House Of Cards Budget - Shadow Treasurer Kim Wells State Budget Reply Speech

May-07-2009

On Tuesday, 5 May, the Treasurer presented the State Government's Budget for the 2009-10 financial year.
Given the difficult economic circumstances Victoria is currently facing, this year's Budget is fundamentally critical for the future of our State.
However, this and future generations will be burdened by the failures, financial mismanagement and massive debt legacy unleashed by the Brumby Labor Government in this Budget.
Budget summary...
In many ways, this was a typical high taxing, high spending, high debt Labor Budget of old bringing back painful memories of Victoria's darkest days of the Cain-Kirner era.
Funded on the 'never never' through a huge increase in debt and John Brumby maxxing out the State's credit card and leaving our children to pay for it.
This Budget is a 'house of cards'.
It is based on a whole range of assumptions.
The Budget Papers refer to the fact that there's a much higher degree of uncertainty about those assumptions, and they refer to the volatility of those assumptions.
So there are assumptions in this which make this a house of cards Budget.
Any slippage can turn this Budget into a disaster.
This Budget can fall apart just with an increase in unemployment, higher debt levels, a failure of costings or a blowout in any of the costings.
This is a government that claimed all the responsibility for the good times, and now wants to deny any responsibility for the bad times.
Last Monday, John Brumby said there was no bad news in this Budget.
Try telling that to the tens of thousands of Victorians who will lose their jobs.
Try telling that also to our children and their children who face having to pay back Labor's debt binge.
Despite the Premier's spin, this is a bad news Budget for Victoria:
· More than 200,000 Victorians will be unemployed;
· State debt will reach 31 billion dollars;
· The State's annual interest bill will blow out by over $800 million to $2.2 billion and further erode the ability to deliver basic services; and
· If it wasn't for Kevin Rudd borrowing to bail out his comrade mate John Brumby, the Victorian Budget would be in the red by more than $2 billion.
The phoney surplus of $165 million in 2009-10 has only been created after a huge injection of capital grants from the Federal Government, up from an estimated $459 million in the most recent Budget Update to $2.8 billion in 2009-10.
John Brumby cannot boast about Victoria's budget remaining in surplus when this surplus relies on counting one-off capital funding provided by the Rudd Government, most of it part of a one-off emergency stimulus package.
This Budget was supposed to be about jobs, it is - but it's about jobs being lost not protected.
Unemployment will reach 7.75 per cent which means at least 70,000 additional Victorians will lose their jobs.
Labor has had 10 years of record taxes and revenue to build desperately needed infrastructure and provide basic services. This budget shows they have failed.
Instead of using the massive $300 billion in taxes and revenue they've received in the last 10 years to build infrastructure to ensure our manufacturers and industries remain competitive Labor has wasted and mismanaged opportunities.
Now we find that Labor has plunged this state into a massive debt of $31 billion.
We're in tough economic times, but John Brumby's making it worse not better.
This Budget was a test for John Brumby to tell Victorians the truth regarding the state of the economy and he has failed.
Before turning to specifics of the Budget, to place the importance of this Budget in proper context we need to look at...
What has gone wrong under 10 years of Labor and John Brumby's watch...
In 1999 Labor inherited a state which had an operating surplus of more than $1.7 billion and low and falling state debt, a state which had a restored AAA credit rating, a state which was the manufacturing engine room of the nation and a state where growth had outpaced national economic growth since the end of the 1991-92 recession.
The Victorian State Labor Government has received record amounts of taxes and revenues over the past decade, however it has simply squandered its 'rivers of gold' through waste and mismanagement.
The Government has failed to build up sufficient surpluses and reserves in the good times to cushion us from the downturn we are now experiencing.
Instead, it has decided to manage our economy from one media release to the next photo opportunity, with the resultant lack of clear, long-term economic vision becoming abundantly clear to all Victorians.
After ten long years, Labor has not built the desperately needed infrastructure such as roads, rail and bridges to ensure Victoria's industries maintain a comparative advantage against their interstate and international competitors.
Our manufacturing base continues to erode, our exports have plummeted and now jobs are being lost.
The Brumby Government's delivery of vital services has not kept pace with Victoria's population growth.
Our education standards have fallen, our trains are overcrowded and unreliable, hospital waiting lists have blown out, violent crime has increased and there is no security of our vital water or electricity supplies.
With the Brumby Government rapidly accumulating enormous debt over the next four years and beyond, it will be failing yet again, breaking the trust of Victorians who would have expected quality infrastructure and services to have been delivered, without the massive cost being borne by our children.
But it gets worse.
We now find that there has been a breakdown in trust between the State Government and Victorians.
We know from recent Auditor-General and Ombudsman's reports that hospital waiting lists have been manipulated and crime figures are grossly inaccurate and cannot be trusted.
The efforts of Labor ministers to cover up 'figure fudging' are nothing short of damning.
And to make matters worse, there are allegations of improper behaviour involving government ministers.
