Victoria is heading for financial disaster

Victoria is heading for financial disaster that will make the lockdown look like a minor incident along the road to Dan Andrew’s destruction of the state he has been overseeing. It’s only a small story, of course, but at least it is being mentioned: Building boom blamed for blowouts. It’s described as an “Exclusive” mostly because none of the other members of the Victorian media will go near it. You will never see this on the ABC for example.

VICTORIAN road projects are suffering big cost blowouts as the Andrews government battles to rein in the rising cost of labour and materials. The Sunday Herald Sun can reveal a series of suburban road upgrades have cost more than $50 million more than first planned, and some projects have blown out by nearly a quarter of the original cost…. Cost blowouts also affected works to strengthen bridges in regional Victoria, and just one of seven planned upgrades was completed last year because of changes to projects and rising costs.

It’s modern economic theory that is partly to blame, since everyone is now taught how public spending is necessary to create jobs. Absolutely wrong, of course, but everyone thinks it so that phenomenal amounts of money are poured into one wasteful project after another, projects that will never ever recover their costs in the value of their retunrs to the community. But it is possible that help is on the way, or at least a small modicum of coherence. I’ve emphasised the bits that need to be understood and then become the focus of attention, first for the Opposition and then for the rest of the community.

Opposition Transport spokesman David Davis said the government could not manage the finances of major projects. “Everywhere you look … costs have blown out and timelines are shot,” he said. “The community expects projects to be built on time, they don’t expect money to be wasted or squandered. “Many projects are delayed and its all down to the government’s own incompetence.”

The issue is NET costs, that is, the relative size of the return as against the costs of doing whatever is being done. Seems basic, but there is not a socialist government in the world that gets it right, with almost as many non-socialists as clueless as the socialists.

1 thought on “Victoria is heading for financial disaster

  1. Pingback: Victoria is heading for financial disaster - The Rabbit Hole

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