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AAP
AAP
Politics
Callum Godde

Vic budget to focus on health, not debt

Premier Daniel Andrews says Victoria's budget will see a massive investment in health and hospitals. (AAP)

Health spending will be a centrepiece of the Victorian budget, setting the scene for an election stoush on the issue after two pandemic-plagued years.

Premier Daniel Andrews described the 2022/23 state budget, the eighth to be handed down by Treasurer Tim Pallas on Tuesday, as a pandemic repair plan.

"The centrepiece will be ... a massive investment in health and hospitals to repair the damage that the pandemic has done," he told reporters on Monday.

"This is all about making sure we've got more staff to treat more patients to catch up on some of the care that had to be deferred for safety's sake."

Although scant on details, Mr Andrews alluded to changes to encourage Victorians to see a GP for specialist referral sooner, ensuring fewer end up in the public hospitals.

"These are the legacies of a one-in-100-year event and the best way to deal with those is to invest," Mr Andrews said.

"Some would urge us to cut. That's not what we do."

The opposition has flagged health will be a key election plank, previously promising to build a $750 million hospital in Mildura and fix the state's embattled triple zero call service if it wins office in November.

Opposition Leader Matthew Guy said the premier has had eight years to remedy the health system crisis, which he says pre-dates COVID-19.

"He's out of time, he's out of ideas and out of money," he said.

With inflation soaring and interest rates predicted to rise, the Victorian government is also making a pitch to households to reduce cost of living pressures with a new $250 energy payment.

Under the $250 million budget commitment, the bonus will be open to all Victorian households who compare their energy deal online from July 1 to mid-2023.

There are about 2.5 million Victorian households and hundreds of thousands are expected to apply for the one-off payment, which is not means tested.

Mr Andrews said the scheme would not allow multiple members of the same household to double dip as the bonus is linked to each home's energy meter, but Victorians can re-apply for the payment if they move house.

It is one of less than a handful of pre-announced measures in this year's budget, including $55 million to bring Crown Casino into line with royal commission recommendations and a tax hike on its pokies.

Crown Resorts on Monday warned shareholders the proposed changes could cost between $35 million to $40 million a year, based on its 2019 financial year earnings.

In comparison to previous years, 27 initiatives were unveiled before the 2021/22 budget and 38 in the budget before the last state election in 2018.

Victoria was forecast to post a $19.5 billion deficit this financial year after spending billions on health and business pandemic support, fuelling a predicted rise in net debt to $162.7 billion by mid-2025.

After lowering the state's credit rating last year, Moody's is warning Victoria faces "downgrade pressure" if its policy response to economic and fiscal shocks results in a larger and more pervasive rise in current debt forecasts.

John Manning, vice president of Moody's investors service, said the state's debt burden will rise significantly in the foreseeable future due mostly to its infrastructure works programs.

The rating agency is watching the budget to see what measures, if any, are implemented to narrow deficits.

"If there is a rapid and sustained increase in that debt burden, we think it's going to constrain the operating profile over time," Mr Manning told AAP.

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