Department of Planning, Transport and Infrastructure, $501,908,000

Administered Items for the Department of Planning, Transport and Infrastructure, $10,022,000

Membership:

Ms Chapman substituted for Mr Marshall.

Mr Wingard substituted for Mr Spiers.

Mr Knoll substituted for Mr Williams.

Minister:

Hon. S.C. Mullighan, Minister for Transport and Infrastructure, Minister Assisting the Minister for Planning, Minister Assisting the Minister for Housing and Urban Development.

Departmental Advisers:

Mr K. O'Callaghan, Executive Director, Land Services Group, Department of Planning, Transport and Infrastructure.

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

Mr M. Elford, Acting Group Executive Director, Strategic Transport and Infrastructure Planning, Department of Planning, Transport and Infrastructure.

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

Mr L. Di Lernia, Deputy Chief Executive, Public Transport Services, Department of Planning, Transport and Infrastructure.

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

Ms J. Tepohe, Director, Finance, Department of Planning, Transport and Infrastructure.

The CHAIR: I declare the proposed payments open for examination and I refer members to Agency Statements, Volume 3. There is an agreed timetable split up into four sections and I just want to check that everyone is happy with that timetable. I call on the Minister for Transport to make a statement if he so wishes.

The Hon. S.C. MULLIGHAN: No statement, thank you, Chair.

The CHAIR: Thank you minister. Does the member for Bragg have an opening statement?

Ms CHAPMAN: No, sir, but I would like to confirm that I am pleased to be attending here today as the shadow minister for infrastructure with my learned colleagues and other members of the committee, including the member for Mitchell, who has been appointed the opposition spokesperson for transport matters, and ably contributed on our side by Mr Stephan Knoll, the new member for Schubert.

The CHAIR: Do you have a question?

Ms CHAPMAN: In lieu of an opening statement I am happy to move straight to the omnibus questions of which I have advised the minister.

1. Will the minister provide a detailed breakdown of expenditure on consultants and contractors above $10,000 in 2013-14 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 2013-14, provide the number of public servants broken down into heads and FTEs that are (1) tenured and (2) on contract and, for each category, provide a breakdown of the number of (1) executives and (2) non-executives.

3. In the financial year 2013-14, for all departments and agencies reporting to the minister, what underspending on projects and programs (1) was and (2) was not approved by cabinet for carryover expenditure in 2014-15?

4. Between 30 June 2013 and 30 June 2014, 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?

5. For each year of the forward estimates, provide the name and budget of all grant programs administered by all departments and agencies reporting to the minister and, for 2013-14, 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 grants and whether the grant was subject to a grant agreement as required by Treasurer's Instruction 15.

6. For each department or agency reporting to the minister, what is the budget for targeted voluntary separation packages for the financial years 2014-15, 2015-16, 2016-17 and 2017-18?

7. What is the title and total employment cost of each individual staff member in the minister's office as at 30 June 2014, including all departmental employees seconded to ministerial offices and ministerial liaison officers?

Chairman, I indicate I am happy for the minister to take that on notice and otherwise indicate to the committee that the volumes I will be referring to today are the Agency Statements, Budget Paper 4, Volume 3, as you indicated, and also Budget Paper 5 and Budget Paper 6.

I start with Budget Paper 4, Volume 3, page 105, the area of commercial building leases managed. The total area of building leases managed is expected to increase by 33,000 square metres this year. Does that include the State Administration Centre and education department building, which is expected to be sold and leased back? If not, what building space does it represent?

The Hon. S.C. MULLIGHAN: My advice is that we are expecting the increase in leasable area because of the government sale program but, principally, because of the Netley property. Netley Commercial Park, I understand is its correct name.

Ms CHAPMAN: Does that mean that the state admin centre and education department building are not budgeted to be sold this year?

The Hon. S.C. MULLIGHAN: I do not have the answer to that. I understand the sale process is being managed by the Department of Treasury and Finance.

Ms CHAPMAN: But, in any event, it is not in your budget for the extra 33,000 square metres?

The Hon. S.C. MULLIGHAN: No, not at this point, I am advised.

Ms CHAPMAN: Do you have any knowledge of the leaseback arrangements that are proposed for the state admin centre and education department building that will be managed by your department?

The Hon. S.C. MULLIGHAN: I will have to check with the Department of Treasury and Finance. Indeed, it might be a question better put to the Treasurer or the Department of Treasury and Finance if they are managing the sale process and the terms under which that will be managed.

Ms CHAPMAN: Your department is in charge of the area of commercial buildings for leases that are managed so, even though the Treasury has indicated that it will attend to the sale of the property, your department will be in charge of the leaseback of it for agency purposes.

The Hon. S.C. MULLIGHAN: Yes, that is correct, but the terms of those leases, I would imagine, would be determined at the time of sale.

Ms CHAPMAN: What about offering the terms for the purposes of someone interested in the sale, as to what the lease payment will be? Just as most commercial buildings are advertised—good government tenant, 12 years plus five years plus five years, I think I read in the paper yesterday, for the police building, for example. That would be known to the government.

The Hon. S.C. MULLIGHAN: It probably would be known to the government, but my rudimentary understanding of these sale processes is that these are negotiated at the time of sale and, as I have said, these are being handled by the Department of Treasury and Finance.

Ms CHAPMAN: Is it your understanding that, if and when sold and if and when leased back, you will be in charge of it?

The Hon. S.C. MULLIGHAN: The department will have management of the leases, is my advice.

Ms CHAPMAN: Will other government agencies, to the best of your knowledge, be shifted into the state admin centre to increase the area of secure lease?

The Hon. S.C. MULLIGHAN: I am not aware at this point in time.

Ms CHAPMAN: Have you received any briefings on this from your department in respect of the commercial building leases managed area?

The Hon. S.C. MULLIGHAN: I would have to check that, but nothing comes to mind immediately.

Ms CHAPMAN: What is the grade of office accommodation in the state admin centre and education building?

The Hon. S.C. MULLIGHAN: I would have to take that on notice.

Ms CHAPMAN: Is there anyone with you today who is in charge of the commercial building leases management?

The Hon. S.C. MULLIGHAN: Yes, I have Judith Carr sitting next to me who manages that sort of leased accommodation. In reference to those two buildings, I reiterate my earlier advice to the committee that that will be subject to a sale process, which I understand is being managed by the Department of Treasury and Finance.

Ms CHAPMAN: But, as indicated, your department is going to be assuming responsibility for it under the leaseback arrangement. Are you able to inquire as to what the standard is of the office accommodation—the grade, I think they call it—three stars, five stars, whatever it is?

The Hon. S.C. MULLIGHAN: Presumably, but I am not sure at what point in time that would be possible.

Ms CHAPMAN: I am asking you now what it is.

The Hon. S.C. MULLIGHAN: Yes, we could inquire now, is my advice, but we do not have the information at hand.

Ms CHAPMAN: Take it on notice?

The Hon. S.C. MULLIGHAN: If, indeed, that is an area for which I am responsible, yes.

Ms CHAPMAN: The lease costs, then: you are not familiar with any of the arrangements for any other agency within government that is proposed to be moved into either of these two buildings?

