Department of State Development, $674,320,000

Administered Items for the Department of State Development, $7,629,000

Membership:

Mr van Holst Pellekaan substituted for Dr McFetridge.

Mr Knoll substituted for Mr Goldsworthy.

Mr Duluk substituted for Mr Williams.

Minister:

Hon. K.J. Maher, Minister for Manufacturing and Innovation, Minister for Automotive Transformation, Minister for Aboriginal Affairs and Reconciliation.

Departmental Advisers:

Dr D. Russell, Chief Executive, Department of State Development.

Dr P. Heithersay, Deputy Chief Executive, Department of State Development.

Mr L. Piro, Executive Director, Industry and Innovation, Department of State Development.

Mr R. Janssan, Executive Director, Strategy and Business Services, Department of State Development.

Ms M. Antcliff, Director, Innovation and Strategic Projects, Department of State Development.

The ACTING CHAIR: Given that this is the minister's first estimates, I will just make him aware of the process; being from the upper house, it will be good for him.

The estimates committees are a relatively informal process and, as such, there is no need to stand to ask or answer questions. Standing orders apply, including my right to boot people out under the House of Assembly standing orders. I understand that the minister and the lead speaker for the opposition have agreed an approximate time for the consideration of proposed payments, which will facilitate a change of departmental advisers. Are we agreed on that?

The Hon. K.J. MAHER: Yes.

The ACTING CHAIR: I confirm that the timetable for today's proceedings previously distributed is accurate. Changes to committee membership will be notified as they occur. If the minister undertakes to supply information at a later date, it must be submitted to the committee secretary by no later than Friday 30 October 2015. This year, estimates committee responses will be published during the 17 November sitting week in corrected daily Hansard over a three-day period.

I propose to allow both the minister and the lead speaker for the opposition to make opening statements of about 10 minutes each should they wish. There will be a flexible approach to giving the call for asking questions, based on about three questions per member, alternating from side to side. Supplementary questions will be the exception rather than the rule. A member who is not part of the committee may ask a question at the discretion of the Chair—a very discreet Chair, too, I might say. Questions must be based on lines of expenditure in the budget papers and must be identified at the beginning of the question.

Members unable to complete their questions during the proceedings may submit them as questions on notice for inclusion in the House of Assembly Notice Paper. There is no formal facility for the tabling of documents before the committee. However, documents can be supplied to the Chair for distribution to the committee. The incorporation of material into Hansard is permitted on the same basis as applies in the house, that is, that it is purely statistical in nature and limited to one page in length. All questions are to be directed to the minister and not the minister's advisers. The minister may refer questions to advisers for a response.

During the committee's examination, television cameras will be permitted to film from both the northern and southern galleries. I declare the proposed payments open for examination and refer members to the Agency Statements, Volume 4. I now call on the Minister for Manufacturing and Innovation to introduce his advisors and then make a brief statement should he wish to do so. We will then ask the lead speaker for the opposition to make a brief statement, and then we will go on to questions. Minister.

The Hon. K.J. MAHER: I have with me from the Department of State Development Len Piro, Don Russell and Paul Heithersay and further advisers, if necessary, behind us. For the benefit of the committee, I might inform you, Chair, that we have had some negotiations and, as you are aware, the running time for this particular estimates committee has been reduced to one hour rather than two hours for the manufacturing and innovation portfolio, with automotive transformation remaining at half an hour.

As a result of these negotiations, only opposition members will be asking questions today, rather than government members, and I do place on record that these arrangements for this year do not alter what the proceedings might be in future years for this particular portfolio. I place on record my thanks for the cooperative way in which the member for Stuart has engaged to allow this committee to run as efficiently as possible and, indeed, how he has engaged in these portfolio areas over the last six months. I will make a very brief opening statement and then hand over to the member for Stuart.

Chair and committee members, thank you for the opportunity to briefly outline the government's activity in this area in shaping an innovative economy, one in which manufacturing must continue to play a significant part if South Australia is to be competitive in a challenging global environment. In order to grow, South Australian manufacturers must increase their capabilities and their competitiveness. Not all our local businesses can easily access the tools of transformation, such as cutting-edge technologies and specialist advice, and we believe that enabling access to these resources is a sound and strategic investment in the future of South Australia's economy.

In October 2012, we launched Manufacturing Works, a strategy to accelerate the transition to a high-value, advanced manufacturing economy. The strategy has received $11.1 million to fund a range of initiatives to help build businesses and workforce capability, to accelerate the uptake of new technologies and to identify and access new markets and increase collaboration between industry and the research sector.

As we know, there are significant challenges ahead for our manufacturing sector, particularly in Adelaide's north, which will be disproportionately impacted by the closure of Holden. The state budget provides $5.4 million for the development and implementation of the Northern Economic Plan. The Northern Economic Plan will support the industrial transformation of northern Adelaide and deliver a vision, strategies and tangible actions to drive this transformation.

We have also committed $2 million to the development of a new food park which will involve co-locating food manufacturers and processors with packaging specialists and storage, logistics and transport companies, with the goal of increasing efficiencies and competitiveness. These developments in northern Adelaide will be assisted by the suite of state government tax reforms which focus on removing impediments to business growth and job creation.

Our work in the north and with industry to transform manufacturing aligns with our commitment to support local industry and workers in the light of Holden's closure by the end of 2017. In January 2014, the Premier announced Our Jobs Plan which committed $60 million over four years to prepare South Australia for Holden's exit and its consequences for business, employment and economic opportunities.

The state government's Automotive Transformation Taskforce, chaired by Greg Combet, has been established to implement Our Jobs Plan and to manage responses to the closure of the automotive manufacturing sector and the ripple effects right throughout South Australia. The task force oversees programs such as the Automotive Supplier Diversification Program, which has been allocated $11.65 million to help auto supply chain companies diversify into the supply chains of other sectors.

There are also other programs within Our Jobs Plan that focus on manufacturing and innovation portfolio priorities, particularly by accelerating the transition to advanced manufacturing. For example, we have created industry clusters in sectors important to the future of the economy, such as defence, medical technologies, the creative industries and water. We have also implemented programs such as the Innovation Voucher Program, the Manufacturing Technologies Program and the Business Transformation Voucher Program, all of which support the implementation of new technologies, systems and practices to improve productivity.

Through Our Jobs Plan, the South Australian government is providing $7.3 million to help workers affected by the closure of the automotive industry. This funding is administered through the Automotive Workers in Transition Program, which was launched in December last year. The program offers support, including information sessions, career advice and transition services, skills recognition, training and business start-up advice to automotive sector workers.

Earlier this year, the Career and Workforce Development Centre at Warradale was opened to deliver Automotive Workers in Transition programs for those workers based in Adelaide's southern suburbs. The Warradale centre complements the one at Elizabeth and reflects our understanding that businesses and workers right across the metropolitan area are affected by the changing economic landscape.

Finally, the government's $253 million investment into Tonsley's redevelopment is well underway, with major research, education and training providers, TAFE and Flinders University joining companies known for their innovative approaches, including Siemens, Hills Limited, ZEN Energy and Signostics on the site. Tonsley provides an excellent representation of our government's work to foster sustainable manufacturing capabilities in sectors that will be critical to our future growth.

An environment of innovation provides the infrastructure, finance, information, institutions and people with skills and connections to support companies willing to take the risks and then reap the rewards of business change. This is what we are aiming for and, indeed, what we are achieving at Tonsley, and Tonsley will serve as a model for future initiatives across business, across industries and across the state. I welcome the opening statement and then questions from the committee.

Mr VAN HOLST PELLEKAAN: I have just a brief opening statement. We do need to change. Certainly, our manufacturing sector across the state needs to change, and no doubt that is happening all over the world. It is not because there is anything wrong, usually, with our manufacturing companies or our manufacturing workers. Certainly, there can be individual problems from time to time, but it is not a blight on our industry.

Even from a wages perspective, the rest of the world is starting to catch up with us. The gap we used to have between Australia and the rest of the world exists, but it is a lot smaller and it will continue to narrow; that is not really the issue. Any individual company, of course, can have its own issues but, on average, the problem for manufacturing in South Australia as I see it is that our Australian population is not nearly large enough to achieve economies of scale of production in most cases, and we are a very long way away from the rest of the world with regard to accessing other customer bases.

Asia is closer, with Europe and North America being further away, and Africa is potentially down the track if they have the money to buy what we make. That is really the issue: that we are trapped in South Australia and in Australia needing to produce more than our market will accept but, of course, being a long way away from another market. If you are producing heavy, lumpy, chunky, expensive to transport and freight items like cars, it makes it nearly impossible.

Yes, advanced manufacturing is the way forward, but it is not the only way. I think anything that is relatively small, light, safe and easy to transport is also a manufacturing opportunity for our state. It might be that we manufacture more and more components that are exported into production systems overseas rather than completed items into the future. Yes, it will be high-tech but I urge everybody interested in this sector not to forget that light, small, easy-to-freight items are certainly an important opportunity for us as well.

Employment has to be the key and not only just keeping jobs but keeping jobs where they currently exist, trying to find alternative employment opportunities for Holden workers and other auto industry workers near where they are currently employed. That is going to be vitally important to keep the communities intact where they live and work and keep to them healthy, otherwise the ripple effect becomes pretty significant even if jobs can be replaced. Even if people were prepared to move, it does not help the local community if the jobs are elsewhere and people have to move.

Lastly, it is pretty difficult in opposition to sometimes see through all of the accounting and the budget presentation in this area—it is true of other areas too—but there is a series of successive announcements and re-announcements and I accept that is a feature of government and it has been for decades, but my questions today will really be about trying to get some detail. A very easy example of that is $60 million back in 2014 from the state government for the Our Jobs program and then the commonwealth's $155 million program which included state government money. So, you get two announcements, etc., and I am sure there is a prize internally in government—whether for ministers or departmental people—for how often money can be re-announced and saved, essentially, so I will be trying to get to the bottom of some of that and would appreciate the minister's cooperation.

I refer to Budget Paper 4, Volume 4, page 110, under objectives: reinforce the competitive strengths of the SA economy. Minister, how many full-time and part-time manufacturing jobs are there currently in South Australia? I do not think I picked it up in your opening statement, but what is your current best estimate of that?

The Hon. K.J. MAHER: Before I answer that question, I might just respond to a couple of comments from the opening statement. I agree with the member for Schubert that it is going to be essential that what we made in the past—what our grandfathers might have made—will be very different from what we do in the future where we are moving to make different things.

Traditionally, for half a century we have made big items, as you have stated—cars, white goods—and it is going to be very different. We will not be a jurisdiction that can compete solely on cost anymore; we have near neighbours in the Asia-Pacific region who will be able to make some of these things cheaper than we can. What we are going to be competing on is the value, quality and innovation of what we make.

We are starting to see us transitioning to that higher quality, higher value manufacturing area and, of course, light and small—it is much easier to transport. A really good example of that is Hegs Pegs. These are really innovative clothes pegs that have been previously manufactured in China, and just recently the manufacturer of these pegs has brought every part of the manufacturing process back to Adelaide, which is a fantastic story. It demonstrates, with innovative manufacturing processes and also a very small item, where we can go in the future.

In relation to the specific question about the number of jobs, I might do it in two ways, and talk about the number of manufacturers as well as the number of manufacturing jobs. In 2014, there were 6,300 manufacturers in South Australia, representing 4 per cent of all businesses. Despite a small proportion, in terms of the 4 per cent of all businesses, manufacturing has traditionally accounted, and continues to account, for a high share of economic activity in this state, including 8.3 per cent of the state economy, 8.9 per cent of state employment, 15 per cent of all wages paid to South Australians, 32 per cent of all business expenditure on R&D, and 39 per cent of all goods exported.

Manufacturing's contribution to the economy in terms of industry value-add increased 2 per cent in 2013-14 to $7.5 billion. In terms of some very specific employment numbers, while manufacturing remains a core driver to the state economy and we are rapidly pursuing higher value-added and productivity improvements, as is probably expected with the decline in automotive and other areas, manufacturing employment has declined in the past two years by almost 10 per cent to currently about 72,500 manufacturing jobs. It should be noted, however, that the Australian Bureau of Statistics is a database survey and, therefore, is subject to great volatility. I note that many of these indicators are respondent-led answers, so people define themselves in what jobs they are in; so from survey to survey there is a fair bit of volatility. I think that answers the question.