But the Government will be held accountable by Victorians on how it handles the difficult economic and financial times ahead and what it does to save and create Victorian jobs.
Labor's denial of economic reality...
We are facing extreme economic and financial challenges nationally and in Victoria.
The international economy is in severe recession.
International trade is forecast to contract this year for the first time since World War Two.
The International Monetary Fund in its latest grim prognosis says the international economic crisis could be more protracted than first thought, with the slowest recovery reserved for over-leveraged economies - which includes Victoria.
And what has been the response from governments?
There has been a real reluctance on the part of the Federal and State Labor Governments to be straight with the public.
It took many months for the Federal Treasurer to even hint at the 'R' (Recession) or 'D' (Deficit) words.
And it took until just over two weeks ago, for the Prime Minister to finally utter the 'R' word and acknowledge that the Nation's economy will inevitably slide into recession.
But in Victoria it has been much worse.
The Brumby State Labor Government is in denial about the economic realities facing Victoria.
We have had a Premier and a Treasurer who have on the one hand been warning of hard times but in the next breath saying how well Victoria was doing.
If things are going so well, as claimed by the Premier and Treasurer, why then are so many Victorians suffering?
We even had the State Treasurer saying barely a month ago in Parliament, "The state of Victoria is one of the most dynamic and vibrant economies in the world."
And then just a fortnight ago, Treasurer Lenders said, "we are not in recession".
But this is from a Treasurer who breaks critical budget promises - how can he ever be believed?
This is the same Treasurer who following last year's Budget promised that Victoria would maintain a Budget Surplus of at least one per cent of operating revenue ($380 million based on last year's budgeted revenues) and when things turned decidedly for the worse in recent times so conveniently ignored this promise and went back to spruiking that the Surplus would be $100 million or more.
To make matters worse, we now we find that the Budget Papers, Premier Brumby and Treasurer Lenders remain silent on the 'R' word.
Everyone else is in recession but apparently not Victoria.
The economic indicators contained in the Budget are optimistic in the extreme and predicated on Victoria not entering recession and benefiting from a fast recovery.
The figures just don't stack up.
This is a house of cards Budget.
Labor's decade of economic mismanagement to blame for the extent of Victoria's decline ...
In an increasingly global economy, it is clear that the impacts of overseas events have affected, and will continue to affect, Victoria.
But, despite the Government's spin, the extent of Victoria's current problems is not just the result of the international economic crisis ... but also home grown.
Victoria's problems are directly the result of a decade of neglect, waste and economic mismanagement by the State Labor Government.
The economic role of a state government is to maintain an environment conducive to economic growth and activity, business and consumer confidence and investment certainty and growth leading to job creation.
However, economic policy under Labor in Victoria is a story of disjointed, incoherent, fractured policy direction and understanding - whether it is fiscal, debt, trade, education, energy, transport, industry, infrastructure and environment policies - that has ultimately undermined Victoria's economic activity, capacity and energy.
The Brumby Government's performance has not equipped the state for the difficult economic times we are now facing.
There is something very wrong with a government that instead of using record revenues wisely and planning for the lean times, blew a generational opportunity to cushion the effects of any inevitable downturn.
State of the Victorian economy...
For eight of the last nine years, Victoria's economic growth rate has been below the Nation's growth rate.
Business investment growth in Victoria was the weakest of all states in 2008 barely growing at 0.8 per cent over the year. Even in NSW investment grew by 10.5 per cent. Overall, private business investment grew 12.7 per cent nationally.
Victoria's share of national business investment declined to just 18.4 per cent in 2008, compared to nearly 25 per cent in 1999.
However it is the decline in manufacturing investment that is of greatest concern. In 1999, business spent nearly three times more in the manufacturing sector in Victoria than it did in Queensland. In 2008, for the first time Queensland experienced more business investment in manufacturing than Victoria.
Victoria's share of national manufacturing investment has fallen from 34.4 per cent in 1999 to 22.6 per cent in 2008 and the trend is continuing to decline.
There is something very wrong with a government that allows the State's key industry sector, our key employer and traditional economic foundation to wither.
Victoria is fast becoming an export failure.
Exports have stagnated while other states, including non-resource states, have leapt ahead.
Our exports have grown barely 2 per cent since 2000 compared to growth of 82 per cent in NSW, 193 per cent in Queensland, 196 per cent in Western Australia, 50 per cent in South Australia and 52 per cent in Tasmania.
Victoria's share of the national goods export market is now just 9.2 per cent compared to 20 per cent in 1999.
There is something very wrong with a government that has not even publicly acknowledged that there is a problem with exports.
Jobs...
Nowhere are the effects of Labor's decade of economic mismanagement more visible than when we look at Victoria's fast weakening employment situation.
The Budget Papers confirm this with unemployment to reach 7.75 per cent up from an average 5 per cent this financial year.
Over 200,000 Victorians will be unemployed over the medium term.
