Department for Housing and Urban Development, $106,787,000

Administered Items for the Department for Housing and Urban Development, $5,003,000

Membership:

Mr Pederick substituted for Mr Whetstone.

Minister:

Hon. J.K. Szakacs, Minister for Trade and Investment, Minister for Local Government, Minister for Veterans' Affairs.

Departmental Advisers:

Mr D. Reynolds, Chief Executive, Department for Housing and Urban Development.

Ms A. Hart, Director, Office of Local Government, Department for Housing and Urban Development.

Ms J. Burton, Acting Chief Operating Officer, Finance, Department for Housing and Urban Development.

Mr T. Pearce, Principal Adviser, Finance, Department for Housing and Urban Development.

The ACTING CHAIR: Welcome back, everybody. We are moving on to the portfolios of Office of Local Government, Outback Communities Authority and Local Government Grants Commission with the Minister for Trade and Investment in the Department for Housing and Urban Development. I declare the proposed payments open for examination. Would the minister like to make a statement and introduce his advisers?

The Hon. J.K. SZAKACS: Thank you, Chair. With me here at the top table are Mr David Reynolds, Chief Executive of the Department for Housing and Urban Development, and Alex Hart, Director of the Office of Local Government. I have other advisers with me as well: Trevor Pearce and Jane Burton.

In introducing them, I thank them and the Office of Local Government, the OCA and our statutory authorities and particularly also the broader DHUD department. With the machinery of government changes within this financial year that have seen the Office of Local Government come under the Department for Housing and Urban Development, we thank them very much for the smoothness of that transition and their diligence and commitment in the manner in which they undertake their work.

The ACTING CHAIR: Would the opposition lead speaker like to make a statement?

Mr TELFER: I will go directly to questions. Minister, thank you, and thank you to your staff in local government. Sadly, we only get an hour to unpack local government; it is a complex space indeed. For the benefit of the Chair, I will be working from Budget Paper 4, Volume 3, predominantly pages 80 and 81. The overall program net cost of services summary is on page 78; I might start there with that table, but also where the numbers are extrapolated out on page 81.

Minister, the actual expenditure was $5.6 million in 2023-24. The 2024-25 budget was put down to $4.8 million; however, the estimated result is $5.6 million. Can you give me an explanation as to those changes?

The Hon. J.K. SZAKACS: I am advised that the material input into that variance is grants and subsidies. The 2024-25 estimated result, compared with the 2024-25 budget, is a $0.3 million increase due to a carryover of the unspent municipal services infrastructure initiative budget. Also the 2025-26 budget as compared with the 2024-25 estimated result is a half a million dollars decrease due to a $0.3 million municipal services infrastructure completion and a $0.25 million completion of funding to the Coober Pedy Taskforce.

Mr TELFER: The difference is in the grants and subsidies component of it, the $300,000. The estimated result in 2024-25 is $3.6 million, and then in the 2025-26 budget that is back down to $3.1 million; is that reflective of an overall decrease in that aspect of that funding stream in particular as far as the grants and subsidies component that you spoke about?

The Hon. J.K. SZAKACS: No, it is more. It is the completion of some one-offs as well as carryovers that have impacted this financial year.

Mr TELFER: One-offs in the municipal delivery?

The Hon. J.K. SZAKACS: And also the $250,000 allocation out of last year's state budget for the Coober Pedy Taskforce work.

Mr TELFER: Does the Coober Pedy Taskforce work not continue on?

The Hon. J.K. SZAKACS: The project and piece of work that that funded was acquitted in this financial year.

Mr TELFER: Looking at the employee benefit expenses, the 2023-24 actual of just over $1 million, the budget of 2024-25 was $843 million, but there was an estimated result of $1.2 million, so an increase of $400,000, all at the same time as a one FTE drop. So costs go up, FTEs go down. Can you give me an explanation as to why?

The Hon. J.K. SZAKACS: I am advised by the chief executive that previously under DPTI the allocation for annual leave, long service leave, and superannuation was held centrally. With the MoG and DHUD, that is then allocated out to business units within DHUD, so there is no material change other than the way that is accounted for within the program.

Mr TELFER: It is more included within all the long service obligations, etc., as opposed to the 2024-25 budget when it was within DPTI?

The Hon. J.K. SZAKACS: That is correct.

Mr TELFER: The one FTE drop in the budget from the estimated, which part of the program was that out of?

The Hon. J.K. SZAKACS: I am advised that the FTE reduction is accounted for by a resource that was temporarily allocated to the Office of Local Government from the Department for Infrastructure and Transport when the Office of Local Government was within DIT, so there has not been a service delivery or program delivery impact as a result of that FTE.

Mr TELFER: What was that temporary allocation tasked with in the Office of Local Government?

The Hon. J.K. SZAKACS: I am advised general assistance.

Mr TELFER: Is there an external obligation on the remaining 10.5 FTEs? It is a 10 per cent drop in the FTE, so this administrative work that they were doing is that now either not being done or on the shoulders of the remaining?

The Hon. J.K. SZAKACS: I am advised that piece of work or the duties and responsibilities have been well and truly picked up through the corporate team of DHUD, for which there has not been an additional allocation of resources. But as advised by the chief executive, the DHUD corporate team are providing those service inputs into the OLG.

