How could the revealed Covid spending waste affect S&P Global Ratings?
S&P Global Ratings may reassess Victoria's debt profile due to Covid spending waste The Auditor-General's Office found that Victoria's $39bn Covid response involved hundreds of millions in waste and mismanagement. This waste, including $397m paid to potentially ineligible recipients and $771m of unused PPE written off, negatively affects the state's fiscal health and debt profile. As a credit rating agency, S&P Global Ratings assesses the financial stability of the state, and such significant financial mismanagement could lead to a negative reassessment of Victoria's credit rating.
- Effect
- Strong negative
- How direct
- 2 steps, 1 inferred by Brind
- When
- Within weeks
- The story
- Gone quiet
How it reaches S&P Global Ratings
-
A report by Victoria’s Auditor-General’s Office found that Victoria spent at least $39bn on its Covid response, with hundreds of millions paid to potentially ineligible recipients or written off. The report noted that between 2023 and 2025, the Department of Health wrote off over $771m of unused PPE equipment. Additionally, the Department of Jobs, Skills, Industry and Regions wrote off $72.5m in Covid grants by June 2025, after determining they were paid to ineligible applicants.
The full event1independent outlet -
Victoria's Auditor-General's Office reported that the state's $39bn Covid response included hundreds of millions paid to ineligible recipients or written off. Specific waste included $397m paid to high risk and potentially ineligible recipients and $771m of unused PPE written off between 2023 and 2025.
1 report connects these two. Brind only summarizes; follow a link to read the reporting itself.
- perthnow.com.au Oct 22
-
state branch of the Australian Labor Party
Everything about Victorian Labor Party -
The documented waste and mismanagement of public funds, such as the $72.5 million in Covid grants written off by the Department of Jobs, Skills, Industry and Regions, indicates a strain on the state's financial integrity. This financial instability is a key factor in determining a government's debt profile. Credit rating agencies like S&P Global Ratings monitor the fiscal health of governments. Significant, reported financial waste and mismanagement could prompt the agency to review and potentially adjust its assessment of Victoria's creditworthiness.
No report states this step directly. Brind drew it from the reporting on each side of it, so treat it as an informed guess.
-
credit rating agency, subsidiary of S&P Global
Everything about S&P Global Ratings
Tap any step to see the evidence behind it.
The facts so far
As reported. Each one links to where it comes from.
- Victoria’s Covid response exposed at least $39bn in spending, with hundreds of millions paid to ineligible recipients or written off.perthnow.com.au
- Up to $397m was paid to high risk and potentially ineligible recipients.perthnow.com.au
- The Department of Health wrote off more than $771m of unused PPE equipment between 2023 and 2025.perthnow.com.au
- The Department of Jobs, Skills, Industry and Regions wrote off $72.5 million in Covid grants by June 2025.perthnow.com.au
Why it matters
For the Victorian government, the revelations of massive financial waste raise serious questions about accountability and the efficiency of public spending. A negative assessment from a major credit rating agency like S&P Global Ratings could increase the cost of borrowing for the state, potentially forcing the government to dedicate more revenue to servicing debt rather than public services.
This issue highlights the scrutiny faced by governments following major crises. The reports detail the financial fallout of the pandemic response, showing that even with massive public spending, significant mismanagement occurred. This places the state's financial stability under intense review, not just politically, but also by international financial bodies.
What we don't know yet
- Will S&P Global Ratings specifically cite the Covid spending waste in its next assessment?
- What corrective financial measures will the new government implement to address the waste?
What would change this answer
Who else could feel it
Other possible ripples from the same event.
Reporting
- perthnow.com.auOct 22
Keep going
Brind's analysis is written by AI from the reporting linked above and can be wrong. This explainer is a possibility worth considering, not a forecast: steps marked as Brind's reasoning are not stated in the reporting. It is not investment advice; do your own research.