And this is optimistic considering the Prime Minister and Federal Treasurer have recently said the nation's unemployment rate will reach 8 per cent or more.
When it comes to the economy and jobs, the Brumby Government has been watching jobs disappear from across Victoria on an almost daily basis.
Employment across Victoria is taking a severe battering.
Despite the Brumby Government's avowed 'jobs, jobs, jobs' priority, Victoria was the only state to lose jobs in 2008, the first year since the recession of 1991-92 that Victoria actually lost jobs.
Victoria was also the only state to lose fulltime jobs in 2008. In March Victoria lost 34,000 fulltime jobs, the worst performance of any state representing 48 per cent of fulltime jobs lost nationally.
The number of unemployed has risen by nearly 36 per cent in the last year or by almost 42,000 Victorians.
Graph 1 Jobs Market
Of particular concern is the jobs situation in manufacturing.
In 2008 the manufacturing sector in Victoria recorded its lowest fulltime employment on record of just 270,000, or nearly 46,000 jobs below the level at the start of 2000.
And the latest jobs surveys, advertisements and unemployment figures show a rapidly declining trend.
The jobs situation in Victoria is grave but we have a Labor Premier and Treasurer who continually claims Victoria is doing well compared to everyone else.
This is cold comfort for Victorians who have regrettably lost their own jobs in recent months and for the 200,000 Victorians that will soon be unemployed.
The 2009-10 State Budget should have been about protecting and growing jobs for Victorians but the Brumby Government has failed.
All we have is a tired Government too busy listening to its own spin and rhetoric to care about Victorians and their jobs.
The State Budget
The Brumby Government's report card...
The Victorian Liberal Nationals Coalition outlined last week a checklist of what we saw as the critical priority areas for the Government to deliver on to protect and save jobs.
The question is, has the Government delivered on any of these key priority areas?
Here is its Report Card: · no new state taxes - $85 million in Budget from new Infrastructure Growth Levy on Land Developers FAILED
· a freeze of existing state taxes, fees and charges FAILED
· a cap on land tax increases FAILED
· a thorough state tax review that drives long-term tax reform FAILED
· fast-track review of state government tendering practices to ensure fairness and transparency FAILED
· fast-tracking of the delayed projects promised under the Regional Infrastructure Development Fund FAILED
· a cut to the red tape and freeing-up access to the Industry Transition Fund FAILED
· an immediate review of the rising cost of training FAILED
· a long term infrastructure plan for the building of Victoria's economic and social infrastructure to better deliver services FAILED
· a debt and budget management plan to deliver the long term infrastructure needs of Victoria FAILED
· the introduction of longer term revenue, spending and debt forecasts to provide greater transparency and accountability as Victoria goes into deeper debt FAILED
· better outcomes for services FAILED
Overall, the Brumby Government has failed Victorians yet again.
The Budget in detail...
John Brumby's record revenues...
In the decade of budgets under Premier Brumby's watch, Victoria's revenues have more than doubled from just over $19 billion in 1999 to $42 billion in 2009 bringing into the Victorian coffers over $300 billion.
This 'decade of plenty' is largely due to Labor gouging Victorians with an unprecedented record tax grab from payroll tax, land tax and stamp duty, in addition to the GST funding pipeline from Canberra to Spring Street.
Goods and Services Tax...
How ironic it is that the State Labor Government has benefited so enormously from the GST, something it totally opposed before its introduction in 2000.
GST revenues will have increased by 84 per cent from $5.1 billion in 2000-01 to an estimated $9.4 billion in 2009-10.
GST revenues have contributed an actual $57 billion to the Treasury coffers to 2007-08 and it is forecast that total GST revenues will exceed $107 billion by 2013.
While the GST has been a major contributor to Victoria's revenue streams, the greatest windfalls have come in the form of record levels of state taxation.
Payroll tax...
The State Labor Government has benefited enormously from record payroll tax revenues of more than $30 billion in total since 1999.
Payroll tax has increased by 82 per cent from $2.2 billion in 1998-99 to $4 billion this financial year and is expected to increase by a further 18 per cent to $4.7 billion by 2012-13.
Graph 2 - Payroll Tax
The payroll tax net has systematically increased under Labor and become a major problem confronting Victorian business today. Increasingly, more small businesses are being caught up in the payroll tax net each year due to the comparatively low payroll tax threshold in Victoria of just $550,000 per annum - the lowest of any state.
In comparison:
· Queensland has a payroll tax threshold of $1 million;
· Tasmania $1.01 million;
· Western Australia $750,000;
· New South Wales $623,000; and
· South Australia $552,000 ($600,000 from 1 July 2009).
The Brumby Government's dependence on payroll tax is now well entrenched.
Further evidence of this dependence was revealed in 2003, when then Treasurer Brumby, removed the previous long standing exemption of apprentice and trainee wages from payroll tax.
Many apprentices and trainees are now being sacked or put on indefinite standby by their employers due to the current economic slowdown.