Mr TELFER: Can you give me a breakdown of what the 10.5 FTEs do as far as responsibilities in OLG?

The Hon. J.K. SZAKACS: I can advise that there is the FTE, of course, attached to the director of the Office of Local Government, then there are FTE responsibilities; workload, etc., apportioned and related to government policy units; policy officers; legislation; principal project officers; senior policy officers; senior project officers for boundaries, administration and corporate support; the Outback Communities Authority, a statutory authority; as well as the municipal services and Aboriginal lands program.

Mr TELFER: So does that one FTE feature those—

The Hon. J.K. SZAKACS: Some of those have multiple FTE.

Mr TELFER: Can you inform the house as to which of those positions have multiple FTEs allocated to them?

The Hon. J.K. SZAKACS: Yes. I might take that on notice just to get the most up-to-date allocation.

Mr TELFER: Thank you, I appreciate that. The beauty of having a small team is you can break it down into individual.

The Hon. J.K. SZAKACS: It goes to the fraction of an FTE.

Mr TELFER: Indeed. Minister, continuing on with page 80, I have been reflecting somewhat as this is the fourth estimates period before I become the local government minister, I guess, at the next election potentially.

Looking at targets that have been aimed for and achieved or otherwise through previous budgets, minister, in 2023-24 targets, for instance, there was an undertaking to review the 2022 local government periodic elections and consider legislative reforms. That was in 2023-24. In 2024-25 there was a target to finalise the review of the 2022 local government periodic elections and consider measures to enhance community engagement. So, not quite a copy and paste, but close to. Then in 2025-26 again we see the target to complete the review of the 2022 local government periodic elections and finalise the introduction of a community engagement charter. The question is, minister: how long does it actually take to do a review of the 2022 local government periodic elections? It has been three budgets in a row where it has been the target.

The Hon. J.K. SZAKACS: I think perhaps the first part of the member's question or more of a statement about his confidence—

Mr TELFER: Yes, you do not need to respond to that.

The Hon. J.K. SZAKACS: No, I would just give the member the respect that it requires. I would be happy to respond to that. No.

With respect to 2022-23 and 2023-24, particularly 2022-23 financial year, I am not in a position to be able to comment, reflect or provide significant advice. With respect to the elections review, I can advise the member that it is my strong expectation that the parliament will have before it this calendar year a bill that pulls together that piece of work that has been done, now informed by the completed review of the Electoral Commissioner. With respect to that, we have been working closely with the sector and satisfied that will provide ample time for any material changes to be worked through and implemented by the 2026 periodic elections.

Mr TELFER: Has the Office of Local Government's review of the 2022 local government periodic elections been completed?

The Hon. J.K. SZAKACS: Yes, that was completed some time ago.

Mr TELFER: Why then is it one of the targets for 2025-26?

The Hon. J.K. SZAKACS: With respect to the way that is noted in the budget papers, I am advised by the director that that is in anticipation or reflection of the fact that the 'completion' of that also includes bringing forth any amending bill to the parliament, of which the member would appropriately understand.

Mr TELFER: You could have perhaps reflected the targets from 2023-24, which did include considerable legislative reforms. That was two years ago. The targets for 2025-26 talk about the completion. So the review of the 2022 local government elections within OLG has been completed, and the consideration now that you are undertaking is in response to that long-awaited review and what legislative amendments may be considered by the parliament.

The Hon. J.K. SZAKACS: Absolutely. Yes, it has also been, as I said, informed by the receipt in the 2024-25 financial year of the very important report of the Electoral Commissioner into the 2022 periodic election. It would be both improper but also futile to consider legislative reform or a bill without contemplating both of those pieces together. They are, of course, now both public; and, yes, the strong anticipation, strong expectation, is that that will inform any amending bill before the parliament this year. That is a piece of work that the Office of Local Government is quite deep into already.

Mr TELFER: Why did it take so long for the Electoral Commissioner to complete the ECSA review of the 2022 periodic elections?

The Hon. J.K. SZAKACS: That is not something I can answer for him. I am not sure if that has been asked of the—

Mr TELFER: You did not seek an explanation from him as to why?

The Hon. J.K. SZAKACS: I can put to you what he has put to me, but I cannot speak for the Electoral Commissioner is my point.

Mr TELFER: What was the advice that you received?

The Hon. J.K. SZAKACS: The advice that I received from the Electoral Commissioner is that the volume of work of the Electoral Commission was such that it was not as prompt as we had previously seen from the Electoral Commissioner. That involves everything like contested elections, well-ventilated process errors from the Electoral Commission at the First Nations Voice election, and a number of by-elections. I have lost count of how many by-elections, but there were a number of by-elections. That was the information that the Electoral Commissioner provided me.

Mr TELFER: So it was a resourcing issue for him?

The Hon. J.K. SZAKACS: It was not articulated that way, no.

Mr TELFER: I thought that was what you were reflecting: there was a body of work but he did not have the resources?

The Hon. J.K. SZAKACS: Again, it is difficult for me to comment on that nuance. I do not resource the Electoral Commissioner, so it is not something that was a material conversation between me and the Electoral Commissioner.