The Hon. S.C. MULLIGHAN: There is a sequential process that is undertaken with these things. There is a sale process which, as I have indicated, as far as I understand it, is to be undertaken by the Department of Treasury and Finance. The terms of that sale process—I presume, but I cannot absolutely say at this point in time—would include what net lettable area the government would be interested in taking for particular terms of a lease and then it would be a matter for government to determine which departments would be located in those buildings. But, as I said, given the stage that that sale process is at, we do not have any of that information at this point in time.

Ms CHAPMAN: The new courts precinct project, which is a PPP of the government for the development of superior courts and some consolidation of legal agencies in South Australia, has been announced by the government and is currently in the design process. The Courts Administration Authority has been largely involved in the development of that project to date, but has the government office accommodation council been consulted on this new project?

The Hon. S.C. MULLIGHAN: Perhaps if I could begin by saying that it is my understanding that that project would not normally be considered a PPP. My understanding of the project is that the government has gone out to market to procure a private sector builder or developer to construct a building in which the government will lease an amount of accommodation. That process is still underway. I understand we are still out to market with that. As you can imagine, and given that the government has announced that it is a courts facility, yes, of course, the Courts Administration Authority, justice agencies and the Attorney-General's Department have a keen interest in that, but as for how it is being discussed in other fora throughout government, I cannot comment at this point in time.

Ms CHAPMAN: That is why I am asking whether your government office accommodation council which is in your department and which will be ultimately responsible for the management of agencies that are accommodated within this other than the courts—

The Hon. S.C. MULLIGHAN: I think the department will be responsible for managing it. I am not sure whether the government accommodation committee will be responsible for managing it.

Ms CHAPMAN: My question, though, was: has the government office accommodation council been consulted on this new project?

The Hon. S.C. MULLIGHAN: Not as yet. I understand it is too early in the process for those sorts of consultations to occur.

Ms CHAPMAN: Has your department been consulted at all in respect of the courts proposal and in particular as to what leases other agencies of the government such as the Crown Solicitor's Office, the DPP and the Attorney-General's office, might have to run on the accommodation that they currently have? Where their accommodation is leased and under the management of that division in your department, have they been consulted at all?

The Hon. S.C. MULLIGHAN: I am sorry—was the question whether my department is being consulted?

Ms CHAPMAN: Yes.

The Hon. S.C. MULLIGHAN: Yes, we have a close involvement in that project, I understand.

Ms CHAPMAN: Have you provided information to the Courts Administration Authority in relation to the current leasing arrangements of the other justice agencies?

The Hon. S.C. MULLIGHAN: I have not, but the department may well have.

Ms CHAPMAN: Are you able to inquire as to whether they have?

The Hon. S.C. MULLIGHAN: I am informed that yes, we have.

Ms CHAPMAN: Do you have a list of the justice agencies that are under consideration for a tenancy in the new courts precinct facility?

The Hon. S.C. MULLIGHAN: I do not have that list with me, but I understand there is a list of agencies.

Ms CHAPMAN: Will you make that available to the committee?

The Hon. S.C. MULLIGHAN: If, at the appropriate time, I can, then, yes, I will.

Ms CHAPMAN: With the list of agencies, can you provide the terms of their current leases in their current premises? I do not need the detail of rental, but just when they are to expire.

The Hon. S.C. MULLIGHAN: I will need to check that, deputy leader, because given that we are out to market, it will involve a commercial negotiation with a proponent to construct the building and enter into a leasing arrangement with government. I would need to check and do some careful thinking about what it is appropriate to publicly release.

Ms CHAPMAN: That is why I say, I am not asking for the lease payments. I am simply asking for the expiry dates of the current leases of each of those agencies.

The Hon. S.C. MULLIGHAN: In so far that such information can be provided without revealing or compromising the government's commercial position, then I am happy to look into that.

Ms CHAPMAN: I will note that. Has a direction been issued by cabinet to look at office sites outside the CBD for agencies that have leases expiring during the forward estimates?

The Hon. S.C. MULLIGHAN: I could not possibly reveal what has been the subject of cabinet discussions or directions.

Ms CHAPMAN: Has your department received any instruction at all from anyone in respect of looking at lease opportunities outside of the CBD?

The Hon. S.C. MULLIGHAN: Just generally?

Ms CHAPMAN: Yes.

The Hon. S.C. MULLIGHAN: I would imagine that the government is continually looking at lease opportunities across the metropolitan and, indeed, statewide area for all sorts of purposes.

Ms CHAPMAN: As you would know minister, the government has already announced their intention to look at and the relocation of certain agencies to Port Adelaide, for example, to help them with the renewal of their community. I am sure it will be interesting to you given that you represent areas close to that. Have there been any office sites considered in the Port Adelaide region, for example?

The Hon. S.C. MULLIGHAN: I think your previous question was 'Have we considered further sites for leases beyond—

Ms CHAPMAN: Outside the CBD.

The Hon. S.C. MULLIGHAN: —outside the CBD?' and your follow-up question was 'Given we are considering lease opportunities down in Port Adelaide', so I think one follows the other fairly neatly, does it not?

Ms CHAPMAN: Have you found any?

The Hon. S.C. MULLIGHAN: Yes, Port Adelaide.

Ms CHAPMAN: At Port Adelaide, yes. What agencies are proposed to be relocated there?

The Hon. S.C. MULLIGHAN: I would have to take that on notice.

Ms CHAPMAN: Any idea?

The Hon. S.C. MULLIGHAN: They would be government agencies.

Ms CHAPMAN: Any in your electorate?

The Hon. S.C. MULLIGHAN: Any government agencies in my electorate? I cannot think off the top of my head if there is a government agency in Lee. There may be shopfronts, but I would have to give that—

Ms CHAPMAN: No sites that have been identified for the purpose of relocating agencies?

The Hon. S.C. MULLIGHAN: Port Adelaide is not in my electorate.

Ms CHAPMAN: I understand that, but you are next door.

The Hon. S.C. MULLIGHAN: Yes, Lee is adjacent to Port Adelaide, but not in Port Adelaide, so if we are considering sites in Port Adelaide that might not achieve the aim of what the government is trying to achieve in Port Adelaide.

Ms CHAPMAN: Anyway, to your knowledge there are not any that you know of?

The Hon. S.C. MULLIGHAN: Sorry, say that again? There are not any—

Ms CHAPMAN: To your knowledge, in your electorate—

The Hon. S.C. MULLIGHAN: There are not any government agencies?

Ms CHAPMAN: —that have been identified sites for the purpose of relocating government services to?

The Hon. S.C. MULLIGHAN: No, my understanding is that we are out to market to identify an opportunity to move our government staff down into Port Adelaide. Given that my electorate does not cover Port Adelaide, my understanding is that we are not looking at sites out of Port Adelaide.

Ms CHAPMAN: What is the leaseback arrangement for the Netley facility which was sold late last year?

The Hon. S.C. MULLIGHAN: I would have to take that on notice.

Ms CHAPMAN: Is there anyone who is here today who has the details of what the leaseback arrangement is?

The Hon. S.C. MULLIGHAN: I am sure that officials may be generally familiar, but what I am not sure of is whether we are in a position yet to be revealing that information.