Mr VAN HOLST PELLEKAAN: Of the 72,500, what share is full time versus part time?

The Hon. K.J. MAHER: I can take that on notice and bring back a response. I do not have that breakdown of the ABS data. I am not sure it exists, but if it does I will bring back an answer.

Mr VAN HOLST PELLEKAAN: We are familiar with the programs—and we will learn more about that today—but does the government have a target for manufacturing jobs growth or even a limited number of jobs lost? To be really clear, this is a question that I asked last year in estimates along the same lines. It was along the lines: we have got these programs, and there is money to be invested and effort being made, but how will you know if you have succeeded? A year ago the advice was well, 'Well, actually, no, we don't have targets and we won't know how successful we've been. We're just going to do our best.' Is that still the case, or are there targets in place to know whether this taxpayer money has been used wisely and successfully?

The Hon. K.J. MAHER: I will answer that in two ways: there is not a nebulous global target for jobs. Many of the programs we have in manufacturing are about new industries and leading new industries, but they do not necessarily easily lend themselves to have a KPI with a number of jobs when you are trying to develop new industries and new technologies. However, we do look at the programs that we run and make an evaluation, in some respects, of how successful they are, bearing in mind that a lot of it is about creating new industries, not necessarily a specific number of jobs.

An independent evaluation of the Manufacturing Works strategy by global consulting firm Frost & Sullivan, completed very recently, found that the strategies already generated significant benefits for the 232 participating manufacturers. These have included, from the Frost & Sullivan evaluation, an estimated 290 new jobs created to April 2015, $88 million of additional revenue for participants, and $26 million of value added to the South Australian economy. Perhaps, most importantly, the Frost & Sullivan review found that the companies that had received support through Manufacturing Works performed better than the broader manufacturing industry.

For example, sales income increased for participants by 2.7 per cent, compared to a decline of 6.5 per cent in the wider industry. Similar results were achieved in employment and sales per employee. Also, based on the four-year funding period, Frost & Sullivan estimate the total future impact of Manufacturing Works will be $229 million of additional revenue, $56 million of value added to the wider economy, and 847 new jobs. So, although there are no hard targets set down by what is necessarily a program that is aimed at creating new industries, we do, of course, as a government, look at how effective different programs are to make an assessment of what is the best way for taxpayers' money to be spent.

Mr VAN HOLST PELLEKAAN: That assessment of 847 jobs coming is a very small number compared to the jobs that have been lost already, but every job does count so we are grateful for every one. Does the fact that there is no particular target mean that the 30-year Plan for Greater Adelaide target, which was established at 52,400, is still relevant or no longer relevant? How does that fit in?

The Hon. K.J. MAHER: I can only speak for my portfolio areas and certainly what we are doing is aimed at creating jobs. There are no specific targets that involve X number of manufacturing jobs. It is about the new technologies of the new manufacturing processes.

Mr VAN HOLST PELLEKAAN: Those 52,400 jobs were specifically manufacturing jobs. I submit that it is relevant to your portfolio.

The Hon. K.J. MAHER: I can take that on notice and have a look at how that might interact with my portfolio areas.

Mr VAN HOLST PELLEKAAN: That would be good, thank you. Page 111 in the same book. I think we are in the same book for the whole time.

The Hon. K.J. MAHER: We are. We are staying on about four different pages.

Mr VAN HOLST PELLEKAAN: Please outline what initiatives were implemented in the manufacturing and innovation program to achieve the $2.5 million savings for 2014-15?

The Hon. K.J. MAHER: Which particular line are you referring to?

Mr VAN HOLST PELLEKAAN: The estimated result, actual savings, where it says 'savings initiatives in general operations' which is dot point 2. It is about a quarter or a third of the way down the page.

The Hon. K.J. MAHER: I am advised that there are a number of components from the savings and they are associated with savings from the Small Business Innovation Research pilot program and the Strategic Industry Development Fund and also a reduction in salary expenditure to meet FTE savings targets.

Mr VAN HOLST PELLEKAAN: Saving money is always a good thing, but in the current situation the industry is in decline and everybody is, quite rightly, doing everything they possibly can to support the industry, because once jobs are gone they are gone and once companies are gone they are gone. Was this a deliberate savings measure or was this something that just happened by chance? How is it that you have saved this money from those programs? Wage reductions, for example? It seems to me that this is an area that the government should be going hell for leather as hard as they possibly can to effectively and usefully spend the money that is available to try to help our manufacturing sector transition.

The Hon. K.J. MAHER: In a perfect world I am sure if every portfolio had tens of millions of dollars more they could find ways to spend it, but in a fiscally constrained world each area of government does make savings.

Mr VAN HOLST PELLEKAAN: So this was a deliberate saving target and not an outcome of just not spending the money?

The Hon. K.J. MAHER: It is a combination of both. I can take it on notice to bring back exact details.

Mr VAN HOLST PELLEKAAN: That would be great.

The Hon. K.J. MAHER: I do not want to provide anything that might not be entirely correct, so I am happy to take it on notice. The components were money that was not spent or things that were deliberately looked at as necessary savings and, as you would appreciate, the juggling of different priorities to decide what is the most effective.

Mr VAN HOLST PELLEKAAN: This is not an area of trying to cut out government waste: this is an area where spending has specifically been established to try to support the decline of a sector. My view, at least, is that this is not the place to be taking deliberate savings. You do not want to waste the money, but not to take deliberate savings.

At page 110, what is the total expenditure for your ministerial offices? How many FTEs have you got based in your office?

The Hon. K.J. MAHER: My advice is that, as I outlined in the budget papers, my ministerial office has a budget of $1.299 million for the 2015-16 financial year, comprising $0.883 for employee expenditure and $0.466 for supplies and services. The funding provides for seven FTEs and the office has an additional six FTEs from departmental budget lines.

Mr VAN HOLST PELLEKAAN: So, 13 staff in total work in your office, seven directly, six MLOs and that sort of thing?

The Hon. K.J. MAHER: Yes.

Mr VAN HOLST PELLEKAAN: Are any of those staff being paid but not working for some reason or another? Everybody is on the job, actively involved?

The Hon. K.J. MAHER: Certainly, every time I walk through the office they all look very busy—and I am sure it is not just when I am walking through the office. I am sure they are pretty busy all the time.

Mr VAN HOLST PELLEKAAN: Minister, referring to page 112, targets for 2015-16, where it says 'Continue to deliver Our Jobs Plan', can you provide an update on the industry road maps for South Australia's new industries to support economic diversification?

The Hon. K.J. MAHER: I will have to bring back much greater detail, but the manufacturing technology, ICT and luxury food road maps are either in the process of being completed or completed. The exact details of each one of those, exactly where it is up to and what the result was, I am happy to bring back an answer.

Mr VAN HOLST PELLEKAAN: Do you know, yourself or through your advisers, whether the expected commonwealth government contribution was received for the industry road maps?

The Hon. K.J. MAHER: I have been advised that, as far as the department is aware, there have been no commonwealth government contributions, which I share your disappointment in.

Mr VAN HOLST PELLEKAAN: Because that was outlined in the Our Jobs Plan.

The Hon. K.J. MAHER: There certainly are, in this area of the state government, a large number of areas where we would hope for much greater commonwealth support that has not been forthcoming. We will not cross over portfolios but next is automotive transformation and that certainly is an area where we had hoped for and expected much greater commonwealth support than we have received.

Mr VAN HOLST PELLEKAAN: And, as I said before, it is sometimes very hard, certainly from opposition, to unpick all of these details. It might not be in one place, it might be in another, state and federally. I look forward to getting that answer when you provide it. I refer to page 112 and the same line, in fact. What was the total expenditure for the government's Our Jobs Plan in 2013-14, 2014-15, budget for 2015-16, and estimates for 2016-17 and 2017-18?

The Hon. K.J. MAHER: I do not have the actuals for 2013-14 and 2014-15 but I can provide those. I can run through the budget that was for those years and for the next two years and then bring back the actuals for the first two years that you have requested. The budget for—

Mr VAN HOLST PELLEKAAN: Sorry, minister. You do not have an estimated actual for 2014-15?

The Hon. K.J. MAHER: Yes. Sorry, I can go through what was budgeted for for all of those years, I can go through what the budget is for 15-16, what the estimate is for 16-17 and then bring back the actuals for 2013-14 and 2014-15. The budget for the implementation of Our Jobs Plan for 2013-14 was $5.1 million; for 2014-15, $9.78 million; for 2015-16, the budget is $22.62 million; and for 2016-17, $17.38 million. I do not have the information but I am sure it will not be too hard to find to bring back the actuals for 2013-14 and 2014-15.

Mr VAN HOLST PELLEKAAN: I agree. I refer to page 112 and the dot point beginning, 'Continue to deliver Our Jobs Plan'. Our Jobs Plan states that the South Australian government will work with the federal government to bring forward high priority economic infrastructure projects, including construction of the Northern Connector. Can the minister provide an update on how the government is progressing with bringing the Northern Connector project forward?

The Hon. K.J. MAHER: I am aware that discussion continues on that and a whole range of projects and ones that you would be well aware of like the Strzelecki Track and other projects that will open up economic benefit to South Australia. These are not in my portfolio areas. Obviously they are in the portfolio areas of the Minister for Transport. Exactly where those are up to in terms of those road projects would be better directed to him, but certainly I know that there is continuing discussion with the federal government on these and a whole range of other matters.

Mr VAN HOLST PELLEKAAN: Even though it is in the Our Jobs Plan, it is not your responsibility?

The Hon. K.J. MAHER: No, there are many things that will help create jobs in manufacturing that rely on a whole lot of other ministerial areas.

Mr VAN HOLST PELLEKAAN: Well, minister, what areas then are within your responsibility?

The Hon. K.J. MAHER: Do you have a specific question? Far too many—we will be here for the rest of the estimates committee, but if you have a specific question on a particular one of them that is within my portfolio that is not a road or with the Minister for Transport, I would be happy to answer it.

Mr VAN HOLST PELLEKAAN: Okay, so any roads—

The Hon. K.J. MAHER: Building a road is not within the Minister for Manufacturing and Innovation's portfolio area.

Mr VAN HOLST PELLEKAAN: Even if it is a target of the Our Jobs program, it is not something that you work together on?

The Hon. K.J. MAHER: I liaise very closely with all my ministerial colleagues on a whole range of areas but, if it is a road, it will be with the Minister for Transport. So, if there is another road you are interested in, I can pre-empt your question by letting you know it is the Minister for Transport's responsibility.

Mr VAN HOLST PELLEKAAN: Minister, I refer to page 112 and targets 2015-16 under the dot point beginning, 'Continue to build South Australia's industry capability to innovate through supporting cluster development, entrepreneurship and commercialisations'. Our Jobs Plan states that the state government will contribute $5 million towards supporting new smart specialisation clusters and precincts where future industries can work together to innovate, create jobs and secure export growth. What was the expenditure for this innovation in 2013-14, 2014-15 and the forward estimates please?

The Hon. K.J. MAHER: As the member has pointed out, Our Jobs Plan includes funding allocated of $5.14 million over four years to support the development of industry-led clusters in a number of areas, particularly: defence, creative industries, water, medical device and ICT (ICT in the mineral and resource sectors). The cluster program seeks to support globally competitive industries to collaborate and innovate in order to access international markets and generate wealth for South Australia.

The first cluster supported was the Aerospace Alliance. This cluster of defence supplies is engaging with the broader aerospace markets globally. In October 2014, Cobham, an aviation firm headquartered in Adelaide, secured a $640 million contract to supply, integrate, maintain and operate search and rescue aircraft for the Australian Maritime Safety Authority, and Aerospace Alliance is going along very well. I know the members of that industry cluster are working together extremely efficiently. I think we were together at Cobham for the launch of that a number of months ago and were sorely disappointed that all the young people were not turning out for our arrival but were there for One Direction's arrival just next to Cobham.

There are two CleanTech water industry-related clusters that have been formed in collaboration with the Water Industry Alliance. The first relates to managed aquifer recharge technology and the second relates to water treatment in remote locations. A creative industry cluster focused on the nexus between music and technology has been formed, which I have visited already. The Musitec cluster supports the technologies that underpin the music industry.

