DEPARTMENT OF PLANNING, TRANSPORT AND INFRASTRUCTURE, $954,509,000

ADMINISTERED ITEMS FOR THE DEPARTMENT OF PLANNING, TRANSPORT AND INFRASTRUCTURE, $4,041,000

Witness:

Hon. P.F. Conlon, Minister for Housing and Urban Development, Minister for Transport and Infrastructure, Minister for Transport Services.

Departmental Advisers:

Mr M. Buchan, General Manager, Urban Renewal Authority.

Mr F. Hansen, Chief Executive, Urban Renewal Authority.

Mr J. Hay, Ministerial Adviser.

Mr M. Clemow, Chief of Staff.

Mr W. Smith, Executive Director, Corporate Affairs and Strategy, Urban Renewal Authority.

Mr P. Fagan-Schmidt, General Manager, Urban Portfolio Planning, Urban Renewal Authority.

The CHAIR: The estimates committees are a relatively informal procedure and, as such, there is no need to stand to ask or answer questions. The committee will determine an approximate time for consideration of proposed payments to facilitate change over the departmental advisers. I ask the minister and the lead speaker of the opposition if they could indicate whether they have agreed on a timetable for today's proceedings and, if so, provide the chair with a copy.

The Hon. P.F. CONLON: I certainly agree.

Ms CHAPMAN: Yes.

The CHAIR: Thank you. Changes to committee membership will be notified as they occur. Members should ensure the chair is provided with the 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, 21 September 2012. I propose to allow both the minister and the lead speaker for the opposition to make opening statements if they so desire. There will be a flexible approach to giving the call for asking questions, based on about three questions per member. A member who is not part of the committee may, at the discretion of the chair, ask a question. Questions must be based on lines of expenditure in the budget papers and must be identifiable or referenced.

Members unable to complete their questions during the proceedings may submit them as questions on notice for inclusion in the House of Assembly NoticePaper. There is no formal facility for the tabling of documents before the committee; however, documents can be supplied to the chair for distribution. All questions are to be directed to the minister and not to the advisers. The minister may refer questions to advisers for a response. I also advise, for the purposes of the committees, that television coverage will be allowed for filming from the areas clearly marked on the floor of the room.

I will now proceed to open the Transport, Planning and Infrastructure lines for examination, and the ministers appearing are the Minister for Housing and Urban Development, the Minister for Transport and Infrastructure and the Minister for Transport Services. I declare the proposed payments open for examination and refer members to the Portfolio Statements Volume 3. Minister, do you have an opening statement?

The Hon. P.F. CONLON: No, thank you.

The CHAIR: Shadow minister?

Ms CHAPMAN: No, sir.

The CHAIR: Okay, we will start. Member for Morialta.

Mr GARDNER: We will start with the omnibus questions, if you like:

1. Will the minister provide a detailed breakdown of expenditure on consultants and contractors above $10,000 in 2011-12 for all departments and agencies reporting to the minister, listing the name of the consultant, contractor or service supplier, cost, work undertaken and method of appointment?

2. For each department or agency reporting to the minister in 2011-12, please provide the number of public servants that are (1) tenured and (2) on contract; and for each category please provide a breakdown of the number of (1) executives and (2) non-executives?

3. For each department or agency reporting to the minister, how many surplus employees will there be at 30 June 2012, and for each surplus employee what is the title or classification of the employee and the total employment cost of the employee?

4. In financial year 2011-12, for all departments and agencies reporting to the minister what underspending on projects and programs was not approved by cabinet for carryover expenditure in 2012-13? How much was approved by cabinet?

5. Between 30 June 2011 and 30 June 2012, will the minister list the job title and total employment cost of each position with a total estimated cost of $100,000 or more (a) which has been abolished and (b) which has been created?

6. For 2011-12, will the minister provide a breakdown of expenditure on all grants administered by all departments and agencies reporting to the minister, listing the name of the grant recipient, the amount of the grant and the purpose of the grant, and whether the grant was subject to a grant agreement as required by Treasurer's Instruction No. 15?

7. For all capital works projects listed in Budget Paper 5 that are the responsibility of the minister, please list the total amount spent to date on each project.

8. For each department or agency reporting to the minister, how many targeted voluntary separation packages were or will be offered in total for financial years 2010-11, 2011-12, 2012-13, 2013-14, 2014-15 and 2015-16?

You do not have to answer that now.

The Hon. P.F. CONLON: I have heard it before.

Mr GARDNER: To start with Housing SA, Budget Paper 3, page 96, I note the commonwealth government has brought forward remote Indigenous housing national partnership payments of $20.7 million from the 2012-13 financial year into the 2011-12 financial year. What was the purpose of bringing forward this significant grant?

The Hon. P.F. CONLON: I think there is something we should probably get pretty clear. We still do have a Minister for Social Housing in the budget line, and that is his budget line. I have someone here who knows something about it, but I think in fairness to the minister those questions should be addressed to minister Ian Hunter.

Mr GARDNER: In terms of the housing component with Housing SA, could you give us a breakdown of the areas of Housing SA responsibility you are happy to answer questions on and we will ask everything else of minister Hunter?

The Hon. P.F. CONLON: The Urban Renewal Authority is a broader housing urban renewal arm of the government. It holds some stock that would formerly have been held by Housing SA, some items of property. It holds those landholdings that the Land Management Corporation used to have, and it holds the holding—at least I believe they have been transferred—of the former Defence SA, which also held substantial land down at Port Adelaide in particular.

The area of overlap with the social housing minister is in the development of those areas of stock and land held by the former Housing SA and in other developments that might ultimately provide some new stock to the department (but I am not actually quite sure what the department is called, forgive me). Any aspect of the development that might in the past have been undertaken by Housing SA would now be with us.

I think, from memory, there is the Woodville West and Marden developments. If there is something that is a development that Housing SA used to do, in short we probably are now doing it. There may be developments that we do that will provide stock to either community housing or to the housing minister. I am quite relaxed about your exploring what it is, and I will let you know if we are responsible or someone else is.

To be fair to you, as an explanation, we are in a transitional process at present. I should explain who we have with us. We have Fred Hansen, the Chief Executive, formerly of Portland, Oregon. He has travelled further than Lewis and Clark to get to his position. We have Michael Buchan, formerly of the Land Management Corporation, who is Major Projects. We are just settling down all the new directors and all the new lead people in the agency because it is entirely new and brings three together. Back behind me somewhere, you will find Phil Fagan-Schmidt, who still works for Housing SA but is here because of that overlap with developments done by Housing SA, and I think we have Warren Smith, formerly of the Land Management Corporation back there.

We are still in the process. We have not finalised the board of the new authority. We are still in the process of setting up those structures and transferring some items. You will find that we have some property transfers already, but there might well be property still held by Housing SA where we have taken over, if you like the leadership role in managing the future strategy and direction. It will probably take a good year to finalise all of the different holdings and such like.

If you will bear with me, I am quite happy for you to explore areas in each, and I will be courteous as I can. I know that everyone in this room will be very well behaved. We have always been led astray by those other people in the chamber. It could be the start of a beautiful friendship, as they said in Casablanca.

Mr GARDNER: Cannot wait. In relation to the new spend on disability housing, that would fit entirely, then, within the Minister for Social Housing's purview?

The Hon. P.F. CONLON: The one you raised about the Indigenous—

Mr GARDNER: No, I have accepted that is in social housing.

The Hon. P.F. CONLON: You are very kind; I am very hard of hearing. I am not trying to be difficult.

Mr GARDNER: I will speak slowly. The disability housing that was part of the disability spend, those houses have been built by Housing SA.

The Hon. P.F. CONLON: The social housing minister is responsible. He is the Minister for Disability Services, or whatever it is now called.

Mr GARDNER: In that case, focusing on River Street, Marden and Woodville West then—

The Hon. P.F. CONLON: We have taken that from Housing SA.

Mr GARDNER: Can you give us updated times on those developments?

The Hon. P.F. CONLON: River Street, Marden is nearing the end of the design stage. I am hoping to take a proposal to cabinet in the next couple of months, and that will be released to the market by the end of this calendar year. The outcomes are higher density, with good design around the river to increase the local amenity, and to have a good mix of social, affordable and other housing in it. Those are the design objectives, and they will be finalised and they will then be off to cabinet within the next couple of months and released to the market by the end of the year.

Mr GARDNER: Within those design objectives, at this stage do we have any anticipation of whether any Housing SA stock—buildings or properties—will remain in that development, or are we just looking at the 15 per cent affordable housing?

The Hon. P.F. CONLON: Phil has been responsible for this to date. I understand that there will be a mix. It might be a good time to make the point, though, that one of the things that we are seeking to explore with the new arrangement is how much housing we can create for those in greatest need, the social housing—how much affordable housing we can create without being as hung up about the ownership of that housing as we have been in the past.

It is very clear that, in South Australia, community housing has played a smaller role than in other states. We know that there are some smaller, very good not-for-profit organisations out there. We know that there are good ones interstate, and we know a number of other things. We have historically had an extremely high level of Housing Trust stock in South Australia, and we know that, as a consequence of that, people in need have received less as a proportion in terms of commonwealth payments as a result of the ownership of that stock.

We make no secret of the fact that we are exploring the best way to optimise and to maximise the amount of social housing and the amount of affordable housing for those who need it out of the new arrangements, but undoubtedly stock will be held by the Housing Trust. It may well be that in future there is growth in the community housing sector as well, and we are very keen on our organisation helping to meet market failure where we see the changes.

Changes in the way housing happens in Australia have meant that those on what I would call ordinary incomes are finding it harder to achieve home ownership because the old answers do not work. We have to find new answers for that market failure as well. We see the role of our agency, in attempting to assist the social housing minister in the primary objective, as having more stock available for those who need it; good quality stock on good terms. How that is achieved—we are exploring as many options as we can because we think, to the person who needs housing, they are not as fussed about how it is branded but what the quality and the affordability of it is.

Mr GARDNER: At the moment there may be Housing SA stock; there may not be?

The Hon. P.F. CONLON: There will be a higher component of community housing but there will be some Housing SA stock as well.

Mr GARDNER: Can I ask the same batch of questions on Woodville West, then: timing and—I assume, if it is the same answer—community and Housing SA stock?

The Hon. P.F. CONLON: Woodville West has a substantial amount of commonwealth funds in it, too, though. I think the difference with Woodville West would have been the major contribution from the commonwealth's stimulus package around affordable housing. The Woodville West package is aimed at that affordability. At completion of Woodville West we would expect about a third of it to be affordable housing and 60-odd of that to be in the social housing mix.

That was both a stimulus package from the commonwealth and a development aimed at creating affordable housing. What we have all learnt over many years is that we cannot simply create only affordable housing in a precinct—at least not an attractive proposition—so I think they are looking for a mix of a third of affordable, which is probably quite a high target. Stage 1 is to be completed by 30 June; stage 2 civil works are commencing later this year.

Mr GARDNER: This one, again, has some overlap, but it is in relation to the Housing Trust and the URA, so I will ask you in case it is you.

The Hon. P.F. CONLON: And I love to talk about anything, let's face it!

Mr GARDNER: At Budget Paper 3, page 99, table 5.9, I note that there are 972.9 FTEs allocated to the Housing Trust, and my understanding is that last year there were 958.7, and 82.6 of those have been transferred into the URA. It says, 'reflecting the incorporation of some functions previously undertaken by the trust into the authority.'

The Hon. P.F. CONLON: Yes.

Mr GARDNER: Is that transfer reflected in these figures or does the 972.9 figure in table 5.9 include the 82.6 who have transferred to the URA?

The Hon. P.F. CONLON: I am not quite sure, to be honest. Certainly the budget papers for the URA include the transfer, but I cannot speak for whether they have actually subtracted it from the—

Mr GARDNER: One hundred and ninety four are listed under the URA so I would assume that that would—

The Hon. P.F. CONLON: Yes; the URA includes them. I cannot speak for Housing SA.

Mr GARDNER: They are not double-counted? On that basis—

The Hon. P.F. CONLON: We would want to check just to make sure.

Mr GARDNER: Do you want to check that now?

The Hon. P.F. CONLON: As I said before, we are continuing a transitional phase. There may be further transfers of property in the future; there may even be new transfers of people; there may be employment of different people—I do not know—but we are creating a very extensive and comprehensive new agency, and we prefer to make sure the transition gets it right rather than we get the transition over with quickly.

Mr GARDNER: The issue I have is that if you remove those 82 they are counted in the URA figures. Last year, we would have had 876 FTEs in housing trust and now it is listed as 972, so that is an extra 97 FTEs in the housing trust. Is there any way to explain that significant increase?

The Hon. P.F. CONLON: We do not have responsibility for the broader range of activities of that minister so you will probably have to direct that question to them. I would purely be guessing.

Mr GARDNER: I will establish that on Monday. Are we able to talk about HomeStart Finance a little?

The Hon. P.F. CONLON: Yes, we can. Is anyone here from HomeStart?

Mr GARDNER: He is getting ready for the CEO sleep-out.

The Hon. P.F. CONLON: We were talking about them yesterday. Everything is hunky dory down there.

Mr GARDNER: In Budget Paper 3, page 98, table 5.8, I think there are three or four references to HomeStart.

The Hon. P.F. CONLON: I will take your word for it.

Mr GARDNER: Previously the HomeStart Finance board was answerable to you as the Minister for Housing and Urban Development. The CEO of HomeStart has also worked with the department for families and communities, and when the minister for housing was the minister for families and communities obviously there is a sympathy there. Is the CEO now working with the Department for Communities and Social Inclusion, or is he working with DPTI in a departmental role?

The Hon. P.F. CONLON: I guess in salaries and victuals, he is part of DPTI, but traditionally he has reported to the HomeStart board and, obviously, to the relevant minister. HomeStart has become part of the Urban Renewal Authority because we see the role of the authority in the delivery of development outcomes as both making sure that the private sector does it right and that what the government does meets government objectives.

While HomeStart Finance will report to me, its activities will remain around its primary focus of providing finance to those who are appropriate to be financed but who struggle in conventional finance to achieve home ownership; we see HomeStart as remaining extremely important in that role. In a very cautious way, at the moment in the Urban Renewal Authority we are considering other things that have been done around this sort of financing around the world, and we may have some ideas about that in the future.

HomeStart Finance does report to its board and to me, but we see its role in the broader role of the Urban Renewal Authority in delivering government objectives in this area, in delivering government objectives around affordability and around getting people into housing. For your benefit, we also see the Urban Renewal Authority as having a role in delivering broader government objectives in terms of education, health, and healthy living, in terms of all those things we set out to do in our Strategic Plan.

Conceptually, you should see the Urban Renewal Authority as being the development and delivery arm of the government, not simply of the housing sector of the government; therefore, I think it is entirely appropriate that HomeStart Finance finds its new home in DPTI, which is the lead agency. Is that right? Anyone have an argument with that?

Mr GARDNER: I have some other questions on HomeStart Finance but they are probably best kept for another day if there is no-one here from there. Perhaps you could take this on notice: in Budget Paper 3, page 98, table 5.8 shows there has been an increase in the net contribution to government from HomeStart Finance of $2 million due to what is described as 'improved operating performance'. Is there any possibility that you can provide any detail around the circumstances of that improvement?

The Hon. P.F. CONLON: We can certainly do that. I was looking at some of the stuff yesterday. From memory, the level of activity has increased a little each year by HomeStart. They lend a little more each year. They have very few bad loans, so they make a return on what they do, and I would imagine that it is purely associated with the fact that every year Treasury very carefully inspects them, allows them to borrow a little more, they lend a little more, they do a little more and they probably make a little more, but we will get the actual details of that.

Mr GARDNER: In doing that I note that the previous year there had been a downturn in the amount of loans effectively sold off to other lenders. If there has been an upturn in that in the last 12 months, that would be good to know. I would have thought that this would maybe have fitted in with social housing as well, but affordable housing is listed under today's estimates schedule. I refer to Budget Paper 3, page 59, table 3.15. We are talking about the national affordable housing SPP. Are you able to provide us with a geographical distribution of affordable homes, as in those sold to people meeting the affordable housing criteria within the 2011-12 year by suburb?

The Hon. P.F. CONLON: You mean sold by the industry in general?

Mr GARDNER: Sold using the facilities under the SPP. Obviously you may want to take that on notice rather than provide it now.

The Hon. P.F. CONLON: They think they can probably go through the database, because they list them by property details.

Mr GARDNER: We are very grateful. Are you able to identify what proportion of affordable homes under these same criteria are purchased by people using HomeStart finance loans?

The Hon. P.F. CONLON: Yes, we can: there you go, I didn't know that.

Mr GARDNER: That would be great. I am also interested to know what proportion of affordable homes are taken by eligible buyers before they are placed on the open market after 30, 60 or 90 days. If they are not taken by an eligible buyer, they are placed on the open market: I am wondering what proportion that would be.

The Hon. P.F. CONLON: In broad terms it is about 50 per cent, but we can get you a precise number.

Ms CHAPMAN: My questions principally are on the Urban Renewal Authority. First, you mentioned that you are still appointing the board. There is a statutory obligation on the number on that—you still have one missing, is that the position?

The Hon. P.F. CONLON: Who said I had one missing?

Ms CHAPMAN: They have been announced—members of the board.

The Hon. P.F. CONLON: No, what was announced was a board that would have a life time until the end of the financial year, and a board to be created from 1 July.

Ms CHAPMAN: When will you be announcing the new board?

The Hon. P.F. CONLON: Very soon.

Ms CHAPMAN: Excellent.

The Hon. P.F. CONLON: You would not assume that everyone who went on the temporary board would be on the new board. A lot of that was to keep business as usual going.

Ms CHAPMAN: I accept that, thank you. Can I ask you about Lochiel Park? Are any houses not sold yet and how many?

The Hon. P.F. CONLON: We believe there are about 11 allotments not sold, but we can get a precise number.

Ms CHAPMAN: Including the Housing Trust?

The Hon. P.F. CONLON: Yes.

Ms CHAPMAN: Thank you. Just while we are on HomeStart, could I just ask you about that? The former premier announced in 2002 that he would not be selling a number of assets under his government, including ForestrySA, Lotteries Commission, HomeStart, Housing Trust and a few others. I think all now have been sold or are on the market except the Housing Trust.

The Hon. P.F. CONLON: I certainly can't agree with you there; that is just not even vaguely—

Ms CHAPMAN: Can you rule out any proposed sale of HomeStart Finance?

The Hon. P.F. CONLON: Can I say this: we have absolutely no intention of selling HomeStart. It is a very important agency for us, but it is completely mischievous to allege the sale of all those agencies that, in fact, have not been sold. In particular, the talk about the sale of forward rotations as being the sale of ForestrySA is just completely wrong. What ForestrySA do is sell timber and the proposal is to forward sell the timber. It is exactly what they do, except over a longer period of time. You can have the argument and run it that it is a breach of a promise made in 2002, but it is simply not the case.

