Estimates Vote

Department of Primary Industries and Regions, $108,461,000

Administered Items for the Department of Primary Industries and Regions, $4,788,000

Minister:

Hon. L.W.K. Bignell, Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Tourism, Minister for Recreation and Sport, Minister for Racing.

Departmental Advisers:

Mr S. Ashby, Chief Executive, Department of Primary Industries and Regions.

Mr S. Johinke, Chief Financial Officer and Acting Executive Director, Corporate Services, Department of Primary Industries and Regions.

Prof. M. Doroudi, Deputy Chief Executive, Department of Primary Industries and Regions.

Mr T. Goodes, Deputy Chief Executive, Department of Primary Industries and Regions.

Mr D. Casement, Executive Director, Rural Solutions SA, Department of Primary Industries and Regions.

Mr W. Zacharin, Executive Director, Biosecurity SA, Department of Primary Industries and Regions.

Mr M. Williams, Acting Director, Finance and Prudential Management, Department of Primary Industries and Regions.

The CHAIR: Good morning, everyone, and welcome to committee A as we gather on Kaurna land for estimates committees, which are a relatively informal procedure and, as such, there is no need to stand to ask or answer questions. I understand that the minister and the lead speaker for the opposition have agreed to an approximate time for the consideration of the proposed payments, which will facilitate a change of departmental advisers. Can the minister and lead speaker for the opposition confirm that the timetable for today's proceedings previously distributed is accurate?

The Hon. L.W.K. BIGNELL: Yes, it appears to be accurate.

Mr PEDERICK: Yes.

The CHAIR: Changes to committee membership will be notified as they occur. Members should ensure that the Chair is provided with a completed request to be discharged form. If the minister undertakes to supply information at a later date, it must be submitted to the committee secretary by no later than Friday 27 October 2017. This year, estimates committee responses will be published during the 14 November sitting week in the corrected DailyHansard 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 each 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. Questions must be based on lines of expenditure in the budget papers and must be identifiable and referenced before the question is asked. Members unable to complete their questions during the proceedings may submit them as questions on notice for inclusion in the 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 in Hansard is permitted on the same basis as applies in the house, that is, that it is purely statistical and limited to one page in length. All questions are to be directed to the minister, not the minister's advisers. The minister may refer questions to advisers for a response.

During the committee's examinations, television cameras will be permitted to film from both the northern and southern galleries. If there is anyone up there, could they make sure their phones are on silent. I declare the proposed payments open for examination and refer members to the Agency Statements, Volume 4. I call on the minister to introduce his advisers and make his opening statement, should he wish.

The Hon. L.W.K. BIGNELL: Good morning, Chair and committee members. It is my pleasure to provide information about the work conducted by the Department of Primary Industries and Regions (PIRSA) to support the state's agriculture, food and wine and fisheries and aquaculture industries. I would first like to introduce the members of the department who are with me today.

On my immediate left is PIRSA Chief Executive, Scott Ashby. Next to Scott is Stephen Johinke, the Chief Financial Officer and Acting Executive Director, Corporate Services. On my right is Deputy Chief Executive, Professor Mehdi Doroudi. Behind me are Tim Goodes, Deputy Chief Executive; Mark Williams, Acting Director of Finance and Prudential Management; Will Zacharin, Executive Director, Biosecurity SA; and Daniel Casement, Executive Director, Rural Solutions SA. Before answering your questions, I would like to update you on the status of our primary industries based on the latest PIRSA scorecard data and highlight some examples of how PIRSA is contributing to their growth.

In 2015-16, our agriculture, food and wine and fisheries and aquaculture industries generated $18.64 billion in revenue, an increase of $443 million on the previous year. Employment in these industries increased by 3,400 jobs to an average of 147,400 jobs in the 12 months to August 2016, with an increase of 11 per cent or 2,500 jobs in food and beverage manufacturing, the state's largest manufacturing employer. Overseas exports of food and wine reached a record $5.22 billion, or 45 per cent of total merchandise exports. Food exports were worth $3.9 billion, and gross wine revenue increased by $329 million to $2.11 billion, with the value of wine exports reaching $1.34 billion.

Grain continues to be a vital part of the state's economy, generating $4.4 billion in revenue in 2015-16, with about 85 per cent of the crop exported overseas. The state's grain farmers produced a record-breaking 11.1 million tonne harvest for 2016-17, worth an estimated $2.2 billion, despite extreme weather events in September and December 2016. I would like to acknowledge Viterra, which has done a fantastic job working with industry to manage this bumper crop and boosting its workforce, storage, handling and shipping capacity.

In 2015-16, meat and livestock revenue increased by $195 million to $4.78 billion, with an increase in total value of production of $116 million, led by beef production, with exports remaining steady. In 2015-16, horticulture revenue increased by $157 million to $3.23 billion. Although a significant amount is for local consumption, exports are growing steadily, increasing by 32 per cent, to a total value of $297 million.

In 2015-16, our fisheries and aquaculture industries generated revenue of $934 million, an increase of $58 million. Total seafood exports reached $251 million. The outlook for the state's seafood industry is positive, particularly with the growing demand from Asian markets for the high-quality safe seafood produced in our well-managed clean environment.

PIRSA helps our industry strengthen our global reputation for premium food and wine, managing the food and agribusiness components of the government's international trade missions. In 2016-17, this included 25 inbound and 11 outbound trade missions. More than 1,000 new business connections were created in just two missions to North Asia and China. The value of our food and wine exports to China has grown by 137 per cent during the past five years, so it continues to be our number one priority, with supporting activities in other key markets, predominantly in North Asia and South-East Asia.

PIRSA continues to lead the South Australian-Shandong High-Level Working Group (Agriculture) subcommittee. In May this year, following discussions between government agencies and China's Ministry of Agriculture, South Australia was confirmed as the host for the 2018 Australia-China Plant Health Bilateral Workshop. During my visit to China late last year, we built relationships with the Guangzhou Entry-Exit Inspection and Quarantine Bureau, discussing pre-customs clearance opportunities for seafood at Adelaide Airport.

Of course, we would not be able to maintain market access for our producers without the world-class biosecurity, product integrity and food safety systems provided by PIRSA's Biosecurity SA division. Thanks to their work with industry and the community, South Australia remains the only fruit fly free Australian mainland state, and every year we spend about $5 million keeping fruit fly and other plant pests out of our state. In 2016-17, Biosecurity SA undertook more than 100,000 inspections of the 7,629 fruit fly traps located across the state. There were no fruit fly outbreaks in South Australia in 2016-17, the first time in nearly a decade that this has been achieved.

Fruit fly freedom is particularly important to the Riverland pest-free area, maintaining access for growers to lucrative citrus export markets such as Japan, China, Hong Kong and Malaysia. Indonesia now also recognises the Riverland's pest-free area status after a delegation reviewed arrangements in 2016. The National Sterile Insect Technology facility at Port Augusta was opened last November. The SIT facility will provide a powerful new line of defence against fruit fly and is supported by SITplus, a national research and development effort, which has a combined program budget of $45 million.

This year, the Yamba Quarantine Station celebrates 60 years in operation. Since records started in 1980, more than one million kilograms of fruit have been seized and 312 fruit fly larval detections have been reported at the station, which targets travellers coming into South Australia from the Eastern States.

South Australia's animal disease surveillance programs are essential to maintaining access to international markets. In 2016-17, Biosecurity SA undertook more than 2,250 on-farm animal disease investigations to rule out 61 exotic diseases, and none was detected. The 2016-17 state budget included $452,000 per year for four years to enhance South Australia's clean, green image through new biosecurity measures, to support growth in production and exports.

PIRSA is working with the cherry, apple and pear, and strawberry industries, to establish a Mount Lofty Ranges pest-free area, which is expected to be worth about $112 million per year to the South Australian economy and generate about 920 new jobs in the region during the next 10 years. Of course, there are many other ways in which we are building on our global reputation for premium food and wine.

In July 2016, Adelaide, South Australia, became part of the prestigious Great Wine Capitals global network, joining a group of international cities whose wine regions are recognised as significant economic and cultural assets. To build the reputation of Adelaide as a great wine capital, the state will host the Great Wine Capitals annual general meeting and industry conference in November 2018, bringing global food, wine and tourism leaders to the state.

The Northern Adelaide Plains is a key horticultural area employing more than half the state's vegetable industry workers and producing more than a third of the state's horticultural produce. Through the Northern Adelaide Plains Agribusiness Initiative, we are working with industry to transform the area into a national leader in intensive high-tech food production. We are seeking funding through the Australian government's National Water Infrastructure Development Fund for the Northern Adelaide Irrigation Scheme to upgrade water treatment, storage and distribution infrastructure.

If this funding is secured, the state government, through SA Water, will co-invest $110 million in the project, to initially deliver an extra 12 gigalitres of recycled water a year, which is projected to create 3,700 jobs and add $578 million a year to the state's economy. As export markets grow, the scheme will be expanded to increase the additional recycled water 20 gigalitres a year. This is projected to create up to 6,000 jobs and add more than $1 billion a year to the state's economy.

Another key component of the government's Northern Economic Plan is the northern Adelaide food park, which is bringing together food manufacturers and food-processing businesses, with packaging, storage and logistics companies in a dedicated food precinct, with access to infrastructure and services on one site. The food park is attracting strong interest and, following the decision to move to Edinburgh Parks, four high-profile businesses have progressed commercial discussions to take up tenancy, with the potential to secure 21 hectares of land.

The Edinburgh Parks site, managed by Renewal SA, will give food businesses the flexibility in land tenure and development opportunities that many expressed they were looking for. Local transport and storage company, Auscold Logistics, has been one of the first companies to sign a letter of intent to move to the food park. A $7 million Business Attraction Fund is now available to help businesses looking to relocate to the food park.

Another way in which we are supporting food businesses to innovate is through the South Australian Food Innovation Centre, which is helping businesses deliver high-value products sought after by local, national and international markets. In addition, the Advanced Food Manufacturing grants program co-funds the development of new or improved food products, or manufacturing, and the small Advanced Food Manufacturing grants program has helped six food businesses with funding totalling $180,000 to improve their products and compete on a global stage.

The Premium Food and Wine Credentials program assists food and beverage businesses and industry associations to attain industry-standard third-party certifications. Under round 4 of the program, nine South Australian food and wine businesses have been awarded more than $86,000 in funding to attain important certifications and boost exports in new and established markets. To further support access into international markets, local businesses can also apply to receive a statement of recognition for non-GM foods.

The Agribusiness Growth Program aims to accelerate business growth in the agriculture, food, wine and beverage industries, by providing expert business evaluation and coaching services. Designed by PIRSA, and delivered by Food SA and the South Australian Wine Industry Association—

The CHAIR: Nearly finished?

The Hon. L.W.K. BIGNELL: Yes, and this is the short version, Chair.

The CHAIR: Ten minutes is all you are allowed, unfortunately.

The Hon. L.W.K. BIGNELL: There is no clock up here.

The CHAIR: We have a clock, and it is—

The Hon. L.W.K. BIGNELL: We do not have one up there.

The CHAIR: I am not going to argue.

Members interjecting:

The CHAIR: Stop, everyone stop. I am not arguing; I am just tapping the desk and saying that you have one minute now.

The Hon. L.W.K. BIGNELL: Thank you. Designed by PIRSA and delivered by Food SA and the South Australian Wine Industry Association, the program is targeting businesses with turnovers of between $300,000 and $1.5 million, meeting a gap in small business industry development assistance. The new $1.8 million South Australian Wine Industry Development Scheme has been well received by the wine industry since it was launched in October last year.

Of course, I could not look back on the year without reflecting on the outstanding response from PIRSA staff to a series of emergencies, including the Gawler River flooding and the Riverland hailstorm, as well as the ongoing recovery efforts following the Pinery bushfire. PIRSA also responded to a range of pests and diseases throughout the year, including giant pine scale, Russian wheat aphid and the tomato potato psyllid, and participated in the national response to the prawn white spot disease in Queensland.

Of particular note is Biosecurity SA's role in the successful deployment of a national eradication response to the detection of the Khapra beetle on Kangaroo Island last year, which was recognised with the 2017 Australian Biosecurity Award.

The CHAIR: I was going to ask if it was your birthday yesterday, but I have decided not to ask you that now. Was it your birthday yesterday?

The Hon. L.W.K. BIGNELL: Yes, it was, Chair.

The CHAIR: We have established that.

Mr PEDERICK: I want to make a brief statement acknowledging the wonderful work that our producers and value-adders do in agriculture right across the state. Certainly, coming from a dryland heritage, I acknowledge that the planets almost lined up last season—good prices for wool, good prices for beef, good prices for lamb and the biggest grain and legume crops we have ever seen in the state. The money was down, but that was the only thing where the planets did not quite line up for everyone; however, it was a magnificent year. Things are struggling a little bit in areas this season but, due to dryland farmers' techniques with conserving moisture, some great work is happening, so I acknowledge everyone involved in agriculture.

I refer to Budget Paper 4, Volume 4, ministerial office resources, and page 14, ministerial travel. The 2017-18 budget for the minister's office is $1.6 million, with eight FTEs, and the 2016-17 budgeted amount was $1.57 million. Can the minister confirm how much of this budget was spent on ministerial travel and ministerial staff travel in 2016-17?

The Hon. L.W.K. BIGNELL: I thank the member for the question. I do not have that total figure here, but all our travel interstate and overseas is available online through proactive disclosure at the end of each month, so those figures are out there in the public realm. I welcome the member having a look at that and finding out those figures.