The Coalition believes that the Government should have introduced initiatives in this Budget to provide support and encourage employers to retain their apprentice and trainee staff.
Land tax...
John Brumby, first as Treasurer and now Premier, has presided over a massive land tax grab from property owners over the past decade.
State revenue from land tax has increased 227 per cent or more than three-fold from $378 million in 1998-99 to a forecast $1.237 billion this financial year with total land tax revenues collected since 1999 approaching $8 billion and they still want more.
Graph 3 - Land Tax
The land tax pain for Victorians does not end there.
In 2009, John Brumby is increasing his land tax take from some taxpayers by up to 500 per cent compared to 2008.
The causes of these massive increases are three-fold:
· The Brumby Government scrapped its previous 50 per cent land tax bill cap in 2008.
· The applicable land tax threshold of $250,000 and the rate scales for 2009 have not been indexed or adjusted appropriately in proportion to increased property values.
· The date of property valuations for 2009 is 31 December 2007 - a period coinciding with the peak of Melbourne's property prices, which have now fallen by around 13 per cent (REIV March Quarter 2009).
The Victorian Liberal Nationals Coalition warned the Brumby Government about the removal of the 50 per cent cap.
Cash flows for many households and businesses are being crunched by a rapidly weakening economy, the drought and recent devastating bushfires.
Yet Premier Brumby has imposed massive land tax increases on Victorian property owners and businesses at a time when they can least afford it.
Many business owners now have to make a diabolical choice - sack workers to pay Labor's excessive land tax bills or just close the doors entirely.
Stamp duty...
Stamp duty on land transfers has increased by 270 per cent since 1998-99 from $1 billion to just over $3.7 billion in 2007-08. Over the next four years an additional $14.1 billion in stamp duty revenues from land transfers will be received.
Graph 4 - Stamp Duty
From this, we can see that the State Labor Government has benefited very nicely from the huge increase in stamp duty revenues over the past decade flowing into the State's coffers.
Yet just last week, and despite the record revenues, we had the Treasurer crying poor and trying to shift responsibility for tax reform elsewhere stating in his submission to the Henry Review that the Commonwealth should compensate the states for the removal of stamp duties.
How hypocritical.
State Labor has had a decade to do something about genuine state taxation reform and it hasn't.
The release last December of the BankWest Residental Stamp Duty Report 2008 confirmed findings of an earlier Coalition analysis that Melbourne home buyers are being hit particularly hard with stamp duty costs by the Brumby Government.
Melburnians have the dubious honour of paying the highest stamp duty of any capital city.
On a $410,000 Melbourne median priced home (REIV March Quarter 2009), Victorian non-first home buyers would pay $16,870 in stamp duty compared to $13,940 (17 per cent lower) in NSW, $5,600 (67 per cent lower) in Queensland, and $13,490 (20 per cent lower) in Western Australia.
Despite the Brumby Government's continuing spin and rhetoric, Victorian home buyers are being more heavily taxed than their interstate counterparts.
In fact, the State Labor Government's heavy dependence on property related taxes has increased dramatically over the decade contributing greatly to the decline in affordable housing in Victoria.
Property related tax revenue as a percentage of total state taxes has more than doubled under Labor, increasing from 15.1 per cent in 1998-99 to 35.8 per cent in 2009-10.
Labor's tax record
There have been a total of 21 new or extended taxes, charges and tolls introduced under Labor since 1999.
Some examples are: New or Extended Taxes/Charges/Tolls Date of Imposition
Growth Areas Infrastructure Tax: increasing developer charges 2009
Scoresby Freeway/ EastLink Tolls 2008
Long Term Parking tax (Congestion Tax) 2006
$80 Motor Vehicle Registration charges for pensioners etc 2004
Gaming machine levy 2000
While the State Government has seen more taxation as a problem solver, the fact is that these new imposts have had a double whammy on people throughout the State.
Not only are individuals and businesses bearing the burden of these taxes and charges, but the inefficient use of acquired revenues on poorly performing services or costly major projects can also leave Victorians out of pocket.
This rising tide of tax increases has also played a substantial role in reducing the effectiveness of the Rudd Government stimulus packages.
Up to $714 in additional taxes and charges in the areas of gas, power, water, transport, taxis, local government rates, vehicle registration and public housing rents will be levied by the Government on Victorians this year, clawing back much of Federal Labor's financial assistance payments.
Budget spending - money in one door and straight out the other...
Premier Brumby recently claimed, not for the first time, that Victoria will remain in a positive growth position in the coming years "due to a decade of disciplined financial management".
Now there's a myth! Labor's good fiscal management is a myth. The huge increase in revenues since 1999 has been met with an equally huge boost in spending with little or no expenditure discipline applied.
Every Labor Budget has blown out to well above the original generous budgeted spending increases. Between 2000-01 and 2007-08, Labor spent more than $10 billion than it expected above the original Budget estimates.