Mr TELFER: When we ask the minister who is responsible to the Electoral Commission about local government elections, he always points us to this session, so I am trying to get a bit of insight.

The Hon. J.K. SZAKACS: Okay. I am not in the business of articulating and speaking to every conversation I have with every person, but I am being very frank with the member: that is the information that the Electoral Commissioner has provided to me. I thank him for his work and for the important periodic report that is provided. It is informative, and it will inform strong consideration by the government as we move this forward.

Mr TELFER: So local government puts in considerable resourcing. It costs councils and their communities a significant amount of money for the Electoral Commission to run periodic elections, and the whole process that goes with that. As the local government minister, do you find it satisfactory that they have had to wait three years until after a periodic election for there to be a review for a service that they have paid significant amounts of their own funding for? Is this something that is acceptable?

The Hon. J.K. SZAKACS: It is not for me to opine on that, but I have certainly had feedback from members of the sector who would be very much hoping for an earlier report. There has also been—

Mr TELFER: It is the latest it has ever been after an election.

The Hon. J.K. SZAKACS: There have also been members of the sector leadership—mayors, chief executives, members of the LGA—who have quite reasonably understood that there have been matters that have been significantly out of the control of the Electoral Commissioner that have led to, as he has put to me, delays in the finalisation of that report. I think it is very reasonable—and not just by-elections, but other material matters that have been prioritised importantly by the Electoral Commissioner.

I say this not to provide any sort of reflection that I do not think that the member feels exactly the same way—in fact, we both do—but we do appreciate the work of the Electoral Commissioner, the strength of our of elections and the independence of the Electoral Commission. I also appreciate the frank and fearless advice that public officers always receive from the Electoral Commissioner, and I have every faith that it will continue.

Mr TELFER: You touched on it a little bit, but you are confident, and the advice that you have received gives you that confidence, that there will be enough time to be able to not just consider potential legislative change but also deliver it and have the capacity for councils to be able to be appropriately prepared before their 2026 periodic elections?

The Hon. J.K. SZAKACS: Yes, the advice I have received gives me that significant confidence, absolutely. That has been the material undertaking in discussions that we have been having with the OLG and that the OLG has been having with the sector. I am in no position to speak on behalf of the parliament, but suffice to say that, subject to the normal processes of this parliament and government, we have every expectation and confidence that that will be the case.

Mr TELFER: Obviously, come budget time councils have to start to consider allocations themselves. Within some of the recommendations from the Electoral Commissioner, in particular, there was commentary around the timing of elections and that sort of thing. They are pretty significant potential changes that the Electoral Commissioner has put out there. I am only surmising what the anticipated response from the government might be, but they are pretty significant potential suggestions.

The Hon. J.K. SZAKACS: I can perhaps give the member some confidence about one of the most material changes, that may be moving the election to 2026, the periodic election will be occurring as per what the act says.

Mr TELFER: Minister, you spoke a bit about and reflected on the importance of a strong and rigorous process when it comes to elections. What has been the minister's response to the decision made in the Court of Disputed Returns' finding that illegal practices affected the Adelaide City Council 2022 periodic election?

The Hon. J.K. SZAKACS: First and foremost, I am appreciative of the consideration of the matter by the court. I am in no place to provide any opinion on their findings, other than that they are sound, they are rigorous and we thank them. There is nothing more important than public confidence in elections—federal, state, local. It is an absolute pillar of our democracy and we both receive and take a whole series of privileges and latitudes as public officers and leaders thanks to the strength and integrity of our system. We need to do all that we can to ensure that that is consistent and remains.

That is what gives me faith that the court has, through processes available to it and through processes available, determined exactly that. I also acknowledge the quick work by which the Electoral Commission and the City of Adelaide has turned around and gone back to the community now to ensure that their voices continue to be represented.

Mr TELFER: They have to because they lost four of their councillors.

The Hon. J.K. SZAKACS: No, but they have been timely.

Mr TELFER: The process has hardly been quick, it is fair to say. It was a 2022 election and this is now mid 2025.

The Hon. J.K. SZAKACS: Within the timeframes that have been available to all parties involved since the decision, I am very mindful and note that they are quick to progress. As the member rightly says, there is nothing more important than ensuring that those voices within that constituency are heard and represented.

Mr TELFER: Talking frankly, the reality is that it was an outrageous indictment on the process. I am not appointing blame, but the outcome that was provided was something that we should not be accepting at all. Within the Electoral Commission's election review, he published his election review and gave it to you prior to the findings of the Court of Disputed Returns. Thus, he made no commentary on recommendations that may come from that outcome. Has that outcome informed your review and potential development of legislative change over and above what the Electoral Commissioner put in his formal election review?

The Hon. J.K. SZAKACS: The timing of the Electoral Commissioner's report in respect of how that intersects with the findings of the court will not in any way, shape or form impede the considerations of government. It will not surprise you that I will not disclose them at the moment but, yes, we are actively considering matters that go to ensuring there remains the highest degree of public confidence in elections.

Mr TELFER: Specifically regarding those arrangements, who are you receiving advice from—over and above what the Electoral Commissioner has put in his report—when it comes to consideration?

The Hon. J.K. SZAKACS: We have the strength of an Office of Local Government and a whole series of other agencies and authorities within the government, as well as external and third parties.