In terms of specific funding allocated, what I might do is go through the budget allocations. This year's financial results have not been closed off so I will go through the budget allocation for the same four years, 2013-14 up to 2016-17, and take on notice and bring back the actuals for 2013-14 and then in about a month when 2014-15 is closed off bring back the actuals for that as well. For the cluster program the 2013-14 budget was $715,000, for 2014-15 it was $1.475 million, for 2015-16 it is $1.575 million and for 2016-17 it is $975,000. I will bring back once the 2014-15 year is closed off and also the result that we will have floating in a book somewhere for the actuals for 2013-14.

Mr VAN HOLST PELLEKAAN: Thank you, minister. Page 111, the second dot point under highlights, 'Delivered Manufacturing Works programs and initiatives'. Does any part of the manufacturing works strategy specifically include the electronics industry?

The Hon. K.J. MAHER: There is no specific line or reference for the electronics industry within that program, however, it is a very important industry to South Australia. I do not have the figures with me but we have quite a huge share of the Australian electronics industry in South Australia and we recognise that. Right across our programs are all the business vouchers and innovation vouchers. All the programs we have are open to the electronics industry. As a government, we recognise the value it provides to South Australia. Some of Australia and the world's leading electronics manufacturers and electronic component manufacturers are based in South Australia.

Mr VAN HOLST PELLEKAAN: That is certainly very true. It can sometimes be hidden because it can be a component, essentially an ingredient, into somebody else's success, but it can also be an export, the parts can be exports in their own right. I would suggest to you that is a sector that we are already doing very well in, but it is still a rich area for growth as well, and you do not get that at the same time very often. So, I am pleased the government is becoming focused on that.

Page 112, targets, 'Continue to deliver Our Jobs Plan programs'. The Our Jobs Plan states that the state government will contribute $2.68 million towards supporting local entrepreneurs to turn good ideas into successful ventures through a number of start-up initiatives. What was the expenditure for 2013-14, 2014-15 and the forward estimates period? It is a similar style of question to try to get that information and I predict that you might answer it the same way.

The Hon. K.J. MAHER: We could spend some time here, but I fear we would be wasting your valuable time for asking questions. There are a number of programs that fall into that category, such as the venture capitalist program, the Innovation Voucher Program, the recently set up SA Micro Finance Fund, but it will take us a while to get together the estimates and expenditure for each of those. I might take that on notice, so that we do not spend five minutes here trying to pull those together for you and bring back an answer.

Mr VAN HOLST PELLEKAAN: I have another question that is not looking for a dollar value: how many start-ups and entrepreneurs has the government assisted to date through this program?

The Hon. K.J. MAHER: Again, I will take that on notice and bring you back an overall sum from all those programs. There are quite a number of them. I know I regularly see coming across my desk the recommendations that are approved for entrepreneurs and start-up. I might specifically mention one that we have just started in recent months—the South Australian Micro Finance Fund, where there are grants of up to $50,000 for very new start-ups and for emerging technologies to use.

That was highly successful and I am hoping that we will see some very interesting work come out of that to help our start-up community. I know these sorts of accelerator and incubator programs are very successful in many other places around the world. In fact, one of the recipients of the first round of the Micro Finance Fund is currently in the MassChallenge, the world's largest of those accelerator programs. They received an SA Micro Finance Fund and have now gone on to the world's largest incubator. I think Makers Empire are in Boston at the moment developing their start-up venture.

Mr VAN HOLST PELLEKAAN: I will look forward to getting that information, because obviously we want to support existing industries as much as possible, but the whole economy will not achieve what we need it to achieve if we are not supporting those start-ups and entrepreneurs as well. Referring to page 12, 'Continue to deliver Our Jobs Plan'—the same area as last time—minister, please provide an update on how the government is progressing with establishing a jobs acceleration fund to assist businesses to invest in new economic activity that creates jobs as part of the Our Jobs program.

The Hon. K.J. MAHER: Twenty million dollars has been budgeted for the jobs accelerator. We were hoping for some significant funding from the commonwealth that did not eventuate. However, we did use a majority of that $20 million as our contribution to leverage off the commonwealth for the next generation program and, on top of that, there are some other areas where we have put the remainder of that $20 million.

I am happy to bring back the exact amounts and exactly where it has gone to but, certainly, when we did not receive matching commonwealth money for that particular program, we made the decision to put the majority of the Jobs Accelerator Fund into the Next Generation Manufacturing Investment Program that attracted significant commonwealth funds. I think one round of grants are about to be made for South Australian firms.

Mr KNOLL: There is a jobs accelerator program that was announced in last year's budget as part of the agreement with the member for Frome—the $10 million Regional Jobs Accelerator Fund. Has any of that money been used and transferred into the next generation fund? Has that got anything to do with this portfolio area?

The Hon. K.J. MAHER: I am advised that is a completely different thing.

Mr VAN HOLST PELLEKAAN: On the same line, minister, how many business transformation vouchers has the government awarded, and what was the total expenditure for each financial year over the past two years, please?

The Hon. K.J. MAHER: Excellent question.

Mr VAN HOLST PELLEKAAN: Finally found an answer!

The Hon. K.J. MAHER: Your colleague in the Legislative Council, the Hon. Andrew McLachlan, regularly asks me very specific questions on this and a couple of other programs, so it is one where I have information at hand.

Mr VAN HOLST PELLEKAAN: He is a very thorough chap.

The Hon. K.J. MAHER: By way of background, the Business Transformation Voucher Program has a budget of $4.5 million over four years to 30 June 2017. To date, the program has supported 37 companies from 76 applicants with a total of $1.435 million to support their transformation. These companies have provided over $2.1 million towards their business transformation projects, exceeding the required dollar for dollar cofunding ratio.

Again, I will get the actuals for the 2013-14 and 2014-15 years, but I will go through the same budgeted amounts. In 2013-14, it was $0.5 million; in 2014-15, $1.5 million; in 2015-16, $1.5 million; and, in 2016-17, $1 million. Again, I will bring back the actuals for 2014-15, once it is closed off, and I will also bring back the actuals for 2013-14.

Mr VAN HOLST PELLEKAAN: On page 113, I am looking at the 2015-16 budget and the 2014-15 estimated result, under the commencement of expenditure for the Northern Economic Plan, dot point 2. Please outline how the $2.2 million is being spent on the Northern Economic Plan, which you will see about a third of the way down the page.

The Hon. K.J. MAHER: As the budget line indicates, it is the commencement of expenditure for the Northern Economic Plan. Only a small part of the $2.2 million has been spent so far in developing that plan. There have been consultations with some of the significant stakeholders, including councils. Over the next few months, we will be spending a lot more of that as we have much wider consultations with industry and with the community. I am happy to provide updates from time to time on how the Northern Economic Plan is progressing.

This is one of the more significant things we need to get right as a government. As I think we both mentioned in our opening statement, the effect of the loss of manufacturing jobs is going to be felt more acutely in northern Adelaide. We are committed to engaging with, as we have, local council, with community and with industry in those areas. Only a small amount has been expended so far as the commencement of expenditure for the Northern Economic Plan starts. It certainly ramps up much more significantly over the coming months and over the next couple of years.

Mr VAN HOLST PELLEKAAN: If a small amount of the $2.2 million has been spent so far and it ramps up over coming years, when will the plan actually be completed and released?

The Hon. K.J. MAHER: We have the initial discussion paper which has been completed and which you would have seen. We anticipate that sometime in the next few months we will have a much broader, much bigger and more developed paper taking into account northern Adelaide's community concerns, desires and wants and also what we know from starting a consultation as to where jobs will be and what potential projects will be underway. I am loath to put an end date on something that you want to properly consult on, but I have in my mind somewhere towards the end of this year.

Mr VAN HOLST PELLEKAAN: No, that is helpful; that is your target, your best estimate.

The Hon. K.J. MAHER: And that is the development, that is for a plan. Of course, the implementation of what is in that plan will continue forward.

Mr VAN HOLST PELLEKAAN: That is right, that is what really counts; you have answered that, thank you. You mentioned consultation with councils. Can you delve into that a little bit more because I get the feeling from talking with councils in the northern areas that they would like more consultation. Is that because there is a difference in views or because there is more about to happen, or do you think they have had sufficient?

The Hon. K.J. MAHER: I have been very pleased with how I have been working with councils. There is a community leaders group which is steering the Northern Economic Plan and which comprises myself and the mayors of Port Adelaide Enfield council, Salisbury council and Playford council. An implementation group sits under that and includes the CEOs of those councils. I have visited a number of these councils and the whole of the council members to talk to them, and I regularly have meetings with these councils and their mayors.

Certainly, the mayors of those councils—and I am their chief executive—share the sense of urgency we have to make sure that we get this right in the development of the Northern Economic Plan. I am regularly getting text messages from some of the mayors about some of their ideas as they think of them, so I would hope that there is not a feeling that they are not being included because we are doing all we can to recognise that all levels of government have to work together to face the challenges in northern Adelaide.

Mr VAN HOLST PELLEKAAN: What input have you had from the office of the northern suburbs?

The Hon. K.J. MAHER: We have had a degree of input and we will have continuing input in that implementation group and as we set up subgroups in the Northern Economic Plan. The part I failed to mention as well is that, apart from myself and the mayors on that leaders group, there are a number of business leaders from northern Adelaide as well, and certainly on the implementation group there are a number of business leaders who will be critical to successfully implementing that plan as well.

Mr VAN HOLST PELLEKAAN: The Northern Economic Plan is obviously underway as we are discussing, but the government has a 30-year plan as well. Will the Northern Economic Plan diverge significantly from the existing 30-year plan? Obviously, it is not complete so you do not know, but in these initial stages are you finding there are new directions emerging, or will it be very similar?

The Hon. K.J. MAHER: I am not finding significant divergence, and if I had a crystal ball I would look in it to find out exactly where that is going and how it will look. Certainly, the 30-year plan is a plan to look at what will happen in 30 years. The Northern Economic Plan will look very specifically at some of the projects and some things we can do in northern Adelaide. It will not ignore work that has gone before and will build on any work, whether it be the 30-year plan or other work that has happened in the past.

Mr VAN HOLST PELLEKAAN: There is nothing coming out of the work done so far in the Northern Economic Plan that indicates that the 30-year plan needs to be adjusted?

The Hon. K.J. MAHER: As I say, we are just at the initial stages of the Northern Economic Plan.

Mr VAN HOLST PELLEKAAN: I refer to page 112, targets, coordinate the delivery of the Northern Economic Plan, the fourth dot point. What measures have been considered so far to address youth unemployment in the northern suburbs as part of the Northern Economic Plan? I understand it is still being developed, but I am sure that it must be one of the highest considerations for you.

The Hon. K.J. MAHER: Absolutely, and it is something that we have talked about in meetings with councils, with business leaders, projects specifically that, as you earlier pointed out, provide jobs and provide jobs where jobs are going to be lost. Youth unemployment is certainly a big issue that we will be addressing. We are at the start of this process.

Mr VAN HOLST PELLEKAAN: I understand that, but there are no revelations this year yet. The reason I ask is that I understand the plan will not be completed and released for a while, but youth unemployment is an extremely immediate problem.

The Hon. K.J. MAHER: I can absolutely assure you that if I had a magic bullet to solve youth unemployment anywhere in South Australia, I would be more than happy to share it with you right now.

Mr VAN HOLST PELLEKAAN: Yes, of course you would, and I would too if I had it. What I am getting at is that for an unemployed youth to wait six or 12 or 18 months for productive suggestions—

The Hon. K.J. MAHER: It might be helpful to point out that as we identify potential projects we are not going to wait for anything to conclude or for any stage in the Northern Economic Plan to be finalised. If there are things we identify as we go along in developing this plan that can be done, we will do them.

Mr VAN HOLST PELLEKAAN: Before the release of the plan?

The Hon. K.J. MAHER: Absolutely.

Mr VAN HOLST PELLEKAAN: That is great. I refer to page 111, estimated results, estimated versus actual, Advanced Manufacturing Council, dot point 6. Now that the Advanced Manufacturing Council has been transferred to the Economic Development Board, has the subcommittee of the Economic Development Board been established for advanced manufacturing?

The Hon. K.J. MAHER: Effectively, yes. It is a subcommittee about evaluating, which includes, very prominently, advanced manufacturing.

Mr VAN HOLST PELLEKAAN: Can you provide any outline of the work, any achievements?