Ms CHAPMAN: Can you inquire with the person sitting next to you?

The Hon. S.C. MULLIGHAN: No, she does not have it.

Ms CHAPMAN: Do you agree to take that on notice?

The Hon. S.C. MULLIGHAN: Yes, I will look to see if it is appropriate if we can provide that information.

Ms CHAPMAN: Subject to commercial effect.

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: I understand that, yes, and including in that what is the cost per year of the lease in respect of that facility, if you would take that on notice again subject to there being some commercial infringement. The income from building infrastructure management—this is where your department has responsibility for the leasing out of government assets. It is another division of your area of responsibility, of course. The Auditor-General last year in his annual report at page 2120 and 2121 described the transfer of the ASER site—this is the Adelaide Railway Station, Casino and surrounding precinct—from your department to Renewal SA. Renewal SA say that they took it because they were asked to take it—

The Hon. S.C. MULLIGHAN: Just to save the committee some time, could you point out a budget reference for this question?

Ms CHAPMAN: Budget Paper 4, Volume 3, Sub-program 6.2: Building Infrastructure Operations and Management.

The Hon. S.C. MULLIGHAN: And the reference to the Auditor-General and to the Adelaide Railway Station?

Ms CHAPMAN: You have income and expenses for assets—

The Hon. S.C. MULLIGHAN: Yes, page?

Ms CHAPMAN: —which cover last financial year. My understanding is it was transferred at the beginning of last financial year.

The Hon. S.C. MULLIGHAN: Yes, I am sorry, which page are we looking at?

Ms CHAPMAN: At page 102 is one of the assets owned by the government which your department has transferred to Renewal SA.

The Hon. S.C. MULLIGHAN: Yes, it is here on page 103.

Ms CHAPMAN: The property that was transferred is referenced at $81.8 million. It is identified, I think, as one of the explanations about various changes.

The Hon. S.C. MULLIGHAN: What I can see is:

The $57.8 million decrease in expenses is primarily due to:

the transfer of the Adelaide Railway Station to Renewal SA in 2012-13.

Yes, $81.8 million.

Ms CHAPMAN: That is a transfer that he has referred to in his report as being necessary to achieve the recovery opportunity for land tax to the extent of $1 million a year, and it also takes into account that Renewal SA was going to have responsibility for the precinct planning and development of the Riverbank area. Since that time, of course, we know that the government has announced that it is going to have its own Riverbank authority.

My understanding is that as of at least November last year the management of this precinct was back under the responsibility of Mr Rod Hook and, after his demise, it transferred to Mr Hanlon. In fact, Mr Hanlon has provided me with a briefing in respect to that development. Whoever is the current acting member will no doubt take it on in the next week or so.

My understanding, having raised this with Renewal SA, is that they say, ‘We have taken the property because we were asked to’—for the reasons presumably that the Auditor-General highlighted—‘but we don’t attend to the leasing arrangements; the Department of Transport is still handling all of that.’ That is the information we have to date from the committee. My question is: what is the current lease arrangement with the tenants in the Adelaide Railway Station and surrounds, in particular their terms and rentals?

The Hon. S.C. MULLIGHAN: I do not have that information with me.

Ms CHAPMAN: Will you get it?

The Hon. S.C. MULLIGHAN: If it is available, yes.

Ms CHAPMAN: Was the rent payable by the Adelaide Railway Station tenants increased when the asset was transferred from your department to Renewal SA?

The Hon. S.C. MULLIGHAN: I am not aware, but it seems that my preliminary advice is no.

Ms CHAPMAN: You will take it on notice to clarify whether or not that is the case?

The Hon. S.C. MULLIGHAN: If I have provided incorrect information to the house then, yes, I will come back.

Ms CHAPMAN: Thank you. In relation to that entity—

The Hon. S.C. MULLIGHAN: Which? The Railway Station, Renewal SA?

Ms CHAPMAN: Yes, the ASER site, which is the Railway Station, the Casino and precinct. I just want to ask another question about the rental agreement between your department and the Casino.

The Hon. S.C. MULLIGHAN: Well, if the site is Renewal SA’s and the tenant is the Casino, that would be a matter for Renewal SA, and the Deputy Premier has carriage of that.

Ms CHAPMAN: I thought I just explained, minister, that—

The Hon. S.C. MULLIGHAN: I am sorry, I lost you in the middle of your soliloquy, but I have just explained what the arrangement is.

Ms CHAPMAN: I thought I had explained, minister, and I thought you might have read avidly the Renewal SA transcript of the estimates committee but, if you have not, I will just perhaps refresh your memory.

The Hon. S.C. MULLIGHAN: Read the transcript, please.

Ms CHAPMAN: Renewal SA say that they have received this property because they have been requested to do so and, of course, they are subject to Treasurer’s direction to take the property. However, they said, when we asked questions of them—or the minister responsible, namely minister Rau—that your department is still handling all that, and that is consistent with what the Auditor-General says at the references I have indicated: that your department is still managing the leases and managing the property. Indeed, on inquiry with some tenants at that site, that is the position they understand too; that is, that your department is still handling it. Is that different?

The Hon. S.C. MULLIGHAN: Sorry, there was a question: is that different?

Ms CHAPMAN: Yes.

The Hon. S.C. MULLIGHAN: I will have to take that on notice. I am not going to take what you say at face value.

Ms CHAPMAN: That is fine. I have indicated that we will be seeking the rental payable by the Adelaide Railway Station tenants. I am not sure, minister, whether or not you are aware, but, during the time that minister Conlon was responsible for transport, before that brief interruption when minister Koutsantonis had it and prior to your elevation, minister Conlon’s department (when he was the leader of that department) renegotiated the tenancy arrangements because of the proposed development up through the city. There had been some considerable upheaval about the tenancy arrangements, in particular the opportunity to continue to be tenants in the Railway Station. That matter, some of which was in the media, resulted in the Small Business Commissioner being brought in in an attempt resolve those matters.

My understanding is that those issues are now concluded to the extent that there has been a settlement as to what the tenancy will be and what the new arrangements will be, including the opportunity to be removed if there is some commercial advancement of the site. Usually that means a clause to sell, having the right for the tenants to be removed. So my question is—and I think you have taken this on notice; my note is that if it is available—the rent payable by those tenants. To the best of your knowledge, I think, you have indicated that you would make that available subject to commercial in-confidence other than—

The Hon. S.C. MULLIGHAN: If I can cast my mind back, or the department's mind back, as to what minister Conlon may or may not have done back then, then we will endeavour to come back with an answer. However, as you can imagine I was rather closely following another minister's progress at that point in time.

Ms CHAPMAN: You may have been, minister, but my understanding is that the finalisation of these agreements was in your time. I was giving you the benefit of some history as to why I was leading up to—

The Hon. S.C. MULLIGHAN: Sorry, I thought your previous question was 'Had the rental arrangement changed?' The advice I had, preliminary though it was, was that it had not.

Ms CHAPMAN: That is correct; that is what I noted here, that it had not. But what I have asked is: what are the terms of the tenancy of the Railway Station tenants? I think your answer is that you will make that, if available—

The Hon. S.C. MULLIGHAN: Sorry, could you say that again? I will make that, if available—

Ms CHAPMAN: You will make that available to the committee.

