Wilson’s promise of 25,000 more surgeries comes with $880 million black hole
Opposition leader Jess Wilson is promising to pay for more elective surgeries by winding up the state’s investment company. But the sums don’t add up.
The first is that Breakthrough Victoria no longer exists as a standalone company. It ceased operations at the end of the last financial year, and its functions have been folded into a new entity – Innovation Victoria.
Breakthrough Victoria last month posted a note to its now redundant website reporting that, as of 30 June, it had made 103 investments totalling $529 million. That portfolio of assets was now valued at $824 million, representing nominal $246 million surplus. Most of these assets are illiquid, meaning they cannot be readily sold.
The second issue is that the opposition is proposing to use forgone capital expenditure over the next decade to cover an operating expense in the next four years. Given that nearly all government capital expenditure in Victoria is financed by debt, this would mean a Wilson government intends to bring forward future borrowings to pay for an immediate health expense.
While the state’s long-term fiscal position would be left largely unchanged by the Coalition’s plans, they would increase government spending, debt and the cost of interest repayments, and reduce the size of operating surpluses over the next four years.