The Hon. K.J. MAHER: I can certainly take that on notice. I do not have the achievements of every committee of the Economic Development Board with me, but I can take that on notice.

Mr VAN HOLST PELLEKAAN: When did you last meet with representatives of that subcommittee?

The Hon. K.J. MAHER: Within recent weeks I would have met with the board, which includes members of that subcommittee, and certainly I would almost on a weekly basis have contact with members of the EDB—or at least every fortnight—who are involved in work that is important to these areas. I would like to place on record my appreciation of the Economic Development Board and its individual members for what I think is the exceptional service they provide to this state and to this government.

Mr VAN HOLST PELLEKAAN: Is Greg Combet on that subcommittee?

The Hon. K.J. MAHER: No, he is not on the Economic Development Board and he is not on its subcommittee. While I am on the topic of thanking people for their great work, Greg Combet has been invaluable not just to me as minister but to previous ministers for manufacturing and automotive transformation. Again, Greg is someone whose knowledge in this area I would use almost on a fortnightly basis.

Mr VAN HOLST PELLEKAAN: I refer to page 111, highlights, continued to lead the Tonsley redevelopment. How many additional companies have moved to or started operations at Tonsley in the last financial year?

The Hon. K.J. MAHER: I am not certain that I will have in here the dates that companies started operations at Tonsley. I will take that on notice and maybe bring back a comprehensive reply about the dates when companies have started over the last 12 months.

Mr VAN HOLST PELLEKAAN: If it is alright with the Chair, I will ask you questions to take on notice. How many companies have moved to or started operations at Tonsley? During the same period (last financial year) how many have ceased operation? Were any of the companies that ceased operation grant recipients? How many other potential tenants is the government negotiating with at the moment?

The Hon. K.J. MAHER: I will take those on notice and bring back a reply to all but your last question. I am pretty sure I will not talk about how many we are negotiating with at the moment.

Mr VAN HOLST PELLEKAAN: You could not give a number to say there is six or 26? I am not asking for the substance of the negotiations.

The Hon. K.J. MAHER: I will take some advice from my department about the wisdom of bringing back details about how many or what we might be negotiating and bring back a reply to the others and, if appropriate, bring back a reply to that one.

Mr VAN HOLST PELLEKAAN: Thanks, minister.

The ACTING CHAIR: While we are on the subject of Mr Combet, I also would add my thanks for his work on behalf of the government from when I was a minister. He was excellent and no doubt continues to be. There being no further questions, we will switch to the Minister for Automotive Transformation.

Membership:

Mr Goldsworthy substituted for Mr Knoll.

Mr Williams substituted for Mr Duluk.

Departmental Advisers:

Dr D. Russell, Chief Executive, Department of State Development.

Dr P. Heithersay, Deputy Chief Executive, Department of State Development.

Mr L. Piro, Executive Director, Industry and Innovation, Department of State Development.

Mr R. Janssan, Executive Director, Strategy and Business Services, Department of State Development.

Mr P. Tyler, Director, Automotive Transformation, Department of State Development.

The ACTING CHAIR: I invite the minister to update us on the change in advisers. Feel free to make a very brief statement on this subject and then we will rip into questions again.

The Hon. K.J. MAHER: We have Phil Tyler and I have no opening statement.

Mr VAN HOLST PELLEKAAN: I will just make a very short introductory statement on this area. I really do understand how vitally important this area is. I am not from the northern suburbs, I am from the north of the state, but there are a lot of parallels and I really do understand the criticality of this work.

I would also like to put on the record my appreciation for what I understand is still taking place at the Holden factory, which is that the management and the workers are doing an exemplary job and that they recently won an efficiency and productivity award from within the broader GM group. I am sure that they do not hand those out just to make the people feel good who are not going to be here in a few years' time. If they wanted to use those for any other reason they would give them to the affiliates from within their company that they expect to be working with, so they really deserve an enormous amount of credit for doing an exceptionally good job under exceptionally trying circumstances. While many of their colleagues are losing their jobs more quickly than was expected, those who remain are really battling on wonderfully well.

I would also just like to put on record something of which the minister is aware. I have put in writing and in person to the Premier that I think that the automotive transformation portfolio really needs to be expanded beyond the auto industry at the moment. It is not because the auto industry has any less importance or any less urgency, but the issues that are affecting the auto industry in the north of Adelaide are month after month broadening to affect many other industries.

Exactly the same issues that affect the auto industry are affecting mining, defence industries, other manufacturing and power generation. With 8.2 per cent unemployment across our state now, the highest in Australia at the last count, I think that, with all respect to the auto industry which is absolutely vitally important, the challenges it faces are far broader now than just the auto industry and that really we have an industry and employment transformation challenge, not just in the automotive industry at the moment.

Budget Paper 4, Volume 4, page 113, sub-program 10.2: how much of the 2013-14 and 2014-15 expenditure on automotive transformation was made up of the Our Jobs funding?

The Hon. K.J. MAHER: Before I answer that, I was not intending to make an opening statement because I covered much of this in the opening statement for the manufacturing and innovation portfolio area. I join the member for Stuart in placing on record my appreciation for what the Holden workers are doing and have done for our state and how they continue to carry on in very difficult circumstances.

I have visited the Holden site, and Holden management and the employees at Holden are continuing very proudly, as they have for many decades, to manufacture cars. I know that the company has its own Automotive Workers in Transition Program at the Holden site that is providing exceptionally valuable resources to their workforce through what are very trying times. There have been a couple of rerates of production and associated job losses and those who remain are doing an exceptional job under difficult circumstances. In relation to your question, the answer is: all of it.

Mr VAN HOLST PELLEKAAN: All of it: 100 per cent?

The Hon. K.J. MAHER: Yes.

Mr VAN HOLST PELLEKAAN: The same page, looking at the financial commentary which says 'An increase in Our Jobs Plan expenditure for automotive transformation projects'. What was the expenditure for the automotive task force in 2014-15 and what is the task force's budget for 2015-16?

The Hon. K.J. MAHER: I will have to take on notice the exact figures for the task force. We do not have them broken down in the papers in front of us here but I am happy to take that on notice and bring back a breakdown. To clarify, do you mean the task force itself, the within-government task force, or the board as well?

Mr VAN HOLST PELLEKAAN: If you are going to take it on notice, please bring both back.

The Hon. K.J. MAHER: I am happy to do that.

Mr VAN HOLST PELLEKAAN: And for each year of the forward estimates.

The Hon. K.J. MAHER: Again, from 2013-14 right up to 2016-17?

Mr VAN HOLST PELLEKAAN: Yes, I think if it is going to be taken on notice, you might as well provide the lot. Page 113 again, the same line item. What was the expenditure for the Automotive Supplier Diversification Program?

The Hon. K.J. MAHER: I can give a reasonably comprehensive answer on the program, again on the same basis, that I can give you what was budgeted in those years and then bring back an exact year-end figure for the two years. We will know both years in a month's time and then the estimate for the next two years.

The Automotive Supplier Diversification Program is an $11.65 million initiative to assist the automotive supply chain manufacturers impacted by the announcement of Holden, and also Ford and Toyota, who South Australian companies supply to. The program has been delivered by the Automotive Transformation Taskforce and is designed to work collaboratively in combination with the commonwealth's Automotive Diversification Programme. The program provides a package of support to firms operating in the auto supply chain to ensure they are provided with timely and relevant assistance based on their specific circumstances. Features include:

flexibility in the assistance package based on the individual circumstances of each firm;

support for a wide range of activities related to diversification; and

securing alternative revenue streams, including but not limited to diversification strategy development and associated business model development, mentoring, business and capability development, management and workforce upskilling, and retooling.

There is ongoing targeted support for firms, including mentoring rather than one-off transactional intervention.

The program has two interrelated and complementary components: firstly, the automotive supplier capability and competitiveness part, a $7 million program that funds services and mentoring provided by specialists relating to business improvement, capability development, business development and research and, also, retooling for a diversification component: that is $4.65 million. It is a merit based program that provides direct funding to support and assist companies to retool and implement their diversification strategies.

On that second point, I recently visited Adelaide Tooling, which was a recipient of that part. They have a high degree of exposure to the automotive supply chain and our automotive diversification program has allowed them to get into other interests, particularly cabling for the mining industry.

I have seen first-hand some of how this has helped companies that have been very exposed to the automotive supply chain. I might mention five South Australian companies that have been successful under this program. Numetric Manufacturing received $97,250 for a project to diversify into defence industries and mining services and has received a second grant under this program of $243,755 for a project to diversify and build aerospace manufacturing capability in South Australia. ZF Lemforder Australia received $29,000 to assist in a project for them. Quality Plastics and Tooling received $495,000 for a project to expand its product range. The one I mentioned and I should have read down in my brief before, Adelaide Tooling Pty Ltd received $168,500 to diversify into the mining sector. Finally, Rope and Plastic Sales Pty Ltd has received $200,000 for a project to expand its product range into the domestic market. There are five South Australian companies and six grants specifically made via the Automotive Supplier Diversification Program.

In terms of the amount budgeted for for this particular program, the budget for the 2013-14 financial year for that first section of the Automotive Supplier Diversification was $1 million. For 2014-15, the Automotive Supplier Diversification component was $800,000; the Retooling for Diversification component in 2014-15 was $700,000. For 2015-16, the budgeted amount for the Automotive Supplier Diversification component is $3 million; for the Retooling for Diversification, $2.1 million. For 2016-17, the budgeted amount for the Automotive Supplier Diversification component is $1.7 million; for the Retooling for Diversification component is $1.35 million. The budgeted amount for 2017-18 for Automotive Supplier Diversification component of the program is $500,000; and for the Retooling for Diversification component of the program is also $500,000. As with the similar questions for the 2013-14 to 2017-18 financial years, I will bring back a response to the actual expenditure for 2013-14 and, in a month or so when the books are closed for 2014-15, I will bring back a response for the actual expenditure for that as well.

Mr VAN HOLST PELLEKAAN: Thanks, minister. The five successful grant recipients there, no doubt all sound very worthy. How many applications did you get?

The Hon. K.J. MAHER: I will have to bring back a response and let you know. I know from talking to the Automotive Transformation Taskforce we expect the number of applications we receive to start ramping up and increasing as companies that are exposed to the automotive industry face the reality of the complete closure of the industry in South Australia. We expect in the lead-up to the end of 2017 for an increase in applications to occur.

Mr VAN HOLST PELLEKAAN: Thanks, minister, and—

The Hon. K.J. MAHER: And that reflects the budget allocation in those years to reflect that reality that, as the automotive industry winds down, companies will be looking to access these things in a much greater way.

Mr VAN HOLST PELLEKAAN: Yes, I understand. If I have done my maths correctly very quickly, those five grants added up to $900,000 or very close, but the budget was $800,000. Does that mean that the budget for next year will have to be decreased by $100,000?

The Hon. K.J. MAHER: I will take that on notice and bring back a reply as to if that was the case or whether there was an underspend in that first year of the budget. It is, of course, as my department reminds me, also a cashflow issue of when payments are made and when grants are received. I will bring back a reply to that question.

Mr VAN HOLST PELLEKAAN: So it might be that these grants, while they are handed out, they are approved essentially this year and the money might be able to move from year to year to keep the total budget on track.

The Hon. K.J. MAHER: I will bring back a reply to let you know exactly the circumstances.

Mr VAN HOLST PELLEKAAN: Same page, commonwealth government Growth Fund. In what financial year, or years, did the South Australian government make its $12 million contribution to the commonwealth government $155 million total?

The Hon. K.J. MAHER: The commonwealth government Growth Fund is a $155 million fund established to create new jobs and investment in communities impacted by the closure of the automotive sector with, obviously, a particular focus on South Australia and Victoria. The Growth Fund has five specific elements: a $30 million skills and training initiative funded by General Motors Holden and Toyota to assist their own automotive employees in skills recognition and provide training for new jobs while they are still employed. I mentioned earlier that the centre that Holden has at Elizabeth is working very well.

The second component of the Growth Fund is a $15 million extension to the current commonwealth Automotive Industry Structural Adjustment Program. The third component is the $20 million Automotive Diversification Program that I mentioned earlier in terms of our own Automotive Supplier Diversification Program, which we have just talked about working collaboratively with. The fourth is the $60 million Next Generation Manufacturing Investment Program, which provides pools dedicated to both South Australia and Victoria to accelerate private sector investment in high-value non-automotive manufacturing sectors. Finally, a $30 million infrastructure program to support investment in non-manufacturing opportunities in affected parts of Australia.