Budget spending has blown out under Labor without regard to fiscal discipline.
Spending has more than doubled from $18.2 billion in 1998-99 to a forecast $42.2 billion in 2009-10. Budget income has increased 118 per cent while spending had risen 132 per cent - a totally unsustainable situation but typical of the fiscal history of this Labor administration.
Despite its revenues under pressure Labor just cannot stop spending.
Debt spiral...
In a bid to cover up its failings, Labor has again turned to public sector debt.
Many Victorians will well remember the previous Cain-Kirner Labor Governments, when they so irresponsibly borrowed to pay recurrent expenditure including public sector salaries and more was being spent on interest repayments than on health - totally unsustainable and inept financial management.
The damage caused during the Cain-Kirner period took years to repair under the Kennett Government.
Total non-financial public sector net debt is forecast to increase by 794 per cent, or more than eight-fold, from a low of $3.5 billion in 2002 to $31.3 billion in 2012-13.
Graph 5 - Debt Rollercoaster
The debt servicing ratio on the state's net debt as a percentage of total revenue is expected to double from 2 per cent in 2007-08 to 5 per cent in 2012-13.
As a percentage of GSP, net debt in 2013 is expected to top 10 per cent compared to an actual 1.5 per cent in 2007-08.
The interest bill on this debt will now soar to an expected $2.2 billion in 2012-13 far above the $1.8 billion per year previously budgeted by the Government. This amount was itself equivalent to the total cost of our police force.
The present rapid rise in debt is focussed particularly in the State's non-financial corporations, principally the water corporations, Port of Melbourne and transport authorities. The Brumby Government seldom mentions this debt as it is set to climb from $1.9 billion in 2007-08 to a forecast $15.3 billion in 2012-13.
The huge increase in debt servicing that will be required will put upwards pressure on water prices to consumers and port charges on exports and imports.
Labor's 10 years of waste and mismanagement on major projects...
The Brumby Government's record on major projects is dismal and how it uses debt for capital works is of great concern to the Coalition.
Infrastructure projects over the last decade have incurred huge amounts of waste under Labor.
The budgets of just 33 projects (excluding EastLink) have blown-out by over $4.4 billion, representing a whole year of infrastructure investment - not to mention Victorians' money - down the drain because of lax, incompetent project management.
This is another clear sign as to why the Brumby Government cannot be trusted to manage the State's finances.
The Top-10 projects over budget include: Project Promised Cost Present/Final Cost Blowout
($ mn) ($ mn) ($ mn)
Regional Fast Rail 80 919 839
Myki Smartcard Project 494 1350 856
Channel Deepening 114 969 855
M1 Tollway-Westgate Upgrade 1023 1390 367
Austin Health Redevelopment 155 376 221
Commonwealth Games 318 469 151
Royal Children's Hospital 1000 1150 150
Wimmera-Mallee Pipeline 77 274 197
HealthSMART 323 427 104
Craigieburn Rail Project 20 115 95
Total $3,835

Rapidly rising debt must meet strict criteria...
Victorians are once again burdened by a State Labor Government addicted to debt and there are serious concerns over the Brumby Government's ability to demonstrate how borrowings will be used effectively to advance Victoria's productive output.
The overwhelming problem with Labor's debt is that there is no identifiable plan or program in place that outlines exactly how the Government is going to pay back Victoria's debt in future years.
To ensure responsible and conservative economic management the Victorian Liberal Nationals Coalition would initiate strict criteria for spending options funded by borrowings and recently called on the Government to comply with these criteria in the 2009-10 Budget.
· Infrastructure funding and other major financial commitments made by the state must be transparent to the taxpayer.
· Debt should not be used to prop up recurrent expenditure in the way it was used by Labor in the 1980s and early 1990s.
· Infrastructure projects relying on debt must be individually identified in the budgetary process together with the corresponding increase in debt.
· There must be a transparent repayment plan for debt associated with infrastructure projects and programs, which will be audited each year by the Auditor-General.
· Debt accumulated by the Commonwealth for projects normally undertaken by the states must be separately accounted for.
Premier Brumby's forecast debt binge will guarantee that Victorians in this and future generations will pay dearly through higher taxes and reduced services.
Victoria's massive future debt must not become an overwhelming burden on future generations, and it must have appropriate accountability and transparency.
The dismal state of Victoria's services...
What exactly have Victorians received for the unprecedented 'rivers of gold' in state revenue?
The reality is we have very little to show for it.
Labor has comprehensively failed to deliver the basic services expected every day by Victorians and Victorian businesses.
Delivering quality services is what state governments should do. They are charged with running services - the hospitals, the schools, keeping our streets safe, water, roads, rail, and emergency services.
Labor has degraded government services despite almost a decade at the helm, despite record revenues to tackle any issue, and despite some of the best economic times in this country's history. This is the ultimate mark of failure - the failure to lead, to plan, to invest or to administer with any capability or foresight.
Health and hospitals...