Mr TELFER: Are you confident that there was no process or oversight from the Electoral Commission regarding that case that needs significant change?

The Hon. J.K. SZAKACS: As I have already said, I note the court's findings. They have made a series of findings and there is no reason for me—or, frankly, anyone in public office—to question those.

Mr TELFER: I am not questioning the findings; I am questioning—

The Hon. J.K. SZAKACS: Insofar as they have made a suite of observations, and they are sound and they are directly informing the government's and my commitment to ensuring that we have the highest degree of public confidence in elections. There is no room to equivocate on this and we will not do that.

Mr TELFER: What was the minister's response to the decision of the Court of Disputed Returns regarding the finding that errors in the Electoral Commissioner's computer software settings affected the outcome of the 2022 periodic election for the Adelaide Plains Council, where we saw two elected members put into place in council? There was an extended lag time before that error was actually discovered and rectified, and that community quite rightly feels aggrieved by that process.

The Hon. J.K. SZAKACS: I was concerned, absolutely. I have been entirely consistent with the Electoral Commissioner, who has apologised for the impact of the error on the respondents, and particularly the Adelaide Plains Council which this disrupts. It is the strong expectation of government that processes are sound, rigorous and de-risked. I trust and certainly have every confidence that both the post-event review and also the findings will inform really strong and rigorous processes and systems moving forward, without a similar risk of error.

Mr TELFER: Once again, in the local government review from the Electoral Commission there was not any sort of detail within that reflecting on that. As someone observing the long-awaited review, for which we waited for a significant period of time, for it not to touch on those two matters in particular—which had significant ramifications for those local communities in particular—obviously there needs to be consideration of changes and reviews not just in the procedural parts of what ECSA do but in your consideration of legislative change, potentially. Who is informing you? Is it over and above the Office of Local Government on some of the details of what changes could be considered, especially for those two aspects in particular?

The Hon. J.K. SZAKACS: Not just any specific aspect, but to go to the member's question around the breadth of government agency support to provide advice to ministers and ultimately to cabinet, that goes across into Crown law and into Crown counsel. It goes into the Attorney-General's Department, of course, which the Office of Local Government is working closely with.

This is no different—albeit it is probably different in its impact—than the changes on donation reform that our government brought to the parliament, and multiple agencies, including engagement with the commission, the AGD and the Crown, informed that piece of work. That piece of work went to cabinet and cabinet, through the minister, brought it here.

Mr TELFER: That is something that is proactive. This is in response to categorical failings and errors made through process. Are you aware of what the total cumulative cost to both the state government and local government has been due to the mistakes, the errors, the procedural oversights during the 2022 local government periodic elections? Has that body of work been done, and if not, will it be done as part of the review of the process?

The Hon. J.K. SZAKACS: I do not have that information. I will see if I can take that on notice. If we do have the information available I will obviously provide it to the member. With respect to the first part of the member's question regarding errors, we concur that errors are not just regrettable but should be avoided at all costs. I am not certain or persuaded at all that any piece of law stops errors occurring. Certainly frameworks—but more so policy frameworks—need to be rigorous, and those policy frameworks and internal mechanisms need to be rigorous so as to minimise the likely occurrence of errors and also the impact of those errors should they occur. But a piece of law will not stop an error occurring, or it will not cause an error to occur.

Mr TELFER: What undertakings have you received from the Electoral Commissioner, or what ramifications for those errors have there been and what are the potential changes to the way they go about it? The shrug of the shoulders thing 'hopefully it doesn't happen next time' is probably not acceptable to communities.

The Hon. J.K. SZAKACS: I certainly have not had any sense of a shrug of shoulders?

Mr TELFER: What undertakings have you received from the Electoral Commissioner, in particular, when it comes to these processes?

The Hon. J.K. SZAKACS: I should say that much of this engagement was well and truly before my swearing in as minister. These are errors that occurred well and truly before my time and the remedial actions and rectifications of those errors took place before I was minister. But I am entirely satisfied and have the highest degree of confidence in the Electoral Commissioner both understanding the impact of these errors and also putting in place internal measures—for which he does not account to me—which mitigate against the risk of future errors.

Today we are examining local government line items, but the need and desire and assurance that we seek is consistent across all layers of elections, and there are many. We have just had a very smooth federal election. Much of the staff of the South Australian Electoral Commission were deployed across to the AEC. They do great and important work and democracy is strong here, but it needs to be treated with the highest amount of respect, and we certainly do so.

Mr TELFER: I move on to the next subject matter. As the minister responsible for the Local Government Act 1999, which provides for that strategic management advice scheme currently conducted by ESCOSA—and obviously as the minister receiving advice from the OLG on the merits of that advice scheme—are you satisfied as those reviews are being received by both you and local government that the process that has been developed by ESCOSA is appropriate in its scale and scope?

The Hon. J.K. SZAKACS: I am and I have also seen and been advised, independently, internally and externally, about the positive evolution of the engagement between ESCOSA and the sector. Certainly one of the first things that I did on becoming minister was to meet with ESCOSA and the sector, both of which independently raised with me the tenor and nature of the engagement across the early years of the advice scheme.