Mr PEDERICK: Minister, can you bring back to the house a collated—

The Hon. L.W.K. BIGNELL: They are already online.

Mr PEDERICK: That may be so, but I am just asking if you could bring them back to the house.

The Hon. L.W.K. BIGNELL: You can just do a Google search and find them.

Mr PEDERICK: Why do you or your staff not do that?

The Hon. L.W.K. BIGNELL: Why do you not do it?

Mr PEDERICK: No, I get to ask the questions.

The CHAIR: Order!

The Hon. L.W.K. BIGNELL: You ask the question and I give you an answer.

The CHAIR: Order! This is the sort of question that has been asked of other ministers. If you can just take it on notice, I am sure that would be fine.

Mr PEDERICK: I would like it to be taken on notice, ma'am, but I am not sure that he is.

The Hon. L.W.K. BIGNELL: It is there in the public realm. We have the member for Schubert, who gets up here all the time and says that we cannot ask questions because it is something that is available online. This information is available online—

Mr PEDERICK: He obviously does not like it. I will try another one: how many overseas trips did the minister have in 2016-17 and for how many days was the minister overseas?

The Hon. L.W.K. BIGNELL: I made two trips; one in late July, which was to South-East Asia, including Singapore, Malaysia and Thailand, was for eight days, from memory. I also had a trip in December to Guangzhou, where we met with China Southern. It was a huge coup for this government to bring direct flights from mainland China into South Australia, not only to bring in tourists but also to fill the bellies of the planes with great produce from South Australia and get that out into the marketplaces throughout China and the rest of Asia.

Mr PEDERICK: How many days was that second trip?

The Hon. L.W.K. BIGNELL: About three, from memory.

Mr BELL: Along the same lines, in 2017-18 the budget for the minister's office was $1.6 million with eight FTEs. In 2016-17, it was $1.57 million. Can the minister bring a detailed breakdown of what that $1.57 million was spent on?

The Hon. L.W.K. BIGNELL: The breakdown is for salaries and wages, operating expenses and office accommodation.

Mr BELL: Can you detail the exact amounts in each category?

The Hon. L.W.K. BIGNELL: We are just chasing that figure. We will hopefully get it to you in the next little while, before we end this session this morning.

Mr PEDERICK: I refer you to Budget Paper 4, Volume 4, Sub-program 1.1: Financial Commentary, page 17, in relation to the northern Adelaide food park. There is a $3.7 million reduction in budgeted expenditure associated with the northern Adelaide food park. What has been the total cost budgeted and committed to the northern Adelaide food park project since the 2014-15 period?

The Hon. L.W.K. BIGNELL: The food park will facilitate the co-location of food manufacturers and processors, food packaging specialists, storage, logistics and transport companies, and other related service providers, to increase industry efficiency, international competitiveness and stimulate employment. The next stage of the northern Adelaide food park is underway. Following extensive assessment and due diligence, as well as discussions with the food industry and potential new occupants, the food park will be located at Edinburgh Parks, instead of at the site initially selected at the nearby Parafield Airport's Cross Keys precinct.

During consultation, businesses expressed a desire for a variety of land tenure options to give commercial flexibility and accommodate individual business needs and preferences. Edinburgh Parks offers flexibility in land tenure that industry wants, is shovel-ready and sits within a dedicated growth corridor with connections to freight and transport routes.

The recently announced Food Park Business Attraction Fund provides $7 million in grant funding for food businesses, food processors and service providers looking to invest in their growth plans by scaling up and locating to the food park at Edinburgh Parks. Applications require a matched contribution at a minimum rate of dollar for dollar, with maximum funding of up to $1.5 million per applicant.

The key achievements for 2016-17 include completing concept site planning, feasibility assessment and due diligence and finalising the location for food park implementation at Edinburgh Parks. The next steps are to secure early-stage tenants of the food park at Edinburgh Parks, which will be conducted in partnership with Renewal SA. There is strong interest from industry in the Edinburgh Parks site, and commercial negotiations are underway with potential anchor tenants and developers, with a target for the food park to be operational in 2018. More than 180 businesses have registered their interest in receiving updates on the food park initiative.

The $1.994 million allocated for prefeasibility, concept, infrastructure and implementation planning was directed towards the following activities:

the funding deed with Parafield Airport Limited;

implementation planning and technical due diligence;

strategic framework;

investment and tenant attraction;

project management; and

demand study.

Of that total of $1.994 million, approximately 65 per cent of the costs incurred supported the implementation the food park irrespective of which site was selected. The remainder was directly attributable to the planning and investigation of the food park at the Parafield site. I will ask Mr Johinke to expand on the costs and the differences.

Mr JOHINKE: Of the $1.994 million the minister was just talking about in relation to prefeasibility, concept, infrastructure and implementation planning, around $700,000 sits in the 2016-17 estimated result, in addition to the $7 million for the Food Park Business Attraction Fund. Approximately $5 million sat in the 2016-17 estimated result, so that gives about $5.7 million in that year. The remaining $2 million of the Food Park Business Attraction Fund sits in the budget papers in the 2017-18 budget, so that reduction from $5.7 million in the 2016-17 estimated result to $2 million in 2017-18 gives a $3.7 million variance.

Mr BELL: Just to be clear, you are saying that the total cost budgeted since 2014-15 is about $9 million, so the $7 million plus the $1.99 million?

Mr JOHINKE: That is correct.

Mr PEDERICK: In regard to that—and I am going to talk in round figures here—a million dollars was wasted on the previous site at Parafield?

The Hon. L.W.K. BIGNELL: I might just pass over to Professor Mehdi Doroudi to answer that question.

Prof. DOROUDI: We went into the arrangement and agreement with Parafield Airport in terms of completing that feasibility study. Part of that study was directly related to that particular site, but a lot of the work we did could be adopted at any site. We cannot say if you refer to $1 million that was wasted, because if we have done work on the demand study, on energy efficiency, on any other business shared services that need to be done, most of that work could be adopted at the new site.

No doubt there has been specific work for that specific Parafield Airport site that was related to that site in terms of environmental assessment, site planning, etc., that could not be adopted directly at another site, but the volume of that as we calculate it, perhaps in the order of $1.9 million, something around 30 per cent could be specifically designed to that particular site. When you put that into calculation, it is perhaps around $300,000 or $400,000.

The Hon. L.W.K. BIGNELL: Just to finish off there, we tried to make Parafield Airport work. Parafield Airport tried to make it work. All the businesses that we spoke with tried to make it work as well. The best decision you can make, if it is not going to work for all the players, is to make the decision to find a location that will work, and that is what we have done so far. I would like to put on the record my thanks to Parafield Airport Limited, and my thanks to Professor Doroudi and everyone who has been working on this, including Food South Australia and those individual companies.

Everyone tried to make Parafield work. It did not work for a number of different reasons, and one of those, as I have outlined already, is that many of the owners of these businesses wanted to actually own the land they had rather than have a lease on a site that was tied up with Parafield Airport's own lease with the commonwealth government for owning an airport.

Mr BELL: Minister, can you indicate how 30 per cent of $1.9 million is $300,000? By my reckoning, 30 per cent of nearly $2 million is $600,000, or just a little bit under.

The Hon. L.W.K. BIGNELL: I will ask Professor Doroudi to respond.

Prof. DOROUDI: Just to clarify that, the specific cost to the site is around $700,000, including the deed that has gone to Parafield Airport. In terms of a percentage calculation, you are correct: it does not sit with what I said.

Mr BELL: Just to be clear, is it $600,000 or $700,000 wasted on the Parafield Airport site?

Prof. DOROUDI: Again, I would like to say that a feasibility study is a feasibility study. For any project that we run, we need to run a feasibility study to make sure it is either economically viable or not. From where we sit, we say something is wasted when we put in dollars associated with an investment when there is not going to be a return on that investment. We did not put any investment in place in terms of infrastructure that we would not be able to really get a return from.

A feasibility study is something that we have to go through to make sure it is economically viable. It was not economically viable or attractive enough to the clients, industry and the rest that we had. With the $700,000, we went into a deed with Parafield Airport because we just wanted to make sure that that feasibility study was going to be conducted and done in a timely manner. If we were going to leave it with Parafield Airport, it could have been another four or five years before we knew if it was going to be attractive to them or attractive to the industry.

In consultation with industry, we decided to provide this funding to Parafield Airport, and Parafield Airport matched that with their own dollars. For every single dollar that was spent here, they matched that to make sure that the timing of that work was going to be shortened in order to be able to get to a position as to whether we can effectively make a park there or not.

Therefore, I just do not know if I would say that the money has been wasted. The site was selected through an independent, open process where eight different applicants put in their applications. The site was selected for two main reasons: firstly, it was in close proximity to the CBD and in a better location; secondly, in total it is about 40 hectares of land. We could not necessarily get land of that size at some other sites.

When we went through all this process, we realised that there were a number of matters, like the additional external infrastructure that is needed to bring that site to a level that is ready for construction. Secondly, many, many of our clients and industry members said that they would like to own their land rather than lease it, and this is commonwealth land that we could not own anyway. No-one could own it. I hope that explains or articulates a bit further what happened here.

Mr BELL: I think the point that has been made is that $700,000 of taxpayers' money has been used and that project is not going ahead.

The Hon. L.W.K. BIGNELL: The project is going ahead—

Mr BELL: At Parafield.

The Hon. L.W.K. BIGNELL: —it is just not going ahead at the site that was initially selected. The real waste of money would be if we continued on down the track of developing and putting power and other infrastructure into that site for something when people did not want to move into that site at the scale that we had intended and at a scale that the industry wanted to do it. You may want to say that it is wasted money, but it is money well spent in terms of reaching the conclusion that we will reach.

What we all want to have at the end of the day, whether it is the food industry or the government, is somewhere the food industry can come together and expand their existing business, start up a new business or add to their business. What we are seeing is that the growth in food manufacturing is absolutely staggering. For 19 years in a row, we have had year-on-year growth in the food manufacturing sector in South Australia, so it is a terrific result. What we need to do as a government is help work with the industry to facilitate future growth. We all recognise that that needed to happen.

We have been working with Food SA and with individual companies. When you start going to 24 hours a day manufacturing shifts, you start to have some issues with your neighbours over noise, smells and other things. What we identified a couple of years ago was that people wanted to come together and have like-minded businesses in the one precinct where you could add in things like logistics, such as packaging, transport, quarantine, research or food safety testing. There was definitely a need for it.

Initially, when the call went out for a parcel of land, as Professor Doroudi said, there was analysis done on a number of different sites that showed that Parafield Airport was, at that time, the best site. Since then, the discussions we have had with the industry, particularly over the ownership of land, proved that it was not going to be the best site. We went looking for another site and Edinburgh Parks has turned out to be a real winner.

All the learnings we have taken out of the money that has been spent have been really valuable as we go out and talk to industry. We have four companies that have signed letters of intent to move into the Edinburgh Parks site. Proper due diligence and collection of information is not free; it costs money to do these things properly. It is better to work now and spend this sort of money than to spend millions and millions of dollars in infrastructure.

The cost of getting the sorts of power connections that we needed at Parafield to run energy-hungry businesses in the food manufacturing sector was huge. They are costs that we averted by doing this sort of due diligence, talking to the industry and working through what the needs of this site would have been, not just from a government point of view but from an industry point of view and from the airport's point of view. These are huge costs that you do not really know until you do the proper due diligence and analysis on the site.

Mr PEDERICK: Thank you, minister, but I think you still have a major disparity in what you are telling me are the numbers that were wasted at Parafield. In your own statement, you said that 65 per cent of $1.994 million was attributable to Parafield only, so I would say that you have buried $1.3 million, not just $700,000.

The Hon. L.W.K. BIGNELL: No, it is the other way around: 65 per cent of the costs incurred support the implementation of the food park irrespective of which site was selected—this is what I said earlier—and the remainder was directly attributable to the planning and investigation of the food park at the Parafield site. We are talking about 35 per cent, not 65 per cent.

Mr PEDERICK: You have talked about four proposed tenants. Have they only signed an expression of interest? They have not signed leases or contracts to purchase land at the proposed site?

The Hon. L.W.K. BIGNELL: I will ask Professor Doroudi to answer that question.

Prof. DOROUDI: Yes, all four of them signed an expression of interest and they are in direct negotiations and discussions with Renewal SA. I understand they have even pointed out or selected the sites that they are interested in and they are in that negotiation phase with Renewal SA.

Mr PEDERICK: How many hectares of the new site will these tenants who have expressed an interest occupy if they take up that expression of interest?

The Hon. L.W.K. BIGNELL: I will ask Professor Doroudi to answer that question.

Prof. DOROUDI: If they are all based on the allocated hectares that they have started negotiations on, something around 20 hectares are going to be occupied by the four companies.

Mr PEDERICK: With regard to the completion of the food park, when do you see that on-site construction will start?

The Hon. L.W.K. BIGNELL: As I mentioned in my earlier statement, next year.

Mr PEDERICK: What, the first quarter, the second quarter, the third or fourth quarter?

The Hon. L.W.K. BIGNELL: It is largely going to rely on what individual businesses want to do and, if they have existing operations, how they transition that from their existing site to the new site. We would like to see it early in 2018, but we are largely in the hands of the individual companies and what works best for them.

Mr PEDERICK: With regard to the private land of this new location, how many hectares are owned by Lang Walker and is it one of his companies that will need to be acquired for this food park proposal?