I might say too, that while we welcome the commonwealth government's support for these areas, it is, in our view, not nearly enough. We asked for a lot more than this. There is still $795 million in the commonwealth Automotive Transformation Scheme. The commonwealth government attempted to abolish—but was blocked in the Senate—legislatively that scheme, but I note in the last commonwealth budget the banked in savings for nearly all of that money.

We have consistently called for that $795 million in the ATS to be opened up to allow both South Australian and Victorian companies to continue to diversify, but also to support industries where jobs may be provided for people who have been affected by the closure of the auto industry. So, we will continue to call for the ATS to be opened up, as it should be, to benefit South Australian and Victorian companies.

Specifically in relation to the $12 million of the South Australian contribution to the commonwealth Growth Fund, I can inform you that the budgeted contribution is for $5 million in 2015-16, $5 million in 2016-17 and $2 million in 2017-18.

Mr VAN HOLST PELLEKAAN: You mentioned the programs that you worked collaboratively on. What role does the South Australian government have in administering grants that come out of the commonwealth Growth Fund, if any?

The Hon. K.J. MAHER: Officials from the South Australian government participate in all the advisory committees in relation to these grant programs and I jointly sign off with my commonwealth counterpart, minister Macfarlane, in relation to grants for South Australian companies.

Mr VAN HOLST PELLEKAAN: But with regard to administering them, rather than—

The Hon. K.J. MAHER: No, in approval of grants.

Mr VAN HOLST PELLEKAAN: That is the approval part, but what about the process all the way through to acquittal?

The Hon. K.J. MAHER: The commonwealth monitors those grants and any associated requirements under those grants, but we as the South Australian government get reports on those.

Mr VAN HOLST PELLEKAAN: How many tier 1 and tier 2 auto supply chain manufacturers do you estimate to exist at the moment?

The Hon. K.J. MAHER: We know there are about 33 tier 1 companies and our Automotive Transformation Taskforce has visited every one of those at least once to talk about what their company is doing, what their company might want to do and about what support the government has in many of the programs that we have talked about extensively so far. There are some hundreds of tier 2 companies. We have identified a lot of them, but we are still identifying further tier 2 companies.

Mr VAN HOLST PELLEKAAN: That identification is an important aspect of being able to go and visit them.

The Hon. K.J. MAHER: Indeed, and we are not waiting for companies to come to the government to say, 'We're affected by our exposure to the auto industry.' We are being as proactive as we possibly can be in identifying companies and making sure companies are aware of the assistance that we, as a state government, can provide and also what might be provided by the federal government, even though, as I said, we would like more support from the federal government.

Mr VAN HOLST PELLEKAAN: On page 114, the first line of that table talks about the number of visits, and the target for this current financial year is 100 visits. Is that 100 visits in total, which could include repeats, or will 100 companies receive visits?

The Hon. K.J. MAHER: I am advised that the target is 100 visits.

Mr VAN HOLST PELLEKAAN: So it could be twice to 50 companies or four times to 25.

The Hon. K.J. MAHER: I do not think it is likely to be 50 times to two different companies.

Mr VAN HOLST PELLEKAAN: No, I said it the other way around.

The Hon. K.J. MAHER: I think, from experience in visiting companies, companies might receive one or two visits, but it is certainly getting out to a lot of companies.

Mr VAN HOLST PELLEKAAN: But it is not 100 different companies that will experience—

The Hon. K.J. MAHER: No, it is 100 different visits but, if past experience is anything to go by, it will be closer to 100 separate companies than 10 separate companies that are visited.

Mr VAN HOLST PELLEKAAN: Given that the government visited 66 manufacturing companies in 2014-15, this target to visit 100 automotive supply chain companies would obviously be a significant step up. Are extra staff being allocated to that task and to that priority?

The Hon. K.J. MAHER: I will have to take on notice the staffing arrangements in a particular area of the department. I will bring an answer back to you.

Mr VAN HOLST PELLEKAAN: On page 114, regarding the third dot point at the top, revisit and inform all eligible tier 1, 2 and 3 companies and their workforce regarding the state government response for workers, how do you plan to go about achieving that target, minister, given that there is an identification issue at the moment outstanding anyway with regard to who they are?

The Hon. K.J. MAHER: The target is an ambitious target and deliberately so—because we want to visit as many companies that are affected by this. We are working in conjunction with the commonwealth and its agencies as well to visit as many of the eligible companies as we can. It is an ambitious target but quite deliberately, given the magnitude of the difficulties that do lie ahead, and we are working with the commonwealth in doing that as well.

Mr VAN HOLST PELLEKAAN: On the same page, focusing on tier 1 companies, of the 33 tier 1 companies you mentioned before, how many have advised the government that they will definitely cease operations or have done so already?

The Hon. K.J. MAHER: A big percentage of the tier 1 companies have exceptionally high exposure to the auto industry and a big percentage may not be able to transform and diversify, but I will have to take on notice the exact number and come back to you.

Mr VAN HOLST PELLEKAAN: You would have a record of the ones that have actually confirmed for you—

The Hon. K.J. MAHER: It will not be an exceptionally firm number, but there will be something on record. The task force has visited all those companies. There will be some indication but, rather than a number such as 17 of 33, it might be a range of companies. Obviously, some will have levels of optimism of surviving beyond Holden's as well. It will not be a very bright line for both of those things.

Mr VAN HOLST PELLEKAAN: I understand that. I was specifically asking about the ones that have advised you of their intention, to make that a fair question.

The Hon. K.J. MAHER: I will bring back a response.

Mr VAN HOLST PELLEKAAN: And the same for tier 2.

The Hon. K.J. MAHER: Certainly, I will bring back a response in relation to those tier 2 companies that have made some definitive statement to the Automotive Transformation Taskforce.

Mr VAN HOLST PELLEKAAN: Minister, can I just ask about Ethan Automotive. I am advised that they sought a $1.8 million grant or loan. They told me that they asked for a grant, but they did advise that they would have accepted a loan as well, but they were unsuccessful in that application. Are you in a position to share some of the reasons they were unsuccessful?

The Hon. K.J. MAHER: I am not going to go into the specifics of discussions with companies that come to the government with proposals. As a state government, we are happy to talk to anyone who has a proposal that might provide jobs, particularly manufacturing jobs, in South Australia. I know that our department has had a number of discussions with Ethan Automotive over the previous months and that there have been a number of requests for support from not just Ethan Automotive.

A wide range of companies have put proposals about manufacturing in South Australia, and we are keen to do whatever we reasonably and possibly can as a state government to support manufacturing jobs, but we need to be prudent with the use of taxpayers' money. We will continue to talk to any company that has proposals or suggestions, but we will be prudent with the use of taxpayers' money and support where we can things that are going to develop new industries or provide jobs. I am not going to go into the specifics of any particular proposal that has been put or is being put to the state government.

Mr VAN HOLST PELLEKAAN: Certainly, I support only prudent spending as well, no doubt about that.

The Hon. K.J. MAHER: I am happy to sit down maybe outside an estimates environment and outside the parliament to have a chat about some of the things we are doing, and I have appreciated the ability to do that with some of the challenges that have faced South Australian manufacturing already. I am happy to sit down and go through some of these details because there will be companies that will speak both to the government and to the opposition, so I think it is only fair. I am happy to sit down and go through some of the intricacies of this but in a not quite so public forum.

Mr VAN HOLST PELLEKAAN: Thanks, minister, and I will take you up on that. I refer to page 113, under highlights, launched the Automotive Workers in Transition program. How many car component manufacturing workers does the government plan to provide information sessions to in 2015-16?

The Hon. K.J. MAHER: I do not have the specific target. What I can say is that since the establishment of the Automotive Workers in Transition team it has engaged with over 1,200 automotive workers through program information sessions, and it has received registrations from more than 320 automotive workers and supported 151 workers to date to access career advice.

There is every expectation that that will increase significantly over the next year. There is not a specific target, but we do recognise that, as we head towards the end of 2017, the work will increase and those figures will increase significantly.

Mr VAN HOLST PELLEKAAN: And the resources will be there to—

The Hon. K.J. MAHER: What the team does will increase significantly.

Mr VAN HOLST PELLEKAAN: With regard to automotive transformation funding and support in general, I understand that it is very much about trying to support existing organisations to transition. They are already up and running, they have a structure and they have employees and, hopefully, those people can transition to other industries.

It has been put to me by industry and local government that consideration should be given to other employing organisations in the northern suburbs which are not in the automotive sector because, if you are trying to support—and I would support you in doing it—people in the auto sector transitioning to other industries, the key is that those people get jobs. It might well be that companies who are already in other industries could use the support the government has to offer to help create employment for those people currently employed. I realise that is outside the scope of the current programs, but is that something that you are considering or open to?

The Hon. K.J. MAHER: Certainly, I can touch on that. It is very much at the front of my mind that as we transition out of the automotive industry we have certain strengths in South Australia; we have marginal strengths in other manufacturing and other industries that we would seek to enhance. Defence industries is certainly one where we think there is a possibility of providing jobs as job losses happen in the automotive industry.

Medical devices is an area where we have some strengths, and one area that we know has grown every year, year-on-year for the last 17 years, is food manufacturing. As you point out, these are areas that are not to do with the automotive sector, they are to do with other forms of manufacturing or other forms of industry in South Australia. We are absolutely doing what we can to support areas that might provide jobs that are not automotive related. The food park to be located in northern Adelaide is an example of that. There was $2 million in the last budget to look to the establishment of a food park that will bring together food manufacturers and other areas in the food industry to try and grow that area.

As I said, food manufacturing has grown year-on-year for 17 years and all the reports and all the evidence indicate that it will continue to grow and will likely be an area of potentially significant jobs in South Australia and the growing of food in innovative and new ways, like Sundrop Farms outside of Port Augusta. We know that as these innovative technologies continue they will provide jobs, so food manufacturing and food areas is one that we are looking to support.

Mr VAN HOLST PELLEKAAN: Can I just put on record my appreciation for the minister answering the questions as openly and straightforwardly as he is able to do.

The ACTING CHAIR: It will be noted on his permanent record.

The Hon. K.J. MAHER: I do not know that it will do me any good though being complimented by a shadow minister.

The ACTING CHAIR: I will report that back to caucus. In accordance with the agreed timetable I advise that the committee stands suspended until 5pm, and that is the end of Automotive Transformation, and we will come back to Aboriginal Affairs and Reconciliation.

Sitting suspended from 16:47 to 17:00.

Membership:

Dr McFetridge substituted for Mr van Holst Pellekaan.

Mr Duluk substituted for Mr Goldsworthy.

Departmental Advisers:

Dr D. Russell, Chief Executive, Department of State Development.

Ms A. Reid, Deputy Chief Executive, Department of State Development.

Ms N. Saunders, Executive Director, Aboriginal Affairs and Reconciliation, Department of State Development.

Mr R. Janssan, Executive Director, Strategy and Business Services, Department of State Development.

Ms F. Ward, Director, Strategic Policy and Coordination, Department of State Development.

Ms S. Bartlett, Manager, Strategy and Support, Aboriginal Affairs and Reconciliation, Department of State Development.

The ACTING CHAIR: This portfolio is Aboriginal Affairs and Reconciliation. The minister appearing is the Minister for Aboriginal Affairs and Reconciliation. I refer members to Agency Statements, Volume 4. I call on the Minister for Aboriginal Affairs and Reconciliation to make a brief statement, introduce his advisers, and then we will proceed to the lead speaker for the opposition, who may make a statement should he wish to do so, and then we will move to questions. Minister.

The Hon. K.J. MAHER: I will introduce the people around me for the benefit of the committee. To my left is Dr Don Russell, Chief Executive, DSD, and Alex Reid, Deputy Chief Executive, DSD. To my right is Nerida Saunders, Executive Director, Aboriginal Affairs and Reconciliation within the department. On the table directly behind us we have Fiona Ward, Director, Strategic Policy and Coordination, DSD, and Rick Janssan, Executive Director, Strategy and Business Services, DSD.