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: The last question is in relation to the rental agreement with the Casino, that your department is managing. What is the current term of the rental arrangement to the Casino, and what is the income over the forward estimates?

The Hon. S.C. MULLIGHAN: From the rental agreement or the Casino?

Ms CHAPMAN: From the Casino, as the tenant.

The Hon. S.C. MULLIGHAN: I will have to come back to the committee with an answer.

Ms CHAPMAN: Do you have any knowledge of how long the tenancy is for?

The Hon. S.C. MULLIGHAN: Off the top of my head, no; I cannot recall.

Ms CHAPMAN: Anyone next to you that you can ask?

The Hon. S.C. MULLIGHAN: No.

Ms CHAPMAN: Does the department manage any other tenancies in the Riverbank area?

The Hon. S.C. MULLIGHAN: I would have to double-check that and come back to the committee.

Ms CHAPMAN: On the average management cost per square metre, the average management cost (that is page 104) per square metre, as a percentage of the total value of construction costs managed, increases from 1.9 per cent in 2012-13 to 2.6 per cent in 2014-15, and is attributed to a smaller number of projects being managed that are bigger than those in the past. Given that the number of major projects that will be progressing in 2014-15 is lower than in previous years—excluding the new RAH which, of course, is a PPP—how was this assumption arrived at, and what is the total project management income to DPTI from providing these services?

The Hon. S.C. MULLIGHAN: I understand that you litigated this point significantly last year with my predecessor, Mr Koutsantonis. Off the top of my head—and I am happy to check this—my understanding is that we have a sliding scale, which is negotiated with agencies for whom we are managing construction projects. The higher the dollar value of the project the lower the percentage management fee is, and the lower the value of the project the higher the management fee is. So the gradual increase from 1.9 per cent to 2.6 per cent reflects, I understand, the nature of the projects we anticipate managing, in terms of their value.

Ms CHAPMAN: That is what is peculiar, minister; that of the major projects the number is lower than in previous years. That is why I asked the question. Given that sliding scale you have referred to, why then would that be the case?

The Hon. S.C. MULLIGHAN: I do not understand how you say it is peculiar.

Ms CHAPMAN: I will let you reread the Hansard. If there is anything else you think you can add for the committee, I will wait to hear it. On page 103, you highlighted a completed sale of government employee housing. How many properties were sold during this program and how many were budgeted to be sold at the beginning of the program?

The Hon. S.C. MULLIGHAN: My advice is $59 million in total returned net proceeds through the sale of almost 300 properties.

Ms CHAPMAN: How much was budgeted to be sold of the almost 300 properties, or was it more?

The Hon. S.C. MULLIGHAN: My advice is $86.2 million was budgeted to be sold and I understand the figure reduced to that $59 million figure because some of the properties which have been identified for sale a decision was taken not to proceed with sale because of unfavourable market conditions and not securing an appropriate price for those properties.

Ms CHAPMAN: I appreciate the contribution of the amount, minister, in differential—

The Hon. S.C. MULLIGHAN: Sorry; just to complete my previous answer: in particular depot houses.

Ms CHAPMAN: So, the number that was budgeted to be sold that wasn't?

The Hon. S.C. MULLIGHAN: Do you mean the actual quantum rather than the dollar value?

Ms CHAPMAN: Yes.

The Hon. S.C. MULLIGHAN: I do not have that; I will have to come back to you.

Ms CHAPMAN: So, you sold nearly 300 but there was another budgeted amount.

The Hon. S.C. MULLIGHAN: There was a budgeted amount which was certainly higher than what we achieved and so it follows, logically, that there must have been a higher number of properties, but I do not have that higher number of properties here.

Ms CHAPMAN: Are you happy to get it for the committee?

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: Thank you. Of the number of government employee—this is now at 105—residential tenancies managed, the agency currently manages 2,400 government employee residential tenancies. What is the average cost of managing each tenancy per year and how does this compare to private management of residential tenancies?

The Hon. S.C. MULLIGHAN: I suspect we may have to take that on notice.

The CHAIR: Member for Bragg, as per the agreement, I invite the minister to have a minor reshuffle of his advisers, if he wishes.

Membership:

Mr Griffiths substituted for Mr Knoll.

Departmental Advisers:

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

Mr L. Di Lernia, Deputy Chief Executive, Public Transport Services, Department of Planning, Transport and Infrastructure.

Mr M. Elford, Acting Group Executive Director, Strategic Transport and Infrastructure Planning, Department of Planning, Transport and Infrastructure.

Ms J. Tepohe, Director, Finance, Department of Planning, Transport and Infrastructure.

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

The CHAIR: Member for Bragg.

Ms CHAPMAN: I extend my congratulations to Mr Milazzo on his appointment as the acting chief executive. Budget Paper 4, Volume 3, page 100, the provision and planning of infrastructure. Minister, the Treasurer indicated last week, during these committee hearings, that the Minister for Infrastructure was the best person to ask questions concerning the Festival Plaza upgrade. Lucky you.

The Hon. S.C. MULLIGHAN: He would say that, wouldn't he?

Ms CHAPMAN: Despite the project being listed under state development. So, you can take it up with him, this handball.

The Hon. S.C. MULLIGHAN: Well played, Treasurer.

Ms CHAPMAN: Will the $16 million for the Festival Plaza upgrade be paid to the Walker Corporation or will it be paid directly to the contractors?

The Hon. S.C. MULLIGHAN: My understanding is that these matters are being—despite the Treasurer's best endeavours—handled by the Deputy Premier, when it comes to the management of the Festival Plaza. He has further and better particulars on where we are at with this process.

Ms CHAPMAN: So the Attorney-General, or minister Rau, is the person who you say is responsible for this.

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: While Mr John Hanlon was the acting head of the Department of Planning, Transport and Infrastructure he had some responsibility for this. So, is it in planning, or is it in transport, or is it in infrastructure? If you could give us a hint about which section—

The Hon. S.C. MULLIGHAN: It is in minister Rau's bailiwick.

Ms CHAPMAN: In his bailiwick?

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: So, is it in planning?

The Hon. S.C. MULLIGHAN: I could not comment about how minister Rau has chosen to organise his officials around him to manage the issue, those would be questions best put to him—as you have been for a number of question times in the other place.

Ms CHAPMAN: In the announcement by the government in January of this year, minister Koutsantonis, as the then minister for transport, had some involvement (on my recollection of the announcement at the time by the Premier). In any event, if you now say that minister Rau is in charge of it, do you have any knowledge of what the $16 million will be spent on?

The Hon. S.C. MULLIGHAN: I think when that announcement was made I was raising a sweat knocking on doors, so I cannot recall what happened on that particular day.

Ms CHAPMAN: It was your government's policy, and it remains so.

The Hon. S.C. MULLIGHAN: Yes, and I have told you that another minister is responsible for it, yet you persist with this line of questioning.

Ms CHAPMAN: I will ask some other questions. Do you have any knowledge of what the arrangements are in respect of the $46 million development of the Festival Plaza upgrade?