The Hon. L.W.K. BIGNELL: Some of the land in the precinct is owned by Renewal SA and some is land that is owned by other individuals, including people who have been involved in other forms of manufacturing and who, in the private sector, may wish to sell their properties. But we definitely have land that is owned by Renewal SA, and Renewal SA is willing and certainly keen to enter into any arrangements that companies or individuals would like to proceed with, whether that be on a sale basis or if it suited some companies to lease then Renewal SA is open to that as well.

Mr PEDERICK: Does Lang Walker or one of his companies own any of that land?

The Hon. L.W.K. BIGNELL: I am not sure who owns the land; all I know is that some land is owned by private companies and some land is owned by Renewal SA.

Mr BELL: So, minister, you are saying that you have no knowledge at all of Lang Walker or any of his companies owning any of the land to be acquired for the food park?

The Hon. L.W.K. BIGNELL: That is correct. I have no knowledge of who owns the land other than some is owned by Renewal SA and some is owned by individual landowners.

Mr BELL: When the maps were drawn and bits were added in and taken out, etc., that was done without your knowledge of who owns any of that land?

The Hon. L.W.K. BIGNELL: You are probably better directing these questions to the Minister for Planning or the minister responsible for Renewal SA rather than to me. What we know is that there is a site out there and some of it is owned by Renewal SA, for which I have no responsibility as the Minister for Agriculture, Food and Fisheries and Forests. So those questions on who owns the land at the moment will be better directed to the relevant minister.

However, what I can say is that there is a big parcel of land out there that, in a part of the world where we are seeing a huge transition away from automotive manufacturing to other forms of employment and the food manufacturing sector, as I said, has had enormous growth in the past 19 years in South Australia. We want to see further growth. We think this is an ideal site. Some of the land is owned by the private sector and some of it is owned by the government through Renewal SA. We have land for sale; the government has land for sale. The government has land out there for lease. What existing private owners do with their land is up to them.

Mr BELL: I find it staggering that land is included in the precinct, yet the government does not know who owns that land. That absolutely staggers me.

The Hon. L.W.K. BIGNELL: I have not said that the government does not know who owns the land; I said that I have responsibility for agriculture, food, fisheries and forests, and that is why I am here today. If you want to ask questions about who owns the land in that parcel, direct them to the relevant minister.

Mr BELL: You have had no consultation with that relevant minister on who owns that land?

The Hon. L.W.K. BIGNELL: It does not matter who owns the land from a food park perspective because a chunk of the land is owned by the government through Renewal SA and some of it is owned by a number of different private entities. I do not know whether Professor Doroudi wants to add to that.

Prof. DOROUDI: If I could just add to what the minister has said, we have talked to Renewal SA. Renewal SA has a good understanding of what rest of the land is privately owned and by whom. We did write to the owner of those lands.

Mr BELL: So you do know who they are?

Prof. DOROUDI: I do not know who they are.

Mr BELL: But you just wrote to them.

Prof. DOROUDI: No, I do not know who they are, but what I said was that they had been contacted in terms of the creation of this food park there. With that particular example of that company, we do not know in particular if they are interested in any development there or not, but we have been advised that there are one or two companies within the private sector that would like to turn their activities to food manufacturing and food-related activities.

Letters have gone out and we have talked to people just to let them know about this development and all the vacant land. Half the land at Edinburgh Parks is owned privately, but a major part of that half is free, it is available and it is on the market. We want to make sure that the approach to be taken towards government land is similar to the approach to be taken towards that privately owned land.

Mr BELL: Minister, I accept all that, but I still find it curious that you do not know who these private landowners are, yet the government has written to them. I am not saying that there is any conspiracy here, but does Lang Walker own a parcel of that land?

The CHAIR: I think you need to ask the relevant minister.

The Hon. L.W.K. BIGNELL: You can take any block of land—any parcel of land anywhere in the state—and I am not going to know who owns the different parts of it. I have said it several times: part of this precinct is owned by the government through Renewal SA and another part is owned by a whole lot of different individuals, as far as I know. For all I know, the member for Mount Gambier or the member for Hammond may own that land out there. It is not who owns the land—

Mr PEDERICK: My grandfather probably used to.

The Hon. L.W.K. BIGNELL: If only he had held onto it.

Mr PEDERICK: No, it was compulsorily acquired.

The Hon. L.W.K. BIGNELL: From that point of view, that is not the important part of what we are trying to achieve. As Minister for Agriculture, Food and Fisheries, what I want to achieve is finding a really good parcel of land where we can get companies in there starting not only from next year but well into the future as well. What we know about the private sector is that, if there is private sector land there and someone who owns the land gets offered a good price, they may well sell their land. As I said, there is a lot of land out there owned by Renewal SA, and Renewal SA has told us that they are happy to enter into negotiations over the leasing or sale of the land they own.

Mr PEDERICK: With the acquisition of the land, does that mean that all the private land will be compulsorily acquired?

The Hon. L.W.K. BIGNELL: No. I will say it again: part of the land is owned by Renewal SA and part of it is already owned by private individuals or companies.

Mr PEDERICK: What I am asking is: if people refuse to sell, will you compulsorily acquire the land for the food park because you have it inside your boundaries?

The Hon. L.W.K. BIGNELL: No. It is a precinct that has a mix of land owned by the government through Renewal SA and land owned by individuals. If we look at it, there is a whole bunch of different blocks out there owned by a whole lot of different individuals, and it is up to them. For example, if they are using their land at the moment to make components for Holden cars, which will not be made in South Australia from October, then they may well want to sell their business, their buildings and other infrastructure to someone involved in the food manufacturing area so that they can be part of a precinct that we as a government have earmarked as South Australia's food park.

Mr PEDERICK: What is the marketing and communications budget for promoting the food park and how much has been spent and over which financial periods?

The Hon. L.W.K. BIGNELL: In investment and tenant attraction, we have spent $195,000 on marketing, communication and investment attraction to get out there and talk to people. As we have said, we have interest from a great number of companies with which we now deal directly. They have been with us on the journey from when it was going to be at Parafield Airport, and they are still with us on the journey knowing that it is now going to be at Edinburgh Parks.

We are having constant discussions with them. Of course, we want to let people know that there is $7 million out there to attract people to the new site. We want to let them know that there is up to $1.5 million per company on a dollar-to-dollar matching to encourage them to set up in that area. As I said, four companies have already signed up. We need to get those stories out there; that would be part of the marketing budget.

Mr PEDERICK: How will the proposed food park land be zoned, and what is it currently zoned as?

The Hon. L.W.K. BIGNELL: I will ask Professor Doroudi to answer that one.

Prof. DOROUDI: If I could just add to a couple of matters previously discussed, for Renewal SA, one big point of difference today that we have in comparison to Parafield Airport is that Renewal SA works and acts as a developer. At the moment, they are responsible for conducting all the negotiations with everyone new coming in and everyone who is holding land there. They are going to be the ones who are going to implement it. What we are going to do is facilitate bringing food manufacturing and food industries to that park. In relation to the question about zoning, I have to take it on notice; I really do not know what the zoning arrangement is.

The Hon. L.W.K. BIGNELL: Again, I think they are questions best directed to the minister responsible. I am not the minister responsible for planning, and I am not the minister responsible for transport and infrastructure either.

Mr PEDERICK: Has the minister done any investigations on whether it will impact on local council rates?

The Hon. L.W.K. BIGNELL: Again, they are questions best directed to the responsible minister.

Mr PEDERICK: Okay, I will try the next one: can the minister confirm whether the proposed new food park will have B-double access?

Prof. DOROUDI: I can answer yes to that question. My understanding is, yes, because we did talk to the Department of Planning and Transport as well. My understanding is that the answer to that is yes, but again I believe we can take those questions on notice or pass them on to Renewal SA to clarify some of them.

The Hon. L.W.K. BIGNELL: They are questions best directed to the ministers responsible, not to us. We do a lot of good work with the Department of Transport and Infrastructure over B-double access and other areas to make it more efficient for our farmers and food manufacturers to have things, but those questions should be directed to the relevant minister.

Mr PEDERICK: In regard to the $7 million business attraction fund for the northern Adelaide food park, under which specific sub-program is it budgeted?

The Hon. L.W.K. BIGNELL: Can you repeat the question? I missed the first bit.

Mr PEDERICK: Under which specific sub-program is the $7 million Business Attraction Fund budgeted?

The Hon. L.W.K. BIGNELL: It is under Sub-program 1.1: Agriculture, Food and Wine.

Mr PEDERICK: What is the expected time line for these grants to be distributed and how much is allocated over the forward estimates over each financial period?

The Hon. L.W.K. BIGNELL: It will be $5 million in the first year and $2 million in the second year.

Mr PEDERICK: And $5 million being the current financial year we are in, I am assuming?

The Hon. L.W.K. BIGNELL: That is 2017-18.

Mr PEDERICK: So none of those grants has been distributed yet, or some have been?

The Hon. L.W.K. BIGNELL: No, they have not been distributed.

Mr PEDERICK: Who will be on the assessment panel providing advice to you, minister, with respect to applications for this funding?

The Hon. L.W.K. BIGNELL: It will be a panel made up of people within the agency.

Mr PEDERICK: So you have not selected those people yet?

The Hon. L.W.K. BIGNELL: Not yet.

Mr PEDERICK: Do you have a number for who you might put on that panel?

The Hon. L.W.K. BIGNELL: We always have at least three, so it would be at least three.

Mr TRELOAR: I refer to Budget Paper 4, Volume 4, sub-program 1.1, which relates to the PIRSA administration of concessional loan schemes. Can the minister detail how many drought concessional loan applications were received?

The Hon. L.W.K. BIGNELL: The number of loans approved for drought assistance is 18.

Mr TRELOAR: So there were 18 drought concessional loans. How many of the applications were successful?

The Hon. L.W.K. BIGNELL: Eighteen.

Mr TRELOAR: All 18? All those that were applied for were successful?

The Hon. L.W.K. BIGNELL: Sorry, 37 were applied for and 18 were successful.

Mr TRELOAR: What was the total value of the successful applications?

The Hon. L.W.K. BIGNELL: About $8.4 million.

Mr TRELOAR: And the cost to PIRSA of administering the drought concessional loan scheme?

The Hon. L.W.K. BIGNELL: We will just work on a figure. Maybe we can go to the next question and come back to that because what we have is a whole figure, including dairy loans as well.

Mr TRELOAR: Yes, I am going to come to them. Can the minister also detail how many Farm Finance Concessional Loan applications were received, and how many of those applications were successful.

The Hon. L.W.K. BIGNELL: Can we just get some clarification about the Farm Finance Concessional Loans because they actually closed off in 2015, so they would not be part of this budget.

Mr TRELOAR: Alright, thank you, minister. We might move on to dairy concessional loans in that case. I will ask the same questions. How many dairy concessional loan applications were received and how many of those applications were successful?

The Hon. L.W.K. BIGNELL: Under the dairy recovery loan scheme, we had 16 applications: nine were approved, three declined, three withdrew and one is being assessed.

Mr TRELOAR: What was that total value of the successful applications, minister?

The Hon. L.W.K. BIGNELL: About $8.55 million.

Mr BELL: What advice have you received from DairySA regarding the difficulty faced by farmers in the application for these loans?

The Hon. L.W.K. BIGNELL: We were the first state government to loan money to people and to make sure that, after Murray Goulburn put dairy farmers in South Australia in such a precarious position, we were the first state government in Australia getting money out there for those immediate concerns, which were all about getting people back on board financially, but also emotionally, because we know it was such a huge shock to people that there were real mental health issues. Then we worked with the federal government to make sure that we could get access to federal funds to help people out as well.

While we administered those loans and that money, the rules were set out by the federal government, and as the Federal Minister for Agriculture, Barnaby Joyce, and I agree—and we have always had this approach—we want to get as much money as we possibly can to people who need that money. But, as minister Joyce says, it is not there as a grant. If people cannot pay it back then we cannot support businesses who cannot pay the money back.

Mr BELL: The question was more around advice received from DairySA.

The Hon. L.W.K. BIGNELL: We are not aware of advice from DairySA. As I said, the feedback we got, certainly from David Basham when he was the head of the Australian dairy association, was that the Do Dairy campaign that we came up with was really good in making sure that South Australian consumers, who can play an enormous role in all this, would be reminded that they should be out there supporting South Australian dairy farmers and avoiding buying dairy products that were not produced by companies that have a good strong South Australian basis.

Earlier in the year, I was at Mount Compass and met with people from DairySA and local dairy farmers. It was a really tough 12 months for these people, but we should remember that none of this was the doing of government: this was all the doing of Murray Goulburn. While people might want to say, 'The government should do this. The government should do that,' what this government has done is really gone in to bat for farmers by supplying information to the ACCC.

I want to congratulate the ACCC on the hard line they have taken with Murray Goulburn to bring them to account for the deplorable way they treated farmers in South Australia and Victoria. What they did was disgusting and I welcome the ACCC's involvement and the actions they have taken to date. I know that there is still more to come on this issue. What happened to South Australian dairy farmers was terrible. If I can update my previous answer about the value of the drought loans, it is $9.4 million.

Mr BELL: Minister, I find it interesting that DairySA has never mentioned to you that water not being included as an asset has reduced their farm value by up to a third. So no DairySA representative has indicated to you that water not being included as an asset in bank valuations has reduced their farm values by a third and that they find the government's process for this loan too clunky and too difficult?

The Hon. L.W.K. BIGNELL: Those concerns were raised by DairySA in terms of the water allocation being included. Sorry, you were not specific in your first question about that part of the—

Mr BELL: But I asked what correspondence you had had from DairySA, what concerns had been raised. You said there were none; now you are saying there are.