Similarly, the Lotteries Commission is not up. These are processes that, as I understand it, are ongoing. So, you can make that comparison if you want, but to try to create a fear over the future of HomeStart by a spurious premise does not take you anywhere. HomeStart is a very important instrument of government. The only thing that we would see in the future and, of course, it would have to be agreed to by Treasury to run the parameters, is exploring new or different products for HomeStart to get people into home ownership.

We believe that home ownership is an essential element of our culture in South Australia. When South Australia was created in 1836, it was essentially a land deal. People came out here to secure a new way of life. People have been coming out here since then to secure a new way of life, and owning a home is a very important part of it. We want the Urban Renewal Authority to try to connect up those aspirations with modern realities. We cannot keep going out north and south. We have to do urban renewal and we will have to do good design and higher density with high amenities.

We have to do all those things but, make no mistake, we do not want to manage a decline. We want this agency to do things that have not been done before to create more opportunities to connect people up with the aspirations we believe are a central part of why people want to live in this wonderful country. So, we will not be losing what we consider to be an extremely important instrument in that regard.

Ms CHAPMAN: I will remember that distinction, minister. It is a little bit like selling ETSA or long-term leasing it, I suppose.

The Hon. P.F. CONLON: You may wish to believe that but, if you want to know about why there is a distinct difference, I think you should refer back to your law. I think you would have been taught in property law, as I was, that a lease is no more than the fragmentation of ownership in time. So, there is no distinction between a long lease and an outright sale—certainly no legal distinction. A lease is a property right, as opposed to a licence, which is merely a contractual right.

Ms CHAPMAN: As you say, minister, selling rotations is different to selling assets.

The Hon. P.F. CONLON: I am certainly not here to go back over our property law together.

Ms CHAPMAN: No; I am glad of that.

The Hon. P.F. CONLON: Although I think I did well then, from memory.

Ms CHAPMAN: On the Urban Renewal Authority itself—we are still at BP 3, page 94, Mr Chairman—you have explained the transfer in March. There was a transfer from the LMC to the URA. There was a target set of $58.7 million dividend to the government from the LMC, which is referred to in the 2011-12 year. Why was a dividend not paid to the government, even a smaller one, given the explanation about reduced land sales?

The Hon. P.F. CONLON: Can I say that the land sales in the last 12 months went very, very poorly—

Ms CHAPMAN: Obviously.

The Hon. P.F. CONLON: —and this is not something we are afflicted with ourselves only. If you go around the nation, that is what happened. So the LMC forecasts what it is going to do on what is forecast with land sales, and you will see that what has happened around the country has taken a few people by surprise. One of the things I am extremely confident about is that the holdings that have not been sold by us have retained very great value and, when the market comes back, we will probably realise more for them than if we had sold in this environment. I am not in the least bit fussed about that.

Ms CHAPMAN: When the LMC transferred its assets to the URA, did it actually hold any revenue that would otherwise have been transferred to Treasury, or did its costs use all of the revenue?

The Hon. P.F. CONLON: There isn't anything to hold revenues any more, as far as I know. Total assets and liabilities transferred to the URA; on future dividends, decisions will be the URA's. There is not going to be an LMC of any description any more.

Ms CHAPMAN: Yes, I understand that, minister. Everything has been transferred; that has been explained. But essentially for nine months of this current financial year, it operated as the LMC. It was going to have a dividend of $58 million; that didn't happen for the reasons you have explained. In the nine months that it traded, are you saying that there was no net revenue from the sales or, if there was any revenue, was it transferred to the URA?

The Hon. P.F. CONLON: They measured assets and liabilities over that period of time.

Mr BUCHAN: The operational activities of the LMC continued on for the nine months. During that period, the sales generated did not produce a profit, which was anticipated as part of the budget result, and as a result there was no return back to government. However, the income continues to operate within (and flow within) the LMC which is balancing its financial operations in terms of overdrafts and other financial instruments which were used to operate that particular entity, and that same structure has transferred over into the URA.

So, there were certainly sales during that period and there were cost of sales that were ascribed to that particular transaction. As a result, the revenue generated, which was beyond the actual cash that went out the door, went into managing the actual financial structures or the balance sheet of the LMC which was then transferred into the Urban Renewal Authority.

Ms CHAPMAN: Minister, I accept that we will have reconciliation for that nine months in due course, but at the time of transfer as at 1 March, which I think was the date of transfer, were there any cash amounts transferred from LMC bank accounts? Yes? And if so, how much?

The Hon. P.F. CONLON: I assume they did not run their cash down to zero before the transfer. No, there were some amounts. We will give you a reconciliation.

Ms CHAPMAN: You will get that? I'll take those on notice.

The Hon. P.F. CONLON: I do not think there will be anything that causes further comment about it.

Ms CHAPMAN: I think there is $7.4 million in dividends expected for this year out of URA, which is encouraging. Where will the sales occur to generate that? Are we talking about the Blakeview, Northgate, Playford Alive developments where it is expected that revenue will come from?

The Hon. P.F. CONLON: Probably one of the best performing areas is the Lightsview development. What I would say, too, is that we firmly believe that the fundamentals for future sales are very strong in that the employment levels have remained robust in this environment. We do not have an oversupply of stock. There are people with very high levels of savings by historic measures out there, and we believe the market will pick up very strongly when it picks up. So, for what revenues are not made out of sales now, we are absolutely confident will more than make up in future sales when the market picks up. I think if you look at the fundamentals you would expect that there will be a very sharp increase in this market at some point in the near future.

Ms CHAPMAN: In this forthcoming year, is it expected that there will be any revenue driven from city-based or near located developments, or is it all the outer suburbs?

The Hon. P.F. CONLON: I think we are probably very close to accepting some tenders in Bowden at the moment from developers.

Ms CHAPMAN: At Bowden, yes.

The Hon. P.F. CONLON: We expect activity there this year. There are sites in the city from the old Housing SA and we are investigating (and had some very good discussions with the council) opportunities in the CBD to go as quickly as possible because we have set ourselves some ambitious targets for new residential living in the city. There will definitely be revenues generated out of the city or near-city areas.

Ms CHAPMAN: In this forthcoming year or is it further out?

The Hon. P.F. CONLON: In the forthcoming year, yes, absolutely.

Ms CHAPMAN: The Caroma site—I think you have just paid $15 million for that or about that?

The Hon. P.F. CONLON: Yes, the Caroma site is very different and demonstrates the strategic nature of having an Urban Renewal Authority, in that there would not be an intention for us to develop that Caroma site as residential in the short term. However, having laid out a 30-year plan for we think the intelligent future development of the city, the Caroma site has great strategic value in that were it to go on to the market at present, the likelihood would be that it would find some new industrial use which would be an existing use which would then frustrate future—

Ms CHAPMAN: So in the short term it is a commercial proposal.

The Hon. P.F. CONLON: So, really, the strategic nature of picking up Caroma is to prevent the wrong type of development there which would prevent us from being able to realise some very good future opportunities. When that happens—no-one can accurately predict when you might see a big residential upturn, even though I know in my bones there is going to be one.

When we would develop the Caroma site, we cannot say. If we develop it, we cannot say. It may well be that strategically we have prevented the wrong development there but that it is released to the private sector at some time in the future for what we see is the right sort of development. It is a strategic step, but one thing we are absolutely certain of is that in the long-term interest of the taxpayer it is a very good investment, given the great likelihood of a rezoning at some point in the future.

It is pointed out that, at present, we give a four-year lease back to the current owner on the arrangements. As I say, it is far more a strategic purchase than an immediate development purchase but we are absolutely certain that it is a very wise decision in the longer term for the taxpayer.

Ms CHAPMAN: Did the URA pay for it or did the government lend it money to buy it?

The Hon. P.F. CONLON: The URA pays for it. The lending arrangements maybe Matt can explain—

Ms CHAPMAN: Has it borrowed money from the state?

The Hon. P.F. CONLON: Yes, we borrowed money from SAFA.

Ms CHAPMAN: Yes. The wrong type of development, what is that—not anything but housing? Is that what you are saying?

The Hon. P.F. CONLON: No, some housing could be the wrong type of development in certain areas. We have a 30-year plan that suggests that there should be high quality urban renewal along transport corridors.

Ms CHAPMAN: Yes, I understand that.

The Hon. P.F. CONLON: Caroma fits into that desire. What is plain is that because of residential activity there is no great appetite at the moment for more than is out there. You have to be realistic: that is the truth of the marketplace at the present, but to allow what I see is a very atypical, unusual, very strange drop-off in residential activity to determine the use of that site at present would be a very poor strategic decision.

Ms CHAPMAN: Sure. So that is a strategic decision. Just in case the private opportunities stuff it up, you want to make sure it is protected.

The Hon. P.F. CONLON: Member for Bragg, it may well be that one day you can do something with this site. I am not looking forward to that day, but it may well be.

Ms CHAPMAN: One day I might get the Britannia roundabout fixed up to go with it! I am sure Mr Hansen will take my wish list on board. It is hard to move traffic from the east unless you fix that up. However, thank you very much for the answers.

The Hon. P.F. CONLON: I must say, I have not heard from you on the Britannia roundabout for what must be months.

Ms CHAPMAN: Don't you read my correspondence? I think I write to you every couple of months. I just want to go back to this question of personnel in the URA, because it is obviously an important unit that you have established. On my reading of it, 194.6 FTEs are shown in the 12.9 table. At the end of the 2010-11 reporting period, the LMC had 93.8 FTEs, according to the Auditor-General. Note (c) shows 82.6 FTEs transferred from the Housing Trust to the URA. That leaves 18.2 FTEs unaccounted for at the URA. I also note that for next year the number of FTEs for this organisation will go up again to 201.2.

The Hon. P.F. CONLON: You do have Defence SA in there.

Ms CHAPMAN: I appreciate that. Is there any reason why the number of employees is increasing, given the revised sales forecast that shows that there will be less generating income? Why are you taking on more people? I am talking about after the amalgamation.

The Hon. P.F. CONLON: One of the things I said to you before is that we have transferred some areas of stock from the Housing Trust. Does the Housing Trust hold it?

Mr FAGAN-SCHMIDT: Yes.

The Hon. P.F. CONLON: There is a likelihood in the future that further holdings from the Housing Trust will be transferred. There is also the case that not all positions, as I understand it, are filled at present. There is still a process of advertising of some positions. There is still a thoroughgoing organisation to examine just what skills will be needed in the organisation. As I say, I think it will be much easier to tell you what the settled position for the URA will be at next year's estimates.

We are certainly not seeking to have more people than we need, but we are also going to make sure that we have the people to do the very important set of functions that we are given. As I say, there are positions yet to be filled and in the future there will be further transfers of Housing Trust properties to the URA for the purpose of perhaps developing and handing back to the Housing Trust—who knows?—or for other reasons. That is something that will take at least a year to settle.

Ms CHAPMAN: In addition to the proposed income from projects in the forthcoming year that you are going to give us a list on, of the actual Housing Trust redevelopments, apart from Marden, are there any other projects that are currently Housing Trust precincts or properties that have been or will be transferred in this forthcoming year to URA?

The Hon. P.F. CONLON: The seven star precinct in the city.

Ms CHAPMAN: The seven star precinct? Yes.

The Hon. P.F. CONLON: There are none specifically identified at present, but there are some that you would think would be logical for a precinct redevelopment in the future. I believe out at Gilberton there is a set of very old stock.

Ms CHAPMAN: Next to the old television site?

The Hon. P.F. CONLON: Yes. That is an obvious one. There is no immediate plan. We have no plans at all at present, but if you were to look at the site, the age of the stock, the location, it is an obvious place for a redevelopment.

Ms CHAPMAN: It might have been a better place to put the new pumping station, but that is past history now.

The Hon. P.F. CONLON: It is a very nice place now and it is rezoned for quite a lot of storeys. We are not rushing to, if you like, grab land from the Housing Trust. What we want to do is identify the role we could play as a development agency assisting the Housing Trust in their goals and ambitions and, more than just the Housing Trust, the housing minister and the government in providing as much stock as is possible for those who need to get a roof above their heads. We do not see it as a one-only shift: we see it as a relationship that will operate over time with the housing minister and the social housing agencies.

Ms CHAPMAN: For the affordable/social housing required component of these developments, is there any proposal to replicate the proposed 30 square metre dwellings that were published to be part of the Bowden program in these other new developments, the 30 square metre units?

The Hon. P.F. CONLON: We have no specific targeted stock of those dimensions. That was merely part of a broader implementation—

Ms CHAPMAN: I appreciate that you have a new Chief Executive, someone who has come with some new skills.

The Hon. P.F. CONLON: No, it has nothing to do with the new Chief Executive. It was always something that was—

Ms CHAPMAN: I understand that—

The Hon. P.F. CONLON: —taken and misread.

Ms CHAPMAN: Well, that published material predated his appointment.

The Hon. P.F. CONLON: Yes, that may well be, but what I am explaining to you is that the published material did not require people to build 30-square metre dwellings.

Ms CHAPMAN: No, it provided a design option. In any event, that is something you will consider for the future?

The Hon. P.F. CONLON: Fred has exactly the same view as I have and exactly the same view Wayne Gibbins had, and that is that what we do at that Bowden Village will be excellent in design and excellent in outcome. There will be nothing we seek to do down there but does anything but convince people that this is the right way to develop in the future. I say clearly that, if you are not looking to urban renewal and urban infill, with higher density around good design now, you will be at some point in the future, and the sooner you realise that it is the future of development in urban settings, the better.

The reason we purchased the site in the first place, the reason we have invested so much of our time and effort, the reason we took developers overseas to look at transport-oriented development, the reason we have worked so hard to include others in the master planning process is that everything that occurs at Clipsal we want to be an advertisement for the future of urban development, and building unattractively designed small places will not be part of that. The truth is that you can have very good living in smaller built form with very good shared open space. There are a few very nice cities in the world built around those ideas, aren't there Fred?

Mr HANSEN: Yes.

The Hon. P.F. CONLON: See—Fred said yes.

Ms CHAPMAN: It might be a good apartment for your retirement, minister.

The Hon. P.F. CONLON: I keep hearing from you people that I am going somewhere. I have no intention—

Ms CHAPMAN: Sometimes they are not voluntary. May I ask of the Glenside development—

The Hon. P.F. CONLON: I have noticed that, so whilst your making choices—

Ms CHAPMAN: —the 15 per cent affordable housing that is on that site, is the URA going to be responsible for the housing development on the Glenside site?

The Hon. P.F. CONLON: We have not been so far. This has been done by Health, hasn't it. This was an obligation imposed on Health, and they are handling it.

Ms CHAPMAN: It is not proposed that it be transferred to you to develop it? It is going to be available—

The Hon. P.F. CONLON: There will be affordable housing—

Ms CHAPMAN: Yes, I understand that.

The Hon. P.F. CONLON: —but the authority that is delivering it at present is under Health.

Ms CHAPMAN: So, to your knowledge, this is not—

The Hon. P.F. CONLON: And I am sure that John is looking forward to your asking questions of the department.

Ms CHAPMAN: I am just saying that, to your knowledge, it is not a URA proposed acquisition for the purposes of that development?

The Hon. P.F. CONLON: I think it is ongoing. I do not know much about it.

Ms CHAPMAN: It has not been sold yet.

The Hon. P.F. CONLON: If they want a hand with anything, we will—

Ms CHAPMAN: You will offer a helping hand. I am sure you would be happy to do that.

The Hon. P.F. CONLON: We are from the government, and we are here to help.

Ms CHAPMAN: Yes, I have heard that before. I want to ask about another aspect. Because of the all assets and liabilities being transferred from LMC, were you advised the total amount that is being sought through the court at present by the government's former partners in the Newport Quays project?

The Hon. P.F. CONLON: I think you had better take a step back because there is a fundamental misapprehension of what they have actually lodged. There is no court action against us for an amount of money. What they are doing is fishing around in pre-trial discovery to see whether they have a case, in my view. I do not want to comment on the case too much—

Ms CHAPMAN: Application for discovery of documents, yes.

The Hon. P.F. CONLON: Yes, it is pre-trial discovery. There has not been an action actually lodged. When an action is lodged, we could probably give you more details of what the action is, but—

Ms CHAPMAN: I am not asking you to disclose how much is being forwarded—

The Hon. P.F. CONLON: I am not going to comment on what they say in the media they think we are going to pay them.

Ms CHAPMAN: I am not asking you, minister, for obvious reasons, how much you might have provided for in the forward estimates to meet this claim, whatever it might be, because I accept that is a matter that will need further negotiations.

The Hon. P.F. CONLON: You can ask us, because we are not—

Ms CHAPMAN: However, I am going to ask: have you made any provision?

The Hon. P.F. CONLON: You do not make a provision because the contract itself, in our view, demonstrates our right, on payment of a certain of money, to terminate. That is what we have always believed, and that is nothing that needs a provision to be made for; it is part of the ordinary operations of the then LMC, the now URA. It will be part of the assets and liabilities, cash at the bank and all those sorts of things you talked about; there has been no need to make any provision. I again state that I believe that, as they continue their pre-trial discovery and find all the documents and stuff, they will find that their hopes are limited by reality.

Ms CHAPMAN: I am sure the taxpayer will be relieved about that, if that is the case.

The Hon. P.F. CONLON: We are very careful.

Ms CHAPMAN: On that project, is it proposed that Newport Quays Mark II will be available for sale in this forthcoming year?

The Hon. P.F. CONLON: No. What you have to do is recognise what we have recognised; that is, that approach was not working. This was an approach that went out to tender way back in 2001, or expressions of interest were then. It was a process that was completed early when we first came to government in 2002. It had a notion of revitalising the port.

To be fair to the proponents—and I have never had any rancour about this—we ran into a number of things that were not expected by the parties, but, at the end of the day, when you looked around, it simply had not delivered what it was thought it would deliver. I am not blaming anyone—it did go out under the previous Liberal government and we accepted those parameters and enacted them—but it did not work.

Is it the definition of madness to keep doing the same thing over and over even though it does not work? I do not know. So what we are doing is approaching it differently and the first step is a master-planning process of the area to see what outcomes definitely need to be generated and that is something that we are working very hard on.

I have a local, Mr Bicknell, a lovely man—I do not know if you have ever met him; he has done a lot of work in charitable and not-for-profit organisations—along with John Hanlon from planning. They are working very hard to bring up a master plan that does realise the objectives we have. The opportunity to end the Newport Quays arrangement came when another hurdle occurred on the project, when the proponent themselves were seeking a substantial delay in further operations, and in all of those circumstances it seemed like the right time, therefore, to say, 'No, this hasn't worked. We're going to start a new approach.'

Most circumstances that have problems also have opportunities, and the problem that we have seen is the collapse in apartment markets. The residential market is as poor as it has ever been so it has given us the breathing space to sit down and master plan. Although I am not going to pre-empt the outcomes of what we are doing, I expect that what you will see there is a larger number of smaller players in the future. We have had a lot of learning out of the Clipsal development and we believe that what is going to result in excellence there will be having a lot of players with a lot of good ideas—good design ideas—around the site, bouncing off each other. We believe that is likely what will happen at the Port.