The Hon. S.C. MULLIGHAN: Perhaps it might sharpen the focus, deputy leader, if you provide a page reference for these questions.

Ms CHAPMAN: I have, page 100. It is Infrastructure Planning, Policy and Operations for the 'Provision and planning of effective and efficient state infrastructure'.

The Hon. S.C. MULLIGHAN: That is a tenuous link at best.

Ms CHAPMAN: I think it is in your category—according to the Treasurer.

The Hon. S.C. MULLIGHAN: Do you? I have just told you repeatedly that it is not in my category.

Ms CHAPMAN: Anyway you are telling me that minister Rau is looking after—

The Hon. S.C. MULLIGHAN: You have litigated this in several question times, yet you persist in a line of questioning that you know I will not answer. It is your half an hour. If you want to waste it on another minister's responsibilities—

Ms CHAPMAN: It is up to you, minister, as to whether you want to be helpful in providing information to the committee or not, but if you say, 'I'm a member of cabinet, but I have no knowledge whatsoever of this issue'—

The Hon. S.C. MULLIGHAN: No, I have told you that I am a member of cabinet and another minister has responsibility for it.

Ms DIGANCE: Chair, point of order—

The CHAIR: A point of order from the member for Elder. I wonder what it will be!

Ms DIGANCE: Yes; the minister is advising that it is not his role to answer this, and I think we need to respect what the minister is saying.

The CHAIR: I am not sure that there is a point of order, but you are certainly right and we should move on. The minister has no responsibility to tell us anything about what happens in cabinet particularly.

Ms CHAPMAN: Just to be clear, Mr Chairman, it is within the portfolio of the minister. The minister has informed the committee that he is not having personal management of this, that in fact minister Rau is, and I take that response and no doubt will pursue it with him.

I refer to Budget Paper 5, page 8, which talks about the total capital spend. How much funding, minister, in 2014-15 is being applied towards the government's $36 billion transport plan, which requires $1 billion of government funding every year for the next 30 years to be achieved?

The Hon. S.C. MULLIGHAN: First, I think there is an inherent flaw in your statement/question. It is a 30-year transport plan; we have announced it has $36 billion worth of investment, and you claim that each year for the next 30 years would be sufficient to fund it.

Ms CHAPMAN: At least.

The Hon. S.C. MULLIGHAN: I was an arts graduate, not a maths major, but I think there is a flaw in your question there.

Ms CHAPMAN: Except that when you read the report you will see that some of those billions come in from a different source. It is federal funding that is anticipated and private funding. Perhaps if you refresh your memory on the actual report, that might help.

The Hon. S.C. MULLIGHAN: Perhaps to clarify for the committee, does the report say that the state will be putting in $30 billion over the next 30 years, because that is not my recollection of the report?

Ms CHAPMAN: No.

The Hon. S.C. MULLIGHAN: No, it doesn't say that, does it?

Ms CHAPMAN: No, it doesn't, but it is government funding. My question was '$1 billion of government funding every year for the next 30 years'.

The Hon. S.C. MULLIGHAN: I thought you said 'state government funding'. My apologies to the committee if I misheard your initial question.

Ms CHAPMAN: In any event, how much is being applied this year, 2014-15, towards that target?

The Hon. S.C. MULLIGHAN: I will come back with an answer.

Ms CHAPMAN: Does the minister to expect to complete all the projects listed as the short-term priorities, five-year priorities, in the transport plan on time, given that only one of the major projects in this category has received any funding in this budget?

The Hon. S.C. MULLIGHAN: It is a little hard to say that we expect all projects within the ITLUP, regardless of their time frame, to be delivered according to a time frame. The ITLUP, by its very nature—and it has been made clear from the outset to all interested parties—presents a menu of transport projects which the government believes would be necessary to maximise both the transport and the planning opportunities, and in turn the economic opportunities, from these sorts of developments over the next 30 years. We will be making further announcements, as we have in the recent state budget, about which priorities we are supporting with funding, and we will continue to do that.

Ms CHAPMAN: That is why, minister, I have asked you for the first five years, because the report actually proposes in certain categories and one is in the first five years. You have made an announcement for one of these projects in this budget. My question was: do you expect to complete the projects as identified in the first five years?

The Hon. S.C. MULLIGHAN: We have not identified what projects are in the first five years because we have not released the final report yet.

Ms CHAPMAN: I see. When do you expect to release the final report?

The Hon. S.C. MULLIGHAN: When the government is in a position to release it.

Ms CHAPMAN: Any idea? This year? Next year?

The Hon. S.C. MULLIGHAN: It will be one of those.

Ms CHAPMAN: So at this stage you say that, even though you have picked out one of them that is identified in your transport and urban development plan as being achieved, it is still a draft report and therefore you could change that? Is that the position?

The Hon. S.C. MULLIGHAN: No, your statement was that we have only funded one project in the next five years. I undertook to come back to the committee outlining what funding we have made available in the recent state budget.

Ms CHAPMAN: Correct. There is only one project out of the plan that has been announced in this year?

The Hon. S.C. MULLIGHAN: Is that right?

Ms CHAPMAN: Well, that is what I am asking you.

The Hon. S.C. MULLIGHAN: Well, I undertook to come back to the committee with a list of funding for the projects that are in the ITLUP that we have committed funding for.

Ms CHAPMAN: That would be good, thank you. That is the other way of doing it. There is a major reduction, of course, in the general capital expenditure in this financial year, from approximately $1 billion in 2013-14 down to approximately $600 million in 2014-15. Given the decision to make a $200 million saving from removing unallocated capital provisions—that is in Budget Paper 3, page 25—does a contingency exist in the forward years to match federal funding as it becomes available?

The Hon. S.C. MULLIGHAN: That is a matter for the Treasurer to answer.

Ms CHAPMAN: You do not have any view on this?

The Hon. S.C. MULLIGHAN: I have strong views about what funding should be made available for transport projects.

Ms CHAPMAN: What is the DPTI capital contingency or unallocated capital budget for the forward estimates?

The Hon. S.C. MULLIGHAN: Matters of budget contingency are usually not revealed publicly for good reason. That is because allocations are made, either centrally within the Consolidated Account or potentially within agencies, where the amounts to be expended are for some reason not confirmed. There has always been a longstanding practice by government not to reveal contingency amounts, whether it is for capital or whether it is for operating costs, for those sorts of reasons.

Ms CHAPMAN: Every application that comes before the Public Works Committee identifies in each project a contingency amount.

The Hon. S.C. MULLIGHAN: So are you asking for each project, or in globo?

Ms CHAPMAN: Global, we are asking for. We are not asking for a breakdown at this point of each of the projects. The capital contingency is identified. I certainly never ask for contingency payments for proposed enterprise bargain increases and those types of things, because of course they are sensitive.

The Hon. S.C. MULLIGHAN: You don't, but your colleagues do.

Ms CHAPMAN: I beg your pardon?

The Hon. S.C. MULLIGHAN: I said you don't, but your colleagues do.

Ms CHAPMAN: Well, let's look at this committee. So far nobody else has asked that and I will not, because they are sensitive, of course, for budget purposes. I am simply asking at this stage the amount that is provided in total for the capital contingency.