Recent exposure of the manipulation of public hospital performance data raises serious questions as to how well Victoria's public hospital system is actually operating. A government does not systematically condone or conceal the distortion and manipulation of hospital performance data if there is nothing to hide.
The provision of services to patients in our public hospitals has declined significantly over the last few years.
Graph 6 - Fewest Hospital Beds
Victoria has the fewest hospital beds per capita in the nation and as a result is experiencing an unacceptable increase in the numbers of sick patients forced to wait in hospital emergency departments.
Many patients are suffering extended delays in receiving treatment and spending longer and longer on surgery waiting lists. There are numerous other indicators of a health system in crisis.
In 2007-08:
· 363,000 Victorians missed out on care in a clinically appropriate time period - an increase of 43,000 people from 2006-07.
· 22 per cent of category two emergency patients were not seen within ten minutes - this is 25 per cent higher than 2006-07.
· 32 per cent of category three emergency patients were not seen within 30 minutes - an increase of 16 per cent on 2006-07.
· 33 per cent of emergency department patients did not get a hospital bed within eight hours - more than 85,000 Victorians. An increase of 19 per cent on 2006-07.
· 25 per cent of non-admitted patients were not discharged within four hours - representing more than 160,000 Victorians. An increase of 9 per cent on 2006-07.
· Almost one in three Victorians needing semi-urgent elective surgery were not operated on within 90 days in 2007-08.
In addition, the Government has closed 21 maternity services throughout regional Victoria, forcing more mothers to travel longer distances.
There is something very wrong with a government that loses sight of the need to provide high-quality health care for people throughout our State.
Education and training...
Victorian school children and their parents are losing out under Labor's mismanagement of education and training systems.
We have some of the lowest basic skills levels in the nation according to the OECD's most recent analysis of educational outcomes.
Given the importance of a well-educated population for the state's economic and social future, the OECD's figures make a mockery of Labor's claims of Victoria being the leading education state.
Many of our schools are in a state of disrepair, and three quarters of them or 1,250 schools state-wide have more than $250 million of maintenance outstanding.
Notwithstanding having had massive budget revenues available over the last ten years and, despite the Government's spin, Victoria spends less per head on its students than any other state.
Parents are continuing to take their children out of public sector schools and placing them into private sector schools where they believe they will get better educational and resource outcomes.
Graph 7 - Parents Voting With Feet
For the third year in a row in 2008, school enrolments in Victoria's public school system fell despite continued strong population growth.
Preliminary enrolment figures for 2009 show the trend is gaining momentum.
There was a drop of 1,300 students enrolling in government schools between 2008 and 2009 - twice the decline seen in 2007 and 2008. During the same period, enrolments in Victorian non-government schools grew by 4,000 students.
Over the last decade Victoria has also consistently spent less on TAFE training than any other State in the nation.
Last year the Brumby Government announced increased fees right across the TAFE system that come into effect next month and described it as 'reform' of the State's training system.
There is something very wrong with a government that raises fees for training at a time of rising unemployment when many more people are seeking new training to enter or re-enter the workforce but have less resources to do so.
Law and order...
Earlier this year it was revealed by the Ombudsman that Victoria's police crime statistics are now as questionable as the hospital performance data. The Brumby Government has used this questionable data for years to claim that Victoria has the safest streets in the nation and crime rates are falling.
The Ombudsman concluded that crime statistics in Victoria were distorted by the under-reporting of serious crimes, particularly assaults.
The Ombudsman also found that some members of Victoria Police had falsely boosted crime clearance rates, casting doubt on the accuracy of crime data.
Despite the manipulation of data, there are some facts that just cannot be hidden. Victoria actually spends less on its police services per person than any other state.
The escalating problem with violence around Melbourne's night clubs and bars can be directly linked to the lack of available frontline police to maintain an adequate presence on the streets.
As the incidence of violent crime has hit new records in each of the last four years, over the last five years police patrols have declined by more than 20 per cent from 1.9 million hours to 1.5 million. Police rosters have also revealed there are more than 1,400 officers missing from their frontline positions across Victoria.
Graph 8 - Violent Crime - Police Hours
There is something very wrong with a government that refuses to tackle the issue of declining frontline police numbers and record rising violence.
Public transport and roads...
Another clear example of the Brumby Government's failure to deliver on services is the appalling state of public transport in Victoria, highlighted by daily scenes of chaos on our trains and train stations.
Commuters across the metropolitan train, tram and regional rail networks are facing record numbers of cancellations and delays, dangerously overcrowded trains and platforms and a system plagued by inadequate infrastructure and unreliable services. This has led to commuters spending substantially more time travelling to and from work.
Graph 9 - Trains Commuter Satisfaction
Labor has blamed the metropolitan train operator Connex for the system's woes.
Connex in turn has blamed everything else for the situation, from signal faults and derailments to vandalism, graffiti and the ongoing shortage of train drivers.