I am not going to pre-empt what the process is now but what I would say to you is that I think it is very unlikely that we will ever see the one mega-developer in an agreement again. I think innovation is better driven by a number of smaller operators. There are other landholders there who were not realistically included in the previous approach who can be included in the new approach.

Ms CHAPMAN: I take it, then, that there is no provision in the forward estimates for any anticipated revenue from the sale of whatever new model of development you do there?

The Hon. P.F. CONLON: I do not think that is how we have traditionally done revenues from the Land Management Corporation, in any event, but I do not know what provision is—

Ms CHAPMAN: Do you want to take that on notice or is there something in forward estimates for Newport Quays?

The Hon. P.F. CONLON: I tell you what: you are a brave person who works out what you are going to make out of property at the moment.

Ms CHAPMAN: Yes. You have put $7.2 million in as a dividend, I think, so that might be a brave guess.

The Hon. P.F. CONLON: Yes; brave in a cautious manner.

Ms SANDERSON: How much has been spent, and how much is to be spent in the forward estimates on planning of the city's South-East precinct, that is, the Manitoba and the Box Factory development?

The Hon. P.F. CONLON: How much has been spent and how much is going to be spent?

Ms SANDERSON: Yes, in the forward estimates. So, what has already been done? I know I have been to seminars on it.

The Hon. P.F. CONLON: It is not a lot so far; they think maybe about $50,000 in preliminary design. There is a master plan. There is scaping work going on with the council at present, so there would some more funds rolled out in that process with a view to there being at least some presales in the precinct in the next 12 months, but not a lot of money has been spent so far. We will try and answer the figure, but it is a little hard to disentangle your upfront costs in a development that is going to make revenues as well. Anyway, we can come back to you on that.

Ms SANDERSON: So, you expect there will be some residents moved within the next 12 months, if you are expecting to sell them?

The Hon. P.F. CONLON: That is not for me. There has been one building where 12 people have moved. That is the only decision taken.

Ms SANDERSON: One building. So it is not the individual units at the Box Factory? You are starting with a high rise building?

Mr FAGAN-SCHMIDT: Yes, the twelve in the Playford site on that street.

The CHAIR: I now declare the examination of the Minister for Housing and Urban Development completed.

Membership:

Mr Whetstone substituted for Mr Gardner.

Departmental Advisers:

Mr A. Milazzo, Deputy Chief Executive, Transport Services, Department of Planning, Transport and Infrastructure.

Mr R. Hook, Chief Executive, Department of Planning, Transport and Infrastructure.

Mr M. Elford, Department of Planning, Transport and Infrastructure.

Mr M. Palm, Director, Investment Strategy and Divisional Finance, Department of Planning, Transport and Infrastructure.

Mr M. Williams, Director, Sustainable Transport, Department of Planning, Transport and Infrastructure.

Mr B. Cagialis, Chief Finance Officer, Department of Planning, Transport and Infrastructure.

Ms CHAPMAN: Minister, just so that I am clear, one of the members of our committee would like to ask you some questions about ferries, and I propose that that will be in the area which is under trans planning services, which is another subdivision that you have there because it follows that program, so I just mention that.

The Hon. P.F. CONLON: He is responsible for it, so you can ask him. It was his idea. Just so we all know.

Ms CHAPMAN: I propose to ask you about Budget Paper 6, page 78, on the Goodwood and Torrens junction project first. This is an upgrade of these junctions, to which the federal government has announced it is contributing a couple of hundred million, as you would appreciate there. Will land acquisition be required for the Goodwood component of the junctions project?

The Hon. P.F. CONLON: No.

Ms CHAPMAN: Does that assume that there will not be an upgrade of the Leader Street portion of that project?

The Hon. P.F. CONLON: Leader Street remains at grade.

Ms CHAPMAN: So, there is no land acquisition for any improvement to that intersection at the time of doing this?

The Hon. P.F. CONLON: No. I do not know what they do on the intersection itself, but you do not have to buy land because it remains at grade at Leader Street. In an abundance of caution, they are still doing a planning study on Leader Street to define the scope. But it remains at grade, outside the forward estimates we are talking. The first stage we are doing now involves a grade separation.

Mr HOOK: Victoria Avenue has to be grade separated. We have to deal with Brownhill Creek. Goodwood platform has to be the two levels for the Noarlunga line and the Belair line, but we would expect to be back at grade by Leader Street.

The Hon. P.F. CONLON: That is the current project. In future, we will have to do a planning study for a future grade separation at Leader Street, which is much further out, and I imagine that might require land acquisition at that time, but it is a long way out. I would not want to frighten people at this juncture about it.

Ms CHAPMAN: From our assessment of this whole project, as described at page 78, there appears to be approximately $100 million missing for what is an over $400 million project.

The Hon. P.F. CONLON: I did not take it, if that is what you are implying.

Ms CHAPMAN: Have you discussed the potential for private investment in the section of the project, which takes the Outer Harbor rail line under the Bowden development, with potential land developers?

The Hon. P.F. CONLON: Just a minute. I am taking advice on the previous question. Your question was?

Ms CHAPMAN: There seems on that material that $100 million is missing. It is a $400 million-plus project: they have agreed to pay half, you have put in $100 million—where is the other $100 million?

The Hon. P.F. CONLON: Well, it is a bit more complicated.

Ms CHAPMAN: Perhaps you will explain where it is.

The Hon. P.F. CONLON: The original commonwealth funding of half is the 2015-16 estimate of $232 million. What the commonwealth has agreed with us, because they are nice people, is to bring some of that well ahead. Given the work we are doing on the Noarlunga line now, it made sense to do that work if we could on the existing Noarlunga upgrade. We are actually bringing ahead less than half of the commonwealth's money to that Goodwood piece of work, for the obvious reasons I have just explained. Our own contribution comes in the 2015-16 and afterwards period; is that right?

Ms CHAPMAN: So the $110 million here is the commonwealth money?

The Hon. P.F. CONLON: No, I got that wrong. I told you it was complicated.

Ms CHAPMAN: I think Mr Hook can see that there is the $110 million this year, 2012-13, coming up. There is nothing then until the $232 million, which is the commonwealth money.

The Hon. P.F. CONLON: That is right.

Ms CHAPMAN: It is a $400 million-plus project.

The Hon. P.F. CONLON: We are all confused now. Sorry, it is similar. The $110 million is our money—

Ms CHAPMAN: Yes, I thought so.

The Hon. P.F. CONLON: —that we have put in ahead of Commonwealth money in 2015-16.

Ms CHAPMAN: Correct.

The Hon. P.F. CONLON: Alright?

Ms CHAPMAN: Yes.

The Hon. P.F. CONLON: But the other works do not commence until 2015-16 and even after then. What we are doing is putting up our money, which would be seen to be towards matching that $232 million, for the reasons I explained. If you are going to upgrade the Noarlunga line now, we do not want to do two bodies of disruptive work on the Noarlunga line, so we do that now. The commonwealth money starts flowing to us in 2015-16. We will make a further contribution, as that money starts being spent out beyond the out years, for our half.

Ms CHAPMAN: Right, so that extra $100 million has been provided for past the forward estimates?

The Hon. P.F. CONLON: Yes.

Ms CHAPMAN: By the state government or by a property developer?

The Hon. P.F. CONLON: I do not know of any property developer who wants to pay it for us, but we would happy to talk to them. No, we would be required to make a contribution against the future commonwealth funds.

Ms CHAPMAN: Yes.

The Hon. P.F. CONLON: While those commonwealth funds, you have to remember, might be received from 2015-16, what you are seeing in the budget is the revenue being received. It does not necessarily mean they will be going out in that year.

Ms CHAPMAN: No, I understand that. I think what you are saying is that the extra $100 million that the state is going to put in is past the forward estimates, but it has been provided for. Is that what you are assuring me?

The Hon. P.F. CONLON: I do not know what you mean by being provided for. We have an obligation but—

Ms CHAPMAN: You do not get the commonwealth money unless you do.

The Hon. P.F. CONLON: — you do not draw the budget beyond the 14 years. So, we have an obligation. The commonwealth will not be happy if we do not put in our share, I guarantee you that.

Ms CHAPMAN: Absolutely. You might not get your money unless you make that commitment. I understand that, but has you or your department—

The Hon. P.F. CONLON: It cannot be provided for in forward estimates that do not go out that far—it just cannot be.

Ms CHAPMAN: I appreciate that. Have there been any discussions, though, between you and any prospective property developers, or your department, to contribute towards this grade separation at Torrens, particularly as it is to go under the Bowden development?

The Hon. P.F. CONLON: No.

Ms CHAPMAN: The project, according to the commentary here—again, we are still at page 78—is supposed to boost national productivity, to use the words published there. What level of additional rail freight is expected when the project is complete and will the minister confirm that there will be no increase in freight efficiency in terms of length of freight trains until both junctions are upgraded?

The Hon. P.F. CONLON: The freight is increasing anyway.

Ms CHAPMAN: It says here, 'boost national productivity'.

The Hon. P.F. CONLON: Yes, but it does not increase freight. Freight is increasing anyway; that is the problem. The freight is going to increase whether we do the projects or not.

Ms CHAPMAN: No, I said 'efficiency'.

The Hon. P.F. CONLON: It is the capacity to handle it.

Ms CHAPMAN: I think perhaps we are at cross-purposes. There is not going to be any efficiency in being able to extend the line of the train to 1.8, for example, until both junctions are done. Is that the situation?

The Hon. P.F. CONLON: There will be efficiencies in terms of the slowing down of the trains.

Ms CHAPMAN: For the passenger?

The Hon. P.F. CONLON: No. I do not know about other people, but I would have thought the train is less efficient if it is going slower and stopping. So that will increase efficiency for the freight. If you have ever, as I have done regularly, gone up Cross Road when the freight train is moving very slowly through there, it is very, very annoying, so it will have that benefit for us too. Make no mistake: both projects together will bring the best efficiencies, but the reason it is being brought forward by us is that it would be foolish for us to twice disrupt the Noarlunga line for the projects.

Ms CHAPMAN: I understand that; that is fine.

The Hon. P.F. CONLON: It may well be that we do not realise the full efficiencies until we do all of it, but it would be foolish of us not to do this now.

Ms CHAPMAN: Absolutely. Given the expectation, though, that one of the reasons for doing this is to enable the trains to be longer, you would agree that they will not be able to be longer until both projects are done?

The Hon. P.F. CONLON: We don't agree with you because coming from Melbourne they can be longer after doing this work. Going north from Adelaide, they can't be which is—

Ms CHAPMAN: But don't you have to do both?

The Hon. P.F. CONLON: But setting that aside—

Ms CHAPMAN: Don't you have to do both junctions before you can get that?

The Hon. P.F. CONLON: I don't know whether your point is that we therefore should not do it until later and get the whole benefit.

Ms CHAPMAN: No.

The Hon. P.F. CONLON: What I am saying to you is the reason we are bringing it ahead is not from our perspective to capture those efficiencies, it is to make sure that we do not disrupt those services on the Noarlunga line substantially twice when this way we can do it once.

Ms CHAPMAN: I understand.

The Hon. P.F. CONLON: It may well be the case that you get more efficiency if you do them both together, but that is not the driving motivation.

Ms CHAPMAN: Yes. Can I ask you this about the estimated cost of the undergrounding—and I appreciate you bringing this $110 million to do the Goodwood Junction for the reasons you have said. What is the estimated cost of the undergrounding of the Outer Harbor line below Park Terrace and the Bowden development as part of the Torrens Junction project?

The Hon. P.F. CONLON: This is not a question that is easy and straightforward because we have not established a timeline, let alone—

Ms CHAPMAN: I know, but you have put in a submission to Infrastructure Australia—

The Hon. P.F. CONLON: Yes.

Ms CHAPMAN: —and the funding has been allocated, the figures have stacked up, you have got the approval and the money is on its way, and all those things.

The Hon. P.F. CONLON: We have got money flowing from 2015-16. We have not set the timetable to do it and we have a lot of design work starting out.

Ms CHAPMAN: But of the project, to get the $400 million-odd—

The Hon. P.F. CONLON: We are expecting to spend $333 million on the Torrens Junction and Leader Street that does both of those things, so Leader Street then comes into it.

Ms CHAPMAN: How much is allocated for Leader Street?

The Hon. P.F. CONLON: I will have to get back to you.

Ms CHAPMAN: I am happy with that, minister, if you can just give me a breakdown of the $333 million.

The Hon. P.F. CONLON: Let's be fair. We are talking about projects starting out in 2015-16.

Ms CHAPMAN: I totally appreciate that when we come to do it—hopefully in our lifetimes—things might change but at the moment you have put in a project—

The Hon. P.F. CONLON: In our lifetimes? You have just criticised me for bringing it ahead. Goodness me! It is very hard to win with you.

Ms CHAPMAN: You have put in a project estimate and, if the estimate is $333 million—I am just asking for a breakdown of that $333 million.

The Hon. P.F. CONLON: We will try to do that for you.

Ms CHAPMAN: Same project: have you spoken to the ARTC about the proposal for a freight link between Mildura and Menindee which would have an impact on the viability of the Adelaide to Melbourne rail corridor and therefore the necessity of the junctions project?

The Hon. P.F. CONLON: Who says it has—

Ms CHAPMAN: I am asking have you?

The Hon. P.F. CONLON: No, but I mean who says it has an impact on the viability?

Ms CHAPMAN: In relation to doing that project?

The Hon. P.F. CONLON: You have just told me it has an impact on the viability of the Adelaide line, so who said that?

Ms CHAPMAN: We have had a number of briefings from your department about the priority of other projects and regional Australia as to the proposal for the Victorian rail development. My question simply is whether or not you accept that premise. Have you spoken to the ARTC about the proposed freight link in Victoria?

The Hon. P.F. CONLON: I think the ARTC understands that we don't support it.

Ms CHAPMAN: So you have had the discussion and indicated that you don't support it.

The Hon. P.F. CONLON: The ARTC incidentally doesn't support it either.

Ms CHAPMAN: Okay.

The Hon. P.F. CONLON: We figure since we don't like it and the ARTC don't like it. We don't know who is going to do it.

Ms CHAPMAN: The suspension of electrification which is in Budget Paper 6, page 81, and Budget Paper 4, Volume 3, page 123.

The Hon. P.F. CONLON: Who does like it? Mildura?

Ms CHAPMAN: What is the total amount spent?

The Hon. P.F. CONLON: People at Mildura apparently like it. We don't.

Ms CHAPMAN: What is the total amount spent on the electrification upgrading of the Gawler train line including the resleepering, etc. and what further works are required to complete the electrification works?

The Hon. P.F. CONLON: Sorry, your question is: how much is being spent on the electrification?

Ms CHAPMAN: How much is the total amount spent on the Gawler line?

The Hon. P.F. CONLON: Including resleepering.

Ms CHAPMAN: Including resleepering.

The Hon. P.F. CONLON: So you mean: what is being spent on electrification plus resleepering?

Ms CHAPMAN: Electrification so far and the upgrading, yes.

The Hon. P.F. CONLON: Plus resleepering, plus station upgrades, plus land acquisition if there has been any, plus all of those things.

Ms CHAPMAN: Everything so far on the Gawler train line.

The Hon. P.F. CONLON: Everything. So it is not electrification at all. You want to know everything we spent on the Gawler line.

Ms CHAPMAN: The total, yes.

The Hon. P.F. CONLON: Yes, okay.

Ms CHAPMAN: Are you happy to take it on notice?

The Hon. P.F. CONLON: Well, we will certainly go through it with you but it is a bit tricky to ask the question about what is being spent on the electrification 'including' because it doesn't 'include'. Electrification is one component, resleepering is a very important job which would have had to have been done with or without electrification, station upgrades, all of those things. I am quite happy to provide the information.

Ms CHAPMAN: Minister, I am not contesting the merits of the project. Perhaps we are disappointed that you are not finishing it, but—

The Hon. P.F. CONLON: But I am contesting the trickiness of the questioning. We are quite happy to provide the expenditure on electrification, resleepering, on upgrades and on all the other things that we have done there, but we will make sure that people understand what it is.

Ms CHAPMAN: That it is a breakdown—I am happy with that. As long as we have the total that will be great.

The Hon. P.F. CONLON: There is no doubt that we can provide that information.

Ms CHAPMAN: Why, when the government promised in the 2010 state elections that it would be operating electric trains on the Gawler line in 2013, had the contracts not been entered into for the electrification works by May this year?

The Hon. P.F. CONLON: Sorry, why did we promise that if—

Ms CHAPMAN: When you promised the electrification at the 2010 election—

The Hon. P.F. CONLON: Why did we promise that in 2010 when the contracts had not been entered into in May this year?

Ms CHAPMAN: To be operating in 2013—why had you not signed the contracts until May this year?

The Hon. P.F. CONLON: Why would we have?

Ms CHAPMAN: I am asking you that.

The Hon. P.F. CONLON: No, you asked me to explain something that you have put up that is all in your head. Why would we have had to? Why would we have had to sign those contracts by May?

Ms CHAPMAN: The alternative is: if you had signed the contracts in May this year, if you had done that, as at now, would you have been able to provide the electrification and be operating in 2013?

The Hon. P.F. CONLON: In fact, if it had not been necessary to make budget changes we would have still been able to sign electrification contracts and have trains operating in 2013. However, let us be clear that when we say 'trains operating', whether it would have been possible in any circumstances to have full services run is a matter that we would have had to find out. There are so many things that we depend upon in that regard.

As Rod points out, we have early contractor involvement in the project, so we and the contractor are able to contemplate what the next stages will have to be. As a result of the dramatic fall in revenues and that money not being available, we simply have not proceeded to the next stage of that involvement. The point I make is that when you ask why were contracts not signed in May, I say, 'Why should they have been? Who said that they had to be?'

Ms CHAPMAN: You are simply saying, 'We would still have been able to achieve that if we signed up contracts mid this year to be operational by mid-2013?'

The Hon. P.F. CONLON: Our timetable would have had us moving in the last month or so to be doing that, but the world changed.

Ms CHAPMAN: That being achievable, which—

The Hon. P.F. CONLON: Can I share with the member for Bragg my view that I wish the world had not changed. That would have been our preferred outcome. But the world changed dramatically and one has to respond.

Ms CHAPMAN: Why was it necessary to sign up to buy all the railcars so far in advance?

The Hon. P.F. CONLON: Going back to buying trams and trains, if you remember when we bought new trams the first time on a small order we could only get two tenderers. It is hard to raise a high level of interest for small orders for electric rolling stock. You have to go early in the purchase of rolling stock, and if you can attach your order to a larger order it is very beneficial.

I think we achieved a very good price on the rolling stock by taking this approach but, as with the trams, you simply could not be in a position of someone failing to take an interest and not getting trains; you simply have to go early. That is the nature of the international market. There are very few suppliers of quality rolling stock, and we had to make sure that we would get them in the right and timely fashion. I think it was a very good order.

Ms CHAPMAN: You have told us in another place, minister, that you tried to renegotiate that contract, presumably not to take as many at this stage or whatever, given the—

The Hon. P.F. CONLON: Same place, different location—that is very Buddhist.