The Hon. S.C. MULLIGHAN: My understanding is that on a careful reading of the Consolidated Account there are two or three lines which allude to contingencies. They are deliberately not specified as to the full purpose for which those contingencies are held, precisely for the reasons that you and I seem to be alluding to.

Ms CHAPMAN: I refer to the Seaford and Tonsley rail upgrades, pages 74 and 75. What is the total cost of the Seaford extension, Noarlunga upgrade and electrification, and the Tonsley upgrade and electrification?

The Hon. S.C. MULLIGHAN: Sorry, what was that budget reference?

Ms CHAPMAN: Pages 74 and 75, regarding the Seaford and Tonsley rail upgrades.

The Hon. S.C. MULLIGHAN: I will just check if we have those figures. We will come back with a detailed answer to the committee.

Ms CHAPMAN: Any ballpark amount?

The Hon. S.C. MULLIGHAN: It would be in the many, many millions.

Ms CHAPMAN: I do not doubt that. I will note that that is taken on notice. What is the original budget for each of these programs when they are announced?

The Hon. S.C. MULLIGHAN: I would have to see if we can uncover that information for the committee.

Ms CHAPMAN: Has there been any reporting to you yet as to the extra cost of these projects?

The Hon. S.C. MULLIGHAN: If indeed there is any extra cost, but I would have to check that and let the committee know.

Ms CHAPMAN: The Gawler rail electrification also on page 74. To date, what has been spent on the Gawler upgrade and electrification programs?

The Hon. S.C. MULLIGHAN: Again I would have to come back to the committee with an answer.

Ms CHAPMAN: No idea or ballpark amount?

The Hon. S.C. MULLIGHAN: I assume again it would be in the millions. There has been all sorts of works both along the Gawler line and, I understand, also necessary for the Dry Creek rail depot including installation of masts and that sort of thing so I would expect it to be a fairly significant amount.

Ms CHAPMAN: I am happy for you to give a breakdown as to what is Dry Creek specific and what is the upgrade and electrification, but I am seeking the total.

The Hon. S.C. MULLIGHAN: I do not know if we can necessarily separate those two costs because the Dry Creek works, as I understand it and I will have to check this, which I alluded to were necessary for the purposes of the Gawler electrification. So it may not be that we can necessarily separate those but I will do my best to check and provide that detail for the committee.

Ms CHAPMAN: I am not asking for them to separated. I asked for the total. I think you indicated that you are not sure whether you can sever out the costs for Dry Creek. I am not asking for that. I am simply making the point that if you do–

The Hon. S.C. MULLIGHAN: No, I did not say that. What I said was there were a significant amount of works both on the Gawler line itself and also for the Dry Creek rail depot which were necessary for the electrification of the Gawler line, so I would imagine it would be a significant amount of money but I would have to come back to the committee with an answer.

Ms CHAPMAN: Do you agree that the Dry Creek depot was also necessary for the electrification to Noarlunga/Seaford?

The Hon. S.C. MULLIGHAN: Well I have to say I have visited the Dry Creek rail depot and the staff out there are incredibly proud of the facility that they have and very thankful that the government had the foresight to build it. It makes not only the conditions they operate under much easier in order for them to do their work but in some respects it future proofs the rail network so that they can best look after our rail fleet into the future. I have to say the impression that I got is that it has been a good investment and a good piece of infrastructure.

Ms CHAPMAN: I think that is correct. Certainly my observation is of an equally impressive piece of infrastructure. It is just a pity that we have to tow the current electric trains from the Seaford line out to Dry Creek with a diesel vessel because there is no electrification done from the city to the Dry Creek facility. But, nevertheless, you are absolutely right, I totally agree, it is a magnificent facility and one day—

The Hon. S.C. MULLIGHAN: But we will get there because this government has a policy to electrify the rail lines unlike your party.

Ms CHAPMAN: Well the announcement and cancellation three times of the Gawler electrification project does not fill me with confidence, but I hope in your time, minister, I am proved wrong.

The Hon. S.C. MULLIGHAN: Well I trust you made your views known to your federal colleagues when they withdrew funding from the project.

Ms CHAPMAN: Well I will come to that. At the time the upgrade and electrification was first announced, what was the total budget to upgrade and electrify the whole way from Adelaide to Gawler and how does this compare to the estimated total cost now?

The Hon. S.C. MULLIGHAN: I am not sure we have that figure. The figure that we have used has been, as I best recall, $152.5 million for the electrification to Salisbury.

Ms CHAPMAN: That is not what I actually asked.

The Hon. S.C. MULLIGHAN: I know that is not what you asked but that is the information that I have just provided to the committee.

Ms CHAPMAN: Well, I can ask then, does that still apply, given that that cost estimate was based on a construction time frame for 2014-15 to 2018-19 which is now not planned?

The Hon. S.C. MULLIGHAN: Well, that would depend on what our best estimates and negotiations lead us to into the future.

Ms CHAPMAN: That is what I am asking now that we are in 2014-15 and we are not constructing it, what are your best estimates as to what the total cost will be now for that project Adelaide to Salisbury?

The Hon. S.C. MULLIGHAN: I am sorry, deputy leader, I have my information correct; I understand on 17 February 2014 the Premier used a figure of $152.4 million not five.

Ms CHAPMAN: And as that was an estimate for construction to commence now for completion in 2018-19 and that has not occurred, has there been any revised estimate?

The Hon. S.C. MULLIGHAN: As I said in my previous answer, I would have to seek some advice and work out what the position would be given on the deliverability of that project into the future and how our negotiations with a commercial constructor would go.

Ms CHAPMAN: Budget Paper 6, page 78, on the Gawler rail electrification. Does the $60 million in the 2017-18 year include the construction of a substation to support electric train services?

The Hon. S.C. MULLIGHAN: We will have to come back to the committee with an answer.

Ms CHAPMAN: Does a contingency provision exist in the forward estimates to order more electric trains to operate on the Gawler line?

The Hon. S.C. MULLIGHAN: I would have to investigate that matter and come back to the committee with an answer.

Ms CHAPMAN: On the O-Bahn tunnel, at page 31 of Budget Paper 5, has a detailed and independently verified cost-benefit analysis been completed on the O-Bahn tunnel project?

The Hon. S.C. MULLIGHAN: My advice is that we have done a cost-benefit analysis.

Ms CHAPMAN: I understand that. Was it independently verified?

The Hon. S.C. MULLIGHAN: My understanding is that the usual process for these projects is that we do a cost-benefit analysis to enable the government to make a decision whether to proceed with a project and provide it funding. Once that decision is made, we work up a detailed report with a full and detailed cost-benefit analysis and provide that to the Public Works Committee. I would imagine that would be the process for this project.

Ms CHAPMAN: Therefore, was that cost-benefit analysis that you have just referred to as being prepared and worked up for Public Works Committee independently evaluated?

The Hon. S.C. MULLIGHAN: I am not sure, because that would be, on my understanding, inconsistent with how we manage these projects.

Ms CHAPMAN: When the Premier announced the $160 million tunnel option on 13 February, had the Department of Planning, Transport and Infrastructure undertaken a detailed costing of the option proposed by the Premier, and was this the best option according to the department?