Ultimately it is Labor's inaction, lack of planning and funding over almost a decade that is the problem. This has resulted in gross under-investment across the transport network.
Despite a 46 per cent rise in trips on Melbourne's trains in the past four years, the State Government will deliver just one new train this year of the 18 ordered last year.
Given his past appalling record, Premier Brumby's repeated assurances that new trains are on their way is further spin and it is difficult to see when any real relief for commuters from severe overcrowding will occur.
Victorians are also increasingly hampered by congestion on our roads.
The traffic gets increasingly slower every year, costing investment, raising business costs, eroding efficiency, distorting decision making and generally making commuters' lives more difficult.
Road infrastructure has failed to keep pace with the growth of the economy and population. Melbourne now has the slowest evening peak time traffic speed of any capital city at 37.4 km/hour.
John Brumby's latest transport plan provides little prospect that this situation will improve in the years to come as the great bulk of projects, if they ever get off the ground, are not scheduled to commence until after 2013 and not likely to be completed until as late as 2020.
There is something very wrong with a government that cannot put the right infrastructure and systems in place enabling people to get to and from home, work, school and play.
Water infrastructure...
The Brumby Government is trying to play catch-up for its years of neglect of our water infrastructure.
Despite Victoria having been in drought for a decade and taking into account spending on the $750 million North-South pipeline, Victoria's water infrastructure spending per head of population was the second lowest of all states in 2007-08.
Graph 10 - Water Infrastructure
Whilst the Government failed to properly invest in Victoria's water infrastructure over the past decade, it was bleeding the water authorities dry by directing them to pour over $2.5 billion in dividends and payments into state government coffers.
This is $2.5 billion that could have been invested into drought-proofing the state.
Instead, water prices charged to consumers will rise by 60 per cent within four years to pay for the Government's water plan and water restrictions will remain in place until at least 2013.
There is something very wrong with a government that has taken hundreds of millions of dollars from water authorities but is now forcing consumers to pay for the Government's inept management of our water resources.
Infrastructure spending...
Infrastructure is the linchpin of productive investment and enhanced competitiveness across Victoria.
However, Labor has failed to utilise the huge surge in revenues and its Budget surpluses to properly plan, finance and build Victoria's vital economic infrastructure.
Labor's neglect is apparent from a comparison of Victoria's overall infrastructure spend where Victoria was spending less per capita on economic infrastructure projects than any other state in 2007-08.
Graph 11 - Infrastructure Spending
This has been the situation for a decade under Labor and Victoria's infrastructure gap is now widening. To bridge that gap, Labor will have to rely on a huge surge in debt funding, Federal Government assistance and private sector interest.
The rapid rise in debt in the next few years, in part, reflects the Labor Government's failure to use its surpluses productively in previous years to build Victoria's infrastructure progressively and responsibly.
All Victorians will now pay the price for years to come as Victorians and businesses pay higher taxes and have to manage greater costs to remain viable and competitive.
There is something very wrong with a government that thinks that sitting on their hands on infrastructure is the right approach.
Country Victoria...
The past decade has been particularly tough for country Victoria.
The drought has continued to make life very difficult, again hitting country communities and many key rural industries hard. On top of that the terrible bushfires in January and February have taken a great toll on lives and livelihoods in many areas.
The situation has not been helped by the continued neglect of country Victoria by the Brumby Government. Labor has built on its Melbourne-centric bias that pervades its policies and its rhetoric.
Many regional towns are losing traditional industries and jobs. The Ballarat area alone has suffered nearly 800 publicly announced job losses in the last year, principally from well-established manufacturing firms.
These jobs have not been replaced and there is no regional employment strategy to help develop viable industries and protect regional jobs.
Indicative of Labor's neglect of country Victoria is the $610 million promised under the Regional Infrastructure Development Fund (RIDF). With one year remaining of the 10-year program, documents tabled in Parliament confirm that Labor will have spent only $381.5 million.
RIDF-funded projects are vital to communities across the state, however, many projects are still waiting to get off the ground and the Brumby Government has failed to meet its spending commitments under the program at a time when such projects are needed most.
There is something very wrong with a government that choose not to govern in the interests of every person from Mildura to Mallacoota, and from Wodonga to Warrnambool.
Bushfire prevention...
For years the State Labor Government and its Departments have been advised that not enough of the state's bushland was subject to adequate fuel reduction to help curtail fire risk in what is one of the most fire prone areas in the world.
And for years this advice has been ignored.
In the Environment and Natural Resources Committee's 2008 report, Inquiry into the Impact of Public Land Management Practices on Bushfires in Victoria, the Committee recommended that to protect the community and ecological assets, the Department of Sustainability and Environment should increase its annual prescribed burn-off target from 130,000 hectares to 385,000 hectares.
It was also recommended that this should be treated as a rolling target, with any shortfalls to be made up in subsequent years.
Not only has there been a huge fuel reduction deficit on the 385,000 hectare benchmark, but there has also been a very substantial deficit over the last decade, even measured against the grossly inadequate DSE burn-off targets.