Ms CHAPMAN: But if you cannot get out of that contract and you are going to get excess cars, where are they going to be stored?

The Hon. P.F. CONLON: Sorry, I am a bit hard of hearing: where would they—

Ms CHAPMAN: Where are they going to be stored? If you cannot get out of the contract—

The Hon. P.F. CONLON: I assume if we purchase them, the same place the ones we purchase are going to be stored. As Rod points out, if we have them we will use them and rotate them in an ongoing program. I think if we have to store 50 or 66, we are going to have to store them.

Ms CHAPMAN: At pages 33 and 34 of Budget Paper 3, there is extra—

The Hon. P.F. CONLON: I indicate that we already have storage proposals at Seaford and Lonsdale for electric trains operating on that line.

Ms CHAPMAN: Under the full-time equivalent of the workforce, there is an explanation at pages 33 and 34 on employee numbers and there is obviously a change of areas of responsibility, some coming in and some going out. The increase in the 1,400-odd full-time equivalents across the public sector includes 138 FTEs for 'additional employees to support the capital program in planning, transport and infrastructure'. How many of these employees are no longer required, given the indefinite suspension of some of the major projects?

The Hon. P.F. CONLON: We are reviewing that at present.

Ms CHAPMAN: So some of those may be discontinued?

The Hon. P.F. CONLON: Some of them will be continued, some of them may not be. The numbers are included there for the Southern Expressway project, which is a major project. I am assuming that capital works doing less than it was going to do will not need as many people. It is under review at present.

Ms CHAPMAN: The footbridge: page 37, Budget Paper 5.

The Hon. P.F. CONLON: Yes.

Ms CHAPMAN: Before proceeding with this project—and $22 million of that $40-odd million is allocated this year—did you or your department consider any other cost alternative options, like widening the King William bridge, or a dedicated line for pedestrians on game days—any other alternatives?

The Hon. P.F. CONLON: We certainly had the experience of just 30,000 there at the Melbourne-Port Adelaide match, which Port Power won in a tremendous game. Boak's kick after the siren, seven metres tall—but I am sure you do not want to hear about this. Rod, particularly, does not want to hear about it, as a Crows fan. We did have to close off two lanes of King William Street that day. We closed all of King William Street and gave two lanes over to pedestrians. I do not think that is a good option, and that was only for 30,000 people.

The department certainly did not like my cost-saving notion of draining the lake. I thought that would save a lot of money.

Ms CHAPMAN: We are over the drought; have you caught up with that?

The Hon. P.F. CONLON: We could just walk across.

Ms CHAPMAN: It used to be a creek.

The Hon. P.F. CONLON: The stuff that we have done has been modelled by international pedestrian moving experts, Atkins.

Ms CHAPMAN: So you have looked at it?

The Hon. P.F. CONLON: This is simply the best option to move that many people. We are talking about, I think, 25,000 people of a 50,000 crowd wanting to come back that way. This is the best option. It delivers people not just to public transport, but we think it will give a great deal of vitality to that edge of the city, so we think it is the best option.

Ms CHAPMAN: It may be a very good option, minister, but I suppose the question is, given that other projects have had to be indefinitely suspended and there is apparently a tight fiscal situation, according to the Treasurer—

The Hon. P.F. CONLON: I would believe him if I were you.

Ms CHAPMAN: The Rolls Royce version of a footbridge. You considered the others. Did you even cost the others or did you just not go that far?

The Hon. P.F. CONLON: Cost closing a road? It does not cost a lot to close a road, but people are not going to like it very much every week, I would imagine. When you say 'the others', can you suggest to me what others?

Ms CHAPMAN: Expanding the bridge, closing lanes.

The Hon. P.F. CONLON: Expanding the bridge?

Ms CHAPMAN: Putting an extra lane across? You did, of course, to do the Goodwood tram overpass, when you added to the highway at Anzac Highway.

The Hon. P.F. CONLON: I have been reliably advised by my engineering friend here that you would not reasonably propose widening the King William Street bridge. You would need to widen it by three lanes to achieve the same effect, and we do not believe that is reasonable.

Ms CHAPMAN: All right. So, closing the lane option is one you would say was not really an alternative?

The Hon. P.F. CONLON: Closing the—

Ms CHAPMAN: Closing the lane.

The Hon. P.F. CONLON: No, you do not close the lane; you close King William Street, and even then it is not—

Ms CHAPMAN: Why was the minister—

The Hon. P.F. CONLON: You cannot have it both ways on Adelaide Oval. The Liberal opposition voted in the upper house to require us to deliver an extraordinary number of people to the oval by public transport. If you want us to achieve that, we have to build the infrastructure to do it. You cannot ask us to do it, and then not allow us to do it.

Ms CHAPMAN: In any event, you say that it was necessary and this was the option that is necessary to deliver that. I understand what you are saying. When you announced the $40 million-odd for this bridge, why was that cost—even the $22.5 million here—identified before the government had even decided where the bridge would align, how long it would be and what the design would be?

The Hon. P.F. CONLON: A little while ago, you asked me what the cost would be for undergrounding the rail.

Ms CHAPMAN: Well, you have to actually supply that to Infrastructure Australia.

The Hon. P.F. CONLON: Yes, so—

Ms CHAPMAN: In this instance, you are paying for it.

The Hon. P.F. CONLON: So, you say that I should be able to do that—

Ms CHAPMAN: I am just asking—

The Hon. P.F. CONLON: —with a complex rail bridge underneath a development but it is unwise for us to forecast it. The truth is that in government you are required to budget—

Ms CHAPMAN: It is just that the juncture separation, minister—

The Hon. P.F. CONLON: —and, if you put out a budget—

Ms CHAPMAN: —to be fair, is an identified project here.

The CHAIR: Order! Can we have one person talking at a time? The minister was replying.

The Hon. P.F. CONLON: I am quite happy for her to belabour the point.

Ms CHAPMAN: In any event, you are clever enough to work it out; I think that is the answer.

The Hon. P.F. CONLON: No. We always have to budget for projects that are not entirely designed, and that is because we are the government, not the private sector, which has the freedom not to disclose what they are doing in a year's time. We have to disclose what we are doing over the next four years so, if we intend doing something over the next four years, we have learnt over the years how to make a budget for it.

Ms CHAPMAN: I have just one other question in this section, Mr Chair. This relates to the road resurfacing and rehabilitation works, at Budget Paper 4, Volume 3, page 124. Does the $27.6 million budget for 2012-13 include the resurfacing of Gorge Road, in the Campbelltown City Council?

The Hon. P.F. CONLON: This is the road resurfacing program where the Gorge Road is in it?

Ms CHAPMAN: Yes.

The Hon. P.F. CONLON: I will have to find out.

Ms CHAPMAN: Can you provide us with a list of what that is going to be spent on?

The Hon. P.F. CONLON: There is a draft program that is subject to change. We have to adjust our program according to the effect weather conditions may or may not have had on certain surfaces.

Ms CHAPMAN: Can you provide us with a copy of the list, on the clear understanding that it may be subject to changes if there is flooding or—

The Hon. P.F. CONLON: It will say 'draft' on top.

Ms CHAPMAN: —torrential rains, act of God or any other event?

The Hon. P.F. CONLON: Or Morrie Ranger falling off his bike again, making holes in the road.

The CHAIR: We will now move to Land Services and Building Management.

Departmental Advisers:

Mr K. O'Callaghan, Executive Director, Lands, Vehicle Registration and Licensing, Department of Planning, Transport and Infrastructure.

Mrs J. Carr, Executive Director, Building Management, Department of Planning, Transport and Infrastructure.

Ms CHAPMAN: I would like to ask about the new commercial and advertising opportunities or activities that are proposed and detailed at Budget Paper 6, page 77. The government proposes to increase revenue by $7½ million over the forward estimates by amending the Highways Act to permit commercial activity on roads, associated reserves and public transport sites. I am quoting from what is there; I think you are familiar with what we are dealing with.

The Hon. P.F. CONLON: Yes, I know what it is.

Ms CHAPMAN: Subject to that part of the bill, and the budget bill proceeding satisfactorily through the houses, Treasury officials have advised that this will include billboards and services such as petrol stations on land adjacent to main roads. Does the government propose to introduce further paid car parking at public transport interchanges or lease car parking to private operators?

The Hon. P.F. CONLON: I do not know how you get to there from here. My understanding of the origin of this proposal is that someone noticed that we have a lot of long and good roads that do not have service stations on them, and cars really like service stations and cars use roads. I think that is, basically, the origin of it; there is no motivation beyond that. I do not think billboards would be a major commercial proposition, but I know from experience that our transport planning people are pretty careful about the extent of signage that goes on and around roads.

Ms CHAPMAN: I think Mr Hansen has actually recommended that you take it off the buses, but in any event—

The Hon. P.F. CONLON: Who recommends that?

Ms CHAPMAN: Your new Chief Executive, Mr Hansen.

The Hon. P.F. CONLON: He is in a different area. I think what you will find is that principally is around people who want an opportunity to have service stations to provide services to motorists who use the roads. I do not know that that would be the end of the world.

Ms CHAPMAN: In the briefing, the suggestion is that there is a billboard opportunity there—

The Hon. P.F. CONLON: There probably is a billboard opportunity.

Ms CHAPMAN: —as already applies in other states and that this is an area you are moving into.

The Hon. P.F. CONLON: My understanding of it is that I do not think the great commercial opportunity is around the billboard; it is around the service station.

Ms CHAPMAN: So the $7½ million is largely anticipated from service station opportunities, is it?

The Hon. P.F. CONLON: I am not sure how solid the number would be because it has never been done before and people will not know until they explore the opportunity.

Ms CHAPMAN: For the purposes of making that guess or assessment, is it only service stations that are expected to be up and running in the forward estimates, or is it expected to be something else? It does specifically describe it as advertising.

The Hon. P.F. CONLON: Yes, I see what you mean, the commercialisation of road reserves.

Ms CHAPMAN: Yes.

The Hon. P.F. CONLON: Those two items, sorry. I was talking about the commercialisation of road reserves, which is principally around service stations.

Ms CHAPMAN: Yes, I understand that.

The Hon. P.F. CONLON: There is public transport assets operating revenue, and that is some existing revenue and some new revenue. I would say this: the fare box contributes something like 25 or 30 per cent of public transport revenue, and the rest is contributed by the taxpayer. If we can reduce the call on the taxpayer by generating revenues somewhere else, we think that is a good thing, and I think we do it in a very tasteful fashion.

Ms CHAPMAN: In any event, paid car parking, or leasing out to private operators, is not being considered at present; is that your understanding?

The Hon. P.F. CONLON: There are two things. I was talking about commercialisation of road reserves, which is a new thing.

Ms CHAPMAN: Yes.

The Hon. P.F. CONLON: The advertising is an old thing that may be expanded. There is nothing in the proposal here about car parking.

Ms CHAPMAN: That is what I am asking you. Okay, that is fine.

The Hon. P.F. CONLON: That is why I was explaining earlier that the commercialisation of road reserves is around service stations.

Ms CHAPMAN: If I can go to the advertising and the billboard opportunity that has been referred to, are the advertising opportunities going to be open to anyone, or is preference going to be given to other government departments, for example?

The Hon. P.F. CONLON: I think it is open at present to anyone, as long as they do not advertise something that we do not consider to be appropriate.

Ms CHAPMAN: I think at the moment, minister, that is why we have it in the budget bill. We have to change the law so that you can do it, and we are happy to look at that because at the moment—

The Hon. P.F. CONLON: You are happy to look at the budget bill? Thank God for that! It will prevent a constitutional crisis.

Ms CHAPMAN: There are provisions which mean that you cannot do it at the moment. That is what we are told in the briefings by your department. We need to change the law to enable you to do it.

The Hon. P.F. CONLON: I do not think that there has been a suggestion that advertising on our trams and buses is against the law.

Ms CHAPMAN: No, I am talking about on the highways and along the side—big advertising opportunities that have been discussed in the briefings. I am simply asking, to your knowledge, is that going to be available to everyone to advertise, provided it is tasteful?

The Hon. P.F. CONLON: I have said that it is an extension of something we do. Our advertising is available to anyone who advertises things that we do not think are inappropriate. If the Liberal Party pays enough, they may well get a political advertisement.

Ms CHAPMAN: That was going to be my next question. Is there any restriction on political advertising?

The Hon. P.F. CONLON: I do not think we should have political advertising. My own initial view is that I do not think we should have political advertising because it will raise issues about whether people think it has been paid for or not.

Ms CHAPMAN: In relation to property—and, remember, we are looking at amending the legislation to enable the government of the day to use these properties for commercial purposes—will the government be disclosing to the owner of property when it is compulsorily acquired for the purposes of these major highways, in the compulsory notice acquisition, that there may be a commercial purpose or activity developed on it, and will the compensation in future recognise the opportunity for commercial activity?

The Hon. P.F. CONLON: It is not our intention to compulsorily acquire lands so that we can use it for a commercial enterprise—not an intention at all. We are principally talking about land that we have already acquired in the past for our purposes. What has occurred traditionally is that I think the land at the side of the road becomes a reserve and is usually managed by the local council or something like that. It seemed to us that two interests intersected, in that motorists may well want to have some service along that road and, therefore, there would be revenue to the taxpayer for it, but it will not be the case that in future we acquire land with an eye to the commercial use of it. It is merely an opportunity to make a greater return for the taxpayer on an investment that they have already made.

Ms CHAPMAN: It is just that the bill, minister, as you are no doubt aware, also provides for future acquisitions which can then be identified under a prescriptive process by the minister. So it is not just the four major superways or highways that you have going now, but others in the future.

The Hon. P.F. CONLON: We have an existing right to acquire land for our purposes, the purpose of building roads.

Ms CHAPMAN: Let me put a specific one to you. The South Road Superway project included a $30 million acquisition of property for the purposes of preparing the material for that project, which, in the budget, is proposed ultimately to be sold off when you have finished doing your superway—

The Hon. P.F. CONLON: You are talking about the casting yards?

Ms CHAPMAN: Correct; that is a property that you have acquired. Particularly given the downturn in the real estate market we discussed in the previous session, is it the government's intention to establish any commercial activity on that property pending sale?

The Hon. P.F. CONLON: It seems unlikely, but can I come back to your earlier question about land acquisition? You are drawing the connection that if we can use it for commercial purposes and if we have acquired it from someone—

Ms CHAPMAN: Sorry?

The Hon. P.F. CONLON: You have drawn this connection that we should compensate people if later it is going to be used for commercial purposes as well. I am reliably advised by our people that land valuation will take into account the value of the land, and if the land, as a consequence of our acquisition, has a value that includes a potential commercial value, the valuer will take it into account. That is why it is called compensation, you get what you lose.

Ms CHAPMAN: As you know minister, the problem is that, if land is zoned in a certain way and is acquired for the public good of developing a highway, for example, and there is spare space down the track for an opportunity for commercial activity, and the government is then in a position to rezone and to develop, that would be a situation where, perhaps inadvertently, the government would be able to develop a commercial activity, sign up to service station providers, for example, with a long term lease as a commercial activity, which would otherwise have not been available for the purpose of evaluation for the original owner, who of course is losing it under a compulsory acquisition.

The Hon. P.F. CONLON: You have to be careful how far you go. Whenever we build a major piece of infrastructure there are often windfall gains for people.

Ms CHAPMAN: There may be, but I am just simply asking that question.

The Hon. P.F. CONLON: When we built the Northern Expressway there was substantial potential rezoning around that corridor from low value land. Whether it realises all or some of that, we are not going to be able to adjust the process of land acquisition for every possibility that might occur into the future. Similarly, sometimes our works do change the way people move or travel and do substantial damage to existing businesses. I like to cycle past the old Eagle on the Hill Hotel, where I think Agostino lives now.

Ms CHAPMAN: Mr Agostino lives in my electorate indeed, yes.

The Hon. P.F. CONLON: It was not much of a pub once they moved that big road, I can tell you.

Ms CHAPMAN: Your predecessor actually wanted to close the road: we did keep it open. Keep that in mind, along with Britannia roundabout, at the forefront.

The Hon. P.F. CONLON: Write that down: the road past Eagle on the Hill and Britannia roundabout. If I give you both those things you will never bother me again.

Ms CHAPMAN: Is that a promise?

The Hon. P.F. CONLON: I was just trying to work out your part of the deal.

Ms CHAPMAN: We will negotiate. I refer to Budget Paper 4, Volume 3, page 122 and Budget Paper 5, page 36. It is really the government employee housing. The government has been promising $15 million worth of government employee housing at Roxby Downs since 2009. Every year the housing is delayed, and the current budget will not be completed—

The Hon. P.F. CONLON: Did I promise that?

Ms CHAPMAN: Your government—2009. I don't think you had Ms Fox assisting you back in 2009, great assistance that that is.

The Hon. P.F. CONLON: She is a wonderful woman: that is not a very charitable thing to say, she is doing a very good job.

Ms CHAPMAN: Of course she is, and I will be expressing my condolences to her in due course later this morning on another matter. Every year the housing is delayed and in the current budget it will not now be completed until mid-2013. Why has this project been delayed?

The Hon. P.F. CONLON: I think BHP is similarly taking a long time.

Ms CHAPMAN: Dragging the chain?

The Hon. P.F. CONLON: I would not say that. They have an enormously substantial investment that they have been careful about making. My understanding is that the provision of housing has always been addressed towards that very significant BHP expansion. It is only wise that we would time the provision around the expansion of the Olympic Dam mine.

Ms CHAPMAN: Except that you are dealing with highway developments, which I was going to raise later, to service Olympic Dam.

The Hon. P.F. CONLON: Yes: it is $25 million worth; it is not $30 billion.

Ms CHAPMAN: And they're paying?

The Hon. P.F. CONLON: They're paying later—we're paying now and they're paying later.

Ms CHAPMAN: Nevertheless, you have a commitment from them to pay, but this is the commitment that your government made in 2009 in anticipation, obviously, of Roxby Downs both staying there and developing, if the indenture were passed, all of which has happened. Why was this been delayed another year? Is it simply because they have not signed up in London, or why?

The Hon. P.F. CONLON: No, it is a simple, practical thing. The expansion of housing is based on the expansion of the workforce. We would seek to expand the housing to coincide with the expansion of the workforce. We are still of the view that Olympic Dam pulls the trigger this year, the workforce expands and we expand the provision of housing, but it is an unremarkable thing.

Ms CHAPMAN: Under the commercial property management that you do, minister, which is at page 150 of the portfolio volume, you have projected that the government will be leasing 310,000 square metres of property in the year 2012-13. What is the total value of these leases?

The Hon. P.F. CONLON: Are you talking about everything we lease for our purposes?

Ms CHAPMAN: Yes.

The Hon. P.F. CONLON: Off the top of your head, Judith?

Ms CARR: Off the top of my head, no, but I can certainly provide it.

Ms CHAPMAN: Thank you. With the selling off of the government precinct in Victoria Square, which was announced for sale last year, is it anticipated that there will be any sale or income received from any part of that precinct in this 2012-13 year?