The Hon. L.W.K. BIGNELL: Sorry, I misunderstood your question; I thought you were talking about the way the loans were assessed by PIRSA. Yes, those concerns were raised, and it is a matter for DEWNR, the Public Service department that is responsible for water in the state. My understanding is that they are working with their federal counterparts to see if things can be changed in the future.

While PIRSA does take into account water licences when assessing property value, current water licence arrangements in South Australia do not provide financiers with a satisfactory mechanism to register a formal security interest if a water licensing claim proceeds in the event of default. This has not affected the outcome of any application for a concessional loan. I think it is important that we make the point that no-one who put in a loan application has not been successful because of the water issue.

The statutory requirements under the Natural Resources Management Act 2004, which would enable the registration of security interests and caveats against water licences and entitlements, are not yet fully operative. Schedule 3A has not been brought into operation as the South Australian water register does not have the ability to meet in full the demands that registration of security interests requires. It was intended this would be implemented as part of the commonwealth Common Registry Solutions: however, the Australian government made the decision not to proceed with that project in May 2014.

Subsequently, I am advised, DEWNR has developed a proposal to seek funding for the development of a new water register through the commonwealth. The South Australian government is very supportive of the ability for security interests to be registered against water licences and entitlements, as this will help to generate significant investment in water-based industries and greater productivity for the state.

Mr TRELOAR: If we can go back to the dairy concessional loans once again, we are keen to know the cost of the administration of those loans to PIRSA. Are you able to shed any light on that?

The Hon. L.W.K. BIGNELL: The administration costs incurred by PIRSA since 2013—and this is not just the dairy loans; this is overall—to the end of June 2017 in managing and promoting the schemes and assessing the 102 applications, together with subsequent loan settlements and ongoing management of the approved loans, has been under $1 million. PIRSA costs include staff undertaking regional visits to meet one-on-one with potential applicants, 10 field days and answering phone inquiries.

In addition, the loans already approved will need to continue to be administered for up to 10 years during the life of the loan. Based on current loan agreements, PIRSA will incur administrative costs until 2028 as a minimum, and that will be longer if any of these loans require recovery actions.

Mr TRELOAR: I refer to Budget Paper 4, Volume 4, sub-program 1.1. The budget papers indicate that in 2016-17 there was $3.1 million worth of expenditure for the Riverland storm recovery program, $1.7 million for the Gawler River Floodplain flood recovery program and $19,000 for the Pinery Bushfire recovery program. Can you detail how many Riverland storm recovery program grant applications were received? The same series of questions will also apply: how many applications were successful, what was the total value of the successful applications, and what was the cost of administration?

The Hon. L.W.K. BIGNELL: From the outset, I would like to thank all those people right across the Public Service who worked so hard during last year, an unprecedented year in terms of natural disasters. I want to commend all the PIRSA staff who were out there in pretty trying conditions working closely with people who suffered some really horrendous losses. None of the three natural disasters had any real similarity other than there were victims who needed to be helped, but we needed to come up with solutions which varied from Pinery to the Northern Adelaide Plains flooding to the hailstorm that went through the Riverland in November last year.

I was up there with the local member, the member for Chaffey, and Assistant Agricultural Minister Anne Ruston as well, the day after that hailstorm went through, and it was terrible to see the damage that had been done to so many farming areas. It was also very sporadic in the way it cut a path through the Riverland.

With the Riverland storm, the overall estimated crop loss was $74 million, and up to $3 million has been made available for the NDRRA grant scheme. The grants are specifically available to commercial-scale primary producers for immediate clean-up, disposal and restoration activities following the flood. Primary producer recovery grants for the Riverland storm closed on 9 June this year and 117 grant applications were received, with a total value of $1.009 million. As at 28 July, 84 have been approved with a total value of $716,164, nine applications have been declined or have been withdrawn, and the remaining applications are with applicants seeking further information.

A clean-up of approximately 50 hectares of fallen and damaged stone fruit was undertaken with the support of the Cadell Training Centre, thereby reducing the risk of a fruit fly outbreak. The approximate cost for the Riverland administration was about $110,000, and PIRSA maintains a dedicated recovery facilitator based at the Loxton Research Centre who works in collaboration with the Department for Communities and Social Inclusion.

Mr TRELOAR: In relation to the Gawler River Floodplain flood recovery grants, how many grant applications were received, how many were successful, what was the total value of those successful applications and what were the administration costs?

The Hon. L.W.K. BIGNELL: In regard to the Gawler River Floodplain recovery activities, the overall estimated crop loss for this event was $51 million. Up to $3 million was made available for the national grants scheme. The grants are specifically available to commercial-scale primary producers for immediate clean-up, disposal and restoration activities following the flood. There were 139 applications received, and 133 were approved. The grants closed on 14 April 2017. The value of those 133 applications that were approved is $1.2 million.

There was also $120,000 provided for immediate assistance to pump floodwater away from properties and to accelerate drainage. Having been out there in those days after the floods, that was the concern that growers and council put to us. We needed to help the farmers get that water away from their properties as soon as we possibly could. Once again, I would like to commend everyone who was involved in making sure that those pumps were out there as quickly as possible and draining the water not just to neighbouring properties but getting it away from the area as well.

PIRSA maintained a dedicated recovery facilitator and other support staff based in the Virginia recovery centre, who worked in collaboration with the Department for Communities, an appointed recovery coordinator and industry organisers to gather intelligence and provide technical advice and assistance with recovery grants. A range of technical advice and activities has been implemented to support the restoration of soil resources.

Once again, I would like to thank everyone for the great work that they did out there, working day and night in the recovery centre so that people could come in with any sort of questions. We also had people communicating with people in Vietnamese and Khmer to make sure that anyone who had any questions could get answers. The Gawler administration costs for grant programs were around $100,000.

Mr TRELOAR: In relation to the Pinery bushfire program, can the minister detail how many Pinery bushfire grant applications were received, how many applications were successful, the total value of those successful applications and the total cost of administration?

The Hon. L.W.K. BIGNELL: Once again, I would like to place on the record my thanks to those people from PIRSA and other government departments who were in there working hard with the victims of these fires. They were terrible fires, of course, that cost two people their lives and also did amazing damage towards the end of the year before last. Anyone who went out there in the months following would have seen the awful dust storms and whirly-whirlies that did additional damage to the topsoil.

The overall estimated agricultural loss for the Pinery fire was $27 million. The Insurance Council of Australia declared the event catastrophic, with insurance claims of more than $169 million. Up to $4.5 million was made available for the NDRRA grant scheme. The grants were specifically available to commercial-scale primary producers for immediate clean-up, disposal and restoration activities following the fire.

The grant applications closed on 4 November 2016. We had 99 applications and 88 grants, with a total value of $792,000, were approved. PIRSA maintained a dedicated recovery facilitator who worked in collaboration with the recovery coordinator and industry organisations to gather intelligence, provide technical advice and provide assistance with recovery grants. Biosecurity SA provided immediate animal welfare assistance following the fire. The cost to administer the grant applications was around $70,000.

Mr BELL: Minister, can I take you back to the Riverland storm recovery grants. It is a $3.1 million budget and there were 80 successful applicants at $10,000 each, which is $800,000. Where is the other $2.2 million?

The Hon. L.W.K. BIGNELL: The total pool was $3 million and that is to cater for as many people as apply, but we did not have $3 million worth of applications.

Mr BELL: I will ask the question again: where did the $2.2 million that was left over go? There were 80 successful grants at $10,000 per grant.

The Hon. L.W.K. BIGNELL: That was expenditure authority to spend up to $3 million, but that does not mean that we have to spend it.

Mr BELL: I will ask the question again: where did that $2.2 million go?

The Hon. L.W.K. BIGNELL: It was just part of our normal budget but, when we get a natural disaster event like this, we allocate money that—

Mr BELL: Yes, it is budgeted for; I understand that.

The Hon. L.W.K. BIGNELL: So it would just be returned to the budget. It is part of the budget at the end of the year. We want to make sure that, in the worst-case scenario, we have more money there than we are possibly going to need to help people out.

Mr BELL: Of that $2.2 million that has been returned to the budget, how much of that again was for administration costs?

The Hon. L.W.K. BIGNELL: Which one was this?

Mr BELL: This is for the Riverland storm recovery grants.

The Hon. L.W.K. BIGNELL: It was $110,000, which includes having people up there on the ground and helping people who just come in to the centre. We have seen this a lot of times. Last year was such a terrible year for natural disasters and, unfortunately, we had to be out there responding to these things. Having been to these centres and seen the state that people are in when they come in, they need good and clear advice, and that was provided in all three of these examples.

The Hon. S.W. KEY: My question relates to Budget Paper 4, Volume 4, sub-program 1.1, pages 17 to 19. Can you provide an overview of the outcomes—I know you did do some of this in your introduction—of the Premier's trade mission to China in May of this year?

The Hon. L.W.K. BIGNELL: I thank the member for Ashford for this question. From 7 to 16 May 2017, the South Australian government led an international trade and investment mission to Shandong Province, Guangzhou and Shanghai. As part of the mission, a joint sitting of the South Australia-Shandong High Level Working Group was held in Jinan on 12 May, where both sides celebrated the success of the relationship and agreed to continue implementing targets set under the South Australia-Shandong Friendly Cooperation Agreement and Action Plan 2015-2018.

PIRSA delivered the wine program, which included 46 delegates from 20 wine companies. PIRSA also led the Agribusiness Market Access Program for the cherry, apple and pear industry, which had six delegates; the tuna representatives, with two delegates; and the Extension Services program, which had one company participating.

PIRSA also supported South Australian participation in the Wine Australia program from 14 to 20 May, which included 18 South Australian companies and 25 delegates. This program included the official launch of the Great Wine Capitals network, membership at wine show events run as part of a Wine Australia China Roadshow in Chongqing and Zhengzhou and facilitated the Great Wine Capitals official launch event in Beijing and the Barossa Grape and Wine Association event.

PIRSA joined Austrade at the Chateau Seppeltsfield Minquan launch and participated in a media panel session which discussed Seppeltsfield's relationship with Minquan, South Australia's position as Australia's wine capital and Australia's trade relationship with China in wine. The mission built on crucial government-to-government relationships PIRSA has developed with the Shandong provincial government, Guangzhou and Shanghai to deliver greater export opportunities for South Australian businesses.

PIRSA and the Shandong provincial Department of Agriculture progressed the Yellow River Delta region agreement and undertook a site visit to the region. During the visit, they met with the Dongying government and agriculture bureau. PIRSA will provide support for the establishment of trials of lucerne and other pasture products and facilitate further communication with South Australian industry representatives and the Shandong Department of Agriculture.

PIRSA continues to lead the agriculture subcommittee of the South Australia-Shandong High Level Working Group. Key deliverables in the remainder of this year include the implementation of the Yellow River Delta region demonstration project and hosting the agricultural manufacturing and processing delegation from Shandong later in the year. The immediate outcomes of the Agribusiness, Food and Wine Program include the following:

The wine program delegates reported making business connections they believe will result in export deals with an estimated total value of $780,000.

Dinko Tuna is progressing negotiations for the sale of southern bluefin tuna into China.

As a result of meeting with the Chinese Ministry of Culture, South Australia is positioned to host the China-Australia Plant Health Bilateral Workshop to be held in 2018, a crucial opportunity to showcase South Australia's credential in fruit fly monitoring and control and raise awareness of the Riverland pest-free area.

PIRSA established a new relationship with the State Administration of Grain, which opens up research opportunities in the grain supply chain.

South Australian cherry growers have been invited to participate in China's National Cherry Association Forum in April 2018 to highlight 'the Australian cherry to China'. They have been involved in discussions on a possible partnership between CIQA and other industry associations and they met with the Ministry of Agriculture.

The Wine Australia Roadshow program included:

PIRSA promotion of South Australia's membership of the Great Wine Capitals network during Wine Australia Roadshow events in Chongqing, Zhengzhou and Beijing.

In addition, PIRSA launched a membership of the Great Wine Capitals network to a mainland audience in Beijing. Approximately 30 Chinese wine writers, media representatives and influencers participated in the official launch.

Mr PEDERICK: My question relates to Budget Paper 4, Volume 4, Sub-program 1.1: Agriculture, Food and Wine, description/objective, page 17—and there is some on page 12. The objective of the sub-program and the agency more generally is the delivery of the South Australian government's premium food and wine produced in our clean environment. Page 12 of this agency statement also references South Australia's status as a producer of non-genetically modified food crops. Is the minister aware of any genetically modified crop outbreaks in South Australia in either 2016 or 2017 and, if so, how many?

The Hon. L.W.K. BIGNELL: I will ask Will Zacharin to come and provide an update on that.

Mr ZACHARIN: Of course, in South Australia the cultivation of genetically modified food crops is subject to the requirements of the Genetically Modified Crops Management Act 2004. That does make it an offence to cultivate a GM food crop without exemption from the Minister for Agriculture, Food and Fisheries. Under section 4 of the act, though, it is possible to declare tolerance thresholds relating to the presence of GM material in crops. This was last done on 28 August 2008, at which time the threshold in relation to the presence of GM material in any seed used to cultivate a canola food crop was declared to be 0.5 per cent.

