Our economy, growing Victoria for all

A strong economy is vital for the prosperity of all Victorians, because it means more jobs. Since the election in 2014, over 200,000 jobs have been created – more than 250 new jobs every day.

In the year to March 2017, average employment grew by 3.4%. This was the strongest among the states, and a stark contrast to average employment growth for the rest of the nation at only 0.6%.

In that same year, more jobs were created in Victoria than the rest of the country combined.

But this growth is not just confined to the boundaries of Melbourne. Victoria’s regional labour market is one the strongest in the nation – regional employment grew by 2.1% in 2016 alone.

Victoria’s finances are also in excellent shape, with ongoing operating surpluses over the next four years.

Victoria’s economy is one of the strongest in Australia, having experienced 3.3% growth in 2015/16, significantly above the national average of 2.7% over the same period.

Strong financial management

The Victorian Budget 2017/18 continues the Government’s track record of strong financial management.

The 2017/18 operating surplus is estimated to be $1.2 billion, with surpluses averaging $2.4 billion over the forward estimates, putting Victoria in a strong financial position.

Operating surplus

Operating Surplus

Operating Surplus
2015-162.7
2016-171.3
2017-181.2
2018-192.0
2019-202.4
2020-212.7

 

Net debt as a proportion of the economy has been maintained below the levels inherited from the previous government and is projected to be no higher than 6% over the next four years – a level consistent with our prized triple-A credit rating.

Net Debt to GSP

Net Debt to GSP

Net Debt to GSP
2015-166.0
2016-174.6
2017-185.8
2018-195.8
2019-206.0
2020-216.0

The Victorian Government has maintained fiscal discipline by ensuring average revenue growth over the next four years is higher than average expense growth.

Victorian economic forecasts

Victorian economic forecasts

2015-16
actual

2016-17
forecast

2017-18
forecast

2018-19
forcast

2019-20
projection

2020-21
projection

Real gross state product (GSP) 3.3 3.00 2.75 2.75 2.75 2.75
Employment 2.4 3.25 2 1.5 1.5 1.5
Unemployment  rate 5.9 5.75 5.50 5.50 5.50 5.50
Comsumer price index 1.6 2.00 2.00 2.25 2.50 2.50
Wage price index 2.3 2.00 2.25 2.75 3.00 3.25
Population 2.1 2.00 1.90 1.80 1.80 1.80

Source: Department of Treasury and Finance

 

General Government fiscal aggregates

General Government fiscal aggregates

Unit of measure

2015-16
actual

2016-17
revised

2017-18
budget

2018-19
estimate

2019-20
estimate

2020-21
​​​​​​​estimate

Net results from transactons $ billion 2.7 1.3 1.2 2.0 2.4 2.7

Government infrastructure investment

 

 

$billion 4.8 9.3 10.1 9.8 10.1 8.4
Net debt $billion 22.3 18.1 23.8 25.1 27.4 28.9
Net debt to GSP % 6.0 4.6 5.8 5.8 6.0 6.0

Source: Department of Treasury and finance

Victoria’s fair share of Commonwealth infrastructure funding

Victoria has the fastest growing population in Australia but continues to be denied a fair share of Commonwealth infrastructure grant funding.

Based on the latest Commonwealth Budget publication, Victoria will only receive 8.5% of allocated Commonwealth infrastructure funding to the states and territories between 2015/16 and 2019/20.

A decision by the Commonwealth to honour the National Partnership Agreement on Asset Recycling would only partially redress this imbalance.

Victoria would need to receive an additional $6.6 billion over this period to achieve its population share of Commonwealth infrastructure grant funding.

 

 

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