I thank you for the opportunity to introduce the government's work in Aboriginal affairs and reconciliation. Aboriginal affairs can often be a sensitive and contentious policy area, which is why, from the outset, I would like to thank the member for Morphett for the open and constructive relationship we have developed. I have had numerous very valuable discussions with him during my time as minister, and I look forward to that dialogue continuing. The member for Morphett clearly has a very genuine interest in this area and an interest in improving the lives of Aboriginal people in South Australia. I know this because at nearly every function I go to the member for Morphett is there often telling people how closely we work together and showing me up by speaking in the language of Pitjantjatjara at the start of functions.

Our work in this portfolio aims to empower Aboriginal people to have a stronger voice in decision-making across government and within communities and promote effective government arrangements. My department provides whole of government policy advice and coordination. My department protects and preserves Aboriginal heritage and culture. It supports the state's Aboriginal landholding authorities. Our government recognises the importance of building capacity and providing opportunities for Aboriginal jobseekers, employees, businesses and communities to work towards addressing and eradicating barriers to economic participation that are often experienced by Aboriginal people. We recognise the crucial importance of full economic participation and access to the benefits that economic participation provides as fundamental drivers of social and economic equality in our community.

One of the ways we are doing this is through our statewide Aboriginal Economic Participation Strategy which will promote greater participation of Aboriginal South Australians in our economy through improved pathways to education, training and employment opportunities, and support Aboriginal business enterprise and investment opportunities.

Our Aboriginal Business Procurement Policy allows government agencies to procure goods and services up to $220,000 by obtaining one value for money quote from an Aboriginal business or enterprise meeting certain criteria. As part of this, we are working with Supply Nation, an organisation that supports Aboriginal businesses to secure government and private contracts.

In 2014, the state government committed $1.02 million over four years to work with the Jawun Indigenous Corporate Partnerships program to broker partnerships between corporate South Australia and Aboriginal communities. This program involves placing skilled people from the corporate sector into participating Aboriginal communities which builds the capacity of these communities and enables them to pursue their own reforms.

The government is supporting Jawun to establish a presence in South Australia, develop formal partnership agreements with Aboriginal businesses and corporate partner organisations, and implement a public sector secondment program. I anticipate over the next 12 months Jawun will sign agreements with at least three corporate partners and finalise a community partnership agreement with at least one Aboriginal community.

Our government is committed to supporting regional Aboriginal governance. To this end, in 2014 we committed $1.23 million over four years to develop an Aboriginal governance recognition bill which will recognise the self-determining governance structures and the unique cultural identities of Aboriginal communities in South Australia and set out guiding principles for consultation and cooperation between state government and Aboriginal communities.

Work is still progressing on the structure of the proposed legislation so that it reflects both the needs and the aspirations of the Aboriginal community and the government's commitments. I anticipate that a bill will be introduced over the next year.

To support this legislation, the government has provided Flinders University with $175,000 in funding to develop and deliver an Aboriginal Nations Rebuilding education program. This program will support Aboriginal leaders to build on stronger government structures and facilitate a cultural shift across the public sector that recognises the critical importance of consultation, cooperation and engagement with Aboriginal South Australians.

The curriculum will be delivered to South Australian Aboriginal communities and senior public servants and will provide participants with the tools, expertise and common language necessary to work together. The first Aboriginal Nations Rebuilding program was delivered to the public sector in April, with the first program for Aboriginal groups to be delivered over a three-day course commencing in September this year.

Over the last financial year, the government has worked with the Aboriginal community to design the Aboriginal Regional Authority policy to establish a network of regional governance bodies to work with the state government on important issues impacting Aboriginal South Australians. This policy will provide a platform to foster greater confidence in regional decision-making, create increased opportunities for economic growth, strengthen Aboriginal nations and communities, and promote improved wellbeing for Aboriginal peoples. In 2015-16, up to two regional authorities will be recognised through an expression of interest process.

Our government continues to demonstrate a strong commitment to effectiveness, integrity, sustainability and community wellbeing in the Anangu Pitjantjatjara Yankunytjatjara lands. Poor nutrition is one of the prime causes of poor Aboriginal health for people living in remote communities, particularly in the APY lands, and that is why as a government we are continuing to work to improve the availability of healthy fresh foods in Aboriginal communities. With funding support from both the state and commonwealth governments, Mai Wiru Regional Stores Aboriginal Corporation commenced a new freight service to deliver fresh produce direct from South Australian growers at low prices to major APY communities.

For more than a decade this government has played a key role in supporting programs and initiatives that have enhanced the wellbeing of Aboriginal people in this state. I am proud of this government's history in supporting the reconciliation agenda. We established Reconciliation SA which formed in 2002 and supports a people's movement for reconciliation in this state.

For over a decade, Reconciliation SA has been working with the government, business and community to influence and change policies and practices and to deliver better outcomes for Aboriginal people. I recognise the efforts of their staff, board and volunteers in advancing the reconciliation agenda in our state. As a state government, we will continue to ensure that all our work is underpinned by the reconciliation agenda as we work towards promoting and increasing mutual understanding and respect between Aboriginal peoples and other South Australians. I look forward to the committee's questions.

Dr McFETRIDGE: I do not want to make this sound like a mutual admiration society but can I say that I have enjoyed working with the current minister. He is the fifth minister for Aboriginal affairs I have served under, starting with the late Hon. Terry Roberts and including the current Premier. Can I also say that the members for Giles and Napier are on the Aboriginal Lands Parliamentary Standing Committee with me, and I enjoy working with them in a very bipartisan way as well. It is one of those areas that requires dedication, determination, perseverance and persistence, and we keep working on that.

Can I also quickly mention that the Presiding Member of the Aboriginal Lands Parliamentary Standing Committee (Hon. Tung Ngo) has become a father again today to young Jenson Tam, who was born this morning at 3.22 kilos. We welcome young Jenson into the family. We hope his father's passion for Aboriginal affairs and social input is passed down to him. Congratulations to Tung and to Kym.

Also, Dr Russell from DSD, I am pleased to see you here. We used to have a minister for Aboriginal affairs in a separate department. It went to then a division of Premier and Cabinet and now it has gone to, I am not quite sure what it is now, a section of DSD. I can assure the committee and this place and all who may be reading or listening that the importance of Aboriginal affairs has in no way diminished, I think on both sides of this place.

The first question, minister, is one that is very relevant. I understand that you also have a very good working relationship with the federal minister, minister Scullion, and have had discussions on MUNS funding. I refer to Budget Paper 5, page 55. Can you tell the committee what the current situation is with municipal services funding for Aboriginal communities? I understand $2.7 million per annum has been provided by the federal government for a number of years. What is the future for MUNS when it becomes an entirely state-based funded model?

The Hon. K.J. MAHER: This has been a difficult issue right across Australia, the issue of the commonwealth's desire to not fund municipal services in Aboriginal communities. We have seen how this has played out in Western Australia where, as a result of the impasse of MUNS funding between the WA and commonwealth governments, the WA government at the time announced that up to 200 communities would be forced to close, and we have seen how that has reverberated right throughout the country.

That is particularly why both the federal minister (minister Scullion) and I were so keen to make sure that was not the case in South Australia. The potential forced closure of communities in Western Australia has been one of the more difficult issues for a long time in Aboriginal affairs and it has led to a lot of anxiety right throughout Australia. Minister Scullion and I had a lot of discussions about MUNS funding in South Australia given, as I said, the commonwealth government's desire to not fund municipal services in Aboriginal communities.

I can inform the committee that a few months ago we came to an agreement. The commonwealth government will continue to have responsibility for the funding of municipal services, and these services range in different communities from things like water infrastructure, dust management and dog control to electricity infrastructure.

The commonwealth government will continue to provide and have responsibility for these services in the APY lands. It is $9.6 million a year of MUNS funding right across Aboriginal communities in South Australia. I do not have the exact amount but off the top of my head $6.7 million of that $9.6 million is for services on the APY lands, $6.5 million with the remainder being about approximately $2.7 million a year for non-APY communities across South Australia. Those non-APY communities range from Aboriginal Lands Trust communities such as Point Pearce, Koonibba and other statutory landholders like Maralinga Tjarutja to some other homelands throughout South Australia.

As a consequence of the state government taking over the MUNS funding for the non-APY communities in South Australia—that $2.7 million a year—the commonwealth government provided the state government with a one-off sum of $15 million. As a state government, for this current financial year which we have just commenced, we are providing the same level of funding that was provided in the last financial year. There simply was not time to change what was done for the next financial year. However, we are embarking on a review of exactly what those services are, what services are needed and how effectively those services are being provided in those non-APY remote and regional Aboriginal communities.

We are determined that the best possible services for the money that we have will be provided to those non-APY communities with that MUNS funding. We will also look at the most effective way to deliver those services and that might be talking with local government and that will inform us on an ongoing basis. I do not have a crystal ball to know five years from now exactly how those services will be structured but we will be spending the coming months looking at the best ways to provide those services.

Dr McFETRIDGE: Thank you for that, minister, and just on funding for Aboriginal communities and Aboriginal affairs generally in South Australia, can you tell the committee what the global budgets are? I think some Productivity Commission figures are out there for Aboriginal and Torres Strait Islanders in South Australia and also the global budget both federal and state and any other sources for the APY lands. I understand that the global budget for the state is $1.3 billion and for APY about $200 million. Is that about right?

The Hon. K.J. MAHER: I am happy to take those on notice. I do not have exact figures for things that are outside my specific portfolio areas but I am happy to take those on notice and, if there are figures that have been published elsewhere, I am happy for my department to look at those figures and bring back a reply.

Mr HUGHES: Can the minister inform the committee how grants provided by the state government support the celebrations held in South Australia during NAIDOC Week and how the minister marked this important time in the Aboriginal affairs calendar?

The Hon. K.J. MAHER: I thank the member for Giles for his question and thank him for his interest, along with the member for Napier, who are members of the Aboriginal Lands Parliamentary Standing Committee. Certainly the member for Giles' electorate covers many Aboriginal communities in South Australia and a couple of months ago I was fortunate enough to visit the APY lands as my first visit as minister with the local member, the member for Giles, and I look forward to a very strong working relationship as I know previous ministers have enjoyed with your predecessor, Lyn Breuer, in bringing to the government's attention some of the very significant issues and challenges that are faced by Aboriginal people in your electorate.

As many members would be aware—and I know many members participated in events—from 5 to 12 July National NAIDOC Week was held, and the national focus was in Adelaide for NAIDOC Week with the National NAIDOC Awards at the end of that week. It is a time to celebrate the history, culture and achievements of Aboriginal people. NAIDOC is an acronym for National Aborigines and Islanders Day Observance Committee and began as part of Aboriginal Australia's struggle for full citizenship status. While NAIDOC was initially marked as an occasion of mourning, it now stands as a time of reflection on the past and a celebration of the contributions of Aboriginal Australians.

I was pleased to see, support and be involved in many events and activities scheduled in Adelaide and across the state to celebrate NAIDOC Week, including the NAIDOC Awards at the end of the week—and the national awards were held in Adelaide. As I noted earlier, at many events during the course of the week I bumped into the member for Morphett, and I have to say on a personal reflection that NAIDOC Week was probably the most enjoyable single week I have had since being minister, with so many events and so much celebration of Aboriginal people, history, culture and achievements.

My department provides around $68,000 worth of funding for NAIDOC events and activities, which includes funding for the Premier's NAIDOC Award, the Aboriginal Lands Cup, the Gladys Elphick Committee and the SA NAIDOC Committee. The theme for this year's NAIDOC was, 'We All Stand on Sacred Ground: Learn, Respect and Celebrate', and there were many events that certainly held true to that theme. It was exceptionally inspiring to see how the whole community, particularly the Aboriginal community, came together for that week, as they have in past weeks.

As I said, the national awards were held in Adelaide with a big celebratory dinner. Again, I ran into the member for Morphett at that event. It was a great way to finish off an action-packed week, with over 1,000 people in the newly built western wing of the Convention Centre for the event. In addition to the national awards, NAIDOC Week provides an opportunity for the state government to recognise and acknowledge the significant contribution of Aboriginal people in South Australia.

It was an honour to host the 2015 Premier's NAIDOC Award on 6 July, now in its ninth year, which recognises the outstanding achievements and contributions of South Australians whose service have made a significant difference to the lives and welfare of Aboriginal people. I would like to congratulate the winners of this year's Premier's NAIDOC Award, Dr Kali Hayward and Lavene Ngatokorua from Port Augusta, who I have met a couple of times in Port Augusta and the Davenport community. The award winners and finalists were celebrated with an event of about 65 guests at the South Australian Museum.