The Hon. P.F. CONLON: I think you are referring to Treasury responsibility on those sales, but I am happy to get back to you on it. We lease the buildings, so we will be the agent for leasing the buildings, but my understanding is that Treasury is the agency responsible for actually selling the buildings.

Ms CHAPMAN: There is nothing in your forward estimates or anticipated that you are going to have to find the Premier's cabinet officers and the education department some other offices. Is there anything in your forward estimates to provide for their relocation into leased premises?

The Hon. P.F. CONLON: No, I think part of the attraction of the sale might be having nice government tenants, I am sure; but no, that is not the case.

Ms CHAPMAN: So your anticipation is that you are not going to have to provide for that, that there will be—

The Hon. P.F. CONLON: Provide for moving people out of the buildings that we sell?

Ms CHAPMAN: With fairness, minister, we have had SA Water move out into Victoria Square, and we have had your transport department move from Walkerville into the old building. We have had a bit of musical chairs when it comes to government departments and their sell-off, but they have not always stayed in the same property that was onsold; in fact, I think largely they have not. So, you now have quite a significant portfolio of leased properties that your department manages for the purposes of accommodating government tenants.

The Hon. P.F. CONLON: Yes.

Ms CHAPMAN: But in this project I am referring to, your best guess at this stage, if I am hearing you correctly, is that the government tenants in the Victoria Square precinct are likely to remain in those buildings or offer to remain in those buildings as tenants.

The Hon. P.F. CONLON: It is better than a guess. I would say that it is a very high likelihood.

Ms CHAPMAN: I am happy to move on to transport planning services.

The CHAIR: We will do that after the break. Have you finished that line?

Ms CHAPMAN: Yes, I am happy to do that.

The CHAIR: I suggest that we reconvene at 11:10.

[Sitting suspended from 10:53 to 11:10]

The CHAIR: We are now into Transport Planning Services. I will ask the minister to introduce any new advisers who have joined him.

The Hon. P.F. CONLON: No, all the same people.

The CHAIR: Before we start, I have been reminded that we are live streaming, so everything is being picked up.

Ms CHAPMAN: I refer to Budget Paper 4, Volume 3, page 129. Here in the 2011-12 Highlights are included the work on the infrastructure plan and an update of that, the South Road Planning Study, strategies for freight, strategies for ports, but there is no mention of progress on the draft transport plan. Since that was promised 10 years ago, how is it going?

The Hon. P.F. CONLON: I think that the member for Bragg may have missed a few events in the last 10 years.

Ms CHAPMAN: You mean we've got one and I missed it.

The Hon. P.F. CONLON: Including countless comments from me about this, but also the release of the 30-year plan on transport and land use which informs so much of what we do. You asked earlier about purchasing the Caroma site. The use of the 30-year transport and land use plan, which we think is the best way to plan for the future, not roads in isolation, allows us to inform strategic decisions like the purchase of the Caroma site. You didn't see a reference to the transport plan because we never had the intention of putting one in. The nature of the planning we have done from the strategic plan down to the infrastructure plan and the 30-year plan on transport and land use planning, we believe, is the best planning regime in the country. In fact, some people have said that to us.

Ms CHAPMAN: So that I am clear then—

The Hon. P.F. CONLON: COAG, in fact, said that to us.

Ms CHAPMAN: Yes. As you probably know, the new Minister for Planning, the Deputy Premier, is not disclosing a number of the submissions in relation to the 30-year plan, so the usefulness of that in relation to future transport planning may well be an issue. No doubt, we will let the District Court decide that. The reason I ask, minister—and it seems from your answer that we have abandoned any progress of that because you have said it is redundant and covered by another plan—is that a number of stakeholders have approached me, and probably you as well, to say that there is still a need for a transport plan. Is there any consideration going to be made to produce one or are you just simply saying no?

The Hon. P.F. CONLON: I keep an open mind on so many subjects, but what I would say is that I have a difference of viewpoint in that these people see a very narrow focus on planning. I think what we have done is as good as it can be done in the country. Recently I was at the Transport Ministers Conference where, again, the planning system and the way we do things here was commented upon as being a very good model for the nation.

I will continue to talk to people who believe that the transport plan as a stand-alone plan is a good idea. I am not convinced as yet, but I believe that I am having lunch with the RAA board very soon and I am sure that they will make that viewpoint known again. I would say to those people and to everyone who is interested in transport in South Australia that, while you may have a view that a stand-alone transport plan is better than an infrastructure plan and a land use and transport plan—

Ms CHAPMAN: Just an addition.

The Hon. P.F. CONLON: You may well believe that, but what you cannot contest is that under the planning we have used the level of transport infrastructure investment is the highest we have ever seen. One aspect that we have certainly got right is the actual delivery of projects rather than simply the planning of them. Since 2002 we have delivered the Bakewell Underpass; the Gallipoli Underpass; the Northern Expressway; we are currently duplicating the Southern Expressway; we delivered two bridges; completed the Port River Expressway; delivered road and rail bridges over the Port; and we have deepened the port at Outer Harbor—we are way ahead of the Victorians seeking to do theirs.

We are currently working on the South Road Superway and we are continuing planning on the main north-south corridor. By any objective standard, the investment in transport infrastructure in the last 10 years is greater in magnitude than any we have previously seen in the state's history. So I will stick with what we have unless someone has a compelling argument, because I think it is working.

Ms CHAPMAN: Thank you, minister.

The Hon. P.F. CONLON: We did not get the Britannia roundabout done; however, I know you know that.

Ms CHAPMAN: Yes, I notice that has been missed—daily I notice that you missed that. I am sure that when you get on to these TODs you will understand how important it is to fix up the Britannia roundabout so that you can move all those new dwelling residents in and out of Adelaide.

The Hon. P.F. CONLON: I think you should do a deal with Michael Atkinson on a joint bill that reopens Barton Terrace and does Britannia roundabout at the same time.

Ms CHAPMAN: The mind boggles! I don't think I want to do anything with the member for Croydon. The member for Chaffey has some questions on the ferry.

Mr WHETSTONE: Minister, the reference is Budget Paper 4, Volume 3, page 132. The 2010 Sustainable Budget Commission report recommended the closure of the Lyrup and the Cadell ferries, and the government announced the closure of the Cadell ferry on 13 June 2012. Has the government signed the five-year contract on the Lyrup ferry?

The Hon. P.F. CONLON: It is a five-year contract on the Lyrup ferry.

Mr WHETSTONE: Do these contracts have provision for the government to exit arrangements for the ferry service at any time during that five-year period?

The Hon. P.F. CONLON: I do not believe so. Let me make it plain: we have absolutely no intention of discontinuing the Lyrup ferry. I also make it absolutely plain that we are not seeking to reduce our budget for ferry services. What we have sought to do, on evidence supplied to me by the transport department, is maximise the use of that money across the ferry services by discontinuing the service which has a combination of best alternatives to the ferry with the least number of users. There is absolutely no intention to discontinue the Lyrup ferry.

Mr WHETSTONE: Were any of the councils, residents or businesses in the region consulted on the decision to close the ferry service prior to the announcement, which was only three weeks before the announced closure? Were there any studies or research commissioned by your department or DPTI or any of the other agencies analysing any of the impacts, social and economic, in either Cadell or the Riverland region about the closure?

The Hon. P.F. CONLON: Can I say that I have discussed with my people that I do not think we did enough consultation with the locals. I do not think we did as much as I would have liked, but what I can say is that the people in our department certainly had to convince me—and I explained it to cabinet—of the underlying logic and reason for it. They convinced me that the counts they took and the times they took them were compelling evidence.

At the end of the day, can we make it clear that we are talking about taxpayers' funds here. That is the only sort of money we use, and they convinced me that it should be used elsewhere. They advised me that they consulted with the government agencies, the education department and the CFS. What I have said to your counterpart, whom I have met on this issue, the member for Stuart, is that really on this there was some information that we had got wrong. I could not see how the decision would be reversed.

Nothing in longer consultation, in my view, would have changed that basic information, but I would have preferred that our people had consulted earlier locally. At the end of the day, I do not think it would have made a material difference to the outcome of the decision because—and I say it again today—the decision is made on a set of information that is persuasive, and unless there is something wrong with that information I could not see why the decision would change.

Taking away a service is not something that is done lightly. It is not pleasant. It is certainly not pleasant for those people whom it affects, and for that reason you do look at the information very carefully, and the information provided to me was persuasive to the point of being compelling. While I think consultation might have been better, the material difference it made is probably not large.

Mr WHETSTONE: Could I suggest then, with the public consultation that was performed last Thursday night at Cadell, that it would be fair to say that your staff obviously did not have the concerns of the public, of not only the people of Cadell but the people of the region who attended that meeting, with their reasoning behind their justifying taking the service off?

The Hon. P.F. CONLON: No, not at all. I do not accept that at all. Our staff do not get any benefit out of removing a service. They do not get any benefit out of attending a meeting with many angry people who are affected by it. The benefit that flows is an improvement to the overall ferry services, the capacity to run those ferry services across the Murray sustainably. Our people did not do these things without a view to the impact on people.

Department staff are human beings with families who feel pretty much the same sort of human emotions that other people do, and they do not enjoy the fact that their decisions disappoint people. Setting aside the issue of consultation, what I would say to you is that I believe they assembled the information that was provided to me by them accurately and honestly. If they did not, then I would not support the decision. They did it with the best intention for the provision of services. It is a difficult thing for them, as it is for all of us, to remove a service.

To suggest that they do not have a regard for the people there or the region is completely wrong. In fact, as I say, this is not an issue of a budget cut; this is an issue of the department seeking to improve the sustainability and the performance of the overall ferry services in the area by the cancellation of this one service. That is not something taken lightly, and I think that the departmental staff who go there would understand completely the anger of locals. To suggest that they do not feel for them I think is a very poor reflection and it is not accurate.

Mr WHETSTONE: Just on reflection, your staff were on radio that following morning saying that they already understood the impacts of the region and that they had learnt nothing new from the public meeting that prior evening.

The Hon. P.F. CONLON: I have to say that it is much easier to have a conversation about this with the member for Stuart, who is passionate about his local members. Blame me, do not blame the staff; I am the one who makes the decision. At the end of the day, the staff could have come to me and I could have said no. So, blame me. Go out there and bash me up.

The truth is, and you have to put everything in context, what I said to the member for Stuart is that it would take something substantially different from the information I have been provided. One of the key points raised at the meeting was that the department had done the counts at the quiet time of the year, and that is not correct. The department showed me that it had done counts, including months such as January and December.

It is simply not true that the counts were done at the wrong time of year. I do not know what the department said on radio, but what I will say to you is this, if we can be clear about it: my view to the department is that, if its information is right, I will make the decision, and it is me who makes the decision, not the department. So, blame me. If the information needs to be changed because of something we did not know, that would be the way we would change the decision. But if the information I have received is correct, I cannot see the decision changing. I cannot be clearer than that; that remains my position.

What I would say is that, flowing from the meeting, there was very understandable anger and disappointment, but we do not have a substantial change in the information upon which the decision was based; that remains the case. That is my view, not the department's view. So, if you want to go out and whack someone, go out and talk about me.

Mr WHETSTONE: Minister, I can assure you that I am not whacking you. Some of that information you received on people travelling on that ferry is outdated. It might have been that they took that data from previous years, at the end of January or February, but it was at the peak of the drought, it was at the peak of no tourism.

The Hon. P.F. CONLON: Here is what I will say to you: if you can show that the information is wrong, that is when I would be prepared to reconsider. This remains the same message. If that—

Mr WHETSTONE: I am not saying the information is wrong.

The Hon. P.F. CONLON: Okay, but I am not sure what you are saying then. What I say to you is this: the information provided to me, I believe, was honestly and accurately made by the department and, on the basis of that, I felt that the decision was compellingly the correct one. I have said that the way in which the decision would change is if there was information we did not know about. What I am saying again is that, if that is the case, nothing has been provided that alters the information so far.

Mr WHETSTONE: Minister, I have one final question. If there is information, whether it is economic or social impact, that would give you some cause for concern, would you consider an extension of that service to remain until that evidence had been analysed?

The Hon. P.F. CONLON: It would have to be something as compelling as the original case. It would have to be something compelling. It is enormously difficult taking away something people have had for a long time—

Mr WHETSTONE: Over 80 years.

The Hon. P.F. CONLON: Exactly. It went there in 1921, and we can count how many bridges and how many other ferry services and how many sealed roads that were there in 1921. That is the truth of the matter. The truth of the matter is that, say, the ferry was not there and there was a proposal to start one, no-one would do it because it would not be viewed as a priority against services. It simply would not. It would not be viewed by anyone as being the right priority among services.

If I sound cold-hearted, I am sorry because I am not. It is not a question of taking a small budget cut to give back to the Treasurer: it is about increasing the sustainability and the future viability of all of those ferry services that operate on the river. None of us likes doing these sorts of things. I can tell you that, if one day you are in government, you are probably going to do things you do not like doing.

Ms SANDERSON: At last year's budget estimates you said there would be no need for any pokies at the Adelaide Oval complex. Given the Oval's recent application for an extended hours liquor licence, do you still believe this will be the case?

The Hon. P.F. CONLON: Can I say we do not need pokies to build Adelaide Oval. Adelaide Oval is going to be a world-class, state-of-the-art sporting facility that revitalises the city regardless of what entertainment functions they put in there. There is no doubt that alcohol will be an element of the facilities at the new oval, because it is at the old one and I think it probably is at every sporting facility in Australia—unless there is one run by the Mormons or something; I do not think so—so that is there. The issue of what the authority at the Oval does with the licensing authority is for the parties who run it, not for us.

I could have saved a lot of air by saying they have ruled out pokies, but there you go: Andrew Daniel of the SMA has ruled out pokies. It is not unusual that the venue would seek to make money out of alcohol; I have to say it would be extraordinary if they did not. I reckon there would be three people on this side of the chamber who have probably had a drink in the committee room at Adelaide Oval—at the cricket at some point or something like that, somewhere out the back; lovely spots out the back—a cold beer on a hot day.

Ms CHAPMAN: Before we move on to the road safety matters, I have some further questions in relation to the decision on the Cadell ferry. Essentially, representatives of your department were the bearers of the news at the recent public meeting and opened the presentation with, 'It is the government's intention to close the ferry.'

The Hon. P.F. CONLON: Yes.

Ms CHAPMAN: They outlined some data as to patronage or the lack thereof as a basis upon which it was not viable, but assurance was given that the proceeds of saving on the closure of the service would be applied to other ferry services.

The Hon. P.F. CONLON: Yes; that had better be the case, because that is what they told me.

Ms CHAPMAN: That was the essence of their presentation. They may or may not have come back to you with this, but a number of the issues that were raised on the evening included that the data was not comprehensive and that it would have been reasonable to at least take a 12-month period, throughout-the-year tally rather than having identified as long as 10 years before for a particular month which they said was not their peak period.

Secondly, the producers of the area utilise the ferry in the evenings for the efficient delivery of their produce. Thirdly—very significantly and very loudly—was the argument that the existing alternative facilities in neighbouring towns were at peak level for some months during the year and that the capacity to accommodate those that would flow on from the closure at Cadell would overload an already up to two-hour wait.

At the social level, the reduction of numbers of children at the school was raised. The safety capacity for the CFS truck to be able to get to fires on the other side of the river—the safety issues alone and travelling extra time for families were all factors that were raised on the evening. Whether they were reported back to you in detail I do not know, but they are all issues which I think you would agree are the things that the department is supposed to look into, according to your own guidelines that have been operating since 2003, before a service is axed.

The Hon. P.F. CONLON: Can I say that—

Ms CHAPMAN: If they have not done that exercise, will you at least agree to extend this service until that exercise has been done?

The Hon. P.F. CONLON: No, I won't, because—

Ms CHAPMAN: Because how can you possibly know all the information, of which I have just touched on a few things—

The Hon. P.F. CONLON: In fact, there is nothing you have touched on that was not raised by the member for Stuart in conversations with him before the meeting.

Ms CHAPMAN: Those matters, though, had to be investigated before the decision was made.

The Hon. P.F. CONLON: When you finish your speech I will answer you. In the matters you raised, I come back to your first point last: the CFS was consulted and the education department was consulted.

Ms CHAPMAN: In that, do you have an assurance from the education department that they are not going to close the school, for example? Do you have an assurance from the CFS that they are going to keep the fire truck there?

The Hon. P.F. CONLON: You say that, but I come back to your first point about the data: member for Bragg, there is no data that could have been provided by our people at the meeting that would have had them say, 'Oh well that's right, okay then, we had better close the ferry.'

Ms CHAPMAN: That is because they did not do it.

The Hon. P.F. CONLON: Exactly. There is no data in the universe that would have convinced the people at the meeting.

Ms CHAPMAN: They did a trial in the month of August.

The Hon. P.F. CONLON: You are simply not representing the facts. We can tell you when the data was taken; if you like, Andy can run through that with you.

Ms CHAPMAN: From 1999, I think, from recollection, and the last—

The Hon. P.F. CONLON: Here is what I will say to you: if you want to have an intelligent and reasonable conversation about this, we will have it; if you want to use the people of Cadell on the grandstand on which you make your political points here today, you can do that. I am not going to be—

Ms CHAPMAN: These are your rules, minister. These are your rules, and we are just asking—

The Hon. P.F. CONLON: Okay, you have chosen your path.

Ms CHAPMAN: We accept that you make a decision, we accept that. It is your responsibility, and it is appropriate that you take responsibility for it, and I accept that. The people sitting around you are really just sent as the messengers, but these are your rules that require that level of consultation before they make the decision or put the recommendation to you to make that decision, and they have not done that.

The Hon. P.F. CONLON: Well, that is your view. In my view, I am assured that they have made the level of consultation on those areas.

Ms CHAPMAN: They told us on the night that they had not. They had not told the council, they had not talked to the stakeholders there, except for two government departments.

The Hon. P.F. CONLON: I am not going to try to out shout you. If you have a question to ask, I will answer it, and I will answer it honestly. If you have a speech to make, I suggest you make it in another forum.

Ms CHAPMAN: But we have done that, minister.

The Hon. P.F. CONLON: This is not the appropriate one.

Ms CHAPMAN: Can you assure us that in future decisions you make in regional areas you will ensure your department complies with your own rules.

The Hon. P.F. CONLON: What I—

Ms CHAPMAN: That is all we are asking.

The CHAIR: Order!

The Hon. P.F. CONLON: That is not what you are asking. You are asserting, by your very question, that we have not, and what I am telling you is that my advice is that we have. You may take the point for whatever political reason you have to assert that one set of facts is the case. I am telling you that a different set of facts is the case. We will leave it to people to make a judgement, but what I will say is that I do not believe that there is any set of facts I can present to the people of Cadell that would make them happy about losing their ferry service. I do not think there is.

Ms CHAPMAN: Can I put this to you, minister: I am now reading from the document, titled A Guide to Regional Consultation, which is, according to this document—

The Hon. P.F. CONLON: Can I—

Ms CHAPMAN: —a policy which is implemented today and which requires these questions to be asked.