An earlier notice, effective from 9 November 2005, declared thresholds for canola grain for commercially harvested food crops generally to be a GM presence of up to 0.9 per cent. These thresholds, which meet internationally accepted standards, are required to cater for a low-level prevalence of GM trait that may occur from time to time in some lines of non-GM canola. Viterra Australia samples all deliveries of canola grain to their silo receival sites within South Australia. This includes a test for the presence of genetically modified traits. On delivery, farmers are also required to complete a canola sample declaration form stating that none of the canola in the load is a genetically modified variety.

Viterra has informed PIRSA to date that there have been no confirmed GM detections in any South Australian-delivered canola in South Australia. Viterra only accepts varieties of canola from the Australian Oilseeds Federation's approved list of non-GM varieties. While Viterra is understood to be the only bulk-handling company to receive canola, some canola is sold into domestic markets or exported in shipping containers. These pathways are not necessarily subject to the same GM testing regime. However, seed vendors sell seed from the AOF-approved non-canola variety list, which meets the 0.5 per cent threshold for seed used to cultivate a crop. This gives assurance that canola crops grown in South Australia are indeed non-GM, compliant with the current regulated maximum threshold levels.

On 22 May 2019, Biosecurity SA became aware of a report from a Mid North farmer of a number of self-sown or volunteer canola plants that had survived a spray of glyphosate while others in the paddock had died. Biosecurity SA conducted a site visit on 23 May, and a small number of mature plants were observed to be actively growing amongst a number of dead and dying plants. Some newly germinated volunteer canola plants were also observed within the newly emerging wheat crop at the site. This late-germinating canola would not have had exposure to the earlier glyphosate treatment, as glyphosate has no residual activity.

It was uncertain at the time whether or not the canola plants were genetically modified and so bred to be resistant to glycophosphate, although it was noted that the rate of germination represented a level below the declared tolerance level for canola seed. Four samples were taken and dispatched to the National Measurement Institute to be tested for all released and unreleased GM traits. Results from these tests were received on 2 June and confirmed that the samples contained the Roundup Ready gene Gt/Rt73, making them the Monsanto strain of Roundup Ready canola. The farmer agreed to spray the crop with an alternative herbicide to control these volunteer plants.

The seed company responsible for this seed line has a stewardship scheme that describes the risk of glycophosphate resistance and how best to manage the issue of volunteer plants. While we believe that no offence was created against the act in this instance, the seed company has been advised of the potential implications of South Australia's market and trade advantages gained by our policy prohibiting the cultivation of commercial GM food crops. They were also advised of the penalties that could apply should a GM food crop be knowingly cultivated in the state, where a maximum penalty of $200,000 applies. They were asked to provide specific advice on volunteer plant management that could be provided to these growers in instances such as these, and they were asked to provide comment on how the risk of an escalated event could be avoided.

In addition to those actions just described, the seed company responsible for this seed line visited the site, along with the local gene tech agronomist, on 27 June and spoke to the landholder and the manager of the vineyard, which the landholder share-cropped last season. Both parties were provided with advice on how to control these volunteers, and programs were put in place to monitor the effectiveness of the control measures.

The local agronomist for Pioneer Gentech will continue to monitor the site. Pioneer Gentech has conducted an audit of all seed lots sent to the Mid North seed distributor since 2011, and none has shown an advantageous level greater than 0.1 per cent. Pioneer Gentech will also conduct internal audits more frequently on their seed production program. They have joined the Excellence Through Stewardship program, which is a voluntary international program, which audits members to ensure their stewardship programs meet international standards. In this case, the issue has been fully addressed.

The CHAIR: Before you go on, can I clarify, through you, minister, the date at the beginning of your long contribution? What year was that?

Mr ZACHARIN: Yes, 2017.

The CHAIR: It is just that you did say 2019, and we just wanted to make sure it was 2017. Member for Hammond.

Mr PEDERICK: Hopefully, I have got this right: on 2 June, the department knew about the genetically modified canola, but they did not notify the farmer until 27 June; is that correct?

Mr ZACHARIN: No, it was 22May that Biosecurity SA became aware of the report.

Mr PEDERICK: When did you notify the farmer? Was that 22 June or before that?

Mr ZACHARIN: We visited the site the day after, on 23 May.

Mr PEDERICK: And the farmer was obviously alerted at that stage, I am assuming?

Mr ZACHARIN: Yes.

Mr PEDERICK: How many properties with genetically modified plants were identified and how many hectares were identified?

The Hon. L.W.K. BIGNELL: I will ask Will Zacharin to answer that one.

Mr ZACHARIN: We took samples from only one property that was reported to us.

Mr PEDERICK: On how many hectares did those Roundup-resistant, genetically modified plants show up?

The Hon. L.W.K. BIGNELL: I will ask Will Zacharin to answer that one as well.

Mr ZACHARIN: All I can say is that the volunteers were in one paddock. I cannot tell you the exact number of hectares, but you are talking about a small number of volunteer plants in one paddock.

Mr PEDERICK: Well, one paddock is very subjective: years ago, it was 40-acre paddocks, and now we have 400-acre paddocks. You have no idea of the proportion of land this was on?

The Hon. L.W.K. BIGNELL: We do not have that information with us.

Mr PEDERICK: Are you able to bring that back to the house?

The Hon. L.W.K. BIGNELL: Yes.

Mr PEDERICK: Are you able to provide the locations of where this was?

The Hon. L.W.K. BIGNELL: I will ask Will Zacharin to answer that.

Mr ZACHARIN: Of course we know where the property is, but we do not tend to make that public. We deal with the farmer if they have the volunteers. They have not created an offence under the act, so we assist them to make sure that they can get rid of those volunteer plants.

Mr PEDERICK: Has PIRSA run a check to see that the alternative spraying methods have knocked out all the volunteers?

Mr ZACHARIN: We have.

Mr PEDERICK: Was that 100 per cent successful?

Mr ZACHARIN: Yes, but we will continue to monitor that site. It is also being monitored by the agronomist of the seed company.

Mr TRELOAR: Has PIRSA done any work with the seed supply company to ascertain where other seed from this particular batch may have been distributed?

The Hon. L.W.K. BIGNELL: I will ask Will Zacharin to answer that one.

Mr ZACHARIN: We work with the seed company to find out who they have been supplying that seed to within the general area. They have been following up with a number of their producers in the area to see if they have had any volunteers as well. We have provided general information to the company through their agronomist that they can pass on to those people, if there were any other volunteers, to make sure that they can treat them accordingly.

As I have said, there are threshold levels. This is not an isolated incident. We see these year on year and we assist those people who may have problems. It comes down to seed quality. These companies provide seed all over Australia, and of course we make sure that they have appropriate sampling regimes and quality assurance in place so that they are well under the threshold limits of our legislation.

Mr TRELOAR: Minister, if this is not an isolated incident, how widespread is this problem?

The Hon. L.W.K. BIGNELL: I will ask Will Zacharin to answer that one.

Mr ZACHARIN: We investigate incidents from time to time. Some years we go without having any reports, but last year we had that report from this particular property. It was unusual for him; he had been using the same supplier for a number of years, so this was unexpected. That was good for him to come forward and provide that report to us, and then we were able to help him to deal with it.

Mr PEDERICK: My understanding, minister, is that this was a 200-hectare paddock in a reasonably productive area. How many tonnes of canola would have been delivered off this property? It was a pretty good year, so I would suggest that possibly 400 to 500 tonnes would have been delivered to the system.

The Hon. L.W.K. BIGNELL: First of all, if you know the size of the paddock we will not bring an answer back, and I will ask Will Zacharin to answer it.

Mr PEDERICK: You might have a different answer, that is all.

Mr ZACHARIN: As I reported, Viterra is the only bulk-handling company to receive that canola, and they manage all those pathways. They take samples from every single delivery to make sure that there is no GM canola in those deliveries. They certainly have not picked that up in their testing.

Mr PEDERICK: In any testing of that farmer's canola, they have not picked up that there was genetically modified canola in there?

Mr ZACHARIN: Correct.

Mr PEDERICK: How soon were Viterra notified of this incident?

Mr ZACHARIN: We notified Viterra one or two days after we knew about it because we went back to ask them about their grain sampling and to make sure that they were grain sampling in that area. They were aware that we had had this detection of volunteers, and we were provided that information by the company.

Mr PEDERICK: Just to clarify, is the tolerance operating at the moment at 0.5 per cent or 0.9 per cent in genetically modified identified seed?

Mr ZACHARIN: The non-canola variety list meets a 0.5 per cent threshold for seed.

The CHAIR: If you are moving off this—

Mr PEDERICK: No, and I have another one.

The CHAIR: The member for Torrens has some questions as well

Mr PEDERICK: I have another quick line after this question. Were neighbours informed of this outbreak?

Mr ZACHARIN: Yes, we had people go to the contiguous properties next to this detection and talk to those people to see if they had been growing that same seed from the same supplier of canola as well.

Mr PEDERICK: Just in regard to canola again, what is the name of the Japanese company that Kangaroo Island Pure Grain works with to export into Japan?

The Hon. L.W.K. BIGNELL: The name of the Japanese company is Hirata Industries.

Mr PEDERICK: Can the minister confirm whether or not he has annual meetings with that company?

The Hon. L.W.K. BIGNELL: Yes, that is correct. They come here each year, and I have met with them, as has the Minister for Trade.

Mr PEDERICK: So you would do that annually with the Minister for Trade?

The Hon. L.W.K. BIGNELL: Yes, well, either one of us will meet or sometimes both of us; I think that last year we both met with them.

Ms WORTLEY: I refer the committee to Budget Paper 4, Volume 4, page 22, sub-program 1.4. Minister, what is the state government doing to position the South Australian Research and Development Institute as the research provider of choice into the future?

The Hon. L.W.K. BIGNELL: This year marks the 20^th anniversary of PIRSA's research division, the South Australian Research and Development Institute (SARDI). This is an excellent opportunity to celebrate how SARDI's innovative, world-leading applied research has helped our agricultural industries become internationally competitive, and as we recognise SARDI's past achievements since its establishment we also look ahead to an exciting new era following an independent review in 2016.

Firstly, there is fresh leadership with the recent appointment of Dr Peter Appleford as SARDI's executive director, a highly respected public sector executive with an outstanding track record in primary industries and emergency management leadership.

Underpinning the new strategic direction is a research and development plan to focus on supporting our thriving food, wine and agribusiness sectors. To help position SARDI into the future, a new reference group has also been formed, with members including the Chief Scientist and industry leaders, to provide independent strategic advice.

There is also major investment in infrastructure, with a $3.8 million redevelopment of the Clare Research Centre now near completion, with six new purpose-built laboratories, which will enhance SARDI's research capabilities, particularly in the Mid North, and a recent planned $1.8 million upgrade of SARDI's Molecular Diagnostic Centre at the Waite campus will double the processing capacity to 60,000 samples per year, thereby strengthening our surveillance of serious pests and diseases, including phylloxera and zebra chip.

Ongoing collaboration with industry will be a feature of SARDI's future direction. As part of the $50 million bilateral agreement between SARDI and the Grains Research and Development Corporation, six regional agronomy researchers have been appointed in the past year based in key cropping regions, including Eyre Peninsula and Yorke Peninsula. SARDI is also working closely with the Almond Board of Australia to set up the new 60 hectare Almond Centre of Excellence research site at the redeveloped Loxton Research Centre to focus on ways to boost almond production and export.

SARDI has been a vital part of primary industries applied research in this state for the past 25 years and, as you can see, plans are well and truly underway to ensure this remains the case for the next 25 years and beyond.

Mr BELL: Minister, can you indicate the net cost of the SARDI sub-program and the FTE allocation over the forward estimates?

The Hon. L.W.K. BIGNELL: We have the 2017-18 budget figure, and the net cost of the sub-program for that year is $25.207 million and the FTEs are 398.

Mr BELL: I was particularly interested in the forward estimates. Do you have costings going forward?

The Hon. L.W.K. BIGNELL: I might just ask Stephen Johinke to explain the method that is used on the forward estimates.

Mr JOHINKE: In the production of the budget papers each year, the cost of the agency's corporate services are pushed into the programs. That is done for the four years that are presented in the budget papers, but that is not actually undertaken across the forward estimates until the relevant budget year comes around.

Mr BELL: Can the minister confirm when the review of SARDI was completed and what the total cost of the review was?

The Hon. L.W.K. BIGNELL: Professor Doroudi led the review, so I will get him to answer the question.

Prof. DOROUDI: The total cost for the review was $107,000, employing ACIL Allen, which has a good reputation in terms of conducting the same sorts of studies for other organisations like CSIRO, and part of some of the advisory group that we put together to provide input that we need in terms of the direction that that review needs to take.

Mr BELL: Minister, when will the review be made public?

The Hon. L.W.K. BIGNELL: It is on the website. Get the member for Schubert to google it.

Mr BELL: My last question on this is: what is the proposed time line for the development of a 10-year strategic plan for SARDI and when will this be made public?

The Hon. L.W.K. BIGNELL: Again, I will ask Professor Doroudi to answer that one.

Prof. DOROUDI: We had four major outcomes from the review. One was having a clear vision or strategic plan for five to 10 years into the future. The other area was taking the research development more towards extension and commercialisation. One area, in terms of the management and high-level input within SARDI, was that, although our agency has close relationships with many stakeholders and many industry associations, it was seen that there is a need to have a reference group or an expertise group to provide high level advice.

We put the group together with the input and direction that we would like them to have. We appointed a new executive director as well. Right now, we are also working with staff at a different level. We are planning that within the next three months we will have a strategic plan in terms of what needs to be done into the future. That is going to look into many aspects of research priorities, positioning ourselves within the national R&D framework, making more commercialised activity out of what we do and having a more efficient business model to run the agency.

