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The Victorian government has promised to make life “easier, safer, and more affordable” as it handed down its plans for 2026-2027.

As it fights a resurgence in inflation propelled by what the Allan government refers to as “Donald Trump’s war in the Middle East”, there aren’t many surprises or major headline items in the Victorian budget.

Instead, it focuses on school and road infrastructure, tech upgrades, and cost-of-living measures.

Here are the winners and losers.

Winners

Motorists 

The government plans to spend $750m to fund 20% rebates on vehicle registration from 1 June to 31 July, saving drivers $186. The budget also includes $1.04bn to rebuild, repair and resurface roads in what the government has promised will be the “biggest roads blitz in the state’s history” – with 70% of the funding allocated to regional Victoria. It also funds the “Servo Saver” feature on the Service Victoria app, which allows users to compare fuel prices and availability.

Public transport users

Introduced as a cost-of-living support measure amid the Iran war, the government will spend $432m to extend free public transport until the end of May, then deliver half-price fares from 1 June until the end of the year. The budget also includes public transport upgrades including $100m for bus routes across Melbourne and regional Victoria, $76.35m to undertake design and preparation works for the future electrification of the Melton line and $14.8m to boost capacity on the Wyndham Vale line. Labor has committed another $76m for upgrades to Melbourne’s tram network, including more accessible stops.

Melbourne’s western suburbs 

Amid criticism that Melbourne’s western suburbs have been neglected during Labor’s 12 years in power despite rapid population growth, the government has made a number of commitments in this year’s budget. In addition to the upgrades to the Melton and Wyndham Vale train lines, the budget includes $249m for maternity services across the western suburbs, $95m to open the upgraded Werribee Mercy hospital emergency department, $2m for the new Melton hospital and $7m to fund more police prosecutions at Wyndham law courts. 

Families with children

Labor continues its focus on families, with the budget including a $16m expansion of a program offering free eye testing and glasses to children who need them, $15m for free admission for under-16s to several zoos on the weekends and during the holidays and $11m for 55,000 additional Get Active Kids vouchers to help cover the cost of sports equipment.

The government will spend $19bn on education in the next financial year, including $5.5bn of new investment. There’s money for 27 new and expanded kindergarten centres and five government-owned early learning centres in communities where demand for childcare outstrips available places. There’s also $441m to build and upgrade schools.

The budget also includes $2.4bn funding over five years for Thriving Kids, a replacement program for NDIS recipients with autism who will be removed from the national scheme.

The Lottery Corporation

The ASX-listed operator of lottery gambling games including Powerball and Oz Lotto has received an unprecedented 40-year extension to its Victorian licence, allowing them to keep operating until 2068. The government is relying on revenue from gambling taxes to grow by an average of 0.4% a year over the next four years, with growth in lottery sales to offset a decline in revenue from poker machines.

Tech companies

Tech companies will continue to benefit from the government’s commitment to datacentres to “power the AI revolution”, despite growing concern over the sector’s expansion. With an ambition to become Asia-Pacific’s go-to datacentre hub, the government will spend $5.5m in 2026-2027 to encourage private investment and $3.2m over the next two years on a strategy team to work out how much energy AI companies will need to open and operate centres in Victoria.

The government will also fund other technology upgrades. This includes $154m to strengthen cybersecurity and data protection, with $37m to protect patient data and “reduce system failures” in healthcare.

It’s worth noting the budget also includes $38m to upgrade Victoria police’s information system to allow integration with the new national firearms register, once it’s established.

Losers

Future generations

Despite announcing a surplus $727m operating surplus in 2025-26, a slight improvement on the $611m forecast last May, the state’s debt is inching towards $200bn. Debt is forecast to grow from $165.3bn in June 2026 to $199.3bn in 2029-30. By then, interest payments on state debt are forecast to total $11.82bn, working out to $32m a day. While the debt has stabilised, the government is yet to begin meaningfully paying it down, leaving that to future Victorians.

Young people on the wrong side of the law

In the budget papers, the Allan government spruiks its focus on “realising the potential of our kids”, but it will also spend a significant sum to support its youth crime crackdown. The budget includes $397m to continue implementing tougher new bail laws and $117.5m to have alleged young offenders’ cases heard in the County court. By comparison, there’s $81m for youth intervention programs to “stop crime before it starts”.

Poker machine venues

Revenue from gambling taxes paid by electronic gaming machine companies is expected to dip as gambling harm minimisation measures take effect in hotels and clubs.

People who’d like to catch a train to the airport

Hidden in the budget papers is a sign that the promised Melbourne Airport Rail project isn’t likely to be delivered any time soon. The “Sunshine Station Superhub” – which the government said last year would be the first stage of a rail line to the airport – isn’t expected to be finished until 2030. The airport rail line’s remaining expenditure and the estimated completion date are both yet to be confirmed.