Latest news with #DepartmentofTreasuryandFinance
The Advertiser
3 days ago
- Business
- The Advertiser
Credit rating downgrade cost unknown for debt-hit state
Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services. Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services. Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services. Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services.
Yahoo
3 days ago
- Business
- Yahoo
Credit rating downgrade cost unknown for debt-hit state
Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services.
Herald Sun
3 days ago
- Business
- Herald Sun
Victorian Treasury has not modelled impact of any credit rating downgrade
Don't miss out on the headlines from Victoria. Followed categories will be added to My News. In a staggering admission to parliament, Department of Treasury and Finance secretary Chris Barrett said the threat of a downgrade was not considered in this month's budget. 'The five step fiscal strategy is aimed at retaining the current credit rating and improving it over time,' Mr Barrett told the Public Accounts and Estimates Committee on Tuesday. It prompted a frustrated rebuke from the committee's deputy chair, Liberal MP Richard Welch, who accused the government of budgeting on the basis of 'hope'. Victoria's debt plan strategy, introduced in the 2023-24 State Budget, commits to managing and stabilising debt as a proportion of the total economy before finally paying it down. Latest forecasts show the state debt is expected to hover stubbornly around 25 per cent of Gross State Product until 2029 when it is tipped to peak at a record $194bn. At that time Victoria will be paying more than $10bn a year to service the debt. Treasurer Jaclyn Symes will fly to New York on Wednesday to meet with heads of ratings agencies who have repeatedly warned Victoria is at risk of a downgrade from its nation-low AA rating. Such a move would lead to increased borrowing costs and make it harder for the government to start lowering the state's debt profile. Mr Barrett said modelling had been done on a change in interest rates only, and not the impact of a credit rating fall. In a post budget report Moody's Ratings raised serious doubts about the Allan government's ability to cut spending and drive down its forecast $194bn debt. It specifically questioned assumptions built into the budget including slashing spending growth by almost half to 2.9 per cent and warned that increasing cost pressures from the $34.5bn Suburban Rail Loop and a 'political resistance to spending cuts' could wreak havoc with the government's debt repayment plans. It said while plans to axe thousands of jobs from the public service _ pending a review to be handed to government next month _ would curb inefficient spending, more work would be needed. 'We expect an improving economic backdrop to support Victoria's operating performance and help mitigate risks from high and rising debt and weakening debt affordability,' it said. 'However, global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook.' Under questioning from the Opposition Ms Symes also refused to rule out using treasury advances for foreseeable budget overruns.
West Australian
3 days ago
- Business
- West Australian
Credit rating downgrade cost unknown for debt-hit state
Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services.
Perth Now
3 days ago
- Business
- Perth Now
Credit rating downgrade cost unknown for debt-hit state
Treasury boffins have not considered the fallout of another credit rating downgrade on paying down ballooning state debt. As parliamentary hearings into the Victorian state budget got underway on Tuesday, Department of Treasury and Finance secretary Chris Barrett admitted the threat of a credit rating downgrade was not modelled. The department has only assessed the budgetary impact of a 100 basis points rise in interest rates. Credit rating downgrades make it more expensive for governments to service debt, leaving less money to spend on critical services and infrastructure such as hospitals, roads and schools. Victoria's net debt is forecast to reach $194 billion by mid-2029, sending interest repayments soaring close to $29 million a day. S&P Global Ratings downgraded Victoria's credit rating two notches in 2020 from AAA to AA, the lowest of any Australian state or territory. Fellow ratings agency Moody's followed suit, stripping the state of its AAA status in February 2021 and downgrading it from AA1 to AA2 in 2022. Treasurer Jaclyn Symes is travelling to the US to meet with ratings agencies, including representatives from Moody's on Friday. Moody's post-budget report said Victoria's economic outlook remains positive, with the improving economic backdrop expected to ease risks from high and rising debt. But it warned Victoria wasn't completely out of the woods for a credit ratings downgrade. "Global economic uncertainties and geopolitical tensions pose risks to the fiscal outlook," the report said. "Should the risks materialise, or reform momentum weakens, or both, the potential for higher-than-expected debt and interest burdens would further weigh on Victoria's credit profile." Ms Symes also defended the use of treasurer's advances for major project milestones and sparred with Nationals MP Jade Benham over the government's controversial emergency services levy. All Victorian farmers will be spared from paying the increased tax on their land for 2025/26 after the entire state was declared drought-affected on Friday. The one year reprieve, along with carve-outs for Country Fire Authority and State Emergency Service volunteers and life members, means the expanded levy is expected to raise $73 million less than expected. But the treasurer remained adamant it won't compromise the Allan Labor government's funding commitments for emergency services.