Around 20 per cent of bush included in these deficient Government fuel-reduction targets remain untouched.
Graph 12 - Burnoffs
There is something very wrong with a government that cannot act in the best interests of the Victorian community despite every warning that it was not doing enough to protect Victorians from what is Victoria's greatest natural threat.
Labor's list of excuses for its failures...
Victorians are becoming all too familiar with the string of myths which the Brumby Government uses to cover up its abysmal management of the state and its failure to deliver basic services and infrastructure.
No one can make excuses like the Brumby Government.
I have never heard the Premier nor one minister ever say, 'I will take responsibility'.

The Brumby Government has a deliberate government strategy of, 'Let us make excuses, excuses and then more excuses'.
Government members have invariably blamed:
· the Kennett Government
· the Howard Government
· the Rudd Government
· vertical fiscal imbalance (VFI)
· horizontal fiscal imbalance (HFI)
· petrol prices
· the drought
· the GST
· climate change
· the environment
· the heat
· the cold
· the wind
· the global financial crisis
· power generators
· Connex
· rail tracks
· the Aussie dollar going up
· the Aussie dollar going down
· population increases
· banks
And when all else fails be assured they will blame the Opposition.
After nearly 10 long years of the State Labor Government, these excuses are designed to disguise Labor's many failures.
Instead of spelling out a positive vision for the future of Victoria - or at the very least explaining how it, as the Government, will fix our woes in water, public transport, education, health and policing - Labor prefers to dwell on the past.
It is time for John Brumby to stop the excuses, because Victorians want results, not rhetoric.
How the Liberal Nationals Coalition will make Victoria a better place...
Many policy announcements will not be made until closer to the November 2010 state election, after the Coalition has a much clearer picture of the exact financial position Victoria is in.
However, the following briefly outlines key differences between the Victorian Liberal Nationals Coalition and Labor which will guide policy.
The Victorian Liberal Nationals Coalition is committed to:
· Cutting the cost of doing business in Victoria;
· Supporting Victorian businesses to ensure future investment and job creation;
· Managing Victoria's economy efficiently by effectively using taxpayer funds and eliminating waste;
· Investing in, and growing Victoria's infrastructure in order to provide for greater efficiencies and productivity for manufacturers and businesses;
· Strongly supporting the principle of freedom of association in all workplaces;
· No longer tolerating violence on our streets, and providing the necessary frontline police resources to make our communities safer;
· Introducing tougher sentencing for violent crimes and crimes against children;
· Ensuring that corruption in Victoria is uncovered and offenders severely punished;
· Implementing a code of conduct for government ministers which includes honesty and accepting responsibility;
· Leading the nation in literacy and numeracy amongst Victorian students;
· Supporting and fostering volunteerism in our communities and promote the benefits to young Victorians;
· Ensuring Victoria has a world class health service with fair access for all; and
· Ensuring sensible and responsible management of the Victorian environment.
Conclusion...
The Victorian State Labor Government has been in office for nearly 10 years and John Brumby has played a leading role in the budget process.
And John Brumby is responsible for this latest bad news budget - a typical high taxing, high spending, high debt Labor Budget of old.
Funded on the 'never never' leaving our children to pay for it.
It is a 'house of cards' budget based on a whole range of assumptions.
This Budget was supposed to be about jobs.
However, it is a bad news Budget for Victorians particularly the 200,000 Victorians who will be unemployed.
It is a bad news budget for our children who will be left to pay a $31 billion debt legacy by Labor.
Despite Labor's decade of opportunity, the question that Victorians are asking is where has all our money gone? What do we have to show for it?
Labor has had 10 years of record taxes and revenue totaling more than $300 billion to build desperately needed infrastructure and provide basic services.
But our infrastructure continues to fall apart and our services have been seriously neglected.
Labor has failed.
This budget shows that Labor just doesn't get it.
The 2009-10 State Budget should have been about:
1. assisting businesses to invest and maintain and create jobs;
2. announcing infrastructure projects with funding explicitly designed to assist Victorian businesses to be competitive;
3. eliminating government waste, mismanagement and self promotion programs; and
4. ensuring debt funding of infrastructure is transparent, there is a rate of return over the life of the project which is realistic and that there is a transparent repayment plan of associated debt.
On all counts, the Brumby State Labor Government has failed Victorians.
Given its past record, we should not have expected any better of the Brumby Government's ability to steer the Victorian economy through troubled times.
This year's State Budget provided the Brumby Government with the opportunity to make a difference.
Regrettably, that opportunity has been lost and Victorians now and in the future will suffer as a result.
Thank you.

Contact Kim:

9 Lynton Place,
Scoresby VIC 3179
• Phone: (03) 9764 8988
• Fax: (03) 9763 9816

• Email: kim.wells@parliament.vic.gov.au

• Website:
www.kimwells.com.au