The Hon. P.F. CONLON: Mr Chair—

Ms CHAPMAN: I am just putting the question.

The CHAIR: Order!

The Hon. P.F. CONLON: —I have been extremely tolerant about questions that are not about a budget cut at all. They have not had anything to do with the budget.

Ms CHAPMAN: These are budget cuts. These are very serious budget cuts, minister—you know that.

The Hon. P.F. CONLON: It is not a budget cut. That is another invention. It is very hard for me to deal with an issue if the member for Bragg is prepared to misstate the facts. There is no budget cut to the ferry services.

Ms CHAPMAN: There is a clear disclosure in here, Mr Chair, of the five-year contracts being renewed. It is confirmed that it does not relate to this service. It has been cut.

The CHAIR: Do you have a specific question on this line?

Ms CHAPMAN: I do. Minister, the document says, 'The questions to be asked on the access of other impacts on the community—'

The Hon. P.F. CONLON: Which document?

Ms CHAPMAN: I am reading this from the guideline document, as to why this had not been done.

The Hon. P.F. CONLON: Which guideline document?

Ms CHAPMAN: Page 132.

The CHAIR: Which guideline document? You referred to it earlier.

Ms CHAPMAN: I am referring to page 132 in relation to the River Murray ferries for a further five-year period. It is also referred to, River Murray ferries, at page 131. My question is: why, under the guidelines, did your department not cause these questions, which are required, to be asked: does the proposal have an impact on small business, does the proposal have an impact on the environment?

The Hon. P.F. CONLON: Can I cut you short? You are wrong.

Ms CHAPMAN: Does the proposal have an impact on families and safety?

The CHAIR: Order! Minister.

The Hon. P.F. CONLON: Thank you.

Ms CHAPMAN: And does the proposal have an impact on the regions?

The Hon. P.F. CONLON: Can I say—

Ms CHAPMAN: That is all I ask. That is all we want the answer to.

The Hon. P.F. CONLON: No, it is not all you ask; it is what you are grandstanding with now, and I can understand—you are like a moth to the light ,and you have seen some cameras—

Ms CHAPMAN: You can diminish it, minister.

The CHAIR: Order! The minister is talking. Order, please!

The Hon. P.F. CONLON: I am not diminishing. Can I say this: our decisions affecting those people were taken with great consideration. No-one enjoys it: none of the staff enjoy it, no-one enjoys it. There has been no budget cut, despite the assertion. The assertions made by the member for Bragg are wrong. It is painful for all of us to do this, and it is, I think, a little distasteful, given that we deal with the local member and deal with someone else associated, for the member for Bragg to decide arc up when the cameras turn up on the backs of the people of Cadell. They may fall for it, but I tell you what, I'm not.

Ms CHAPMAN: The further question I have in relation to the ferry is this: your officers advised the meeting that the money that would be saved would be reapplied to the cost of other ferry services in the district, that is, the increased cost, which we expect on every service to be provided, would be allocated for that expense. That may be so, but it is not an acceptable explanation to the people of not just Cadell. You forget that it is not just the member for Stuart, but there is a whole district there who use this service.

The Hon. P.F. CONLON: What I do not understand, member for Bragg, is that your questioning on this and other matters seems to have become so much more strident and inflamed since cameras turned up.

Ms CHAPMAN: You refused to answer the question.

The Hon. P.F. CONLON: I didn't know this was a question.

Ms CHAPMAN: Prior to that you were actually doing quite well.

The Hon. P.F. CONLON: Thank you, member for Bragg; your good thoughts are what keep me going. I could not discern a question in your last short, inflammatory speech. I am quite happy to answer honestly all of your questions. What I am not prepared to do is try to argue your misstatement of facts, your misstatement of what actually occurred, your allegations of a budget cut that does not exist. We have been over and over this, and I say again: money has not been reduced from the ferry services. This was an attempt by decent, hardworking people to try to improve the overall sustainability and viability of ferry services without cutting a budget. It is not something anyone enjoys doing.

Cabinet looked at this and we considered it on its merits, and I knew there would be people who would be very unhappy and local members who would present strong arguments, as the member for Stuart has done for his people, and I knew there would be people who would use it as a political grandstand as soon as the cameras turned up, which you have done.

Ms CHAPMAN: Is that why you kept it a secret until they were told last week? Is that why you deliberately kept it a secret?

The Hon. P.F. CONLON: Again, here we are: the inflammatory allegations when the cameras turn up. It is just a little bit sad.

Ms CHAPMAN: We now know that you claim that, if a service is to be dumped, it is not a budget cut because you are using the money somewhere else. If that is the new definition, the new threshold, on which the government operates, that is, blow the people in this regional area because it is not a budget cut—

The Hon. P.F. CONLON: Can we have some modicum of courtesy in asking questions?

Mr WHETSTONE: Or in answering questions.

The Hon. P.F. CONLON: Sorry, do you want to ask a question too? We will come to you in a moment.

Ms CHAPMAN: Why did you keep it a secret?

The Hon. P.F. CONLON: It was not kept a secret; it was consulted. It was not kept a secret—there was a public meeting on it.

Ms CHAPMAN: Until a week ago.

The CHAIR: Hold on, please—let the minister finish.

The Hon. P.F. CONLON: The definition of a budget cut is when you reduce the amount of money you are paying towards a service.

Ms CHAPMAN: When you thrash a service, that is what it is, and you know it.

The CHAIR: Order!

The Hon. P.F. CONLON: So people understand, were that service to pay for itself, it would need a charge of about $30 per ride—right?

Ms CHAPMAN: Ten, they told us the other night.

The Hon. P.F. CONLON: That's not what I was told.

Ms CHAPMAN: Well, Andy, tell him—it was $10 the other night, you told us.

The CHAIR: Order!

The Hon. P.F. CONLON: Come back to the point: the reason that service was chosen, to go over the point coolly, was that it had the lowest frequency, combined with the highest number of the closest alternatives. It was last considered for closure in 1990 or something like that—1991. The reason it was not closed then was the existence of a business, which closed in 2008. These people have not sought to cut a budget: they have sought to take that money and make other services more sustainable. The member for Bragg herself points out that the service down the road is oversubscribed and that there are more people seeking to catch it than can catch it.

I have got to say that some people would say that is an argument for redirecting your effort to where more people want to catch the service; that is the logic that has been used. It is not a pleasant exercise to take away a service, it is not something we ever expected that the local people would like but, at the end of the day—and if they are ever in government they will find it—government simply cannot provide every service that everyone wants. It seeks to direct the effort to the best outcome for the most number of people.

The truth is that this money has not been cut from the budget: it has been directed to getting a better outcome for a larger number of people. I guarantee you that if, God forbid, the opposition ever does make the government, they will have to do things they do not enjoy or they will not be fit to be the government.

The CHAIR: We are due to go to road safety budget lines, so we should wind up these questions.

Ms CHAPMAN: Well, I can tell you the people at Cadell are very worried about road safety.

The Hon. P.F. CONLON: Here we go. Why do you only fire up when the cameras are here?

Ms CHAPMAN: My final question is: did you receive an assurance from the department of education, on the consultation of two that you did, that the school would not close or reduce the class services available? Did you?

The Hon. P.F. CONLON: It is not for us to determine when schools close or do not close.

Ms CHAPMAN: No; you don't care.

The Hon. P.F. CONLON: It is not for us. It is for us to consult with the education department to ask them what the impact of this would be, and we are quite prepared to tell you the answers of that consultation again, if you wish.

Ms CHAPMAN: Thank you, I would appreciate that. What was it?

Mr MILAZZO: We were told by the education department that schools will not close unless there is a vote in the community.

Ms CHAPMAN: That is the law.

The CHAIR: Please don't interrupt.

Mr MILAZZO: We were also told at the meeting that the Lyrup school, I understand, is continuing with a student population of five children.

The Hon. P.F. CONLON: Okay?

Ms CHAPMAN: My question was: was any assurance given?

The Hon. P.F. CONLON: No, because the answer does not suit the sort of strident case—

Ms CHAPMAN: I was just asking: was any assurance given?

The Hon. P.F. CONLON: The school has 21 students, the Lyrup school has five.

Ms CHAPMAN: Minister, you know the law.

The Hon. P.F. CONLON: The Lyrup school stays open. There are six students who travel a long way to go to the Cadell school, which we found surprising. They are the most likely ones to seek to go to the closer school, but I think the Lyrup school staying open with five answers your question. The truth is that the education department was properly consulted; that is the main point. You can try to dress it up with a speech from the stump, but the case is that they were consulted. That is the answer, and I think it is a perfectly reasonable one.

The CHAIR: This minister is due to leave us at 12:15 and we have got road safety budget lines scheduled from 11:45. Are people happy to move on to that now?

Ms CHAPMAN: Thank you.

Departmental Advisers:

Mr R. Hook, Chief Executive, Department of Planning, Transport and Infrastructure.

Mr M. Small, Director, Road Safety, Department of Planning, Transport and Infrastructure.

Mr M. Palm, Director, Investment Strategy and Divisional Finance, Department of Planning, Transport and Infrastructure.

Mr M. Clemow, Chief of Staff.

Mr B. Cagialis, Chief Finance Officer, Department of Planning, Transport and Infrastructure.

The Hon. P.F. CONLON: I have got to hear this question again from the member for Chaffey. It has got a bit of Jean-Paul Sartre about it, I think. I have got Martin alongside me—they have just moved around—and some New Zealander down the end.

Ms CHAPMAN: No, we had a New Zealander—it was the premier. We got rid of him.

The Hon. P.F. CONLON: That is so uncharitable. The man is not here anymore. Suck in the good air, breathe out the bad—let us put all of this behind.

Ms CHAPMAN: If you could introduce me to your next new advisers, that would be great.

The Hon. P.F. CONLON: Martin Small and Martin Palm.

The CHAIR: Okay; let us commence on road safety budget lines. Member for Bragg.

The Hon. P.F. CONLON: I want to hear the question again from the member for Chaffey because it didn't make any sense to me. Would I close down a road because it has a pothole? No.

Mr WHETSTONE: You'd fix it or you would make budgetary savings or measures to fix it.

The Hon. P.F. CONLON: Well, we would fix a pothole, yes. Can you explain what the analogy is to me?

Ms CHAPMAN: I am pleased to hear that because I think the member for Reynell when I first got here described potholes as a tourist attraction, so I am really pleased we have had a change on that.

The Hon. P.F. CONLON: I am reliably advised from some people who have just returned to England that they have far more potholes than we have which I think is amazing given a pokey little place like that. The member for Chaffey asked his question apropos the Cadell ferry, and I am struggling to understand what analogy he is seeking to make.

Mr WHETSTONE: Haven't we moved on to road safety, minister?

Ms CHAPMAN: Page 36 of Budget Paper 5—

The Hon. P.F. CONLON: I hope you have some more questions.

Ms CHAPMAN: —which relates to the Port Augusta to Olympic Dam shoulder sealing project. This is referred to in the capital works but also a proposed road safety initiative. Does the road from Port Augusta to Olympic Dam require shoulder sealing regardless of whether the expansion of Olympic Dam occurs?

The Hon. P.F. CONLON: The shoulder sealing is for the overdimension loads from Olympic Dam.

Ms CHAPMAN: So, on the basis that there are bigger trucks with more dirt in them, you have to fix the shoulders. Is it the only reason it is being done?

The Hon. P.F. CONLON: There used to be a rule in cross-examination that if you got the answer you wanted you should stop. It is being done for the overdimension vehicles. That is why we are getting paid for it.

Ms CHAPMAN: That is my next question. The $25 million that BHP are going to be paying, when is it expected that you will receive that?

The Hon. P.F. CONLON: We will find out for you. We trust them. They have a bit of money.

Ms CHAPMAN: They haven't signed up yet, so let's not hold our breath.

The Hon. P.F. CONLON: For your other question, although I do not know that it is relevant to anything, it is overdimension vehicles, not for moving product.

Ms CHAPMAN: I understand that.

The Hon. P.F. CONLON: Not trucks full of dirt. It is overdimension vehicles.

Ms CHAPMAN: I just raised the question about that being in the road safety aspect as necessary for the purposes of road safety. It is recorded in your road safety section as well, that is all, and I am sure it will make it safer with these bigger trucks.

The Hon. P.F. CONLON: I am sure you regret that shoulder sealing does have a road safety outcome.

Ms CHAPMAN: I think that is quite offensive, minister. Of course, it is important, but if you tell me you do not need it unless you have bigger trucks, I am happy to accept that. My question then is why is it in the road safety section?

The Hon. P.F. CONLON: It is not something that I really address my mind to, but I can guarantee you that shoulder sealing has a good road safety outcome. What is your point?

Ms CHAPMAN: It is just that your other highway developments where there are aspects in relation to shoulder sealing are not necessarily identified in the road safety section.

The Hon. P.F. CONLON: I have to say that I do not really take an oversight of where they put things in columns. I will let them know that you think it should not have been in that column, okay? That will be fine. I'll probably make sure it is never in that column again.

Ms CHAPMAN: My next question on the portfolio is at page 138 on the activity indicators. Here, I think rather concerningly—while we are on road safety, which is a high priority I am sure—there is an increase in the number of crashes involving serious injury or death in urban areas this year from 163 to 188. That is from 2010-11 to 2011-12 respectively. How many of these crashes were at intersections that have received funding in the current budget to be upgraded? I put that question to you because I am advised that you are in charge of the upgrades.

The Hon. P.F. CONLON: Just so we understand, you are saying that there were—

Ms CHAPMAN: There were 163 in 2010-11 and 188 in 2011-12.

The Hon. P.F. CONLON: Of what?

Ms CHAPMAN: Of serious injuries; yes, a major increase.

The Hon. P.F. CONLON: I was just trying to find out what you said.

Ms CHAPMAN: Yes, it is at page 138.

The Hon. P.F. CONLON: And you want to know how many of them occurred at intersections that are going to be fixed up in the road safety program?

Ms CHAPMAN: Correct.

The Hon. P.F. CONLON: I am looking at some casualty crashes. The definition you used is casualty crash or—

Ms CHAPMAN: Serious injury; you will see they are separated there.

The Hon. P.F. CONLON: The information I have is on all casualty crashes. That is the only thing I can offer now. What we have (and we can provide you with some further information) is a list of the 10, if you like, worst intersections for casualty crashes, and a plan around what happens at present, what should happen in the future—

Ms CHAPMAN: Is the Britannia roundabout there?

The Hon. P.F. CONLON: No, it is not. The Britannia roundabout is a great boon to the panel beater.

Ms CHAPMAN: It sure is!

The Hon. P.F. CONLON: The casualty crashes are very low but the panel beating jobs are quite high.

Ms CHAPMAN: Indeed.

The Hon. P.F. CONLON: If you owned a panel beating shop, you would like the Britannia roundabout.

Ms CHAPMAN: It might be a good career for you post-politics, minister, but in the meantime, of the 10 that are identified as the worst, are they the 10 that on your list for—

The Hon. P.F. CONLON: Sorry, Britannia roundabout does have casualty crashes.

Ms CHAPMAN: Thank you. What number are we?

The Hon. P.F. CONLON: It is a signalised list and you are not on that list.

Ms CHAPMAN: Obviously, that is why we are a roundabout still. I have noted your undertaking promise to me. I always remember breaches of promise.

The Hon. P.F. CONLON: In another calling we could have been friends.

Ms CHAPMAN: For the benefit of the committee, we have sat on other groups together pre-politics—when you were normal.

The Hon. P.F. CONLON: And you didn't annoy me as much as that chair did!

Ms CHAPMAN: In any event, back to our list, if we may: of the intersections where there are serious crashes, which has an alarming increase—and I think you will agree that is concerning.

The Hon. P.F. CONLON: I am not going to agree because I do not know how those stats operate.

Ms CHAPMAN: How many of this year's budgeted upgrades are going to be where there have been these serious crashes?

The Hon. P.F. CONLON: I will get that information. Just so we understand this, while the budget line on road safety appears in my area of responsibility, the responsibility for policy and decision-making falls with the Minister for Road Safety. You would not expect me to run a commentary on it.

Ms CHAPMAN: I do, minister, only because you are in charge of program 4, according to the budget, which is transport safety.

The Hon. P.F. CONLON: What I am saying is that program 4 does fall under my responsibility as the minister in the sense that it is written up in the budget as being mine.

Ms CHAPMAN: But there is another program that minister Rankine has.

The Hon. P.F. CONLON: There are decisions of priorities around it, I assume, that would be greatly influenced by discussions on road safety with the minister. I will check that for you.

Ms CHAPMAN: Yes. Your office kindly provided us with a schedule of what she is responsible for and what you are responsible for, and my understanding, on reading that—

The Hon. P.F. CONLON: What I am saying to you is that no matter what the documents say, if a matter touches on road safety I would certainly want to know the views of the Minister for Road Safety.

Ms CHAPMAN: Yes, indeed. I am not asking what her views are; I am asking what you have decided to do in relation to that data which is collected. I look forward to receiving that with interest.

The Hon. P.F. CONLON: What I have already said to you is that, with regard to that data, I will get back to you with what the program will be. What I am trying to indicate to you is that whatever program we have would be influenced strongly by the views of the Minister for Road Safety.

Ms CHAPMAN: Yes, thank you.

The Hon. P.F. CONLON: Because I think that is the right way to do it.

Ms CHAPMAN: Indeed, and your renewed cooperative spirit is welcome, minister, thank you.

The Hon. P.F. CONLON: Member for Bragg, if you knew the real me you wouldn't be so mean.

Ms CHAPMAN: My question now refers to page 138.

The Hon. P.F. CONLON: It doesn't work when your colleagues laugh at you.

Ms CHAPMAN: I know, but they know you well, minister.

The Hon. P.F. CONLON: Yes, they do.

Ms CHAPMAN: At page 138, Targets, you are going to install the pedestrian refuges to improve pedestrian access and safety. Will any of these be installed on Portrush Road?

The Hon. P.F. CONLON: While they do that, having been the Minister for Transport for some time, can I explain to the member for Bragg, how priorities are set in the agency? I can probably do it by good example for you. I have never as a minister inserted my views as to what a priority should be. They are worked out by research within the department and they tell us what are the most important things to do. I have never sought to change that. I do not believe any other minister does. The great example I can give you is something called the Cliff Street lights, the lights on Cliff Street off Morphett Street, I think it is, down near my electorate.

Ms CHAPMAN: I drove down there the other day.

The Hon. P.F. CONLON: I first started writing to the Department of Transport about the Cliff Street lights in 1997, asking for a set of lights there. I think it was in about 2004 that I finally became the Minister for Transport and so I asked the guy in charge of the program, 'What about these Cliff Street lights?' He went away and he came back and showed me the departmental list of priorities. It was a really long list, with mine down about number 92.

He said, 'If you like, minister, we can take yours up the list, if that is what you really want us to do.' I said, 'No, I think that would probably be something people would criticise.' As a consequence, after eight years as the transport minister, I still do not have lights, as the local member, at Cliff Street. Just so you understand, that is the system we use when it comes to prioritising these sorts of works. The guys who are experts set the priorities.