I set a high degree of expectation on ESCOSA that the highest priority should be put on strong collegial engagement with local government. Where that can improve, we are very willing to ensure that we support the sector and support ESCOSA in doing so, but I am certainly satisfied with the merits of the scheme, the legal framework behind it.

Mr TELFER: Are you aware of whether there are any councils that have thought the advice that they have received in the first three tranches from ESCOSA is advice that they were not already aware of? Are you aware of any positive outcomes for South Australian ratepayers as a result of the findings of the ESCOSA processes for those three tranches?

The Hon. J.K. SZAKACS: I think there is absolute value for South Australian ratepayers to have independent oversight of the strength of the financials of their local government—absolutely. Are there councils that have said to me that they do not need it? Absolutely.

Mr TELFER: Are you happy with the flat fee of $40,000 per council, where it does not vary with budget sizes? There is a lot of difference between assessing a $3 million District Council of Franklin Harbour budget through the ESCOSA process as opposed to the hundreds of millions of the Onkaparinga council, for instance.

The Hon. J.K. SZAKACS: It is a really good question, and it was one of the earlier questions that I asked as well: how is this apportioned? It is always open to the sector. The LGA and its constituencies rejected a progressive scheme by which those costs would be differently apportioned. Franklin Harbour would be having a small input, and a larger council with a much larger rate base and balance sheet would be paying a bit more. That was rejected. As minister—

Mr TELFER: It is pretty hard with a membership organisation of all 68 councils to make that decision. It is something which—

The Hon. J.K. SZAKACS: I have run membership organisations, and—

Mr TELFER: Where their influence is varying, to those extremes?

The Hon. J.K. SZAKACS: Yes; as have you, member.

Mr TELFER: Indeed. The question is: do you think that $40,000 is fair and equitable across the councils?

The Hon. J.K. SZAKACS: I do not believe that the $40,000 across four years, 10,000 per annum, is a disproportionate, unfair or significant impost upon the balance sheet of local councils.

Mr TELFER: Ten thousand a year is half a per cent of rates in some council areas.

The Hon. J.K. SZAKACS: It is. Would I support a re-litigation of the progressive implementation of that costing scheme? I would, yes.

Mr TELFER: We are approaching the final tranche of council reviews, the fourth of the four. What is the government's response to the significant number of councils in South Australia that have received a report from ESCOSA that they are either unsustainable or potentially unsustainable? What is the government's response? What does all this mean, in the end, for local communities?

The Hon. J.K. SZAKACS: There is a response to that part. There is also the confidence with which the government and, by defacto, ratepayers see in those councils that are performing with confidence. There is also the underlying strength here of the scheme, which is now three-quarters of the way through, giving the confidence to ratepayers for this oversight. This is the level of government that can ensure, in most instances, it is most connected to community. The standards under the legislative framework mean that councils are accountable to their communities in doing so, and without that detailed compliance oversight from the state government through the scheme, they would not be able to. The state government, through the Office of Local Government, has worked closely with the LGA for some time now.

Mr TELFER: The question is probably around what the financial response is from the state government. What I hear, and I am sure you probably hear it as well in so many communications, is that through this process councils are finding out information that they already know about the challenges they are facing with their finances. It is shining a spotlight, and the words 'unsustainable' and 'potentially unsustainable' are pretty strong terms. What is the state government's financial response? What are you doing over and above what you would ordinarily do in response to having councils that are unsustainable or potentially unsustainable?

The Hon. J.K. SZAKACS: I appreciate the tenor of the member's questions. It is not for the state government to be financially responding. We are sitting here today, and have been for the last week, examining our budget. There are risks and opportunities for our own budget, which have been examined through the estimates. That is what we are focused on.

As for the broader fiscal approach and sustainability question, it remains before the commonwealth. I am, as the sector is and frankly as other states are, eagerly awaiting the completion of the review by the Parliament of Australia. We have an opportunity with a returned mandate for the federal Albanese government, and I am very pleased to see the return of Minister McBain as well into this portfolio for a stepping up of the commonwealth portion of funding. We have publicly advocated for that. We have publicly submitted that.

Mr TELFER: You have publicly advocated and submitted for an overall increase? You have made those personal representations to the minister?

The Hon. J.K. SZAKACS: Yes.

Mr TELFER: So rather than an altering of the proportions, it is an increase of the total—

The Hon. J.K. SZAKACS: Yes. I think it is really important. The position that I have taken and the position that the cabinet has taken is that we do not support a change of the alignment of the way that things are allocated, a bottoming out or a topping out: the pot should be bigger. We have taken public and in our submission a no worse off test. There should be no council that is worse off through any of these changes.

Mr TELFER: Has the body of work been done within your organisation, within OLG, or have you received advice to look at other states in the way that they apportion it out? I get that no council should be worse off. I absolutely agree. But if that does not happen, are there other ways to apportion the funding of those financial assistance grants? Are there better ways to do it that other states are doing?

The Hon. J.K. SZAKACS: It was a really informative piece of work that was undertaken to inform the submission on behalf of the state government to the federal review. I am aware of slightly different approaches, some supported, some not. It is not surprising in public policy that you have some over here that love it, some over here that hate it and people in the middle who kind of roll with it. I would not say that we are closed to any idea. I would not say that we are actively considering any changes. The question, certainly it has been advocated to me, has been far less around changing the methodology and far more in support of an overall uptick of funding into the sector that supports the existing allocation methodology.

