Standard and Poors has belled the cat. The Daniel Andrews Covid Response was a failure. Despite the longest lockdown in the world fatality rates were higher in Victoria than the rest of Australia and now we find that it is the S&P view, as reported in the Herald Sun, leading credit ratings agency Standard & Poor’s says Victoria’s crushing Covid lockdowns were to blame for the state’s dire financial position today.
The damage done to Victoria by Andrews is incalculable. Andrews remains despised, unwanted and unrepentent. Karma is a bitch.
See report below.
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COVID CRIPPLED, BLOWOUTS BROKE
The Victorian government’s hard-headed approach to Covid over almost two years of pandemic turmoil was always going to leave a legacy of economic pain.
While then-premier Daniel Andrews and senior health bureaucrats argued the health of Victorians came before the economy, greater Melbourne’s series of six lockdowns – among the world’s longest at a cumulative 262 days – still saw Victoria outstrip New South Wales in Covid fatalities.
In other words, despite the approach of putting lives before livelihoods being entirely understandable, the Victorian government failed on both measures.
Higher fatality rates and deeper economic damage was the result.
All Australian states, of course, faced the same virus but by the time vaccination rates had crossed 90 per cent coverage to allow restrictions to be abandoned in November 2021, Victoria had endured far longer lockdowns and loss – and by January 2023 Victoria had seen 4545 Covid deaths (36 per cent of the national toll) compared to NSW at 4454 (or 35.2 per cent) – a significantly higher per capita ratio.
As reported in the Herald Sun, leading credit ratings agency Standard & Poor’s says Victoria’s crushing Covid lockdowns were to blame for the state’s dire financial position today.
“It was only five or six years ago when Victoria had the best financial outcomes, and that was before Covid,” S&P’s director of government ratings Anthony Walker said.
“What we’re seeing now is that most other states around the world have recovered from Covid financially. Australian states, not just Victoria, are lagging.”
There is no argument that in the face of a global pandemic, and especially in earlier phases as vulnerability and lethality was being clarified, that health must be the clear and defining priority.
But the Victorian government was for too long, after it was clearly established that the elderly and immunocompromised were those most acutely exposed, insistent on shutting down almost all elements of the non-essential economy and liberties to pursue a flawed zero-tolerance approach to a disease that was destined to become endemic.
While it is true that most restrictions were lifted under the protection of mass vaccination, the government had failed to take enough account of the economic, societal and mental health damage inflicted by continual lockdowns.
Victoria’s Gross State Product went into reverse across the 2019-2021 financial years – the first time in 30 years the local economy had contracted.
The overall economic loss over the course of the pandemic out to December 2022, when reopening was finally secured, has been estimated at some $69.5bn.
That is undeniably a massive impact, but the now Allan-led government can’t put the state’s catastrophic financial position entirely down to Covid.
An explosion in the cost of the public service, from $17bn when Labor first came to power in 2014 to now look at hitting $38.6bn by 2027 is just one element of additional budget burden. Throw in the recently-approved $5600 individual ‘cost-of-living’ bonuses on top of wage increases for about 54,000 of those public sector workers and you get a sense of how profligate government spending has become.
Then there are the multi-billion dollar blowouts on the Big Build projects and the arrogant waste still being accepted on Suburban Rail Loop.
Crippling Covid shutdowns were part of the budget woes now faced, but wider and continual fiscal mismanagement is the reason why Victorian taxpayers face a record debt of $188bn by 2027.
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