Ms CHAPMAN: I am very pleased to hear that, minister, because, although you say that you do not interfere with that, you will recall the time that the Department of Transport had recommended to your predecessor, who had acted on a priority for Britannia roundabout, and as soon as you became minister you cancelled it. I have letters repeatedly from your department about how they are continuing to work on that. In fact, I hope I am helping in being able to send you further projects and different ideas that come forward.

The Hon. P.F. CONLON: You have. What you do not know is that we have looked at so many ideas on the Britannia roundabout, including yours, but let me tell you—

Ms CHAPMAN: But you did interfere with it, minister—

The Hon. P.F. CONLON: I did.

Ms CHAPMAN: —so let's not talk about accepting their advice about what you do.

The Hon. P.F. CONLON: That was certainly not an issue about prioritisation of road safety. What it was about—and I will say it again, having been down to see the proposed works and what would occur, having seen the photographs and actually been on site—was that the suggested project would have removed trees that were—you can say that we remove trees for other projects, but the trees in question—

Ms CHAPMAN: Port Road: hundreds.

The Hon. P.F. CONLON: —were of such dimension and stature that people would have been chained to them before we would have been allowed to do the works and even I—

Ms CHAPMAN: They weren't big on Port Road?

The Hon. P.F. CONLON: —would not have on my conscience taking them down. I am not going to talk about how the job was recommended up or down, or where it went. I think the minister at the time is not even in the parliament any more.

Ms CHAPMAN: No; she is not, more's the pity.

The Hon. P.F. CONLON: Trish. I am not going to comment on how that happened, but I will say that was not an issue about reprioritising road safety. That was an issue about a major piece of public works which I believed had dimensions to it which made it appropriate for a decision at that level, because they simply would have been dramatically changing the face of Adelaide. I think when you get to that level you do have a responsibility to take into account the broad public interest in it. I have to say, I do not think that you could get a properly informed current member for Adelaide to agree with that proposal were it re-enlivened, not once I showed the current member for Adelaide what it would do to that neighbourhood.

Ms CHAPMAN: In any event, when you develop your urban structure plans, inner plans and TOD developments, it might come back up again.

The Hon. P.F. CONLON: I am not saying you cannot remove trees, but you cannot dramatically change the face of Adelaide without a massive repercussion. We are doing Adelaide Oval.

Ms CHAPMAN: Trees are more important than public safety? There are 2½ accidents a week there.

The Hon. P.F. CONLON: Trees are not more important than public safety. No, they are not, but there is always a balance to be struck in projects that we do.

Ms CHAPMAN: If it is so important, minister, and the prioritising is there, why has the worst intersection for level crossings, namely at South Road, Croydon, not been advanced? Why is that dragging the chain?

The Hon. P.F. CONLON: I will find out for you because, as I said, they provide—

Ms CHAPMAN: I am sure the member for Croydon would like to know, too.

The Hon. P.F. CONLON: I am sure that, if he does want to know, he will ask me. The one thing I know about the member for Croydon is that he is not shy.

Ms CHAPMAN: The list, which we were rather sidelined from, for the installing of pedestrian refuges—

The Hon. P.F. CONLON: We do not have pedestrian refuges on Portrush Road.

Ms CHAPMAN: Will you provide a list of those that are to have pedestrian refuges in the forthcoming year?

The Hon. P.F. CONLON: Yes, we will do that for you.

Ms CHAPMAN: Thank you.

The Hon. P.F. CONLON: Don't be so cross; there is nothing to be cross about.

Ms CHAPMAN: I said thank you.

The Hon. P.F. CONLON: The cameras have gone.

Ms CHAPMAN: I said thank you. Is that enough, Your Holiness, Your Majesty, anything else you like?

The Hon. P.F. CONLON: It was a bit of an angry thank you, I thought.

Ms CHAPMAN: Thank you, sweet pea. Is that good enough?

The Hon. P.F. CONLON: I think we will go back to the other thank you.

Ms CHAPMAN: Let's not overindulge, for goodness sake! Okay, back to page 138. You are going to be trialling a pedestrian countdown timer, as Mr Hook identified the week after the budget that has savaged his capital program.

The Hon. P.F. CONLON: I have some good news for you; I might sit on it for a while.

Ms CHAPMAN: Great. On this question, though, can I ask—

The Hon. P.F. CONLON: What is your question about trialling the things?

Ms CHAPMAN: In relation to the trialling of the pedestrian countdown timer.

The Hon. P.F. CONLON: I have seen these in different places.

Ms CHAPMAN: Mr Hook, of course, has made some statements on this. What intersections will the timer be trialled at and at what cost?

The Hon. P.F. CONLON: It is two pedestrian crossing at the railway station, and the cost is in the tens of thousands, but we will have to get a more accurate figure for you.

Ms CHAPMAN: Where are they?

The Hon. P.F. CONLON: At the main railway station, there are two intersections there.

Ms CHAPMAN: Just at the railway station?

The Hon. P.F. CONLON: Yes. There are two big, very heavily used pedestrian crossing there. As to Gorge Road, it is on our resealing program.

Ms CHAPMAN: It is?

The Hon. P.F. CONLON: Yes. That will make you happy.

Ms CHAPMAN: I am sure the member for Morialta will be very pleased to hear that.

The Hon. P.F. CONLON: Now you can put out a press release saying what a good man I am.

Ms CHAPMAN: Well, I would not go that far.

The Hon. P.F. CONLON: No, I did not think you would.

Ms CHAPMAN: But I know that he will be appreciative.

The Hon. P.F. CONLON: He is a nice fellow; I quite like him.

Ms CHAPMAN: Going back to safer roads, I refer to page 137. There has been a significant transfer of safety upgrades, both for level crossings and blackspot programs and so on, which are identified in the financial commentary as being a change of classification in the expenditure as a capital works to an operating budget. Can you explain why that is the case? A number of these projects do have to go through Public Works if they are over a certain value, but is there some explanation as to why this should now be an operating budget and not a capital works?

The Hon. P.F. CONLON: Probably an accountant somewhere is responsible for it. It is council roads. Whenever we provide money to councils to upgrade, it is not capital; it becomes operating. These things about capital operating are decided by accountants, not by builders.

Ms CHAPMAN: I suppose that begs the question of why it was in the wrong column last year.

Mr PALM: That is an annual process.

Ms CHAPMAN: But we still have a number of annual programs in the capital works list.

The Hon. P.F. CONLON: I am not quite sure I understand the answer, either. It is because that, at the start of each year, money goes in there. Some of the money will then go out to state roads and some will go out to council roads, but it is not determined at the start of the year which roads it will be. So, then you go back at the end of the year and recalculate it as either operating or a capital on the basis of where it went. If the accountants left us alone, it would not be confusing.

Ms CHAPMAN: Just on another problem with accountants, perhaps, on page 131—this shows in some other portfolios as well so it may be across the board—there is a significant change in the departmental application of the depreciation under a new asset accounting policy, apparently. This has made significant changes in, presumably, how much you can depreciate or the rate at which you can depreciate. I am not sure what it is or why it is being implemented; it may well be something that has come from Treasury. Can you explain what it is and why it has been—

The Hon. P.F. CONLON: As soon as somebody explains it to me, I can.

Ms CHAPMAN: Indeed; I am happy to wait for the experts on that.

The Hon. P.F. CONLON: Do you want to cut out the middle man?

Mr PALM: It is a revaluation process that happens, I think, every three years. Within that revaluation process, depreciation associated with those revalued assets is re-established (if you like), so that is why there will be an increase in the depreciation from one year to the next. That may happen halfway through the year, so it will happen throughout a Mid-Year Budget Review process. Again, that is why it may change from the budget to the estimated result.

Ms CHAPMAN: Yes; but, minister, I will put this through you—

The Hon. P.F. CONLON: I think Andy put the answer before, because they now include the residual value of the road when they do an upgrade.

Ms CHAPMAN: Who recommended that?

The Hon. P.F. CONLON: Who knows?

Ms CHAPMAN: Is it required by the commonwealth and is it consistent with the commonwealth?

Mr MILAZZO: Our asset valuations are done under accounting policies and they change from time to time; we asses them accordingly. What we have done recently is actually include the residual value of the roads when we come to depreciate them, so they are depreciated to a certain level of value before they are then rehabbed, so part of that process is including the residual value of the roads before they are rehabbed.

Ms CHAPMAN: Is this new way of accounting for the depreciable value of these assets consistent with what the commonwealth does?

The Hon. P.F. CONLON: I assume it is using the same accounting policy.

Mr MILAZZO: The commonwealth are not asset owners in terms of roads so they do not do it—we do it—but it is consistent with standards.

Ms CHAPMAN: Let me ask you this: do you apply the same rule to the roads which the commonwealth takes responsibility for; namely, the major highways?

Mr MILAZZO: The commonwealth does not own any roads. They simply provide funding for a land transport network. They are owned by the state.

Ms CHAPMAN: Let me ask you another way.

Mr MILAZZO: The answer is yes, in that case.

Ms CHAPMAN: You apply the same rule to all the roads irrespective of who provides the funding for them.

Mr MILAZZO: That is correct.

The Hon. P.F. CONLON: For Hansard, this is Martin Palm and that is Martin Small.

Ms CHAPMAN: Yes; we welcome Mr Small. I am sure he will make a valuable contribution to the department as well. Even though he has not had the opportunity to make any direct contribution today, I am sure he gives you wise advice.

The Hon. P.F. CONLON: He has told me a lot of things.

Ms CHAPMAN: I am sure lots of New Zealanders can add to—

The Hon. P.F. CONLON: Can I congratulate Mr Small: he has a citizenship test tomorrow, but that is not the way he said it!

Ms CHAPMAN: He could have come to ours last night; we had a citizenship ceremony yesterday.

Ms SANDERSON: Following on from Vicki's question, is it the same for local government roads?

The Hon. P.F. CONLON: They hold the assets, so I do not know how they account.

Ms SANDERSON: I just thought if it was a standard accounting principle then it should be standard for everybody.

The Hon. P.F. CONLON: I would have thought that local government, properly informed, would use the same accounting standards because they are pretty across-the-board; but they are their roads and they account for them according to whatever. We have an auditor-general who goes to the ends of the earth at the end of the financial year and one of the things that an auditor-general will always look at is whether you have used the appropriate accounting standard. I do not know what happens for the audit in local government and whether they do that.

Ms SANDERSON: It obviously changed recently if you have changed your procedure.

The Hon. P.F. CONLON: They are always changing them.

Ms SANDERSON: Yes; so it changes for everyone. I refer to Budget Paper 4, Volume 3, page 164 which states that $415 million of income came from fees, fines and penalties. That is roughly $19.5 million up from the budget and $55.5 million up from last year. Can you give me a more detailed breakdown as to what areas contributed to this budget being above the expected revenue? Where were the major increases?

The Hon. P.F. CONLON: You are going to have to ask the Minister for Road Safety. I do not have any information about that. They do not give any of it to me.

The CHAIR: Any more questions on this line?

Ms CHAPMAN: No, sir. Thank you very much and thank you to the minister and his advisers in that area.

The CHAIR: Thank you, minister, and I thank your advisers. You have finished for the day.

Membership:

Mr Gardner substituted for Mr Whetstone.

Witness:

Ms Fox, Minister for Transport Services.

Departmental Advisers:

Mr R. Hook, Chief Executive, Department of Planning, Transport and Infrastructure.

Mr P. Doggett, Executive Director, Public Transport Services, Department of Planning, Transport and Infrastructure.

Ms J. Formston, Manager, Finance, Department of Planning, Transport and Infrastructure.

Mr B. Cagialis, Chief Finance Officer, Department of Planning, Transport and Infrastructure.

Mr P. Sparapani, Senior Consultant, Department of Planning, Transport and Infrastructure.

The CHAIR: I will quickly go through some of the protocol for the new minister who has joined us. The estimate committees are a relatively informal procedure. The committee will determine an approximate time for consideration, and I think that that has been done. Changes to committee membership will be notified as they occur, and that has been done. If the minister undertakes to supply information at a later date, it must be submitted to the committee secretary by no later than Friday 21 September.

There will be a flexible approach for asking questions, based on about three questions per member. Questions must be based on lines of expenditure in the budget papers and must be identifiable or referenced. All questions are to be directed to the minister, and not to the minister's advisers. The minister may refer questions to advisers for a response. Does the minister wish to make a brief opening statement?

The Hon. C.C. FOX: Given that we only have approximately 29 minutes, I think not.

The CHAIR: Okay, that sounds good.

Ms CHAPMAN: Minister, I refer to Budget Paper 4, Volume 3, page 162. Perhaps before I do, your predecessor in the committee, minister Conlon, has taken on notice the omnibus questions, which I am sure you will be familiar with from previous committees of this nature. Unless you want me to reread them for your portfolio.

The Hon. C.C. FOX: No, let us make use of the time we have.

Ms CHAPMAN: Thank you, and we will look forward to receiving the answers in relation to your areas of portfolio responsibility. At page 162, minister, you outline, under Passenger Services, your highlights. At this stage I would have to say that I can only express my condolences to you that your No.1 highlight for the 2011-12 year has been the implementation of new contracts with bus operators for the provision of services here in Adelaide. How can this be justified as a highlight when, in the first three months alone, 7,500 complaints were received, the number of boardings decreased by over two million this financial year, and the timetables for services have now been rewritten as they were unworkable?

The Hon. C.C. FOX: First, thank you, member for Bragg, for your condolences: I do not think anyone has died, so they may be slightly misplaced. In relation to what we are doing in terms of these bus contracts, you would be well aware, member for Bragg, that the bus contracts, all of them, began in July or October. There have been some issues with them. That is not a mystery, that is not anything new to anyone in this room. Yes, people have been fined, and rightly so. I do not walk away from that whatsoever. In terms of your mention—

Ms CHAPMAN: How can it be a highlight?

The Hon. C.C. FOX: Would you like me to finish speaking, or do you just want to keep going?

The CHAIR: I am sure she wants you to finish—

Ms CHAPMAN: I would love the answer, that is all.

The CHAIR: — and she will not interrupt again.

The Hon. C.C. FOX: Well, of course the issue is that, having been interrupted, I may lose track of where I am. I believe you mentioned 7,000 complaints. We have 1,400 calls per day to the Adelaide Metro line—1,400 calls, member for Bragg. Now, 70 per cent of those calls are actually for information; 30 per cent are complaints and/or suggestions. I understand that you want to concentrate on the negative—I know that is what you are here to do today—but 70 per cent of those 1,400 calls per day are not complaints, so that is 70 per cent of people contacting us for information rather than complaints.

Ms CHAPMAN: So you have 350 a day complaining; is that right?

The Hon. C.C. FOX: I choose to concentrate on the 70 per cent.

Ms CHAPMAN: Well, in any event, it is a highlight—well done! Of this number of complaints you have had, the 30 per cent rate, in the whole 12 months how many complaints have you received?

The Hon. C.C. FOX: Sorry, are you referring to calls to the information line?

Ms CHAPMAN: Well, the 7,500 in the first three months.

The Hon. C.C. FOX: The one that I just mentioned—I just mentioned the 1,400 calls per day. I am assuming that your 7,000 figure is based entirely on that number?

Ms CHAPMAN: No, that 7,500 is what was FOI'd from your office—

The Hon. C.C. FOX: Then you need to make that clear.

Ms CHAPMAN: —that were complaints for the last three months of the quarter, October to December last year.

The Hon. C.C. FOX: Forgive me, member for Bragg, if I cannot see into your mind—you did not make that clear.

Ms CHAPMAN: It was on the front page of The Advertiser.

The Hon. C.C. FOX: And I believe there was actually an issue with that story on the front page of The Advertiser—

Ms CHAPMAN: There may have been, but on your documents—

The Hon. C.C. FOX: —and if we wish to revisit that, I am quite happy to do so. I believe there was a reporter who may have indeed erroneously added a zero, and that is an internal matter—

Ms CHAPMAN: So you say it is only 750.

The Hon. C.C. FOX: —which The Advertiser has dealt with. Should you choose to ask questions based on reports in a newspaper, so be it. I prefer, myself, to examine the budget lines.

Ms CHAPMAN: Of the complaints, how many have you received for the whole year?

The Hon. C.C. FOX: I have just informed you that, on average, we receive 1,400 calls per day; 70 per cent of those are not complaints, 30 per cent of them are complaints and/or suggestions.

Ms CHAPMAN: Of the complaints, can you tell me how many you have received in the whole year?

The Hon. C.C. FOX: I have just given you the maths—

Ms CHAPMAN: Given me the formula?

The Hon. C.C. FOX: I have just given you the maths based on that, so I am sure you can work that out.

Ms CHAPMAN: I can assume then that that percentage, on those calculations, is the total number of complaints you have received. Is that what you are telling us?

The Hon. C.C. FOX: I will just refer that to Mr Hook.

Mr HOOK: It would be around about 400 complaints or suggestions a day. Multiply it by 360 and you have the rough order of people who are commenting on services or complaining about services, but the vast majority, as the minister has already said, are people who are asking for information.

Ms CHAPMAN: That is why I asked the question about complaints. If, minister, the commenting on services, either adversely or indicating that there needs to be some improvement, is not taken as a complaint but as a comment, I am happy for that to be in the category, but I just want to know if those who have contacted you, for the whole year, with advice for improvement and complaint about an existing service are the 400 a day.

The Hon. C.C. FOX: That would be approximately 400 a day, as Mr Hook said.

Ms CHAPMAN: Thank you. Minister, we are at page 161 now under the portfolio. This is a summary of all the passenger service expense and income. For the total payment to bus contractors, under expenses, can you identify what the total payment was to the bus contractors for the provision of Adelaide Metro services in 2010-11, 2011-12 and will be paid in 2012-13?

The Hon. C.C. FOX: I will refer that question to Ms Formston.

Ms FORMSTON: The bus contracts were $161 million in 2010-11, $167 million in 2011-12 and are budgeted for $171 million in 2012-13. The 2011-12 year is an estimated result.

Ms CHAPMAN: Minister, under the 2010-11 year, when we were under the old contracts, that is $10 million less than what we are paying out for this forthcoming year. During the course of the briefings on the new contracts, we were advised by your chief executive that there was a saving on the new contracts of $10 million to $20 million a year. Can you explain then why it is $10 million more now?

The Hon. C.C. FOX: Given that you were briefed by Mr Hook, I will hand over to Mr Hook for that.

Mr HOOK: Every year we do bus contracts. There is an escalation factor which is worked into the contracts. In addition, over the last few years, we have been progressively adding services as we have put more buses into the system. For instance, now Adelaide Metro services are in the Gawler area, so there are additional services in the last year that were not there in the previous year.

Certainly, by going back to the market with the new bus contracts and changing some of the criteria—which we have explained previously—in the contracts, we got prices by going to the market which were significantly less than what we had allowed for in the budget. That is why we go back to the market and why, when we go to the market, we have to deal with the prices that we are given from the companies in a process that has full probity auditing, Treasury involvement and crown law involvement. We got a good outcome. As the minister said, we have to make it work and that is what we are still all focusing our efforts on.