The Hon. S.W. KEY: My question to the minister refers to Budget Paper 4, Volume 4, program 1, sub-program 1.5, statement pages from 24 to 25. Minister, I would like you to tell us about how the Primary Industries and Regions SA Aboriginal Partnerships Unit is working and how it is creating opportunities communities and businesses.

The Hon. L.W.K. BIGNELL: I thank the member for Ashford for the question. PIRSA's Aboriginal Partnerships Unit has a key role in supporting and assisting the divisions of PIRSA to create opportunities that increase the participation of Aboriginal people in South Australia's economic prosperity. I am advised that the unit provides leadership on Aboriginal employment and procurement across the agency and is driving the development of PIRSA's forthcoming reconciliation action plan, which includes targets to create further opportunities for Aboriginal employment and economic development in South Australia.

The unit works across the agency to leverage existing PIRSA policies, programs and projects for broader investment opportunities and ensures the participation of Aboriginal people in South Australia's economy. Some of the results of this collaboration for PIRSA include the creation of five new positions for Aboriginal people who are keen to pursue careers in the fisheries sector through the Aboriginal Fisheries Officer Career Pathway Program, including the appointment of a traditional fisheries manager and four Aboriginal fisheries officers.

In addition to the above, and as part of our partnership with the First Steps program in 2016-17, we employed six Aboriginal people to support them with meaningful entry-level employment and training within PIRSA to develop work-ready skills and confidence to transition into longer term employment pathways. We are also assisting four Aboriginal people to complete tertiary studies through our PIRSA scholarship program and the South Australian Research and Development Institute bursary. We are supporting four external traineeships with Yalata Aboriginal community and Alexandrina Council through the Regional Youth Traineeship Program.

In addition, through PIRSA's partnership with the Indigenous Land Corporation, the state government is supporting new employment and economic development opportunities for up to 20 Aboriginal people through the extension of the North-West Indigenous Pastoral Development Program. Also, through the South Australian River Murray Sustainability (SARMS) Program, the Gerard Aboriginal community has successfully completed the irrigated hay enterprise, which has longer term economic potential for the community.

Building on this success, the SARMS Regional Development and Innovation Fund is supporting development of the native foods industry in partnership with two regional Aboriginal businesses. This includes the recently announced Wellington Native Greens Project and the Increasing Aboriginal Participation in NRM, Prime Production and Associated Industries in the SA River Murray Region Project with the Ngarrindjeri Regional Authority. It is anticipated that both projects combined will create up to 46 full-time equivalent positions for the Ngarrindjeri Aboriginal community.

As part of the SARMS project, and in addition to the Regional Development and Innovation Fund projects highlighted above, the First Peoples of the River Murray and Mallee Aboriginal Corporation were engaged in the successful launch of the redeveloped Loxton Research Centre. PIRSA also procured landscaping services by the Aboriginal Learning on Country and Gerard Rangers for the redevelopment project. Through the Upper Spencer Gulf and Outback Futures Program, the Adnyamathanha were awarded a grant to support Wilpena Pound Resort to establish new infrastructure and improve the tourism experience for visitors to the Ikara-Flinders Ranges National Park.

While progress is positive and certainly improving, it is critical that we continue to leverage PIRSA's success so far and generate further opportunities to enable Aboriginal people to participate equally in South Australia's economic prosperity. This approach requires continued effort and partnerships from all levels of government, industry and the community, particularly if we are to create meaningful and long-term positive change for Aboriginal people in South Australia.

Mr TRELOAR: I refer to Budget Paper 4, Volume 4, sub-program 1.2, page 19, relating to aquaculture leases. Can the minister confirm how many new aquaculture leases and licences have been granted in the 2016-17 period and in what regions they were granted?

The Hon. L.W.K. BIGNELL: South Australia's aquaculture industry is the second largest in economic value and the most diverse in the country and makes a significant contribution to the economic growth and regional development of South Australia. In 2014-15 the state's total value of seafood production was $468.9 million, with aquaculture contributing 49 per cent and wildcatch fisheries contributing the balance of $241.1 million. Direct employment from the aquaculture sector was estimated to be 1,833 full-time equivalents. In relation to your specific question, I might ask Professor Doroudi to answer that. I know there are two aquaculture licences that we are aware of in that period.

Prof. DOROUDI: Unfortunately, I do not have the exact figure today, but the two that I can recall are, firstly, the Oceanic Victor Swim with the Tuna miscellaneous lease and licence that have been granted in Victor Harbor. The other one is the seven new research leases and licence that has been given to Ocean Grown Abalone in terms of running research trials around Port Lincoln.

Mr TRELOAR: Does the minister know for how many hectares, in total, the leases are?

The Hon. L.W.K. BIGNELL: I will ask Professor Doroudi to respond.

Prof. DOROUDI: The seven new research leases is for about four that are each one hectare, in locations that could be trialled to see if they are going to be productive for that activity. There are research leases for a period of just 14 months, which means that by the end of 14 months they are going to take everything away from the site and are not actually going to have a production site. They are going to analyse the results of their research and, on that basis, they need to put in new applications back to the government to apply for a production site. I do not have the exact figure of how many hectares there are for Swim with the Tuna in Victor Harbor.

Mr TRELOAR: Minister, as a point of clarification for my benefit as much as anyone's, you referred to the value of both wild-catch fisheries and aquaculture as a total contribution. I am interested to know how tuna is counted or included in that. Is it regarded as wild-catch, or is it regarded as aquaculture?

The Hon. L.W.K. BIGNELL: It is kind of wild-catch that is fattened up, is it not? I will ask Professor Doroudi to explain it to both of us.

Prof. DOROUDI: In terms of all the calculations that we do in terms of our economic analysis, that is considered to be within the aquaculture revenue. The catch is a commonwealth catch, and that is under international treaties and agreements. If it was going to be assumed that we do not bring them to Port Lincoln to ranch them or grow them and they were going to be caught and sold in commonwealth water, then they are going to go under the commonwealth revenue figures and values in terms of a fishery.

At commonwealth level, they may still calculate the value and count that value in their calculations, but we bring about 5,000 or 6,000 tonnes of fish to Port Lincoln. We ranch them for about six to nine months, and around 9,000 to 10,000 tonnes are sold and mainly exported. All of that is calculated within our aquaculture revenue.

Mr TRELOAR: Thank you for that. In relation to the POMS outbreak late last year, can the minister confirm that SARDI is producing spat to provide to the market and selling that spat at the size of two millimetres? If that is the case, is the minister aware that the mortality rates for the two-millimetre spat are much higher than for the regular four-millimetre spat, and this is a cost that, unfortunately, growers are having to bear?

The Hon. L.W.K. BIGNELL: Thanks very much again for the question. I want to acknowledge the great interest you have in this issue and all fisheries and aquaculture issues, and the great way in which you deal with us. It is very collaborative, which is good. You come in and you ask questions either directly to us or through the department in the interests of the people you serve in an industry that is really important.

I also want to thank those people in the oyster industry here, and also the people at SARDI and the people in fisheries in PIRSA, who I think have done an amazing job since the POMS outbreak in Tasmania on 1 February, for the quick reaction that occurred to make sure that we could alleviate some of the risk. Of course, we can never totally eradicate all the risk, but I think people have done a really good job in very trying circumstances. I know a lot of the oyster growers are predicting some tough times in terms of stock levels because of the lack of spat and how they respond to that. I guess that is pre-empting, and I will now ask Professor Doroudi to actually answer the specifics of the question.

Prof. DOROUDI: Four hatcheries produced spat this year: Louth Bay, Coffin Bay, SARDI at West Beach and Yumbah Abalone, with the Cameron group starting to grow spat there as well. In total, 134 million spat were produced this year.

Mr TRELOAR: Over the four hatcheries?

Prof. DOROUDI: Over the four hatcheries. Specifically, if you are interested, SARDI produced about 30 million spat. In comparison with what used to happen for many years and what came from Tasmania, the 134 million here were smaller spat. As you mentioned, they were about two millimetres in size. The mortality rate is always higher when it comes to smaller spat going into the ocean or oceanic water. In some cases, we have had up to about 50 per cent mortality, but you need to know that this is the first time that South Australia, for the first year, really grouped together to produce enough spat to supply what the industry needs.

At the start of the outbreak, we were told that the industry usually grabs 110 million spat per year. Although we produced a higher number, but because the size was less than, we have been advised by the industry that, although there were previously 110 million coming in, there will be a shortfall of production over the next 12 months. On top of these four hatcheries, now, after one season, everyone believes that they can produce more and better spat. In Cowell, a new hatchery has also been established that is going to be added to the four. We are optimistic that there will not be a shortage into the future.

The Hon. L.W.K. BIGNELL: Can I pop in here to finish a bit of that question. The new land-based licence for the Franklin Harbour oyster hatchery is a new one that we have to include in that figure that we gave before to the question from the member for Flinders. Apart from Oceanic Victor and the seven new research leases for ocean-grown abalone that you mentioned, there are also some subdivisions of oyster leases that would impact on that number. I guess that is in answer to the question that you asked previously, to clarify all those things.

Mr TRELOAR: Minister, is it the intention of SARDI to continue to produce spat and ultimately get to a point where they can sell four-millimetre spat? Is that the long-term plan?

The Hon. L.W.K. BIGNELL: Again, I will ask Professor Doroudi to answer that, but I know when it was set up that it was an emergency response. We had the facilities down at SARDI and we only had two hatcheries in the state, and it was about trying to contribute to the volume so that we could get as much spat to the growers as possible. It was never the intention of SARDI or the government to try to get in the way of commercial operations; it was about helping out in a really dire time of need for the oyster industry. I will pass over to Professor Doroudi to talk about what the future may entail.

Prof. DOROUDI: We provided funding to the two hatcheries in Tumby Bay and Coffin Bay to upgrade their facilities. They are hopeful that they are going to create a greater size of spat. The Cameron group in the Yumbah abalone farm would be able to produce greater and larger spat because they can set up their nursery ground and facilities with no problem. My understanding is that the design of Shellfish Culture's hatchery is a way that they are going to have a nursery ground. In short, as the minister said, SARDI will stay in as long as there is a need for spat. As soon as the spat is commercially available, SARDI's focus is R&D more than direct commercial production.

Mr TRELOAR: In the meantime, minister—and take this on notice if you need to—how much has SARDI collected from the sale of spat over the financial period that SARDI has been selling?

The Hon. L.W.K. BIGNELL: Again, I will ask Professor Doroudi to attempt to answer that question.

Prof. DOROUDI: Unfortunately, I do not have that figure. I know that the price per spat was competitive and I know that the spat was distributed through SAOGA, which is the peak industry body for the industry, rather than SARDI dealing with direct clients. I also know that that was cost recovery. It means that the activity was not for profit.

Mr PEDERICK: I refer to Budget Paper 3, chapter 2, expenditure, page 29, which relates to the PIRSA overall budget and full-time equivalents. In 2017-18, PIRSA's operating expenses are $216 million. This falls to $183 million in 2018-19 and $165 million in 2019-20 and 2020-21. My first question is: what portion of these decreases in operating expenses is attributed to a decrease in the South Australian River Murray Sustainability funding over each period of the forward estimates?

The Hon. L.W.K. BIGNELL: I thank the member for Hammond for the question. Of course, SARMS has been a really important program for the South Australian River Murray community. Again, I want to commend the Premier for going in and fighting really hard to get that SARMS money. If we remember, the opposition at the time was willing to settle for a Mazda, I think, and we had the Premier out there saying, 'No, we want the Rolls-Royce.' I think we really did get the Rolls-Royce.

A great part of that length of the River Murray is, of course, in the member for Hammond's electorate. Some of the projects that have been undertaken out of the money provided by the federal government, after we went into fight hard for it, then administered by PIRSA, are terrific. Not only has it brought about great economic benefits but also really great environmental benefits to the health of the River Murray.

The $50.7 million decrease in projected expenditure across the forward estimates between the 2017-18 budget of $216 million and the 2021 estimate of $165 million is mainly due to the timing and planned completion of time-limited specific initiatives within the next four years. In particular, the commonwealth-funded SARMS program is budgeted to cease prior to 2020-21, and that has $46.9 million of expenditure in 2017-18. As I mentioned, the program is on track to achieve the 40 gigalitres of water to the River Murray system and is contributing towards South Australia's implementation of the basin plan.

In addition, budget initiatives of $3.5 million, with expenditure in 2017-18, is budgeted to be completed before 2020-21. I might ask Stephen Johinke to add some more detail about that. Obviously, when we do budgets, money does come in from the federal government and outside sources that flows through our budget process to be administered by us. We are grateful for that. We have a good working relationship with the federal government. It is in our interests to maintain that good relationship because we would like to get as much money as we can from the federal government to help people in the agriculture, aquaculture and other primary industry sectors here in South Australia. I will ask Stephen Johinke to add some more detail.

Mr JOHINKE: In terms of expenditure across the forward estimates relating to SARMS, you will be able to see on page 28 of Budget Paper 4, Volume 4, which we have been talking about, that the expenditure related to the SARMS program in the 2016-17 estimated result is about $71.3 million, and in 2017-18 it is about $46.9 million. For future financial years, at this point there is $18.2 million in 2018-19 and, at this stage, that is when the program is budgeted to be completed.

Mr PEDERICK: In relation to the minister's comments about advocating for River Murray communities and advocating to receive commonwealth money into South Australia, did the minister advocate on behalf of those river communities when Premier Weatherill and Treasurer Koutsantonis flatly refused to take the $25 million for River Murray communities for the diversification fund?

