Sector leaders unpack the 2026–27 State Budget at the IPAA Victoria State Budget Briefing

Inside the Budget: economic outlook and fiscal strategy

Chris Barrett, Secretary of the Department of Treasury and Finance, delivered the keynote address, providing a behind‑the‑scenes view of how the 2026–27 Budget was developed and the economic context shaping government decisions.

Chris outlined a global and domestic environment marked by uncertainty, including renewed inflationary pressures, higher interest rates and the economic impacts of conflict in the Middle East. Against this backdrop, he noted that Victoria enters the period from a position of relative strength, with continued economic growth, strong business investment and a healthy labour market.

Chris also spoke to the Government’s fiscal strategy, highlighting progress toward sustained operating surpluses and the stabilisation of net debt as a share of the economy. He emphasised the importance of balancing fiscal repair with continued investment in infrastructure and services that deliver long‑term benefits to the community.

Infrastructure investment remains a key feature of the Budget, with a focus on transport, health, education and emergency services, alongside a deliberate shift toward a more moderate and sustainable capital pipeline.

Independent perspectives on productivity, investment and workforce change

Following the keynote, Chris joined a panel discussion with Julie Toth, Principal Economist at the Committee for Economic Development of Australia, Professor Beth Webster, Director of the Melbourne Institute of Applied Economic and Social Research at the University of Melbourne.

Facilitated by Ian, the panel explored Australia’s productivity challenge, and the role state governments can play through regulation, place‑based investment and industry development. Beth emphasised the importance of long‑term, locally informed strategies that support emerging industry clusters and economic ecosystems, recognising that these investments often take decades to deliver their full returns.

Julie reflected on declining productivity and business dynamism nationally, noting the increased and complex regulatory burden, improved mobility and renewed momentum in business formation. She also observed that while business confidence remains fragile, investment levels in Victoria continue to track strongly, underscoring the complexity of economic behaviour in uncertain times.

The discussion also addressed labour market change, including the impacts of population growth, care sector expansion and technological disruption. Panellists agreed that artificial intelligence, similar to previous waves of technology change, is more likely to augment jobs than simply replace them, with opportunities to improve productivity, address skills shortages and redirect effort toward higher‑value work.

Questions from the audience ranged from youth unemployment and workforce participation to intergenerational equity, debt and the long‑term implications of AI adoption across government and the economy.

A forum for informed public purpose leadership

Closing the event, Darren thanked the speakers and attendees and highlighted the value of the State Budget Briefing in supporting informed leadership across the Victorian public purpose sector.

The 2026–27 State Budget Briefing once again provided a valuable space for shared understanding, discussion and connection, at a time when public purpose sector leaders are navigating complex economic, fiscal and community expectations.

IPAA Victoria would like to acknowledge major event partner Deloitte for their ongoing support, and the Department of Treasury and Finance for supporting this event.