This afternoon, Treasurer Jaclyn Symes handed down her first Victorian State Budget since her appointment to the role in December 2024, following the resignation of her predecessor, Tim Pallas. Despite the change in leadership, the new Treasurer has adopted a similar approach to recent years, delivering a conservative yet politically strategic Budget that “invests in the services people rely on” ahead of Victorians heading to the polls in November 2026.

The Budget shows that land taxes and stamp duty continue to provide major windfalls to the Allan Government. Despite generating income and saving $3.3 billion over the forward estimates — including cuts to 1,200 full-time public service positions — Victoria’s net debt is projected to rise to $194 billion, with interest expenses expected to reach $10.56 billion by 2028–29.

In her address to Parliament, the Treasurer delivered a hopeful outlook for the State’s economy. Victoria’s economy is expected to grow by 2.5 per cent this financial year and 2.75 per cent in 2026–27. Ms Symes announced a projected $600 million operating surplus for 2025–26. While this is $1 billion lower than forecast six months ago, it marks the first surplus since the beginning of the COVID-19 pandemic. The surplus has been supported by planned cuts to the public service and broader public sector reforms.

Despite a modest improvement in projections, net debt remains a significant political and economic concern for the Government. The Budget reveals net debt will reach $167.6 billion this year, rising to $194 billion by 2028–29. As a proportion of Gross State Product (GSP), net debt is projected to be 25.2 per cent in 2025–26, falling slightly to 24.9 per cent by 2028–29.

Following the release of the Economic Growth Statement last year, the Budget allocates $240 million to fully fund its measures. This includes reforms to the Environmental Effects Statement process, an extension of the Resources Victoria Approval Coordinator, a reduction in the number of regulators and regulations, and the establishment of a cooperative fund to boost destination marketing.

The centrepiece of the 2025–26 Budget is the Free Public Transport initiative, which will make travel free for all Victorians under 18 and for seniors on weekends. This cost-of-living measure will take effect from 1 January 2026, saving each child an estimated $755 annually. All children under 18 will be eligible for a new Youth Myki, allowing free travel across all forms of public transport — including trams, trains, buses and coach services — throughout metropolitan, regional and rural Victoria. For seniors, the Government has extended existing free weekend travel from two neighbouring zones to statewide access. This is expected to be a key element of the Allan Government’s re-election campaign.

Following last year’s decision to delay several major infrastructure projects — including the Airport Rail Link — the Government has reaffirmed its commitment to infrastructure investment. The Budget outlines close to $5 billion in public transport funding to support the opening of the Metro Tunnel, deliver more frequent train services, and develop the Sunshine Station ‘Superhub’. An additional $976 million will fund road surface upgrades and pothole repairs under a ‘Better Roads Blitz’.

In response to increasing crime rates, particularly among repeat child offenders, the Government has committed $727 million to increase capacity at prisons and youth justice centres. This investment will deliver approximately 1,000 new adult prison beds and 88 youth justice beds for alleged offenders denied bail.

To support the State’s healthcare system, the Budget includes a range of infrastructure and workforce measures. These include a $634.3 million package to open and operationalise nine new or redeveloped hospitals — including the new Footscray Hospital and the redeveloped Frankston Hospital — $203 million to grow the healthcare workforce, including placements for nursing and midwifery students, and additional ambulance funding to reduce response times.

As part of efforts to “build more homes and make them more affordable,” the Government has extended stamp duty concessions — originally due to expire in October 2025 — with a $61 million investment. The reduced duty applies to off-the-plan apartments, units and townhouses.

Further cost of living measures include:

• $152.3 million to expand the Camps, Sports and Excursions Fund.
• $15 million to extend the Get Active Kids Vouchers for a further two years.
• $30 million to extend the Solar Homes hot water rebate program.
• $50 million for a new round of $100 Power Saving Bonuses for households.