The Hon. S.C. MULLIGHAN: I understand that, for our costings, we have an independent panel of estimators who estimate the costs for these projects. I am sorry, you will have to repeat that question, deputy leader.

Ms CHAPMAN: When the Premier announced this project in February, had the department undertaken a detailed costing of the option proposed by the Premier, and was this the best option according to the department?

The Hon. S.C. MULLIGHAN: Which option was that?

Ms CHAPMAN: The one that he announced, the $160 million one.

The Hon. S.C. MULLIGHAN: You mean the project, not the option of the project?

Ms CHAPMAN: I think you said what option was it? He announced the project in February. First, had the department done a detailed costing on that option, on that model, on that program?

The Hon. S.C. MULLIGHAN: My understanding is: yes.

Ms CHAPMAN: Was it the best option recommended by the department?

The Hon. S.C. MULLIGHAN: I am not sure there are many other ways you can go about electrifying a rail line.

Ms CHAPMAN: I am talking about the O-Bahn tunnel. We have moved ahead.

The Hon. S.C. MULLIGHAN: My advice is that this is the project that the department recommended, so I assume it is the best option.

Ms CHAPMAN: Were any other options presented?

The Hon. S.C. MULLIGHAN: I would assume that, as we work up different projects, all sorts of options are canvassed, and a good example of that is the Torrens to Torrens project where the project assessment report led to a refinement of that project.

Ms CHAPMAN: We have not got to the refinement, yet, minister, I think that is clear. What we have had is the announcement, and my question is: at the time of the announcement, were there any other options on the table?

The Hon. S.C. MULLIGHAN: I could not tell you. I was not around at that time.

Ms CHAPMAN: Will you inquire?

The Hon. S.C. MULLIGHAN: If I was around at that time? No.

Ms CHAPMAN: No, will you inquire as to whether there were any other options at February this year?

The Hon. S.C. MULLIGHAN: We only have one option and that is the project that we have announced, so I am not sure what the purpose of that would be.

Ms CHAPMAN: My question was: at the time of that announcement, were there any other options presented for consideration by the government?

The Hon. S.C. MULLIGHAN: I do not know but I have to say that I am not going to run around flying policy kites which are completely irrelevant to how we run the transport system in South Australia.

Ms CHAPMAN: That is what they said about the Britannia roundabout.

The Hon. S.C. MULLIGHAN: No, I think that is what you did today when you talked about tolls.

Ms CHAPMAN: Given that you have your most senior people in the department sitting next to you, would you inquire of them as to whether there were any other options on the table at the time of that announcement?

The Hon. S.C. MULLIGHAN: My advice is that they recommended an option to the government and that is the option that the government has gone with.

Ms CHAPMAN: In the general project design that has been decided upon, that is, the tunnel along Hackney Road which surfaces at Rundle Street, was that the most cost-effective solution for the city access problem that it purports to address?

The Hon. S.C. MULLIGHAN: I think there are two things to be said. One is that we regard this as a more effective project than the previously mooted O-Bahn city access project and, given that it was the project that was recommended by the department to the government, then, presumably, yes.

Ms CHAPMAN: What is budgeted for land acquisition in this project?

The Hon. S.C. MULLIGHAN: I am not sure I have that figure. I would have to come back to the committee, if indeed we have that figure available, but I would caution that, for these sorts of projects, we are usually reticent about providing those figures, given that it can create an expectation amongst landholders.

Ms CHAPMAN: I understand that, but there is some provision for land acquisition, is there?

The Hon. S.C. MULLIGHAN: I would have to check that and come back to the committee, if there is a provision.

Ms CHAPMAN: Does the $160 million cost include alterations to the Torrens Bridge near the Hackney Hotel?

The Hon. S.C. MULLIGHAN: Not that I am aware.

Ms CHAPMAN: Have any estimates been done yet as to what it will cost?

The Hon. S.C. MULLIGHAN: If we are not changing it, we would not estimate it.

Ms CHAPMAN: Have there been any assessments, though, of the bridge, as to whether we need a new bridge or a replacement bridge or an extra couple of lanes? Have there been any costings done on the bridge upgrade that is necessary for this project?

The Hon. S.C. MULLIGHAN: I have just provided some advice to the committee that we do not plan to upgrade the bridge.

Ms CHAPMAN: Not at all? Not widen it at all?

The Hon. S.C. MULLIGHAN: In relation to this project, no.

Ms CHAPMAN: What was spent on the $61 million O-Bahn City Access project that was cancelled in 2012 and how much of this work will be directly applied to the current project?

The Hon. S.C. MULLIGHAN: I would have to come back to the committee with an answer.

Ms CHAPMAN: On the Darlington upgrade at page 31, how much of the $620 million for the South Road upgrade at Darlington will be spent on works at Darlington, what will be spent on upgrading the intersection of Marion Road and Sturt Road, the intersection of South Road and Daws Road, and other sections of the road that are not at Darlington?

The Hon. S.C. MULLIGHAN: We would have to come back to the committee with an answer, but I should caution the committee that it may be that, in order to provide an accurate estimate, we may not be able to do that within the customary period of providing responses to the committee.

Ms CHAPMAN: What was the cost of the first Darlington transport study?

The Hon. S.C. MULLIGHAN: It is my understanding that the first Darlington transport study, which I think included a scope far more substantial than the project that we are proceeding with, was approximately $7 million.

Ms CHAPMAN: On page 74, there is a rail offset provision. It was supposed to be a $51 million provision which was budgeted for in 2013-14. That has not been achieved. My question is: why not?

The Hon. S.C. MULLIGHAN: My understanding is that that is a rail offset provision that we are progressively achieving.

Ms CHAPMAN: Do you expect to recover that?

The Hon. S.C. MULLIGHAN: My understanding is that we had a task to absorb an amount of money in the order of what you suggested and that we are progressively doing that over a number of years.

Ms CHAPMAN: Is there any reason then why it is not identified? Let me just clarify that. It only achieved 7.884 million as you can see there and it is only budgeted this year for five million, so we are up to about 12½ million. How long is it going to take for this budget offset to be achieved?

Mr PICTON: What page number?

Ms CHAPMAN: Page 74 of Budget Paper 4, Volume 3.

The Hon. S.C. MULLIGHAN: I think our expectation is that we would meet that target in the next couple of financial years.

Ms CHAPMAN: If that is to be achieved in the next couple of financial years, whether that is two or three, if you get the five million for this current financial year, you are only up to 12½ million of a $50.885 million achievement.

The Hon. S.C. MULLIGHAN: I think you are misreading it, deputy leader. It was 7.884. The five reduces that figure, rather than contributing to it, to take it to 2.884, so we anticipate reducing that 7.884 figure down to 2.884 in 2014-15.

Ms CHAPMAN: Can you just clarify this? There is a budget at 2013-14 of 50.885. The estimated result, however, is only 7.884. Then in your budget for this financial year—the one we are currently in, 2014-15—there is another five. If you get that five in this financial year, plus the 7.8 you have already achieved, you still have well over 30 million to get back. Are you saying that that is achievable in the next few years?

