Despite rising debt and increasing economic uncertainty caused by the conflict in the Middle East, the 2026-27 Victorian state budget has delivered significant support for multiculturalism and multicultural communities as well as cost of living relief for vulnerable families.

Delivering the budget, Treasurer Jaclyn Symes said it was a “disciplined” and a “low-spend budget”.

And while the budget promises a surplus of $1 billion in 2026-27, the government continues to struggle with ballooning debt, estimated to rise to $199 billion this year, meaning that more cuts will be made to the public service.

The budget invests more than $123.8 million to support multicultural and multifaith families.

This includes $9.1 million to support students from migrant and refugee backgrounds to stay engaged in education through initiatives like homework clubs.

There is also $3.6 million provided to continue the Early Childhood Language Program in Victorian kindergartens.

The budget also invests $61.9 million to support students with English as an Additional Language program and provide interpreting and translating services in schools.

There is a $400 payment for Victorian government school students as part of a $287 million package that will see parents able to choose how they spend the payment on education-related expenses such as uniforms, school camps and excursions.

An $11 billion injection into the state’s healthcare system will also support the health care of many migrant and refugee families.

The budget includes $13.6 million for the Multicultural Affairs portfolio, including $4 million in targeted support for newly arrived migrant and refugee communities as well as asylum seekers and temporary visa holders.

There is $17 million in the budget to expand the delivery of the Victorian African Communities Action Plan as well as more than $10 million for community language schools to help people maintain their cultural identity through language.

Also in the budget is $3.4 million in 2026-27 for community led projects to fight racism, including antisemitism and Islamophobia.

Health

Nearly $4 billion will go towards health, including $1.6 billion for hospital staff, medicines and resources. 

There is $284 million allocated to open and operate hospitals and wards, including one new community hospital.

Hospital infrastructure and equipment upgrades will see a $145 million boost, and $299 million will go towards supporting new families, including maternity services in Melbourne’s west and IVF support. 

Education

A total of $1.6 billion will go towards new schools, school upgrades and maintenance and $2.2 billion to support children with disabilities in schools.

Four new schools will be built in Melton, Port Phillip, Casey and Wyndham, costing $420 million. 

$222.2 million will be invested in restoring the Victorian Curriculum and Assessment Authority (VCAA) in the 2026-27 budget.

It follows a series of mishaps with VCE exams, including students being able to access exam questions online ahead of time in 2024, and errors in the maths exam in 2022 and the maths and chemistry exams in 2023.

The state government says the funding responds directly to an independent review last year which found the authority lacked a sustainable budget.

The state government is expanding its Free Kinder program, investing almost $500 million to deliver 22 kindergartens at school sites, five early learning centres and grants for 27 new and expanded kinders. 

More than 570,000 children have benefited from Free Kinder since 2023, with the program delivering up to $5,200 in savings per child, the state government says. 

The budget includes $3.6 million for bilingual kinders through the Early Childhood Language Program. It will support 197 kindergartens to teach 21 languages, including Auslan, Cantonese, Hebrew, Hindi, Italian and Japanese.

Transport

The state government will invest almost $100 million to expand bus hours and weekend services, deliver new and upgraded routes in growing suburbs, and boost services connecting to universities. 

In the west of Melbourne, a new bus network will be introduced for Melton South, with two new routes. A separate bus connection will also be added to Woodgrove Shopping Centre and a more direct link between Laverton and Aircraft railway stations. 

A new route will connect Drysdale and Ocean Grove in regional Victoria. Additional trips between Castlemaine and Harcourt will also be added, along with more services from Cowes and Inverloch to Dandenong.

The state government has previously announced public transport will be free across the state until May 31. Tickets will then be half-price until the end of the year. 

With petrol prices soaring as a result of the Middle East conflict, the state government is offering 20 per cent off car registration this year. 

A light vehicle registration costs up to $930.70 annually, meaning each Victorian can get at least $186 back in their pocket. Applications for the rebate can be made through Service Victoria from June 1 and up until July 31. 

The state government says the cut to government fees and charges represents around $750 million in foregone revenue.

Disability

The budget provides about $2.5 billion in disability supports which includes $2.4 billion over five years, with the Commonwealth, to fund Victoria’s commitments under the National Agreement on Foundational Support.