The Hon. L.W.K. BIGNELL: I think the Premier has answered those questions in here in the past.

Mr PEDERICK: So you did not advocate for those moneys?

The Hon. L.W.K. BIGNELL: It was the Premier who advocated for this great SARMS deal. It was the Premier who went up there and met with local irrigators and farmers in the river communities. I have been up there and spoken with people along the river who are very grateful for the work the Premier did. He was in there advocating on their behalf. As I said, he went after the Rolls-Royce. He had that Rolls-Royce delivered for South Australia instead of a crappy Mazda.

Mr PEDERICK: It is interesting that three other states accepted $25 million each, yet this state did all it could and, in the end, did not accept that $25 million. Anyway, I will go to the next question. PIRSA's operating expenses remained steady at $165 million for the last two periods of the forward estimates. Can the minister confirm that there are no new programs or funding initiatives in either the 2019-20 or the 2020-21 periods?

The Hon. L.W.K. BIGNELL: We deal with new initiatives on a year-by-year basis. It is worth remembering that not all funding for initiatives that benefit the agricultural sector is contained within PIRSA's budget. Of course, in this budget we have $200 million to help all sorts of businesses, big and small, to create more jobs. That does not fit wholly and solely in the PIRSA budget, but I am sure that there are plenty of operators throughout regional South Australia who will seek to benefit through either loans or grants that will be provided to small and medium-sized businesses to help them grow. As I have mentioned before, I am dismayed by the Liberal Party in South Australia jumping on board with the banks about this bank levy.

Mr BELL: Point of order: relevance.

The CHAIR: I am going to listen carefully.

The Hon. L.W.K. BIGNELL: We are talking about things that will help regional and rural South Australia, and the grants in this year's budget will help people in farming communities right across South Australia. The way we pay for that is by putting a one-third of 1 per cent levy on the profits of South Australian banks. These banks are the ones that have pulled out of regional communities around South Australia. We want to use that money to help small and medium-sized businesses throughout the community to do that. There is $200 million out there to grow jobs in South Australia. Some of those jobs will be in regional South Australia, so we are keen to do that.

We have $110 million that does not fall within the PIRSA budget but will benefit agriculture in South Australia. That $110 million that we have put forward is for the Northern Adelaide Irrigation Scheme. We are hoping that the federal government will also come up with some funds out of the federal irrigation scheme. That will be a huge boon for the northern parts of the Adelaide metropolitan area, where some of the best horticultural produce anywhere in the world is produced. Using more treated water, that can then be used to expand the growing footprint we have in the Northern Adelaide Plains will create more jobs and put more money into our economy—hundreds of millions of dollars of benefits.

Mr PEDERICK: Minister, you talked about the northern area's irrigation scheme. Is that budgeted in those forward years? From what you are saying, you are confirming that there are no other funding initiatives in those forward years in the PIRSA budget line.

The Hon. L.W.K. BIGNELL: In the PIRSA budget line, we do that on a year-by-year basis. What I am saying is that across government we are doing many things that will benefit regional and rural South Australia. The $110 million that we are putting up for the Northern Adelaide Irrigation Scheme will not come out of the PIRSA budget. You will not see that $110 million, that huge amount of money; that will come out of a different part of government, through SA Water.

Mr PEDERICK: What is PIRSA's total budgeted full-time equivalent allocation for each period over the forward estimates?

The Hon. L.W.K. BIGNELL: It is 913.8 currently. We still have 10 minutes to go, so we will get you the answer in the next 10 minutes.

Mr BELL: Minister, can you confirm that $7.5 million was handed back to the federal government, which could have been used for dairy concessional loans?

The Hon. L.W.K. BIGNELL: It is a little bit like the questions and the explanation we had earlier about the Pinery fire, the hail damage in the Riverland and the Gawler River Floodplain flooding: a float is provided. We have contingency money to deal with as many successful applications as we possibly can. I am not sure whether the $7.5 million figure is correct. The federal government would have provided us with a float to cover the amount for successful applications. What money is not loaned to people is then sent back to the federal government; it is their money.

Mr BELL: It was $7.5 million, minister. Victoria was oversubscribed and, in fact, the federal government put in extra money. We were undersubscribed by $7.5 million. Do you accept that not taking in the value of water and stock had an impact on successful applications?

The Hon. L.W.K. BIGNELL: No, I do not, and I have explained that before, that we looked at all those loan applications. No-one missed out on a loan because of water allocation not being included in the assessment. We have far fewer dairy farms in South Australia than there are Victoria, and we also have a different market. We have more competition through some really good strong dairies here, including Fleurieu Milk and B.-d. Farm. We also have a better retail model, with the addition of not just the big Woolworths and Coles but also Independent Grocers and the Foodland stores, which are more reactive and helpful when it comes to getting the message across to consumers.

The Murray Goulburn impact was far greater in Victoria than it was in South Australia. That is not to say that there were no dairy farmers who were severely hurt by the actions of Murray Goulburn. As I mentioned earlier, I want to congratulate the ACCC. It is a body that sometimes is criticised for perhaps not being as strong as it should be. I think that in the case of Murray Goulburn it has really done the right thing and gone after them. As a government, we have made submissions to the ACCC to make sure that they knew about the damage that Murray Goulburn had done in South Australia.

We get back to the fact that there are rules set by the federal government regarding who is able to be successful in getting these grants in times of need, whether it is for drought, or for dairy assistance in this case, and we followed through with those rules. What money is not spent quite rightly has to go back to the federal government; it is their money.

Mr BELL: My last question is: at the very start of this estimates committee, you indicated that you would get a breakdown of your ministerial office of $1.57 million in specific detail for staff wages, travel, administration, etc. If you do not have that now, will you commit to bringing that back?

The Hon. L.W.K. BIGNELL: Yes, we do have that figure now, and I will ask Mr Johinke to go through those items I outlined before.

Mr JOHINKE: Yes, this is in reference to the minister's office costs on page 14 of Budget Paper 4, Volume 4. The actual costs for 2016-17 relating to employee expenses were about $970,000; costs relating to accommodation expenses were about $340,000; and costs relating to operating expenses were about $250,000. That comes to about $1.56 million last year.

Mr BELL: So no travel was included in that budget?

The Hon. L.W.K. BIGNELL: Yes, travel is included in the budget.

Mr BELL: Which part of those three figures does travel come under?

Mr JOHINKE: Travel comes under the operating expenses of about $250,000.

The Hon. L.W.K. BIGNELL: Before we finish up, I also have the updated figures as promised on the FTEs. In 2017-18, it is 911.8; in 2018-19, it is 904.9; in 2019-20, it is 877.9; in 2020-21, it is 877.9; and in 2021-22 it is 877.9.

Mr PEDERICK: Minister, I will now run through the omnibus questions:

1. Will the minister provide a detailed breakdown of expenditure on consultants and contractors above $10,000 in 2016-17 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. In financial year 2016-17 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 2017-18?

3. For each department and 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 2015-16 and 2016-17.

4. For each agency for which the minister has responsibility:

(a) How many FTEs were employed to provide communication and promotion activities in 2016-17 and what was their employment expense?

(b) How many FTEs are budgeted to provide communication and promotion activities in 2017-18, 2018-19, 2019-20 and 2020-21, and what is their estimated employment expense?

(c) The total cost of government-paid advertising, including campaigns, across all mediums, in 2016-17, and budgeted cost for 2017-18.

5. For each agency for which the minister has responsibility:

(a) What was the cost of electricity in 2016-17?

(b) What is the budgeted cost of electricity in 2017-18?

(c) What is the provisioned cost of electricity in 2018-19, 2019-20 and, 2020-21?

6. For each grant program or fund the minister is responsible for please provide the following information for the 2016-17, 2017-18, 2018-19, 2019-20 and 2020-21 financial years:

(a) Balance of the grant program or fund;

(b) Budgeted (or actual) expenditure from the program or fund;

(c) Budgeted (or actual) payments into the program or fund;

(d) Carryovers into or from the program or fund; and

(e) Details, including the value and beneficiary, of any commitments already made to be funded from the program or fund.

The CHAIR: The member for Flinders has one last question.

Mr TRELOAR: Thank you, Chair—and very well read, member for Hammond. I refer to Budget Paper 4, Volume 4, sub-program 1.3, highlights. In relation to artificial reefs, dot point 4 refers to the native shellfish reef restoration. Can the minister confirm the total cost of this project, how many reefs have been restored and where these are located?

The Hon. L.W.K. BIGNELL: Thank you very much for that question. Funding support of $600,000 was provided for the artificial reef trial through the state government's $3.25 million support package to boost recreational fishing and tourism opportunities as part of the 2014-15 state budget. PIRSA Fisheries and Aquaculture is leading the development and implementation of the trial shellfish reef, in partnership with the Department of Environment, Water and Natural Resources, Yorke Peninsula Council and The Nature Conservancy.

A South Australian company, Maritime Constructions, has been awarded the contract of approximately $500,000 to construct the artificial reef trial. PIRSA is leading the development of the trial shellfish reef, which is focusing on the restoration of native shellfish reefs, in particular live native oysters, as a proactive approach to improve opportunities for recreational fishing.

Mr TRELOAR: How many have we—

The Hon. L.W.K. BIGNELL: We only have information on the artificial reef trial at this stage, but we will see how that goes. It is certainly good news for fishers, and let's hope it is very successful.

The CHAIR: The time for questions having expired, I declare the examination of the Minister for Agriculture, Food and Fisheries completed.

Sitting suspended from 11:31 to 11:45.

Membership:

Mr Williams substituted for Mr Treloar.

Departmental Advisers:

Mr S. Ashby, Chief Executive, Department of Primary Industries and Regions.

Mr S. Johinke, Chief Financial Officer and Acting Executive Director, Corporate Services, Department of Primary Industries and Regions.

Mr J. Coleman, Chief Executive, ForestrySA.

Mr R. Robinson, Director, Forestry, Department of Primary Industries and Regions.

Mr J. Speed, General Manager, Business Operations, ForestrySA.

Mr M. Williams, Acting Director, Finance and Prudential Management, Department of Primary Industries and Regions.

The CHAIR: The portfolio is Primary Industries and Regions SA and the minister appearing is the Minister for Forests. The estimate of payments to the Department of Primary Industries and Regions is still open for examination and I refer members to the portfolio statements in Volume 4. I call on the minister to introduce his advisers and make a statement if he wishes.

The Hon. L.W.K. BIGNELL: I would like to introduce the members of the department and ForestrySA who are here today. To my right is Jerome Coleman, Chief Executive of ForestrySA. On my left is Scott Ashby, Chief Executive of PIRSA. Next to Scott is Stephen Johinke, Chief Financial Officer, PIRSA. Behind me are Rob Robinson, who is the Director of Forestry at PIRSA, and Julian Speed, the General Manager, Business Operations, ForestrySA.

The government's interests in forestry are led by both the Department of Primary Industries and Regions (PIRSA) and the South Australian Forestry Corporation (ForestrySA). PIRSA is responsible for providing policy advice to the government in relation to the forest and wood products industry, including associated environmental matters and for developing the industry in this state.

The government has progressed the South East Forestry Partnerships Program to support the development of innovative products and technologies that can benefit the entire forestry supply chain in South-East. Nearly all the funded projects are either complete or underway and making a difference to the region's economy. PIRSA is also leading the government's Mid North Forests Future Strategy to determine with industry, the community and government, both local and other state government agencies, the best future for the Mid North Forests to benefit the region and the state.

Given the bushfire damage in recent years, a business-as-usual approach for the Mid North Forests was not an option. Replanting the forest would have taken at least 20 years to produce commercial logs, so we have had to work with the community to prepare for a more sustainable future. Binding proposals received from the Mid North Forests Request for Proposal process have all been evaluated and negotiations are being finalised. PIRSA is working with these private parties to implement their new and expanded enterprises that will increase the economic activity in the region, involving:

grazing and cropping enterprises;

commercial forestry to support local sawmilling; and

horticultural and honey production.

We understand the need to progress matters as soon as possible, but we must be certain the proposals will deliver the best possible results and, most importantly, create and sustain jobs for the region. The forest industry generates $1.2 billion worth of activity and around 7,000 jobs in the key log processing hub of Mount Gambier. PIRSA continues to monitor the comprehensive conditions included in the sale of the forward harvesting in the South-East to OneFortyOne Plantations. These conditions include:

OneFortyOne Plantations matching ForestrySA's level of planned viable domestic supply;

processes for uncontracted sawlog sales where local sawmills are able to compete with exporters on price and other commercial terms to secure supply;

no restrictions on the length of contracts for local sawmills;

no sawlog export contracts exceeding two years; and

annual reports to the government on how conditions are met.

The forest industry for Australia is in the process of establishing a national centre for forestry innovation. The Mount Gambier research centre will be an important element of this national strategy.

The government, through ForestrySA, has long supported forest research through the Community Service Obligation fund. This activity will continue with a collaboration between UniSA, the federal government, state government and the forest industry. The South Australian government's contribution will match the federal government's investment of $2 million over four years.

PIRSA has a memorandum of administrative arrangement with ForestrySA to manage and fund non-commercial forestry activities of benefit to all South Australians. Annual programs and performance targets have been developed by ForestrySA in consultation with PIRSA. These programs recognise the importance of forestry and forest reserve uses to the people of South Australia.

