Victoria bucks Aust'n states' budget deficit trend, announce huge surplus

Victoria is set to buck the trend of Australian states' recording budget deficits and razor-thin surpluses, with estimates suggesting the state is poised to bank 7 billion U.S. dollars in coming years.

Despite the impending end of Australia's "mining boom", Victoria has pulled in 1.78 billion U.S. dollars in surplus profits, on average, in each of the past four years.

The state's Treasurer Tim Pallas announced the positive results on Tuesday ahead of the release of the Victorian state budget on Wednesday.

According to Pallas, Victoria is on track for a surplus of around 2 billion U.S. dollars for 2016-17, with the state's total surplus tipped to hit 7 billion U.S. dollars in three years' time.

Pallas said the solid 2016-17 mid-year estimate showed Victoria's "people-powered economy is becoming a powerhouse, with an economic and budgetary position that dwarfs the resource-rich states".

Last year, the resource-driven economy of Western Australia (WA) announced a 2.39-billion-U.S.-dollar budget deficit, while Queensland - still recovering after operating at a loss in 2013-14 - only budgeted for a 930-million-U.S.-dollar surplus this financial year.

Like WA, Victoria has been hit hard by a decline in Government Service Tax (GST) revenue.

On top of that, the state is dealing with the slow withdrawal of the car manufacturing industry, with Ford, Holden and Toyota all set to close their Victorian-based plants by 2017.

But bumper population growth, the highest rate of any state, has counteracted the overall loss of GST income with more than 2000 international and domestic arrivals in Victoria each week.

Major constructions have also helped keep the state in the black with 15 buildings currently under construction in Melbourne, compared with only four in Sydney.

Victoria's budget standing will likely be further strengthened by the Port of Melbourne public sale, which could fetch almost 4.5 billion U.S. dollars, later this year. Endit