Ms CHAPMAN: Did you want to add anything more?

The Hon. C.C. FOX: Yes, I think it is actually very important, at this point, to add that we are trying our very best. In fact, as far as I am concerned, we are going more than halfway to facilitating the execution of those contracts as they should be. We are introducing the new timetables (as we have talked about in detail), we are introducing the bus priority lanes, we are introducing the GPS—all of those things should help us work with contractors to get the better result and to get the result that South Australians deserve.

It is now up to the contractors to do their bit. I have been in meetings with them quite frequently—as has Mr Hook, as has Mr Doggett, as has Mr Cagialis—to really facilitate an improvement there. No-one on this side of the room, no-one in this room, would begin to imagine that the performance certainly of one particular bus company in one particular area has been anything other than disappointing. We do not walk away from that.

Ms CHAPMAN: But minister, clearly on the figures just given, there is not a $10 million to $20 million saving being paid to the bus contractors under this new contract, is there?

Mr HOOK: I think if you are referring to the price of the bus contracts, we have provision in our work up to the budget process of what we think it might cost. When the contracts are set, we do not get to pocket the money or to work out what to do with it; we lose that money. It goes back to Treasury; it goes back into the Consolidated Account. What you see here is the actual cost reflected in the budget, not what we thought we might have to pay before we went to the market.

Ms CHAPMAN: Except, minister, that these are the amounts according to your financial adviser sitting on your right where the money is paid in those three years—one is a future payment as of a few days' time—which are significantly greater. They are not budgeted amounts other than the forthcoming year; they are actual payments. Just between this year and last year before there was any change in timetabling or any new system to remedy some of the defects, it is $10 million a year more that has been paid to the bus contractors than the previous year.

The Hon. C.C. FOX: Before I hand over to Ms Formston, I do not like giving this answer. I was not involved in the implementation of the previous contracts. The contracts that I currently deal with are the new ones. In terms of comparison, it is true that I am not particularly familiar with the contracts that were running from 2005 onwards, so I might hand over to Ms Formston to better explain that for you, or I can take it as a question on notice and put it to minister Conlon and his staff.

Ms CHAPMAN: It isn't minister Conlon I am asking about. I am really referring to the $10 million to $20 million a year saving that was proposed by your chief executive as being a benefit under the new contracts of saving of cost. In the information that has just been given to us, that has clearly not been the case. It actually cost more. Sure, we have added a service at Gawler, but that is not $10 million a year extra, surely.

The Hon. C.C. FOX: No.

Mr HOOK: I thought I had already answered the question but I will have another go. We have increased the amount in the budget for public transport services on what we pay the bus contractors because we have allowed for escalation and we have increased services. We have made a saving by going back to the market, which you do not see in the budget papers, but had we not gone back to the market and had we not got the new prices we could well have had significantly more costs to run those public transport services than what you see in the budget figures, because that is why we are required to go to the market and test the prices. Had we just simply escalated again a new round of contracts with the previous contractors, we knew we would have been asked for a lot more than we are actually paying. So, there are two separate parts. I thought I had explained that previously. Hopefully, that is understood. More services means we pay more but if we go to the market we are paying less than we could have been paying.

Ms CHAPMAN: What is the combined total cost of changing the bus timetables from 1 July, including the printing, advertising, internal department costs, increased payments to the contractors for the additional services and to lease the buses? I particularly ask you this question, minister, because at the briefing that was ultimately provided to MPs—

The Hon. C.C. FOX: Yes, I believe you were confused in that briefing.

Ms CHAPMAN: We were given two bits of information. One was that the cost of doing the reprint which we had been previously advised would be a $2 million to $3 million exercise was $3 million and that the recurrent extra costs for the bus contractors was $2.6 million a year. Later that day you advised the parliament that the cost of leasing the buses was the difference between the $3 million and $2.6 million a year, therefore—

The Hon. C.C. FOX: I think in that sum of $400,000 it was not just the leasing. I think that was made quite clear in the statement I made. In answer to your question—

Ms CHAPMAN: That is why I am asking you again—because it is not clear.

The Hon. C.C. FOX: In answer to your question, I am surprised it is not clear to you, member for Bragg, because you actually received a very detailed letter in answer to these same questions over a month ago. You have received a letter; you have received a number of briefings, individual briefings; you attended the briefing last week; you have already asked the questions in parliament. The answer does not change, and I am sorry if that upsets you.

Ms CHAPMAN: It does not upset me, I just want to know what is accurate.

The Hon. C.C. FOX: I have a copy of the—

Ms CHAPMAN: I have Mr Hook's letter—it was three months ago.

The Hon. C.C. FOX: I have a copy of the letters which have been sent to you. I understand that the date of your first briefing in relation to that matter was on 16 April. Since that—

Ms CHAPMAN: Correct.

The Hon. C.C. FOX: Good. I am glad the member for Bragg acknowledges that.

Ms CHAPMAN: You have done the timetabling since.

The Hon. C.C. FOX: I am sorry, member for Bragg, but I do not know which part of this you have not understood.

Ms CHAPMAN: How much?

The Hon. C.C. FOX: Would you like me to read out the letter that you received?

Ms CHAPMAN: I have that letter, but that is two months—

The Hon. C.C. FOX: You do have the letter?

Ms CHAPMAN: Minister, that is two months before you changed the timetables. I am now asking: how much did it cost?

The Hon. C.C. FOX: And the price, member for Bragg, remains the same.

Ms CHAPMAN: What is the breakdown?

The Hon. C.C. FOX: Mr Chairman, in answer to this question, I am quite happy to read out the contents of the letter that was sent to the member for Bragg. I think, with all due respect, that the member for Bragg wilfully chooses to ignore the information that she has been given by the Chief Executive in writing, by departmental staff and, indeed, by myself. The member for Bragg asks for a breakdown: if we are going to look at that, I am more than happy to go through page 2 of the letter that was sent to her in relation to this very question. Timetable costs, this is page 2 of the letter that the member for Bragg received from the Chief Executive—let that be extremely clear. It states:

Timetable costs

The cost of each service change depends on the amount of services required to be changed.

Based on $10,000 per timetable plus an additional $1000 - $2000 for communications, the timetable change for July could be approximately $900,000 - $1 million. The cost of new timetables, whenever undertaken is allowed for in the Department for Transport, Energy and Infrastructure's budget and additional money is not being sought.

At the bottom of this letter, in the final paragraph (perhaps you did not get to that one), it states:

In addition to these costs, timetable changes will result in adjustments to contract payments to account—

Mr Gardner interjecting:

Ms CHAPMAN: Two months old, I know. We just want to know, minister.

The Hon. C.C. FOX: I am sorry, perhaps the member for Morialta—

Ms CHAPMAN: You have given us the whole range—

The CHAIR: Order! The minister has the floor.

The Hon. C.C. FOX: Perhaps the member for Morialta can ask his question after I have—

Ms CHAPMAN: Was it $9,000—

The CHAIR: Member for Bragg, we are running out of time; it is your time.

The Hon. C.C. FOX: I am still responding to the member for Bragg. The member for Bragg has asked a question—

The CHAIR: You are in order, minister.

The Hon. C.C. FOX: She has indeed asked this question some seven times, possibly more; she has received the same answer every time. This is her time in these estimates. This is the time for the opposition to shine.

Ms CHAPMAN: You could have forgiven me.

The Hon. C.C. FOX: If the member for Bragg wishes to waste her time in this way—

Ms CHAPMAN: Mr Chairman, I have asked a simple question.

The Hon. C.C. FOX: —so she may.

The CHAIR: Order!

Ms CHAPMAN: I know what is in the letter; it is two months old.

The Hon. C.C. FOX: Which has an answer.

Ms CHAPMAN: I now want to know how much it is—

The Hon. C.C. FOX: Which has an answer.

Ms CHAPMAN: —not what the range is.

The Hon. C.C. FOX: Which has an answer.

Ms CHAPMAN: How much?

The CHAIR: Order! The minister has the floor.

The Hon. C.C. FOX: Which has an answer, which, as I said previously, the member for Bragg wilfully chooses to ignore.

Ms CHAPMAN: How much?

The Hon. C.C. FOX: She cannot continue to make up—

Ms CHAPMAN: How much?

The Hon. C.C. FOX: She cannot continue to make up figures—

Ms CHAPMAN: Just give us a figure.

The Hon. C.C. FOX: Mr Chairman, I do not think the member for Bragg can read. I will carry on reading from the letter she has received.

The CHAIR: Please continue.

Ms CHAPMAN: Mr Chairman, please direct the minister to—

The CHAIR: She is answering the question.

Ms CHAPMAN: She is referring to a letter which is two months old, before they had even changed the timetables, giving an estimate about what could happen. I am simply asking: now that it has happened, can you tell us how much? It is pretty simple.

The Hon. C.C. FOX: Yes, which is why I do not understand why the member for Bragg does not understand, but I will go back to the information that she has received from briefings.

Ms CHAPMAN: It gives me about which bucket or which letter, I just want to know how much—how much is in the budget?

The Hon. C.C. FOX: I shall tell you again, as the Chief Executive has, as departmental people have, as I have—

Ms CHAPMAN: They are shaking their heads, Chloe.

The CHAIR: Order!

Ms CHAPMAN: They are shaking their heads.

The CHAIR: Order! The member continues to interrupt the minister and time—

Ms CHAPMAN: We just want to know the answer.

The Hon. C.C. FOX: Should the member for Bragg wish to be a little bit quiet, I will attempt to go through the answers she has already been given.

Ms CHAPMAN: I just want one figure, that's all; one figure.

The CHAIR: Order! Let the minister continue.

The Hon. C.C. FOX: The one figure, member for Bragg, is in the answer, which you will not let me give. It is pretty tricky when you will not let me give the answer to your question.

Ms CHAPMAN: I am waiting. How many millions?

The CHAIR: Keep going, minister.

The Hon. C.C. FOX: Thank you. In addition to these costs, timetable changes will result in adjustments to contract payments to account for the longer running times. The adjustments envisaged in July 2012 could cost to the order of $3 million, as previously advised.

Ms CHAPMAN: And is that the cost?

The CHAIR: Order!

The Hon. C.C. FOX: I am going to hand over to Mr Hook at this point—

Ms CHAPMAN: Hooray!

The Hon. C.C. FOX: —because perhaps the member for Bragg will have improved hearing and comprehension.

Ms CHAPMAN: At least we will get a straight answer.

The CHAIR: Order! The minister has the floor.

Ms CHAPMAN: Come on, Rod, give us the answer, will you?

The CHAIR: Order!

The Hon. C.C. FOX: I think you may find it is a very similar answer, given that the letter came from him to you, but by all means.

Mr HOOK: On 1 May I wrote a letter saying the additional cost outside of us printing timetables, which we do internally, would be $3 million. I have advice now that the actual cost negotiated for the number of revenue hours is $2.592 million. We have some additional leasing costs which will bring that up towards $3 million, so the $3 million I predicted back on 1 May looks pretty good as the cost for the additional time allowed for in services, plus our in-house costs for timetable changes, which I said two months ago would be somewhere around $900,000 to $1 million. They are in that range. I think that is sufficient response.

Ms CHAPMAN: Thank you. Now let us move to 2012-13.

The Hon. C.C. FOX: Just in addition to what Mr Hook was saying, I would like to point out that that $3 million figure is a figure that has been given to the member for Bragg on more occasions than I can remember. It is a figure given to her by Mr Hook, it is a figure that should be made very clear in media reporting of this matter, because certain members of parliament on the opposition side have gone to the public, have gone to the media, with a completely separate and indeed inflated figure. That $3 million cost is one that has been put to the member for Bragg on a number of occasions. Whether she chooses to accept it or not is entirely, of course, up to her and her colleagues.

Ms CHAPMAN: Now that we are going to have a quarterly reassessment of the timetables, is there going to be any change, or will it continue to be $3 million a year extra?

The Hon. C.C. FOX: No.

Ms CHAPMAN: So the quarterly changes are not going to make any difference; is that correct?

The Hon. C.C. FOX: To the cost?

Ms CHAPMAN: To the cost.

The Hon. C.C. FOX: I think that it should be very clear this $3 million cost that we were talking about, this timetable change which is occurring on 1 July, was significant; the process was significant. We are looking at one of the biggest timetable changes in a generation, in 20 to 25 years. That is what I am advised. If you like, that particular shift is going to cost more than ongoing or subsequent changes, so my simple answer to your question would be no.

Ms CHAPMAN: Because, you see, one of the reasons, minister that you delayed agreeing to do the timetable changes—remember?

The Hon. C.C. FOX: Member for Bragg, I did not agree to delay. I would take issue with those particular words.

Ms CHAPMAN: Can I put this to you?

The Hon. C.C. FOX: You may.

Ms CHAPMAN: The reason why you did not proceed with a timetable change prior to 1 July, as advised by Mr Hook to us in briefings, was that it would be too expensive, that we would have to do it all again, and I am now advised in the briefings that you are going to be doing it quarterly. How has that changed?

The Hon. C.C. FOX: Let me explain to you. What we had, from October last year onwards, was—

Ms CHAPMAN: A disaster; yes, we know that.

The CHAIR: Order! Let the minister answer.

The Hon. C.C. FOX: What we had from October last year onwards was a set of circumstances which, if you like, did create the perfect storm, and that had to be examined very carefully. We had to go over input from new contractors, from old contractors and from the internal audits done by the department. It was an enormous amount of information. That is an amount of information that we have now collected and which we are building on. The initial collection of that information was not, as the member for Bragg would like us to suppose, something that we could have done overnight. I referred previously to a generational change. I referred previously to one of the largest changes we have ever had. That does not happen overnight. You do not want to do that sort of thing in a slipshod manner.

The member for Bragg has called, time and time again, for there to be changes to this timetable system. If we were to do anything, politically or departmentally, other than thoroughly and to the best of our ability, the member for Bragg and, indeed, her colleagues would have been the first people to jump up and down to say that not enough due diligence had taken place, that not enough research had taken place, etc.

We have worked very closely with the companies, and we have worked very closely with the internal auditors. Indeed, independent auditors have been employed to make sure that these particular changes will be as effective as possible. If you like, this is the larger change, the change upon which we will be basing the quarterly changes you referred to. Those quarterly changes will, of course, not be as massive as these July changes, and that, member for Bragg, is why they will cost less.

Ms CHAPMAN: My question is in relation to the Metrocard, which is at page 37. This is a new system which has increased from $30 million, under the Labor Party 2010 state election, to $42 million in the budget last year, and it is now $45.7 million in the current budget. Has anything changed in relation to the scope of this service or promised in this ticket system from 2010 until now, or have the costs just kept creeping up?

The Hon. C.C. FOX: That $30 million you referred to as the contract cost remains the contract cost, I am advised. Actually, I am going to hand over to Mr Hook, and he can tell you what he has just told me.

Mr HOOK: I think the figure you referred to is the cost to the external contractor on the acquisition of the product we have bought from France. We have additional costs in our budget for running the whole program, which includes the allocation of our staff against the capital program and the money we spend to put the program together. We have had a budget of $42 million but against an external contract price of somewhere around $30 million, which was the figure publicly announced.

We have increased that from $42 million to $45 million because we now have new rolling stock coming in during the course of next year. We have the latest delivery of the trams, and we have the new railcars coming in, and we continue to buy additional buses. We have allowed in the acquisition to have them prepared to accommodate our ticketing system, but we have moved some money out of the acquisition into the ticketing system budget to ensure that the new ticketing system is delivered within the new rolling stock. So, the difference between the $42 million and the $45 million is just moving the money we have from one line to another, and we have put it with the ticketing system as we roll it out in the additional fleet we are acquiring.

Ms CHAPMAN: Minister, members of your department have provided us with a briefing on the new scheme, and it seems that the scheme you have bought for us is one which is a tag-on scheme and not a tag-on/tag-off scheme, which is the more expensive version—

The Hon. C.C. FOX: Are you referring to the myki version?

Ms CHAPMAN: —which currently applies in Brisbane, Perth, Melbourne and most likely Sydney.

The Hon. C.C. FOX: You are referring to the myki system. That has not been successful. I think our Victorian cousins would tell us that also.

Ms CHAPMAN: Can I put this to you: every other state has it, and it is a much more expensive one. So, your system is the cheaper option. But what I want to ask you about is, as a result of buying the cheaper option and not having a tag-off, under the project, it is our understanding that the government will then be limited to charging passengers the same ticket price regardless of whether they catch the train from Seaford to the city or from Clarence Park to the city. That is, you do not have available to you what we call a 'tiered' ticket system, which is available in the other states. That may be one of the casualties of signing up to the cheap option, but I would like to know whether it is the case that there will be the same charge for the passenger who is travelling from Seaford into the city as for the person who is travelling from Clarence Park?

The Hon. C.C. FOX: I thank the member for her question. I would like to address her assertion, her labelling of this system as the 'cheap option'. I suspect that if she were on the other side of this conversation, her definition of it would not be the cheapest option, it would be the most financially efficient option.

Ms CHAPMAN: It may be.

The Hon. C.C. FOX: However, that is splitting hairs. What we are doing here is taking advantage of proven technology. If you look, for example, to what occurred in Melbourne and to the infamous myki system that Ms Kosky enjoyed so very much, the shortfalls in undertaking investment in that system that was not proven technology were significant, not just financially (the cost that blew out there was phenomenal) but also in terms of commuters. The system we are buying is already in operation all around the world, and it seems to be working well. The experience we have had thus far has been extremely positive. In terms of your, if you like—

Ms CHAPMAN: Question?

The Hon. C.C. FOX: —verballing, I am referring—

Ms CHAPMAN: The question is: will the person from Seaford be paying the same price as the person from Clarence Park?

The CHAIR: This will be the last question. We are running over time.

The Hon. C.C. FOX: I am referring to your question, member for Bragg—

Ms CHAPMAN: And will they?

The Hon. C.C. FOX: And that was the issue. The first thing you raised was this concept of the cheap option. This was a sentence in your own question, and I am addressing it.

Ms CHAPMAN: Whether you think it is cheap or—

The CHAIR: Can I interrupt the member for Bragg and remind people of the time. We are now well over five minutes over time, so we will make this the last question.

Ms CHAPMAN: I think the minister is endeavouring to answer it, Mr Chairman.

The CHAIR: I am sure she is.

Ms CHAPMAN: We are talking about the same model. All we are asking is: will the person at Seaford have to pay the same ticket price under this scheme, good or bad, from Seaford to the city as from Clarence Park to the city? That is all I want to know.

The Hon. C.C. FOX: Yes.

Ms CHAPMAN: The answer is yes?

The Hon. C.C. FOX: Yes—I just said yes.

Ms CHAPMAN: Yes.

The CHAIR: Thank you, minister. I thank your advisers and members of the committee. There being no further questions, I now declare that the examination of the proposed payments is adjourned until Thursday 21 June.

[Sitting suspended from 12:52 to 13:45]