During the pandemic, we used our balance sheet to support Victorian households and businesses, while also setting out a clear, four-step fiscal plan for the medium term:
Step 1: Creating jobs, reducing unemployment and restoring economic growth
Step 2: Returning to an operating cash surplus
Step 3: Returning to operating surpluses
Step 4: Stabilising debt levels.
We’re pleased to report that in this Budget, having continued to deliver on the first two steps, we’re successfully delivering Step 3 of our fiscal plan in 2025-26.
We are also turning our focus to Step 4 which prioritises stabilising debt levels over the medium term.
While we’re delivering on our fiscal plan, we’re also investing in initiatives that will support Victoria’s long-term economic growth.
This Budget delivers for the industries that have the greatest potential to grow – industries that will leverage Victoria’s strengths to create the jobs of the future.
Our continuing investments in our caring workforce and Big Build are creating quality jobs, improving people's lives and making it easier for Victorians to move around our state.
Victoria’s economy is strong – the unemployment rate is the lowest since current records began, demand for workers is high, and business conditions and confidence are elevated. Victoria is on track for strong economic growth.
Victorian economic forecasts(a) (%)
| | 2020‑21 actual | 2021‑22 forecast | 2022‑23 forecast | 2023‑24 forecast | 2024‑25 projection | 2025‑26 projection |
|---|---|---|---|---|---|---|
| Real gross state product | –0.4 | 5.50 | 3.25 | 2.25 | 2.75 | 2.75 |
| Employment | –1.1 | 3.00 | 1.75 | 1.00 | 1.25 | 1.75 |
| Unemployment rate (b) | 6.2 | 4.25 | 4.00 | 4.25 | 4.50 | 4.75 |
| Consumer price index (c) | 1.4 | 3.00 | 2.50 | 2.25 | 2.50 | 2.50 |
| Wage price index (d) | 1.4 | 2.50 | 2.75 | 3.00 | 3.00 | 3.00 |
| Population (e) | –0.7 | 0.10 | 1.20 | 1.70 | 1.70 | 1.70 |
-
- Real gross state product
- 2020‑21 actual
- –0.4
- 2021‑22 forecast
- 5.50
- 2022‑23 forecast
- 3.25
- 2023‑24 forecast
- 2.25
- 2024‑25 projection
- 2.75
- 2025‑26 projection
- 2.75
-
- Employment
- 2020‑21 actual
- –1.1
- 2021‑22 forecast
- 3.00
- 2022‑23 forecast
- 1.75
- 2023‑24 forecast
- 1.00
- 2024‑25 projection
- 1.25
- 2025‑26 projection
- 1.75
-
- Unemployment rate (b)
- 2020‑21 actual
- 6.2
- 2021‑22 forecast
- 4.25
- 2022‑23 forecast
- 4.00
- 2023‑24 forecast
- 4.25
- 2024‑25 projection
- 4.50
- 2025‑26 projection
- 4.75
-
- Consumer price index (c)
- 2020‑21 actual
- 1.4
- 2021‑22 forecast
- 3.00
- 2022‑23 forecast
- 2.50
- 2023‑24 forecast
- 2.25
- 2024‑25 projection
- 2.50
- 2025‑26 projection
- 2.50
-
- Wage price index (d)
- 2020‑21 actual
- 1.4
- 2021‑22 forecast
- 2.50
- 2022‑23 forecast
- 2.75
- 2023‑24 forecast
- 3.00
- 2024‑25 projection
- 3.00
- 2025‑26 projection
- 3.00
-
- Population (e)
- 2020‑21 actual
- –0.7
- 2021‑22 forecast
- 0.10
- 2022‑23 forecast
- 1.20
- 2023‑24 forecast
- 1.70
- 2024‑25 projection
- 1.70
- 2025‑26 projection
- 1.70
Sources: Australian Bureau of Statistics; Department of Treasury and Finance
Notes:
(a) Percentage change in year average terms compared with the previous year, except for the unemployment rate (see note (b)) and population (see note (e)). Forecasts are rounded to the nearest 0.25 percentage points, except for population (see note (e)). The key assumptions underlying the economic forecasts include interest rates that broadly follow market economists’ expectations; an Australian dollar trade‑weighted index of 61.2; and oil prices that follow the path suggested by oil futures.
(b) Year average.
(c) Melbourne consumer price index.
(d) Wage price index, Victoria (based on total hourly rates of pay, excluding bonuses).
(e) Percentage change over the year to 30 June. Forecasts are rounded to the nearest 0.1 percentage point.
General government fiscal aggregates
| | Unit of measure | 2020/21 actual | 2021/22 revised | 2022/23 budget | 2023/24 estimate | 2024/25 estimate | 2025/26 estimate |
|---|---|---|---|---|---|---|---|
| Net result from transactions | $ billion | (14.6) | (17.6) | (7.9) | (3.3) | (1.1) | 0.7 |
| Net cash flows from operating activities | $ billion | (13.0) | (11.8) | 1.3 | 0.8 | 3.6 | 5.5 |
| Government infrastructure investment (a)(b) | $ billion | 15.0 | 18.9 | 21.4 | 23.0 | 21.7 | 19.2 |
| Net debt | $ billion | 72.7 | 101.9 | 118.5 | 137.4 | 154.8 | 167.5 |
| Net debt to GSP (c) | % | 15.3 | 19.8 | 21.7 | 24.1 | 25.8 | 26.5 |
-
- Net result from transactions
- Unit of measure
- $ billion
- 2020/21 actual
- (14.6)
- 2021/22 revised
- (17.6)
- 2022/23 budget
- (7.9)
- 2023/24 estimate
- (3.3)
- 2024/25 estimate
- (1.1)
- 2025/26 estimate
- 0.7
-
- Net cash flows from operating activities
- Unit of measure
- $ billion
- 2020/21 actual
- (13.0)
- 2021/22 revised
- (11.8)
- 2022/23 budget
- 1.3
- 2023/24 estimate
- 0.8
- 2024/25 estimate
- 3.6
- 2025/26 estimate
- 5.5
-
- Government infrastructure investment (a)(b)
- Unit of measure
- $ billion
- 2020/21 actual
- 15.0
- 2021/22 revised
- 18.9
- 2022/23 budget
- 21.4
- 2023/24 estimate
- 23.0
- 2024/25 estimate
- 21.7
- 2025/26 estimate
- 19.2
-
- Net debt
- Unit of measure
- $ billion
- 2020/21 actual
- 72.7
- 2021/22 revised
- 101.9
- 2022/23 budget
- 118.5
- 2023/24 estimate
- 137.4
- 2024/25 estimate
- 154.8
- 2025/26 estimate
- 167.5
-
- Net debt to GSP (c)
- Unit of measure
- %
- 2020/21 actual
- 15.3
- 2021/22 revised
- 19.8
- 2022/23 budget
- 21.7
- 2023/24 estimate
- 24.1
- 2024/25 estimate
- 25.8
- 2025/26 estimate
- 26.5
Source: Department of Treasury and Finance
Notes:
(a) Includes general government net infrastructure investment and the estimated construction costs of public private partnership projects.
(b) Includes the estimated private sector construction related expenditure associated with the North East Link held in the public non-financial corporations (PNFC) sector.
(c) The ratios to gross state product (GSP) may vary from publications year to year due to revisions to the Australian Bureau of Statistics GSP data.
Reviewed 29 April 2022