Victoria’s financial situation is under growing pressure due to continued overspending on government services, while a long-awaited public sector efficiency report remains unpublished. The state’s recent move to introduce a new parliamentary structure further complicates matters, adding costs at a time when rating agencies are likely to increase their scrutiny.
Public concern intensified after the Victorian government disclosed a further $4 billion in budget overruns. This has added weight to Treasurer Jaclyn Symes’s calls for a “fresh approach.” In an unusually assertive decision, Symes appointed a leading expert in public sector efficiency to investigate waste throughout the Victorian bureaucracy. The report was scheduled for release in June 2025, but it remains concealed six months later, prompting speculation about the nature of its findings.
The review began with strong expectations. The appointed reviewer had previously modernised Victoria’s public administration under both Labor and Coalition governments. However, much of her earlier work has since been reversed and the state’s public service is now seen as bloated and ineffective. The committee was tasked with turning this around, but government silence over the outcome is raising concerns that the proposed reforms may be politically challenging or deliberately stalled.
Tensions are heightened by the proposal to create a new parliamentary body representing Aboriginal and Torres Strait Islander communities. This body would have the power to scrutinise legislation, question public servants and enforce response deadlines. It would be supported by a parallel administrative system. The likely result is a two-tiered government framework, adding significant operational expenses at a time when spending control is already an issue.
As Victoria’s debt continues to grow and structural reforms remain uncertain, global credit rating agencies are expected to reassess the state’s financial health. If they call for the full efficiency report and verifiable actions, Victoria could face the downgrade it narrowly avoided earlier this year. Meanwhile, rumours continue about alternative funding options such as renewed financial arrangements with Chinese lenders as the state searches for ways to bridge its expanding budget deficit amid a decline in federal support.
