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Victoria Lifts Surplus Forecast as Cash Deficit Swells in Mid‑Year Update

Delayed revenue measures alongside reprofiled projects push more borrowing into the years ahead.

Overview

  • The revised operating surplus for 2025–26 is now forecast at $700 million after a $1.5 billion revenue boost.
  • Including capital outlays, the state now projects a cash deficit near $14 billion after bringing forward about $4 billion of infrastructure costs.
  • Recurrent spending is projected at $109 billion this year, with employee expenses expected to exceed $39 billion.
  • Planned revenue measures have been deferred, with the Emergency Services and Volunteers Fund rise delayed to July 2027 and farm tax increases pushed past the state election.
  • Forward estimates show spending exceeding revenue by $40.46 billion, adding $41.75 billion to debt, with net debt projected at $165.8 billion this year and $192.6 billion by June 2029.