The South Australian government also provides financial contributions to enable community organisations to plan and host NAIDOC events. For instance, the government provides the NAIDOC SA Committee with about $15,000 each year. The NAIDOC committee works with organisations to hold annual events, such as the NAIDOC SA Awards, a march, a family fun day and a ball in years where we do not host the national awards. I would like to take this opportunity to thank the many South Australians who contributed to the NAIDOC committee and the NAIDOC awards for their great work.

Mr HUGHES: How is the Department of State Development supporting the reconciliation agenda across South Australia?

The Hon. K.J. MAHER: Fantastic question, and I thank you for that question. The South Australian government continues to make recognition and reconciliation a key focus of our agenda. Reconciliation SA was established in 2002 when the Labor government took office, and since that time the government has funded and supported initiatives to drive reconciliation, both across government and business and, of course, across the general community.

Reconciliation fundamentally is about recognition and respect, the recognition and respect of culture, rights and the significant contribution of Aboriginal and Torres Strait Islander peoples. As a government, we want to build a better understanding of each other's culture. We want to overcome inequality and address issues of racism and prejudice.

It is really only through mutual understanding and shared commitment that we can truly achieve reconciliation. It is a goal that extends beyond government; it is a whole-of-community issue, but I recognise that government, particularly state government, has an important role to drive this agenda and to fund programs and policies that will support this vision. That is why the government has, over the last decade (or more), funded and supported the work of Reconciliation SA.

As a former member of the board of Reconciliation SA, I know the work they do is exceptionally important and I know they do that work on behalf of the whole community. Importantly, some of their efforts are about helping non-Indigenous Australians learn the cultural history of this state and of our country and to appreciate the enormity of it, and in developing the pride in this history that we should all rightly feel.

When all Australians feel that pride and the respect that comes along with it, then the work of reconciliation is really moving forward. That is why my department provides almost $200,000 a year to Reconciliation SA to support this critical work. The South Australian government has provided significant financial support to Reconciliation SA for many years to promote the coordination of government and non-government reconciliation events.

I would like to place on record my sincere gratitude to Reconciliation SA, its current co-chairs, Professor Peter Buckskin and the Hon. Robyn Layton, and Mark Waters from Reconciliation SA, whom I have known for a number of years and who goes above and beyond the call of duty in promoting reconciliation in South Australia. I look forward to working closely with Reconciliation SA in the coming years as I have done in the past.

Mr DULUK: In relation to the Warriparinga Wetlands, referring to Budget Paper 4, Volume 4, pages 115 to 116, what is the current status of negotiations regarding the acquisition of the Warriparinga Wetlands for the Darlington Interchange project, and what consultation has been undertaken with Kaurna people regarding the Tjilbruke Dreaming Tracks, which this land marks the beginning of?

The Hon. K.J. MAHER: I might take that on notice and bring back an answer. I know that the wetlands encompass the Darlington area and that there are Aboriginal heritage issues. I would not want to give an answer off the top of my head and from some of these papers that is not as comprehensive and instructive as I might give, so I will bring back an answer in relation to the specifics of that question and the Tjilbruke dreaming trail, which encompasses a long stretch of coastal area which I know is very important for the Kaurna people.

Mr DULUK: To this point of time, you have not met with that community in relation to the Darlington project?

The Hon. K.J. MAHER: I have met with many different groups representing Kaurna people on many issues.

Mr DULUK: But in relation to the Warriparinga Wetlands?

The Hon. K.J. MAHER: I cannot remember which specific groups, but I know the issue has been raised with me.

Dr McFETRIDGE: Referring to Budget Paper 4, Volume 4, pages 115 and 116 and the eternal recurring problem of the APY Executive financial management, given that the KPMG report, APY Land Rights Administration Grant Review, dated 1 May 2015, found significant issues, what is the minister doing to improve governance and particularly financial management on the APY lands? Whilst they are getting some information for you, can I just preface that question by asking whether Mr Richard King been appointed general manager of the APY lands? I am hearing rumours.

The Hon. K.J. MAHER: If you just give me a moment, I will get as thorough an answer as I possibly can for you. That is a very good question and I am not entirely surprised it is raised here. Certainly, it is an exceptionally important issue and it is not a new issue. There are significant challenges faced with many aspects of living in such a very remote area of South Australia, with many people who have English as a second language and with financial and governance structures that are not necessarily culturally what has happened for 40,000 years in that part of the world.

Concerns are raised regularly about APY governance issues, particularly about transparency and financial accountability. I know that KPMG, as the member for Morphett mentioned, were engaged to undertake a review, and a draft report was provided earlier this year. Following that draft report, the APY Executive had an opportunity to look at those recommendations, and KPMG was engaged also by the Department of State Development to address findings from that review.

As the member pointed out, some concerns were raised in that report. In recognition, some systems have been changed by the APY Executive, and the government has also changed some of the requirements of providing funding. A requirement of funding now includes significant measures for accountability and transparency, such as a lot more information being publicly provided on the APY website. There is now a requirement for financial records to be regularly put on the APY website, and minutes of executive meetings as well are regularly put up on the APY website—that has not happened before.

We are working closely with the APY Executive and its administration to ensure that these accountability and transparency measures are continued and improved upon. Working on from the KPMG report, we have engaged Ernst & Young to undertake two tasks: a fuller forensic audit and to put systems in place to ensure that this work continues. I look forward to that work continuing and to APY continuing with the work they have already undertaken.

Dr McFETRIDGE: As a preface to that question, I asked whether Mr Richard King had been appointed as a general manager.

The Hon. K.J. MAHER: My understanding is that Richard King is the interim general manager. There is a process to appoint an ongoing general manager. My understanding is that Richard King has been appointed to continue his role up until that process is finalised. I will check to make sure that is the case and, if it is not the case, bring back a reply.

Dr McFETRIDGE: I should inform the committee that, in relation to financial management, the former financial manager, Mr Kevin Chan, who was I will not say sledged—perhaps I have said it—in a report that was done for the APY Executive on accounting, has now come back as a consultant financial controller, which I am very pleased to see because I think Mr Chan is one of those who is shining a light on financial management for APY.

I will be pleased to see him come back and help those who really want to advance governance on the lands do exactly that, so I will look forward to working with the minister on that. Rather than take up the committee's time with a whole series of questions on that issue, minister, probably through the Aboriginal Lands Parliamentary Standing Committee I will get some further briefings on financial management.

The Hon. K.J. MAHER: Just on that point, it is my understanding as well that that individual is going to continue in some role providing services.

Dr McFETRIDGE: Yes, and I think it is a very good thing.

The Hon. K.J. MAHER: I know we have had a number of discussions and share very similar aspirations for sound financial management, and I think this is one area where we are not very far apart on not just our aspirations but on some of the ways in which we can go about doing that. We do not agree on everything, but I think this is an area where we have a fair bit in common.

Dr McFETRIDGE: I am seeking some explanation, since I am just a humble veterinarian and not an accountant. On page 127 of Budget Paper 4, Volume 4, there is, for supplies and services, under operating activities, 'APY Lands—additional services' and 'Aboriginal Communities—additional services'. I think some of that may refer to MUNS funding, but the budget for 2014-15 was $92,000, the estimated result was $529,000, and the budget for 2015-16 is $94,000. Can you give some information to the committee on what those additional services are and why the numbers are up and down?

The Hon. K.J. MAHER: I was previously just a humble lawyer, not an accountant. I very quickly changed out of doing my commerce degree because financial accounting was not my thing, like you as a humble veterinarian.

Dr McFETRIDGE: We have both made some money though.

The Hon. K.J. MAHER: Some of us more than others. I am informed there are issues with carryovers that affected the variance in that, but I will bring back a reply to get an exact answer for you.

Dr McFETRIDGE: Can the minister also tell us about any progress that has been made on the compensation bill for the stolen generation—and it is not a bill before the lower house and I am just trying to think of its correct title. Has any budgetary allowance been made by way of contingencies for any legislation at all, or how far along are we with that legislation being presented or amended?

The Hon. K.J. MAHER: That is an issue that we are continuing to develop as a government and continuing to consult on. As a minister, it is certainly an area I have spent a lot of time on. We are consulting with Aboriginal groups, Aboriginal communities and, particularly, individuals who were members of the stolen generations and directly affected.

I want to place on record my thanks particularly to the ALRM which has facilitated a lot of group and individual meetings for me to get a better appreciation of what the next steps are in making amends for some of the atrocities, frankly, that were committed on members of the stolen generations.

One aspect that is often raised is individual reparations, which were the subject of a previous bill that the member refers to, and one thing that has become apparent to me is that, although individual reparations are an important part for many people, there are many other parts that individuals and communities affected see as needing to be addressed as well. These include making amends to communities that were deeply and profoundly affected by the policies of the past but also in areas such as education, making sure our education system in Australia properly teaches what happened in the past and also into the future, making sure that mistakes of the past are not repeated. So, I recognise this as an exceptionally important issue.

The government has not come to a settled position on exactly what the next steps will look like, but we will continue to do that and over the coming months look at what those next steps will be, and I will continue to liaise with the opposition and with members of the Greens who ask me this question every second week in parliament to see what the further developments are. It is an exceptionally important issue, it is one that has profoundly and deeply affected many Aboriginal people and Aboriginal communities, and it is one that we are taking very seriously about what a full government response will be.

Dr McFETRIDGE: You mentioned the Aboriginal Legal Rights Movement in your answer. Have you had discussions with the Minister for Communities and Social Inclusion about the funding for the Aboriginal Legal Rights Movement, particularly some of the low income support program funding where I understand there are issues.

The Hon. K.J. MAHER: I have not had specific discussions and I am not exactly sure what the issue is, but I am happy either through you or directly with the ALRM to discuss any issues. Many areas of Aboriginal affairs are not things that as minister I have direct control over. Many areas of government affect the lives of Aboriginal people in services provided, so it is an area where I find myself regularly liaising with my ministerial colleagues.

Dr McFETRIDGE: I will ask minister Bettison in the morning so you can have it as a Dorothy Dixer tomorrow morning.

Ms COOK: Just coming back to page 115 and acknowledging the importance that good nutrition has with life outcomes and health and wellbeing, my question is about how the Mai Wiru are improving the quality and price of food in stores on the APY lands?

The Hon. K.J. MAHER: All South Australians need to access safe, affordable and nutritious food. The South Australian government recognises the importance of equity and access in the state's remote Aboriginal communities, including access to fresh food that supports health and wellbeing. It is important that we acknowledge that our efforts in the past have met with mixed results. Over many decades and in recent years we have wanted to improve food security, safety and nutrition. We have had some good results, some not so good results, but that does not mean we should stop trying, and that applies in many areas of Aboriginal affairs—

Dr McFetridge interjecting:

The Hon. K.J. MAHER: I am not. Food security is simply too important to stop trying and to stop trying different things. The long-term benefits of an improved diet include very obvious things like a reduction in the burden of disease on the individual, their families and community and the healthcare system, but there are also much greater benefits of improved educational outcomes, which then lead to better and further training outcomes and job opportunities. Better nutrition affects so many different areas.

More than 50 per cent of the foods essential to a well-balanced diet are perishable, and include things like fruit, vegetables, dairy products, meat and fish. It is important that these food types are made available to remote communities in a timely manner that ensures that food quality. For most people living in remote communities, their main source of food is a local community store. The nearest major store to the APY lands is in Alice Springs, more than 400 kilometres away. That is why it is so important that people living on the APY lands have access to affordable fresh foods in local stores in all the major communities.

Until recently, fresh fruit and vegetables were often significantly more expensive and of poorer quality than those available in major cities like Adelaide. A very significant cost factor was the long supply chain that transported food from Alice Springs but which was sourced to Alice Springs from all over Australia, including Adelaide, but also from many other places. My department undertook a review of the challenges, and freight infrastructure is the first step in developing a more efficient supply chain for the region.

