Andrews says no timeline on debt repayment

Daniel Andrews says Victoria will be best placed to repay its debt once the economy starts growing.
Daniel Andrews says Victoria will be best placed to repay its debt once the economy starts growing.

Premier Daniel Andrews is unable to say when Victoria will start paying off the principal components of its eye-watering debt.

Tuesday's budget, intended to fast-track the state's recovery out of the coronavirus crisis, includes about $80 billion in infrastructure spending and $49 billion in new stimulus measures.

As a result, debt is executed to soar to $154.8 billion by 2023/2 - about 28.9 per cent of the size of Victoria's gross state product.

The premier told a parliamentary committee on Friday it was the view of economists, both state and federal Treasury and the Reserve Bank that "unprecedented investment" was required to stimulate the economy and reduce unemployment.

"All of us agree that now is the time to invest," he told the public accounts and estimates committee.

"Unless we make these borrowings now, we simply will not have the growth in our economy and the surpluses generated by additional activity to service the debt that we already have."

Mr Andrews said he was unable to provide the committee with a "long-term repayment plan".

"We will be best placed to not only service the cost of that capital but to repay principal once we have the economy growing, once we have healed the wounds in our economy and communities and repair the damage that has been done," he said.

"The repayment of these borrowings and the repair from this pandemic will be a long-term project. That is the position of every first minister, including the prime minister."

Mr Andrews ruled out increasing taxes in order to improve the budget's bottom line.

He said a competitive tax system was key to growing the economy.

"We're not in the business of stifling jobs growth. We're not in the business of making it less attractive to invest in Victoria than other states," Mr Andrews said.

The committee also heard from the new secretary of Department of Premier and Cabinet Jeremi Moule, who confirmed his predecessor did not receive a payout.

Chris Eccles resigned in October after his evidence to the state's hotel quarantine inquiry conflicted with phone records.

"Mr Eccles did not seek or receive any payment for his termination. He resigned of his own volition," Mr Moule said.

Australian Associated Press