Mr TELFER: Moving on to the grants commission and specifically the boundaries commission work that has been done, there are not too many questions about the grants process when it comes to estimates, although I love it. On the boundary stuff in particular, how many council boundary proposals is the boundaries commission currently considering?

The Hon. J.K. SZAKACS: There are currently six in total.

Mr TELFER: How many boundary proposals has the boundaries commission completed in the last five years?

The Hon. J.K. SZAKACS: I am seeking advice. It is probably outside of the budget line but also certainly some years before I was the minister. Since its commencement in 2019, the commission has received 17 proposals. Of these, six proposals, as I said, are currently under consideration. Nine did not proceed as they either did not meet statutory requirements or were withdrawn, and two have been completed.

Mr TELFER: Which are the two that have been completed?

The Hon. J.K. SZAKACS: There was one that did not proceed, which was a realignment between Barunga and Copper Coast, and one that did proceed, which was a realignment between Onkaparinga and Marion.

Mr TELFER: So there were two completed: one proceeded, one did not. What are the six that are currently being considered?

The Hon. J.K. SZAKACS: The six that are currently being considered are the initiated proposal by the Campbelltown City Council; the initiated proposal by the Town of Gawler; a joint council-initiated proposal from the City of Burnside and Adelaide Hills Council to address a boundary anomaly; an administrative proposal from the City of Playford and the Town of Gawler in relation to the council boundary along Dalkeith Road; there is a public-initiated proposal from Seacliff Developments in relation to the boundary between the City of Holdfast Bay and the City of Marion; and there is a further public-initiated proposal from the Truro and District Community Association that the townships of Dutton and Truro move from Mid Murray Council to The Barossa Council.

Mr TELFER: How many of these have been started in the last 12 months?

The Hon. J.K. SZAKACS: Just to define for the purposes of my answer as to whether it has been started or initiated, I will define it as having been received by the—

Mr TELFER: Received and initiated, yes.

The Hon. J.K. SZAKACS: The joint council-initiated proposal from the City of Burnside and Adelaide Hills Council has been received. The administrative proposal by the City of Playford and the Town of Gawler has been received in the last 12 months. The public-initiated proposal from Seacliff Development has been received. The public-initiated Dutton and Truro proposal has been received as well.

Mr TELFER: One of the targets on page 80 is to finalise inquiries from the Town of Gawler and Campbelltown City Council. When will the inquiry into the boundary proposal from the Campbelltown City Council be completed?

The Hon. J.K. SZAKACS: Sorry, was that Campbelltown City Council?

Mr TELFER: Campbelltown, yes.

The Hon. J.K. SZAKACS: For Campbelltown City Council, the community consultation closed on 20 June 2025, and I am advised that the investigator is now completing the draft inquiry report.

Mr TELFER: When do you expect that to be completed?

The Hon. J.K. SZAKACS: This financial year.

Mr TELFER: So before this time next year, it will be completed?

The Hon. J.K. SZAKACS: It depends when estimates is next year.

Mr TELFER: I will wait and see if it is in the targets next time. How long has this one—Campbelltown—been going on for, minister?

The Hon. J.K. SZAKACS: I can provide some detail on that. The stage 1 potential proposal was received from the Campbelltown City Council in 2019. The commission then, in May 2019, determined that Campbelltown City Council could submit a stage 2 boundary change general proposal. In 2022, the Campbelltown City Council then ultimately submitted a general proposal to the commission—so about three years later, the council submitted that. Further in 2022, the commission requested further information from the council.

In October 2022, the commission consulted affected councils on the draft inquiry plan and then, following an open tender and procurement evaluation process, the commission advised Campbelltown City Council of their cost estimate. The Campbelltown City Council, in that same month, accepted the cost estimate and agreed to proceed—

Mr TELFER: What was that cost estimate? Do you have that there?

The Hon. J.K. SZAKACS: In the order of about $170,000. In February 2024, the commission appointed BDO Services as the investigator, and the investigation commenced in late 2024. As I then walked through, from May through June, community consultation occurred.

Mr TELFER: So it started six years ago and ramped up three years ago. BDO were put in place in February but they did not start until the end of the year?

The Hon. J.K. SZAKACS: Yes.

Mr TELFER: It is a long lead-in time for a consultant.

The Hon. J.K. SZAKACS: I asked the same question and I was satisfied that the work of— BDO are a very good operator. To some members of the community and councils it was a bit frustrating that it was this slow.

Mr TELFER: Are you confident that BDO have the capacity to be able to do it?

The Hon. J.K. SZAKACS: Yes. Rightfully so, I sit entirely independent of the commission in respect of them appointing BDO, and I trust their processes entirely. The six years that the member referred to I think is probably just—

Mr TELFER: Three years of the actual process, six years when that first—

The Hon. J.K. SZAKACS: Councils will undertake their own timeframes. Three years, I have no reason to know whether that is—

Mr TELFER: This is the bit where I can see why communities are getting frustrated. It is sort of hanging over those affected ones in particular and not knowing from year to year where things are going to end up. Likewise with the town of Gawler proposal, when is that going to be completed and what is the cost estimate that was given to them?

