt stabilisation strategy.

The Fund will be established using proceeds from the VicRoads Modernisation Joint Venture. The investment returns from the Fund will be quarantined and returned to the Fund so that its balance will grow over time to offset borrowings. Both the initial investment and future returns will be used to repay pandemic borrowings. The Fund is projected to have a balance of around $10 billion in the medium term.

Further investments will be made into the Fund through proceeds from designated government land sales and a proportion of future Budget surpluses once net debt stabilises.

The Fund will be managed by the Victorian Funds Management Corporation (VFMC), the state’s specialist investment agency. The VFMC will implement a diversified investment strategy designed to deliver the best possible returns for Victorians.

Over time, this will improve the state’s operating result and net debt position, further supporting the state’s debt stabilisation strategy. The Fund will be managed in line with strict environmental, social and governance (ESG) principles consistent with other investments managed by the VFMC.

Reviewed 29 April 2022

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