Victorian budget neglects housing crisis

May 6, 2016
Victorian Treasurer Tim Pallas

The Victorian budget, presented by Treasurer Tim Pallas on April 27, is in surplus, due largely to a big increase in stamp duty revenue, to a record $6 billion a year.

This revenue is a result of Melbourne's real estate boom. House prices have been rising rapidly. But the number of homeless people has also been rising rapidly. There has been a marked increase in the number of homeless people begging on the streets.

The budget does little to address this problem. The Family Violence Package includes some measures around crisis accommodation and homelessness support services: $10 million will be spent on rooming house upgrades.

But the fundamental solution — a massive expansion of public housing — is not included in the budget.

Pallas said the government will release a “comprehensive package” for housing later this year. But there is no indication that the government will reverse the bipartisan policy of privatisation of public housing.

The budget includes some improvements to public transport, including the extension of the South Morang rail line to Mernda, duplication of the Melton line, and duplication of part of the Hurstbridge line.

The big ticket item is the $10.9 billion Metro rail tunnel, expected to be operational in 2026. Meanwhile some more modest projects, such as the duplication of the Upfield, Altona and Cranbourne lines, are ignored.

There was no money for new trams, urgently needed to ease overcrowding. Phil Altieri, secretary of the Tram Division of the Rail, Tram and Bus Union, said that tram services are struggling due to soaring patronage. “We are sick of being the poorer cousins of commuter rail,” he said.

The government is supporting some dubious road projects, including the Western Distributor, which will funnel more cars into the CBD, while neglecting the need for a rail link to the Port of Melbourne, which could take thousands of trucks off suburban streets.

The Western Distributor was first proposed by toll road company Transurban. The Victorian government and Transurban will each pay part of the cost of construction. Transurban will collect tolls on the Western Distributor, as well as being given an extension of its collection of tolls on the existing CityLink tollway. The Age's Kenneth Davidson has warned of the danger of allowing Transurban to become “Victoria's de facto planning ministry”.

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