The Victorian Government’s 2025–26 Budget delivers a record $31 billion investment in health, with funding boosts to hospitals, mental health, and women’s health. It represents a significant commitment to frontline care and follows a challenging year marked by hospital austerity drives and system strain.
While the headline figures are welcome, particularly for public hospitals, this budget misses opportunities to strengthen general practice, boost preventative care, and address persistent structural challenges across the health system.
This is AMA Victoria’s preliminary assessment. We are continuing to review the detail and will provide members with a fuller analysis in the coming weeks.
Hospitals and workforce
The government has committed $11.1 billion in additional health funding across the forward estimates, including $9.3 billion for hospital care- a vital investment in a system under pressure. Nine new or upgraded hospitals (including Footscray, Frankston, and Maryborough) are funded, alongside $203 million for workforce training, and an additional $95 million will fund clinical placements and professional development for nurses, midwives, and other health workers.
This is an important shift following the uncertainty and disruption caused by last year’s budget restraints. AMA Victoria welcomes the return to more orderly and sustainable budgeting, and we strongly support investment that expands capacity and improves hospital infrastructure.
However, this funding must translate into real improvements for the medical workforce- including safe staffing levels, manageable workloads, and proper resourcing of EBAs. With negotiations for the next Agreement underway, we will be seeking clear commitments that public hospital doctors will not be left behind.
General Practice
While hospital investment is significant, the budget is notable for its lack of direct support for general practice, a missed opportunity at a time when GP clinics across the state face increasing financial and workforce pressures.
Instead, the budget allocates $18 million to expand pharmacy prescribing, allowing pharmacists to treat a broader range of conditions, including high blood pressure. It also provides $27 million to continue Urgent Care Clinics (UCCs).
While these initiatives are framed as access and cost-of-living measures, they risk entrenching fragmented models of care that bypass GP-led continuity. High blood pressure, in particular, is not a minor or isolated condition. It is associated with high-risk conditions such as cardiac disease and strokes, so is not a “tick and flick” assessment.
AMA Victoria remains concerned about the safety, oversight, and clinical quality risks associated with pharmacy prescribing- particularly in the absence of mandatory data sharing with GPs, limited visibility over clinical decision-making, and a lack of robust governance. Pharmacists are not trained to diagnose complex conditions, do not have access to patients’ comprehensive medical histories, and are not equipped to manage comorbidities or provide continuity of care. We are also mindful of the commercial environment in which these services operate, where patients may be offered non-evidence-based products during consultations. Relevantly, there is limited evidence that this model meaningfully eases pressure on the broader health system. In a constrained fiscal environment, further expansion of pharmacy prescribing without rigorous clinical evaluation risks diverting patients and scarce public health resources away from more appropriate, integrated, and proven models of care- namely, general practice.
We continue to call for a coordinated, GP-led approach to care and for the State Government to back general practice as the cornerstone of the health system, rather than investing in parallel or substitute models.
Mental health
Mental health receives a strong investment, with $497 million in funding, including:
- 82 new mental health beds and 29 ED mental health and AOD hub beds
- Seven new Mental Health Locals, expanding the network to 22
- Workforce expansion, including more psychiatry training positions
- Tailored support for young people, parents, LGBTIQA+ communities, and Aboriginal Victorians
These measures respond directly to some of the system’s most pressing needs. AMA Victoria has consistently advocated for more beds, more staff, and a focus on early intervention. While we welcome the government’s continued commitment to delivering the Royal Commission’s recommendations, progress to date has been slow and uneven. We will be watching closely to ensure workforce shortages do not delay implementation, that funding flows efficiently to frontline services, and that medical expertise- particularly the leadership and insight of psychiatrists- is properly heeded in the design and delivery of care.
Women’s health and public health
The budget includes important initiatives under the umbrella of women’s health equity, including:
- Expanded maternity services in regional hospitals
- Parenting support programs across growth areas
- Culturally safe care for Aboriginal women
These are welcome and necessary investments. However, we note that expanded pharmacy prescribing is again being framed as a women’s health measure. While convenience matters, access to comprehensive, GP-led and specialist care remains critical and cannot be substituted with isolated transactional models.
Elsewhere, the $437 million expansion of the Victorian Virtual Emergency Department (VVED) is a notable digital investment. But broader public and preventative health measures- such as chronic disease prevention, community health strengthening, and immunisation access- are underdone. A sustainable health system requires a far more substantial shift upstream.
Looking ahead
This is AMA Victoria’s preliminary analysis of the 2025–26 Budget. While there are gains- particularly in hospital funding- we are concerned by the lack of investment in general practice and the growing trend toward fragmented or substitute models of care.
We will continue to work through the detail and engage with government in the days ahead. Our focus remains fixed on ensuring that this record investment delivers real outcomes- for patients, for the medical workforce, and for the long-term sustainability and integrity of Victoria’s health system.