The Hon. J.K. SZAKACS: With respect to one of the parts of the member's question around the cost estimates, I believe in the order of about $180,000.

Mr TELFER: And same with the $170,000. These are the amounts that the Grants Commission have informed the council it will cost them to proceed with that next step?

The Hon. J.K. SZAKACS: The whole step, that is correct.

Mr TELFER: That is the cost for the council?

The Hon. J.K. SZAKACS: The Boundaries Commission, that is correct, yes. With respect to when I expect completion, I have been advised that the Boundaries Commission are endeavouring to complete their inquiry and to then provide advice to me as the minister in, I think, early August. So in the next couple of months.

Mr TELFER: So you are expecting that one before the Campbelltown one?

The Hon. J.K. SZAKACS: Yes. Insofar as the Boundaries Commission are further advanced, and that is what has given me the satisfaction of knowing, based upon their advice to me, when they would anticipate being able to provide me with their recommendations.

Mr TELFER: Does the total cost of the Boundaries Commission inquiries get covered by councils?

The Hon. J.K. SZAKACS: Yes.

Mr TELFER: To its entirety, so it is a cost-neutral operation for the Boundaries Commission?

The Hon. J.K. SZAKACS: Where those proposals are initiated by council, yes. There are others that I have referred to in my question from the member around privately initiated or otherwise, they are then covered by other parties. But yes, when they are council initiated, that is fully covered.

Mr TELFER: How much money has been allocated to the grants commission from the state government to consider other proposals that are not instigated by councils?

The Hon. J.K. SZAKACS: I'm sorry?

Mr TELFER: How much money has been allocated in the budget to do that work that is initiated by the public rather than the ones initiated by council?

The Hon. J.K. SZAKACS: I am advised that there is no specific account for those. The publicly initiated ones, being relatively minor in nature, are managed within the existing resources of the commission.

Mr TELFER: As always, we could spend hours on local government. Sadly, I only get one. I am just going to quickly jump into a couple of other subject matters. The Outback Communities Authority, in particular: is the strategic blueprint for Outback SA completed?

The Hon. J.K. SZAKACS: Yes, it is in the final stages of consultation.

Mr TELFER: It is not completed, but close?

The Hon. J.K. SZAKACS: Close, yes.

Mr TELFER: When will that be made public?

The Hon. J.K. SZAKACS: I do not have a date, but I have no reason to think not in the next—it is a matter of weeks, not months.

Mr TELFER: Does it contain anything different from the Outback Futures report recommendations?

The Hon. J.K. SZAKACS: It is a more comprehensive piece of work. I do commend the OCA on this. They have done an outstanding piece of work. There is very good community engagement. As a statutory authority they rightfully have their own processes and consultations to undertake. We have been very proud and I am very pleased as part of this budget across five years to secure an additional $1 million into supporting outback community infrastructure that will be informed then by the blueprint, by the priorities of communities as they continue to be engaged. I do commend the piece of work. I have been briefed by the OCA on the work. It's comprehensive, I think.

Mr TELFER: I have happened to be in some of my communities when the consultation process has been happening. How much money was allocated to develop and complete the blueprint itself?

The Hon. J.K. SZAKACS: I will come back on notice to correct this, but I anticipate it would have been within existing resources, that there would not have been a specific allocation—a specific new allocation—out of the budget.

Mr TELFER: Has there been an allocation to deliver on any recommendations of the blueprint?

The Hon. J.K. SZAKACS: No. The budget cycle has deliberately sought and, as I have already mentioned, has been very deliberate in prioritising what we think is a capacity building for economic development and also community resilience across the outback communities in additional funding of $1 million. That will be disbursed across, in addition to existing programs, so that will go materially and deliberately—

Mr TELFER: Will the blueprint inform that allocation or is the blueprint just a bit too far behind?

The Hon. J.K. SZAKACS: No, the blueprint will. Certainly the community engagement and the prioritisation that has been elicited from the blueprint consultation will go to inform the triaging of these projects. Look, we are like every government constrained by fiscal realities and there will always be a triaging of projects and a prioritisation of projects, but the body of work that has informed that and the diligence with which the OCA have led that. Particularly the chair of the OCA—and I really thank her for her work—has been a great investment.

Mr TELFER: In the last couple of minutes, just a quick couple of questions on the State-Local Economic Partnership Accord. When will that be completed? Is it being led and developed by OLG?

The Hon. J.K. SZAKACS: This has been a collaborative effort through a couple of different government agencies. In terms of when that will be finalised, I expect in the very near future. It has been—

Mr TELFER: Within weeks, months?

The Hon. J.K. SZAKACS: Weeks, not months. Certainly the finalisation has been subject to the completion and the passage through this place of the Coordinator-General legislation, which has been an important, informative piece of work, and access to it—so it has slowed it down and I will be very honest with the member, I think before I reflected on how I am no-one to judge the will of the parliament, it took a bit of time. I would have liked to have got this done a bit earlier.

Mr TELFER: Yes, indeed. It is another one that has been on the targets every single budget as we roll along.

