2020-21 Victoria State Budget Delivered

The 2020-21 Victoria state budget has been handed down. OTA has prepared a summary of those budget measures most relevant to occupational therapists. Click on the links below to skip to the sections of most interest to you.

The Bottom Line

Adopting a high-risk strategy to create 400,000 jobs, the Victorian Labor Government will run up debt totalling $155 billion by 2024. Fashioning the crisis precipitated by the COVID-19 pandemic as a unique opportunity, Treasurer Tim Pallas delivered a budget aimed at stimulating employment while also taking advantage of historically affordable borrowing.

There will be a deficit of $23.3 billion in 2020-21, falling to $5.9 billion by 2024. Net debt is forecast to reach $87 billion in the current financial year, growing to $154.8 billion by June 2024.

Net debt as a proportion of Gross State Product will rise from 19.5 per cent this year to 28.9 per cent by 2023-24.

Unemployment is forecast to peak at 8.25 per cent this quarter before declining to an average of 7.75 per cent for the financial year.

There are multi-billion dollar investments in public housing, schools and roads construction.

Significantly, the government has discontinued its annual major project update, leaving Victorians to wonder about the extent to which the cost of individual infrastructure projects has blown out.

There is payroll tax relief, a 50 per cent cut in stamp duty on houses worth less than $1 million, and a $500 million package to support first home buyers.

The Budget is all the more risky for its underlying assumption that a COVID-19 vaccine will be rolled out next year, precipitating an immediate and strong economic recovery.

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Health and Hospitals

In response to the COVID-19 Pandemic, the 2020-21 Budget invests a further $9 billion in Victoria’s hospitals and healthcare system.

This includes a $2.8 billion investment in hospital capacity and services, which will fund continued operation of new facilities opened to deal with the pandemic; delivery of elective surgeries delayed during the pandemic; and new, higher-cost therapies to treat patients with complex conditions.

The 2020-21 Budget invests $2 billion in new hospitals and upgrades to existing ones across the state. Key health infrastructure commitments include:

  • $384 million to commence the Warrnambool Base Hospital redevelopment, including a new emergency department, operating theatres and acute inpatient beds;
  • $75 million to purchase land and undertake detailed planning and early works for a new Melton hospital;
  • $66 million to acquire land in Cranbourne, Pakenham, Torquay, City of Whittlesea, Eltham, Point Cook and the inner south for new community hospitals;
  • $10 million for planning to upgrade the existing site and create an additional site for the Royal Melbourne Hospital, and investigate the potential for a new Royal Women’s Hospital site in the Arden Renewal Precinct in North Melbourne;
  • $7.6 million to expand maternity accommodation and upgrade critical infrastructure in Wangaratta;
  • $4.8 million to begin planning for the expansion of the Werribee Mercy Hospital;
  • $4.5 million to accelerate planning and design for the expansion of the Angliss Hospital at Ferntree Gully.

The 2020-21 Budget also provides:

  • $121 million for Better at Home, increasing the delivery of hospital services in homes;
  • $85 million for engineering upgrades and to replace medical equipment in metropolitan, rural and regional hospitals;
  • $30 million to refresh clinical technology including pathology, diagnostic imaging and patient management systems;
  • $40 million to improve energy efficiency in public hospitals through solar power and high‑efficiency LED lighting;
  • $26 million to extend new drug and alcohol supports; and
  • $13 million to boost virtual care technology, including new software to facilitate telehealth and devices to make home-care safer for patients and clinicians.

$200 million will fund the establishment of a new Metropolitan Health Infrastructure Fund to finance upgrades and improvements across city and suburban health services. An additional $120 million will also go towards the existing Regional Health Infrastructure Fund.

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Mental Health

This Budget allocates $869 million to provide Victorians with mental health support as the Labor State Government begins the task of fixing its “broken” mental health system.

This includes $605 million to start implementing the Royal Commission into Mental Health’s interim report findings and recommendations, including:

  • $492 million to build 120 acute mental health beds in Geelong, Epping, Sunshine and Melbourne;
  • $21 million to deliver the state-wide expansion of the Hospital Outreach Post‑Suicidal Engagement (HOPE) service;
  • $19 million for 35 acute treatment beds for public mental health patients in private health services;
  • $16 million to support Victorians with lived experience of mental illness use their personal expertise to improve our mental health system;
  • $8.7 million to establish Victoria’s first residential mental health service designed by people with lived experience and their families and carers;
  • $7.7 million to address workforce shortages in the mental health sector and support future expansion of the workforce;
  • $4.4 million to continue support for Aboriginal wellbeing programs and commence design to establish a new Aboriginal Social and Emotional Wellbeing Centre;
  • $2.2 million to establish the Victorian Collaborative Centre for Mental Health, which will bring together people with lived experience, researchers, and medical staff.

The 2020-21 Budget also commits $26 million to fund extra inpatient beds and increased access to community mental health services; $3.9 million to provide mental health and wellbeing support for asylum seekers; and $13 million to promote pathways into employment in mental health professions, including scholarships and mentoring.

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Aged Care

Victoria will partly cover the cost of introducing minimum staff-to-resident ratios in private aged care, with a $40 million investment to train more nurses and personal care workers. This spending is conditional upon the Commonwealth coming to the table.


The Andrews Government will invest nearly $1.6 billion to make sure students with disability are supported in the classroom through an Australian first Disability Inclusion package. The package aims to transform support for students with disability in Victorian government schools – doubling the number of students receiving extra support in the classroom to 55,000 – and is expected to create up to 1,730 jobs across the state by 2025. These jobs will include teachers, allied health workers and other staff to support students with disability.

All schools will benefit from the change, enabling them to better support students who may have previously been ineligible for targeted support – such as those with autism, dyslexia or complex behaviours.

A pilot program in more than 100 schools will now be rolled out across the state, to identify and respond to the needs of students with disability.

This new approach will focus on what a child can achieve, rather than what they can’t. For students, this will mean more opportunities to promote their own strengths, interests and learning needs, and the support they need at school. With additional funding, schools will be able to better plan and adjust support for students throughout all stages of their schooling.

New facilitator roles will be established to help schools and families work together through this new approach. Facilitators will bring their expertise and knowledge into classrooms to support students and schools – which will be critical in the move towards the new approach.

This investment also includes $102.8 million to deliver new resources and support to build the skills and knowledge of school staff in delivering inclusive education for every student. This will include more than 100 extra staff to provide on-the-ground implementation support and program delivery for schools.

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Spending of $235 million will create an additional 500 new jobs across the mental health, family violence and child protection sectors. This includes $4.6 million to support pathways to employment in the community services, disability and aged care sectors. It also includes assistance to help carers with their caring responsibilities while they study, helping with the cost of study materials, mentoring and additional supervision and support.


Spending of $302 million will enable the continued rollout of universal three-year-old kindergarten, including additional funding for the early childhood LOOKOUT program to support the additional needs of families as a result of the pandemic.

A $170 million package will make kinder free next year, saving families around $2,000 for every child enrolled in a participating funded kindergarten program.

Spending of $82 million will increase the availability of before and after school care. Grants of up to $75,000 will be made available to start new outside school hours care programs at up to 400 government schools.

$8.7 million for three-year-old children from refugee and asylum seeker families to access free or low-cost kindergarten, and for early intervention support to help parents and children struggling as a result of the pandemic.

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