It also includes $20 million to support in-home and aged care.

Gender equity

After a decade of Gender Equality Budget Statements and five years of gender responsive budgeting, more than 425,000 women have found work in Victoria, the budget papers reveal.

There has been a 30.4 per cent increase in the number of women in work in Victoria with the share of women in work rising by 5.3 per cent over the past decade.

An investment of $4.8 billion in this year’s budget is aimed at further strengthening gender equity in Victoria.

Housing

The state government will invest $860 million in the Social Housing Growth Fund to help deliver more than 7,000 social homes.

It says this builds on the more than 12,000 social and affordable homes already built or underway.

More than 56,000 households are on a housing waiting list in Victoria, with even those deemed a priority facing average delays of 17 months, according to the most recent publicly available data.

Victorians looking to purchase property under $620,000 will save under an extension of the off-the-plan stamp duty concession.

The state government says the concession has saved buyers an average of $30,000.

It will be extended for six months, for contracts signed before April 21 next year.

Justice

The budget allocates $137.7 million towards more resourcing for police.

This includes $62 million to recruit up to 200 reservists for administrative duties to free up frontline officers and $18.3 million for 3,000 mobile devices for specialist police.

Money will also go towards almost tripling the number of Tobacco Licensing Victoria inspectors in a bid to crack down on the illicit tobacco trade. 

This is on top of $44 million to deliver an additional 50 protective services officers.

The state government has vowed to “completely review and rewrite” Victoria’s sentencing laws with a $3 million investment in the latest budget.

The Sentencing Act, which hasn’t been reviewed since 1991, essentially sets out the purpose of sentencing and the factors a court should take into account when deciding a sentence.

The Sentencing Advisory Council will look at whether the act still meets community expectations, how sentencing can better support victims and how the act can better “reflect and promote” the expectations of the current day. 

Tax

No new taxes have been introduced, but revenue collected by the state government will continue to grow. Tax revenue is forecast to be $43.2 billion in 2026-27 and reach more than $50 billion by 2029-30.

The Victorian Government will collect $12.5 billion in payroll tax and $10 billion in stamp duty as well as $7.7 billion in land taxes.

Gambling taxes are forecast to bring in $2.9 billion in 2026-27 then grow by an average of 0.4 per cent per year over the forward estimates. The state government says the gambling harm minimisation measures are helping to slow the growth.

Family violence

The state government will invest $100 million for family violence prevention and response activities, ending funding uncertainty for organisations in the sector.

The money will go towards refuges, crisis accommodation and trauma-informed counselling recovery programs for children and young people. 

The Central Information Point, which provides information about perpetrators so practitioners can assess risks, will receive $23 million of that, and funding will also go towards Sexual Assault Services Victoria to respond appropriately to victim survivors. 

Industry experts say the budget doesn’t address the rising rates of family and gender-based violence in Victoria.

Government data from 2024-25 showed family violence survivors waited on average 18 months for housing assistance.

The numbers

The budget promises a $1 billion surplus in 2026-27 but debt is estimated to grow to $199 billion, and cuts will be made to the public service.

The budget estimates the unemployment rate will remain at 4.75 per cent over the next four years, the population of Victoria will grow by about 1.7 per cent each year over the same period and gross state product will rise by 1.5 per cent this year and then by 2.5 per cent between 2028 and 2030.

Business investment has reached record levels, largely due to new data centres, the budget papers reveal.

The Treasury Secretary Chris Barrett said that Victoria’s economic outlook was “uncertain”, because of geopolitical factors but that Victoria’s economy was on a firm footing.

He said the conflict in the Middle East was driving inflation and impacting fuel prices and adding to the cost of living and to business costs.

But he said that Victoria was leading the nation in home building, although construction was still below pre-pandemic levels.

He said state debt as a proportion of GSP would decline as major infrastructure projects are completed.

AMES Australia CEO Melinda Collinson welcomed the measures, saying many migrant and refugee families would benefit from the measures.

“At a time when we are seeing a cost-of-living crisis, measures that support the most vulnerable families are welcome,” Ms Collinson said.

“The budget also includes measures that will help to bolster social cohesion at a time when it is coming under stress.

“As many Victorians are grappling with the cost-of-living crisis, migrant and refugee families will be among the people who will be finding some relief in the budget measures,” she said.