The Hon. J.K. SZAKACS: Well, in your words, when you say that you are going to be back here next year as the minister, I do not think that anyone will be asking you that one.

Mr TELFER: The member for Newland can ask me questions as the shadow minister perhaps. What role does the OLG have in regard to that Coordinator-General role and responsibilities? What will OLG be doing specifically? There is some ambiguity in the sector about that local government involvement directly. Can you, in a minute, give me a—

The Hon. J.K. SZAKACS: It might be a question where I seek some advice more materially from the chief executive of DHUD. The short answer, in the time allocated, is it is a work in progress and the finalisation of the appointment of the Coordinator-General and the allocation of a minister who I believe has been already elicited through the committee process will inform the way that DHUD and then OLG engage with that.

Mr TELFER: Will there be a local government representative on the CGO or would it be making recommendations to the CGO?

The Hon. J.K. SZAKACS: Yes, I am advised there will be a sufficient function within the CGO that will enable the initiation by councils.

Mr TELFER: Thank you very much, and thank you for the opportunity to be able to look at local government. As you swap over, I might do the omnibus questions. Thank you to all.

The Hon. J.K. SZAKACS: Thank you.

Mr TELFER: The omnibus questions are:

1. For each department and agency reporting to the minister, how many executive appointments have been made since 1 July 2024 and what is the annual salary and total employment cost for each position?

2. For each department and agency reporting to the minister, how many executive positions have been abolished since 1 July 2024 and what was the annual salary and total employment cost for each position?

3. For each department and agency reporting to the minister, what has been the total cost of executive position terminations since 1 July 2024?

4. For each department and agency reporting to the minister, will the minister provide a breakdown of expenditure on consultants and contractors with a total estimated cost above $10,000 engaged since 1 July 2024, listing the name of the consultant, contractor or service provider, the method of appointment, the reason for the engagement and the estimated total cost of the work?

5. For each department and agency reporting to the minister, will the minister provide an estimate of the total cost to be incurred in 2025-26 for consultants and contractors, and for each case in which a consultant or contractor has already been engaged at a total estimated cost above $10,000, the name of the consultant or contractor, the method of appointment, the reason for the engagement and the total estimated cost?

6. For each department or agency reporting to the minister, how many surplus employees are there in June 2025, and for each surplus employee, what is the title or classification of the position and the total annual employment cost?

7. For each department and agency reporting to the minister, what is the number of executive staff to be cut to meet the government's commitment to reduce spending on the employment of executive staff and, for each position to be cut, its classification, total remuneration cost and the date by which the position will be cut?

8. For each department and agency reporting to the minister, what savings targets have been set for 2025-26 and each year of the forward estimates, and what is the estimated FTE impact of these measures?

9. For each department and agency reporting to the minister:

(a) What was the actual FTE count at June 2025 and what is the projected actual FTE account for the end of each year of the forward estimates?

(b) What is the budgeted total employment cost for each year of the forward estimates?

(c) How many targeted voluntary separation packages are estimated to be required to meet budget targets over the forward estimates and what is their estimated cost?

10. For each department and agency reporting to the minister, how much is budgeted to be spent on goods and services for 2025-26 and for each year of the forward estimates?

11. For each department and agency reporting to the minister, how many FTEs are budgeted to provide communication and promotion activities in 2025-26 and each year of the forward estimates and what is their estimated employment cost?

12. For each department and agency reporting to the minister, what is the total budgeted cost of government-paid advertising, including campaigns, across all mediums in 2025-26?

13. For each department and agency reporting to the minister, please provide for each individual investing expenditure project administered, the name, total estimated expenditure, actual expenditure incurred to June 2024 and budgeted expenditure for 2025-26, 2026-27 and 2027-28.

14. For each grant program or fund the minister is responsible for, please provide the following information for the 2025-26, 2026-27 and 2027-28 financial years:

(a) Name of the program or fund;

(b) The purpose of the program or fund;

(c) Budgeted payments into the program or fund;

(d) Budgeted expenditure from the program or fund; and

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

15. For each department and agency reporting to the minister:

(a) Is the agency confident that you will meet your expenditure targets in 2025-26? Have any budget decisions been made between the delivery of the budget on 5 June 2025 and today that might impact on the numbers presented in the budget papers which we are examining today?

(b) Are you expecting any reallocations across your agencies' budget lines during 2025-26; if so, what is the nature of the reallocation?

16. For each department and agency reporting to the minister:

(a) What South Australian businesses will be used in procurement for your agencies in 2025-26?

(b) What percentage of total procurement spend for your agencies does this represent?

(c) How does this compare to last year?

17. What percentage of your department's budget has been allocated for the management of remote work infrastructure, including digital tools, cybersecurity, and support services, and how does this compare with previous years?

18. How many procurements have been undertaken by the department this financial year. How many have been awarded to interstate businesses? How many of those were signed off by the CE?

19. How many contractor invoices were paid by the department directly this financial year? How many and what percentage were paid within 15 days, and how many and what percentage were paid outside of 15 days?

20. How many and what percentage of staff who undertake procurement activities have undertaken training on participation policies and local industry participants this financial year?

The ACTING CHAIR: The allotted time having expired, I declare the examination of the Office of Local Government, the Outback Communities Authority and the Local Government Grants Commission complete.