I am pleased that Mai Wiru, in conjunction with Foodbank SA, the largest hunger relief agency in this state, developed a proposal for the coordinated purchasing and delivery system to freight goods to community stores on the APY lands directly from Adelaide. With support from both the state and the commonwealth government, a comprehensive business plan was developed for a new service delivery model which would provide fresher fruit delivered within one or two days, direct from South Australian growers, lower prices for healthy food options, and sustainable and compliant transport to the major APY communities. I am pleased to say that this plan was implemented with, again, funding support both from the state and commonwealth governments.

On 15 September 2014, Mai Wiru Regional Stores Aboriginal Corporation commenced their new purchasing and delivery service to the APY lands direct from Adelaide. This new initiative means goods are being bought on behalf of all stores direct from a number of major corporate suppliers in Adelaide. From there, the goods are trucked by way of a triple road train from Adelaide once a week to five regional general stores across the APY lands, delivering fresh goods at a much more affordable price to Aboriginal people living on the APY lands.

I had the pleasure of launching the Mai Wiru freight service in April this year, again with the member for Morphett, out at the Toll depot in the north of Adelaide. Again, he embarrassed me by speaking—

Dr McFetridge interjecting:

The Hon. K.J. MAHER: No, you didn't speak in language at that one, did you? That was good, thank you. I have seen the trucks in action. The results so far have been very positive. There is much improved quality of fresh fruit and vegetables and other goods that arrive within one or two days. The cost of the fresh produce has come down as much as 25 per cent, and there is still a significant ability for the stores to put back into the local community. You can tell that the people are healthier, and even the animals look healthier. Even the desert dogs in the communities look healthier, but, unfortunately, so do the camels and donkeys. They are still looking healthy, which is not the best result.

I also know that Mai Wiru supports cultural and sporting activities across the lands through a community benefits program, and it is looking to other economic opportunities to expand the work it currently does. I would like to take the opportunity to place on the record my thanks to the Mai Wiru Regional Stores Aboriginal Corporation, which is a fully owned and Aboriginal-controlled organisation. Thanks also to the many individuals from Foodbank SA and Toll, who have helped in the development of this policy. As I said, it has already had some great success, and there is no reason not to be optimistic about its future.

Ms COOK: Moving on to page 116, how has the new Aboriginal Lands Trust Act 2013 modernised the operations of the Aboriginal Lands Trust?

The Hon. K.J. MAHER: Thank you for that question. I know many members in this room were involved when the legislation was changed recently to make improvements. The original Aboriginal Lands Trust Act 1966 provided for the vesting of the freehold title of crown land in the Aboriginal Lands Trust. That freehold title would then be held and managed by the trust for the ongoing economic and cultural benefit of Aboriginal people.

At the time, this was a landmark act as it was the first Aboriginal land rights legislation to be enacted in Australia, and its existence is testament to the vision and leadership of the then minister for Aboriginal affairs, the Hon. Don Dunstan. More than four decades later, the Aboriginal Lands Trust (ALT) now holds titles to 64 properties, comprising well over half a million hectares of land located right across regional, remote and metropolitan South Australia.

Since the enacting of the ALT act in 1966, there have been many social and legal changes that have meant the act was in some ways outdated and needed updating. For example, it did not set out clear objects, purposes and functions like most modern legislation. It did not take into account more recent regulatory requirements in land management areas and it was enacted as a land rights act, but in today's circumstances it needed to better assist in realising the economic potential of the land in Aboriginal communities. The act, as it was set up in 1966, required ministerial permission for any dealing with land at all.

We established a review of the act, which included three rounds of public consultations in many of our major Aboriginal communities and Aboriginal Lands Trust lands and received submissions from many people right across South Australia. Following the consultations, the government established the reference group to consider input from the community and to provide advice about its review and the processes for change in the legislation.

Following the review, public input and advice from the reference group that was set up, the parliament passed the ALT bill in November 2013 which came into operation 1 July 2014 and which modernises the act and governance structures to make sure that the trust has clear statutory objects and a new focus of its function and powers. The trust has been given more autonomy in dealing with trust land by removing the requirement for the minister to approve all dealings in all land, and it provides, which we are now working through, for the establishment of a commercial development advisory committee to assist both the state government and the trust with specialised advice on commercial transactions.

The new act represents major reform to the structure and focus of the ALT, and so far it has been welcomed. I am sure that as the years progress the new focus on providing economic benefit will provide benefits to Aboriginal communities right across the state.

Mr DULUK: Referring to pages 115 and116, what is the status of the delivery of the nations rebuilding curriculum developed by Flinders University?

The Hon. K.J. MAHER: Thank you for the question. I did briefly touch upon it in my opening statement, but I will provide significantly more detail to your question. In early 2004, the Premier announced some reform agenda in Aboriginal affairs and reconciliation that would include and help be defined by the resetting of the relationship between the state government particularly and Aboriginal South Australians. The Premier's vision called for a look to see what changes might be able to occur in the government's approach and the underlying assumptions which had operated historically for many years.

To support the implementation of the broader Aboriginal affairs policy reform agenda, in 2014-15 the state government provided Flinders University with $175,000 to develop and deliver an Aboriginal Nations Rebuilding curriculum. The curriculum aims to support Aboriginal leaders to build on stronger governance structures with sound governance and leadership from within and facilitate a cultural shift across the public sector that recognises the critical importance of consultation, cooperation and engagement with Aboriginal South Australians.

The curriculum is being delivered to senior South Australian Aboriginal communities and to senior members of the Public Service to implement the nations rebuilding program. The public sector workshop which was held earlier this year covered areas such as:

Australian international case studies of successful governance and nations building;

political and organisational governance;

imposed versus community designed governance models;

identifying, organising and acting as a nation; and

policy implementation.

I was pleased to be able to speak at the opening of that public sector workshop earlier in the year and, certainly, I got a keen sense from the senior public sector officials to engage and to learn more. Delivery of a three-day program to Aboriginal communities will commence in September and October of this year, and it is intended that the Aboriginal Nations Rebuilding curriculum for communities will help provide pathways for Aboriginal people to undertake further study even at the tertiary level in the Aboriginal governance rebuilding.

Dr McFETRIDGE: For the sake of the committee, I have a couple more questions, but I am looking at the time. I am not sure how long the minister's answers will take to these other questions so, just to be sure, I will read in the omnibus questions. I will do this as quickly as I can so that we can get on with other matters. The omnibus questions for this portfolio are:

1. Will the minister provide a detailed breakdown of expenditure on consultants and contractors above $10,000 in 2014-15 for all departments and agencies reporting to the minister listing the name of the consultant, contractor or service supplier, cost, work undertaken and method of appointment?

2. For each department or agency reporting to the minister in 2014-15, please provide the number of public servants broken down into heads and FTEs that are (1) tenured and (2) on contract and, for each category, provide a breakdown of the number of (1) executives and (2) non-executives.

3. In the financial year 2014-15, for all departments and agencies reporting to the minister, what underspending on projects and programs (1) was and (2) was not approved by cabinet for carryover expenditure in 2015-16?

4. Between 30 June 2014 and 30 June 2015, will the minister list the job title and total employment cost of each position with a total estimated cost of $100,000 or more—(1) which has been abolished and (2) which has been created?

5. For each department or agency reporting to the minister, please provide a breakdown of attraction, retention and performance allowances as well as non-salary benefits paid to public servants and contractors in the years 2013-14 and 2014-15.

6. For each year of the forward estimates, provide the name and budget of all grant programs administered by all departments and agencies reporting to the minister and, for 2014-15, provide a breakdown of expenditure on all grants administered by all departments and agencies reporting to the minister listing the name of the grant recipient, the amount of the grant and the purpose of the grant and whether the grant was subject to a grant agreement as required by Treasurer's Instruction 15.

7. For each year of the forward estimates, provide the name and budget for each individual program administered by or on behalf of all departments and agencies reporting to the minister.

8. For each year of the forward estimates, provide the name and budget for each individual investing expenditure project administered by or on behalf of all departments and agencies reporting to the minister.

9. For each department or agency reporting to the minister, what is the budget for targeted voluntary separation packages for the financial years included in the forward estimates by year and how are these packages to be funded?

10. What is the title and total employment cost of each individual staff member in the minister's office as at 30 June 2015, including all departmental employees seconded to ministerial offices and ministerial liaison officers?

Back to Budget Paper 4, Volume 4, pages 115 and 116, I notice that you mentioned the Aboriginal Regional Authority in your opening statement. In the highlights on page 116 in Budget Paper 4, Volume 4 it mentions the development of the Aboriginal Regional Authority policy with Aboriginal communities, involving four trial sites. Can you give the committee some more information on the progress of establishing these regional authorities? How many have been established/will be established? I have had a number of issues with the financial control not only on APY but other Aboriginal communities and have sought financial records and accounts from them. Will the Auditor-General be auditing these authorities and, if not, why not?

The Hon. K.J. MAHER: I thank the member for Morphett for his questions and I know, as a former colleague of his on the Aboriginal Lands Parliamentary Standing Committee, that he prosecuted his desire for financial accountability very strongly when that committee met in various communities across South Australia, so I know that this is quite a reasonable and genuine desire to see that moneys that Aboriginal communities expend are expended in the best possible way for the greatest benefits of the communities, and I think that is something we would all hope for. In relation to the—

Dr McFETRIDGE: Can I put on the record, minister, that none of that is targeted to any individuals either. As you just said, it is a genuine effort to see that public funds are spent in the way they should be for the best result.

The Hon. K.J. MAHER: Yes, I know. Individuals in communities should not feel you are targeting them. You target everyone equally. You give everyone—

Dr McFETRIDGE: If you are spending public money, I will be asking questions.

The Hon. K.J. MAHER: In my experience, you give everyone an equally hard time regardless of which community it is. It has not singled out a particular one. I know the member has foreshadowed that this is the last question, so I will not disappoint by answering briefly. I will answer fully to comply with his desire that this actually be the last question.

Dr McFETRIDGE: I have plenty more.

The Hon. K.J. MAHER: The Aboriginal Regional Authority's policy seeks to support a network of regional government structures that are capable of working with the state government on key issues that impact Aboriginal South Australians. Such a network aims to provide the state government and Aboriginal peoples with a platform through which to foster greater confidence in regional decision-making, create increased opportunities for economic growth, strengthen Aboriginal nations and communities through a process of nation-building and to promote better general wellbeing for Aboriginal people.

Over the course of the past financial year, we have continued an extensive design process with Aboriginal communities that began following the announcement of this policy in 2013. In January 2014, four trial groups were selected through an expression of interest process to participate in an intensive workshop program which took place from August to November 2014. The workshop program was independently facilitated by PricewaterhouseCoopers Indigenous Consulting and gave the trial groups an opportunity to openly discuss and interrogate elements of the Aboriginal Regional Authority's model.

At the conclusion of the workshop program, a report was provided to my department along with other targeted consultations and previous research that informed the development of the draft Aboriginal Regional Authority's policy for consultation. From February to April 2015, the department convened 15 public and 14 targeted consultation sessions in regional and metropolitan centres across the state which were attended by over 340 people; 13 public submissions were also received.

I know this was a very extensive consultation that was very well attended because for those few months whenever I called Nerida she was somewhere in remote or regional South Australia conducting these workshops, so I want thank you, Nerida, for the work that you have provided on that on many nights away from Adelaide to get extensive feedback from Aboriginal communities right across the state about the Aboriginal Regional Authority's proposal.

Following public consultation, the department worked to collate feedback and to finalise the draft policy. In 2015-16 it is anticipated that up to two Aboriginal Regional Authorities will be recognised under the policy through an expression of interest process. Depending on the individual needs of the organisation it will be recognised in different ways. This policy will have, eventually, minimum criteria for an Aboriginal area to be recognised as a regional authority but will necessarily need to have flexibility to take into account the very different individual circumstances of different Aboriginal communities and areas throughout South Australia.

I am informed that one of the criteria, one of the standards, to be set for the recognition of an Aboriginal regional authority will be that they are registered either with ORIC or OCBA, which provides a level of accountability and transparency that not all Aboriginal organisations and corporations have. I think that will go some way to satisfying the quite rightly held desire that there is the highest level of accountability and transparency for the areas that are recognised as Aboriginal regional authorities.

The ACTING CHAIR: An excellent point at which to end, thank you, minister. There being no further questions, I declare consideration of the proposed payments for the Department of State Development adjourned until tomorrow.

At 18:01 the committee adjourned to Tuesday 28 July 2015 at 09:00.