The ratings on Victoria are supported by: our opinion of the strong institutional framework benefiting state governments in Australia, Victoria's very capable and conservative management, and the state's resilient and diversified economy. These strengths are offset--as with all Australian states--by an institutional framework that features some structural imbalance between revenue powers and expenditure responsibilities. The state governs in a supportive financial environment. In our opinion, Australia's system support and the predictability of federal-state relations are among the strongest in the world, and we expect this to remain so. In particular, Australia adopts a system of fiscal equalization, which is administered by an independent commission. Under this system, however, Victoria receives less than its average per-capita share of the goods