ForestrySA's key commercial activity is now the management of the Mount Lofty Ranges forest estate, with over 11,000 hectares of commercial pine plantation area providing significant economic activity and employment in the region. The Mount Lofty Ranges provide an important community resource for recreation activities which are not as easily undertaken in the high conservation areas of our national parks. These include camping, motorsports, cycling, horse-riding, hunting and hiking. The Green Triangle's native forest reserves are also a significant asset to the state, and ForestrySA is focused on improving the accessibility of these assets to the local community.

The CHAIR: Do you have a statement, member for Hammond? Straight to questions? Member for Mount Gambier.

Mr BELL: I refer to Budget Paper 4, Volume 4, page 30, which talks about monitored compliance with the ForestrySA forward sale of the government contract. Have there been any concerns raised with you or any of your departments regarding compliance or noncompliance of OneFortyOne with the ForestrySA forward sale?

The Hon. L.W.K. BIGNELL: I thank the member for Mount Gambier for the question and acknowledge his advocacy for the forestry and timber industries in the South-East of South Australia. We have had concerns, and I think some of the people who have spoken with him have also had discussions with me and other members of government, as well as with ForestrySA and PIRSA, about some of the concerns they have. We are working through those concerns. Obviously, we want to make sure that as much employment and economic activity as possible happens in the South-East around Mount Gambier and the rest of those forest lands.

In 2012, the state government announced that it had sold up to three forward rotations of its pine plantations in the Green Triangle to OneFortyOne Plantations for 105 years in return for an up-front payment of $670 million. A comprehensive set of conditions was included in the sale of the forward harvesting rights in the South-East to OneFortyOne, which included OneFortyOne matching ForestrySA's level of planned viable domestic supply and processes for uncontracted sawlog sales where local sawmillers are able to compete with exporters on price and other commercial terms to secure supply. As I mentioned before, there are also no restrictions on the length of contracts for local sawmills, no sawlog export contracts exceeding two years and annual reports to the government on how conditions are met.

The government seeks to work cooperatively with OneFortyOne, as their continued business success is important to the South-East regional economy.

Mr BELL: Can you identify what the penalties are for noncompliance with the forward sale agreement? That is, if OneFortyOne are in breach, what can you do?

The Hon. L.W.K. BIGNELL: I will ask Rob Robinson to answer that question.

Mr ROBINSON: The focus, of course, is not to get into that situation. The point is that we have to work through these issues. It is a long-term business relationship, and we want them to be successful. There is a defined process by which these things are worked through in a negotiation sort of way. Of course, it is a contractual arrangement. The ultimate thing is it is a lease, and these things can be implemented via implementing the clawback provisions that are in the lease.

Mr BELL: So there are clawback conditions. These concerns have been raised. There are some provisions in there for penalties. What has the government or you as a minister done to investigate and address these concerns of noncompliance?

The Hon. L.W.K. BIGNELL: I will ask Rob Robinson to give some further information.

Mr ROBINSON: As I said, there is a continual dialogue with OneFortyOne in terms of these issues, and a formal process by which, if there are any breaches to be lodged, OneFortyOne are required to submit those breaches to us and they are then investigated. The details associated with these matters are confidential to the transaction documents, but it is a continual process of dialogue with them. As you would be aware, there is a requirement for them to submit an annual compliance report.

Mr BELL: Just to be clear, in your answer you said that OneFortyOne submit the breaches?

Mr ROBINSON: A breach notice. They are required to submit a breach notice when one is detected.

Mr BELL: Who detects that?

Mr ROBINSON: When they become aware of a breach.

Mr BELL: When they become aware of their own breach, they submit it, at their own application, to the government to then investigate it; is that correct?

Mr ROBINSON: Yes, they—

Mr BELL: That is putting the fox in charge of the henhouse.

The Hon. L.W.K. BIGNELL: That is a standard process, but if we become aware of breaches as well, we will follow those up.

Mr BELL: I go back to my original question: what has the government or you as a minister done to investigate or address the concerns of noncompliance/breaches without of course OneFortyOne reporting their own breach to you, which would be ridiculous?

The Hon. L.W.K. BIGNELL: I would like to point out that we are not aware of any breaches at this stage. We have had concerns raised with us as a government, and we are getting more information from people in the industry, in the South-East, to make sure that we have all the facts that we need to put to OneFortyOne, both at a local level but also with the owners of OneFortyOne in North America.

Mr BELL: Could you detail those types of investigations? Who are you talking about, who have you engaged, and how is that process actually occurring?

The Hon. L.W.K. BIGNELL: We are talking with processors and other people involved in the timber industry in the South-East. If they want to come out and say who they are, they are welcome to do that, but I do not think I want to be in the position of declaring publicly who we have been having the discussions with.

As you know, I was down in the South-East just a few months ago and heard the concerns there. As I mentioned, some of the people who have been talking to you have also raised their concerns with me, which I have asked ForestrySA and PIRSA to follow up on. They are trying to get a complete picture of all these concerns so that, when we go and ask the questions of OneFortyOne, we have all the information.

Mr BELL: Apart from talking with processors, and I accept we do not need to be identifying people, what other processes or procedures have you put in place to identify any breaches in the contract?

The Hon. L.W.K. BIGNELL: I will ask Rob Robinson to go through the process.

Mr ROBINSON: A primary component is their annual compliance reporting. They are required to comply with the various aspects that are detailed and prescribed in the transaction documents. That is submitted on a regular basis to us, so that is a primary way.

Mr BELL: Apart from PIRSA, are there any third-party entities looking at noncompliance of the forward sale contract?

The Hon. L.W.K. BIGNELL: Yes, ForestrySA has also been involved in this and dealing with the processors. The processors have done their own report, which they will get to government, so I will get to look at that. Any concerns that they have—and it is a good, thorough, proper report, I am sure—we can actually sit down with OneFortyOne and ask the questions that the local industry would like us to ask to make sure that there is full compliance.

Mr BELL: Has PIRSA, ForestrySA or any other department that you are responsible for put funds into that third-party report?

The Hon. L.W.K. BIGNELL: I think the processors paid for it themselves—yes.

Mr BELL: Have you or has anyone under your portfolio responsibilities made contact with the Campbell Group, which is the parent company of OneFortyOne, and raised concerns with compliance of OneFortyOne?

The Hon. L.W.K. BIGNELL: They are coming here in a few weeks' time and I am meeting with them then.

Mr BELL: A condition of the forward sale was that OneFortyOne have an arm's-length arrangement in respect to exports, which is 13.1 in the memorandum of lease. Can the minister indicate whether or not this is being achieved?

The Hon. L.W.K. BIGNELL: I think what we have is probably two sides here: OneFortyOne saying they are compliant, but some of the processors questioning whether they are, and this is part of the process. Unfortunately, today we do not have all those answers because we are still working through what it is that the processors have to say and then we can look at all those facts and, as a government, I guess get some legal advice as well.

Mr BELL: On that, from the government's point of view, how many FTEs are responsible for monitoring the compliance of ForestrySA?

The Hon. L.W.K. BIGNELL: I think you meant OneFortyOne, not ForestrySA. There are officers across three different areas: the Department of Treasury and Finance, PIRSA and also the Crown Solicitor's Office. They get together from time to time to make sure that things are being done the way that was intended under the deed.

Mr BELL: We have three people or FTEs—perhaps not full time, so it might not be an FTE—

The Hon. L.W.K. BIGNELL: And it could be more than three people; they are three different departments, so people from those departments who have responsibility for looking at all aspects of the contract.

Mr BELL: So we have three departments and people within those looking at compliance. Have any of them raised any concern about the exporting of log and breaches of that agreement?

The Hon. L.W.K. BIGNELL: That group is constantly looking at the operations and what is happening there and ensuring that everything is being done in accordance with the contract. As I said, concerns have been raised with us and we are in the process of working through those concerns to see what they are. There is a meeting with OneFortyOne and the Campbell Group in the next couple of weeks. I think this is still playing out.

Mr BELL: But these concerns were raised by processors, not by your internal mechanisms, which really should be alerting the government to these issues. I understand that we have OneFortyOne saying one thing and processors saying another thing. I am really interested in where the government's responsibility is in monitoring this. If three departments cannot raise these issues, I question what those three departments are actually doing.

The Hon. L.W.K. BIGNELL: Our role is to look at the information provided to us by OneFortyOne and to ensure that it is accurate. Part of that process is going back to the people involved in the industry and saying, 'This is what is being said; how does that marry up with your experiences?' As I said from the outset, there is a disparity in views there and that is something that this group—across the Department of Treasury and Finance, the Crown Solicitor's Office and PIRSA—is in the process of looking at at this stage. Unfortunately, we do not have an answer yet because we are in the middle of the process.

Mr BELL: In your opinion, minister, and perhaps that of your department, would a breach of the contract relate to OneFortyOne having their own land at the Port of Portland for the stockpiling of logs for export? Would that breach the sale conditions? I put it to you that that is not an arm's-length arrangement with any exporter.

The Hon. L.W.K. BIGNELL: That is probably a question best put to the expert in this particular area, which would be the Crown Solicitor.

Mr BELL: Can the minister assure the committee that local processors are being supplied the quantities of log needed to underpin local employment commensurate with the forward sale contract?

The Hon. L.W.K. BIGNELL: We are not aware of any breach at this stage.

Mr BELL: When did local processors first raise questions of noncompliance with you, any department that you have responsibility for or anyone else in government that you may know of?

The Hon. L.W.K. BIGNELL: These issues have come up a number of times over the past few years and each time there has been no finding of noncompliance. I had some concerns raised. I think you and I had a meeting with some of the processors here in parliament a couple of years ago and we had an initial conversation. Then, when I was in Mount Gambier in I think late March or early April, a processor approached me and we organised a meeting here in parliament I think the following week.

From that, we asked ForestrySA to convene a get-together of a wider group down there so that we could get a really accurate picture. As I have mentioned, these are the processes we are working through at the moment. As I said at the outset, we want to make sure that, for all those processes, everyone involved in the industry is getting a fair deal down there and that as many local people as possible are employed in the forestry industry in the South-East.

We want to see as much log as possible being worked on in South Australia rather than being exported as logs. If there is any possibility at all that we have processes here that can deal with those logs, we want to make sure that as much of that can be handled as possible. This is an ongoing process and one that we take very seriously. As someone who grew up down in the South-East, I totally understand how important the forestry industry is to people in the local community.

Mr BELL: From 2005 through to 2009, ForestrySA averaged an annual profit of $26 million. Last financial year, OneFortyOne disclosed a $125 million profit. Can the minister indicate why there is a quadrupling of profits under OneFortyOne versus ForestrySA's long-term average?

The Hon. L.W.K. BIGNELL: I think we should be careful to note that profit is not the same as a return to government. One of the increases we have had is an increase in the valuation of standing timber over the past few years as well.

Ms WORTLEY: I refer the committee to Budget Paper 4, program 2. Minister, can you provide details about how ForestrySA is providing support for mountain biking opportunities in the Cudlee Creek Forest?

The Hon. L.W.K. BIGNELL: Almost $310,000 will be invested into ForestrySA's popular Cudlee Creek Forest mountain biking trail network within the next 12 months. The project will assist the South Australian government strategy to establish the Mount Lofty Ranges as an international mountain biking destination and increase general visitation to the area. A successful submission by Bicycle SA has secured a $190,000 South Australian government Community Recreation and Sport Facilities Program grant, while a further $120,000 will be contributed by ForestrySA through its Community Service Obligation funding program.

The Cudlee Creek mountain biking trail network is located in the Mount Crawford Forest near Lenswood, just 50 minutes' drive from Adelaide. The network of trails is set amongst 450 hectares of former pine plantation, which was burnt in the 1983 Ash Wednesday bushfire and which is now being returned to native bushland. Known as Fox Creek by mountain bikers, it has been a popular place to ride for more than 20 years and is acknowledged as one of South Australia's best downhill and cross-country mountain biking destinations.

It caters for mountain bikers of all skill levels, from children and families to advanced and experienced riders, and attracts around 10,000 riders annually. More than 35 volunteers and participants from employment and training programs and educational organisations, such as Urrbrae TAFE, have contributed thousands of hours to develop conservation and recreational assets at the site over many years. The 15-year partnership between the state government, through ForestrySA and the Office for Recreation and Sport and peak cycling organisation, Bicycle SA, has been critical in developing this strong community support.

It is envisaged this latest flow of funds will further develop Cudlee Creek as one of South Australia's premier mountain biking destinations. On-site development projects include a purpose-built facility, which will be used as a base for event, visitor and volunteer management, as well as for volunteer education and skills training. It will be established near ForestrySA's Thomas Hill House, an accommodation venue offering picturesque views across the area and out to Gulf St Vincent.

On-site development will also include the construction of toilet facilities at the top and bottom of the trail network, upgraded shedding to increase volunteer participation and storage capacity for event management, a new experienced national competition-grade downhill trail and a new beginner to intermediate climbing trail. It will also include upgrades to existing trails to meet International Mountain Bike Association standards and new parking areas, trail signage and an information bay.

As we know, recreation and sport are very important for the South Australian community. It is great that we have these areas within ForestrySA-owned land where we can help accommodate people who want to be fit, who want to be involved and who want to be active. Not only is this great for South Australians but also for tourists, who are increasingly travelling for experiential activities, like mountain biking.

Mr BELL: Can the minister describe to the committee what support the government provided to ex-CE of ForestrySA Adrian Hatch?

The Hon. L.W.K. BIGNELL: None that we are aware of.

The CHAIR: The time having expired for questions, I declare the examination of the proposed payments adjourned and referred to committee B.

Sitting suspended from 12:17 to 13:15.