The Hon. S.C. MULLIGHAN: I think you might have misunderstood. My advice is that at the end of the 2013-14 financial year that the balance of that offset is 7.884. We anticipate reducing that by another $5 million in 2014-15, hence my advice that we will aim to eliminate that offset over the next two financial years in 2014-15 and, I presume, the balance in 2015-16.

Ms CHAPMAN: Essentially then the balance of what is the offset required is 7.884 as at a month ago?

The Hon. S.C. MULLIGHAN: Yes, as at 30 June 2014, 7.884 and we anticipate reducing that by $5 million in the current financial year, 2014-15.

Ms CHAPMAN: Why was the offset provision originally required?

The Hon. S.C. MULLIGHAN: That is a matter that preceded me. I would have to come back to the committee with a detailed explanation.

Ms CHAPMAN: I am sure that the new acting chief executive is anxious to tell us.

The Hon. S.C. MULLIGHAN: He was cautioning me against saying something silly to the committee.

Ms CHAPMAN: 'Do not tell her.' Was it anything to do—

The Hon. S.C. MULLIGHAN: He is very good to me.

Ms CHAPMAN: —with the Gawler rail line expenditure—

The Hon. S.C. MULLIGHAN: It could have been.

Ms CHAPMAN: —and the requirement to pay money back to the federal government?

The Hon. S.C. MULLIGHAN: It could be. I would have to come back to the committee with an answer.

Ms CHAPMAN: Do you think you would like to ask him?

The Hon. S.C. MULLIGHAN: Yes, I will. I will come back to the committee with an answer.

The CHAIR: Excellent, thank you, minister. In preparation for transport planning services, would you like to reshuffle or shall we just move on?

Departmental Advisers:

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

Mr M. Elford, Acting Group Executive Director, Strategic Transport and Infrastructure Planning, Department of Planning, Transport and Infrastructure.

Mr P. Gelston, Director, Road and Traffic Management, Department of Planning, Transport and Infrastructure.

Ms J. Tepohe, Director, Finance, Department of Planning, Transport and Infrastructure.

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

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

Mr WINGARD: Starting on Budget Paper 4, Volume 3, page 89, Expenses. I want to know what the total budget for 2014-15 for road maintenance is and how that compares with 2013-14.

The Hon. S.C. MULLIGHAN: That is a very good question. My understanding is that the road maintenance capital budget is approximately $21 million, which is a reduction from $30 million because we have had a cut of $9 million from the commonwealth government.

Mr WINGARD: What has been the breakdown between country and metropolitan roads in that spend?

The Hon. S.C. MULLIGHAN: I would have to have a look at providing that. I am not sure if we make an early determination on that at the outset of the year or if we make those determinations within the year as projects come up, but we will do our best to provide that to the committee.

Mr WINGARD: So, there is a list? You will prepare a list, is that what you are saying?

The Hon. S.C. MULLIGHAN: I have some figures for total roadworks which do not necessarily relate to road maintenance, but my understanding is that the total for roadworks for 2014-15 is $496 million, that is both capital expenditure and operating expenditure. Of that, $336 million is in the metropolitan road networks and $160 million of that is on rural road networks, that is for the 2014-15 financial year.

Mr WINGARD: What is the current estimated road maintenance backlog?

The Hon. S.C. MULLIGHAN: I do not think we have a firm figure on that and the reason why is because there are various different ways of determining what a backlog is. Some people talk about resurfacing improvements, some people go so far as to talk about bridge upgrades and improvements, so what we know is what we allocate to it. My understanding is that in 2014-15 we will be allocating $83.4 million for road maintenance, rehabilitation and resurfacing, and $25 million of that will be urban and $58.4 million will be regional. So I correct my earlier advice: I can give you a breakdown between those two.

Mr WINGARD: What percentage of the backlog do you think will be filled with that spend?

The Hon. S.C. MULLIGHAN: I will be perfectly honest with you, I suspect that, while we will try and do our best to keep track of whatever the current backlog may be, we may actually go backwards given that between both local government road grants and state government road maintenance grants over the next five years, we will be losing in the order of $136 million in commonwealth funding.

Ms CHAPMAN: Just on that, minister for road maintenance, we have already started the 2014-15 financial year, so have you actually started doing any road maintenance for this financial year?

The Hon. S.C. MULLIGHAN: I haven’t but the department would have.

Ms CHAPMAN: What roads?

The Hon. S.C. MULLIGHAN: I will come back to the committee with a detailed answer.

Ms CHAPMAN: Do you have any idea of any one that you have started, or that the department has started?

The Hon. S.C. MULLIGHAN: They would be bitumen roads rather than dirt roads, but maybe some dirt roads as well.

Ms CHAPMAN: So it is maintenance of bitumen roads, is it?

The Hon. S.C. MULLIGHAN: We would be looking at deploying our resources across the whole network.

Ms CHAPMAN: Can you think of any one road that you are actually doing any maintenance on?

The Hon. S.C. MULLIGHAN: I will be perfectly honest with you: each night my staff—

Ms CHAPMAN: You sit and think about it, do you?

The Hon. S.C. MULLIGHAN: I do sit and think about a lot of things each night, deputy leader, and each night my staff provides me with a number of press releases which the department puts out to tell local communities about what road impacts there are likely to be. However, off the top of my head—maybe it is the overwhelming presence of you and the estimates—I cannot recall exactly what they are, but I will provide those to the committee.

Ms CHAPMAN: So you cannot think of anything that you have started in the last 23 days, of all these press announcements and notices to people?

The Hon. S.C. MULLIGHAN: I can remember one in particular that we did in the last 23 days, on Port Wakefield Road, on the first Monday of school holidays. That garnered some attention. However, if you want a more detailed list of the probably hundreds of projects—

Ms CHAPMAN: Minister, it is just that each year there is a provision for road maintenance and there is generally a prioritising of roads by the department. Given the significant backlog, there is careful consideration and there is a program that is then prepared for the forthcoming financial year. We are now in this financial year and I am a little surprised to hear you indicate that you have not yet decided what you are going to spend it on.

The Hon. S.C. MULLIGHAN: Well, I do not often make those decisions—deciding what we spend it on.

Ms CHAPMAN: Well, the department, the people sitting next to you.

The Hon. S.C. MULLIGHAN: I am sure they have made decisions on what they are spending it on, and these works are underway.

Ms CHAPMAN: Hence the request to provide that information. Whilst you might not immediately have it at your fingertips, will you obtain information from your department regarding the scheduled road maintenance program for 2014-15, on the clear understanding that obviously the department, and you, of course, reserve the right to change that during the forthcoming year, given the contingencies of weather, etc.

The Hon. S.C. MULLIGHAN: Yes, I am happy to provide some information to the committee about that.

Ms CHAPMAN: Thank you. I refer to the same budget paper, similarly at page 89. What work was undertaken by the department in 2013-14 to investigate options for upgrading freight rail lines in the Mallee and Eyre Peninsula regions, and did the department assess the impact that the closure of rail lines in those areas would have on the road network?

The Hon. S.C. MULLIGHAN: I cannot speak specifically about what detailed options the department worked up, but we have certainly been aware of rail freight issues in both the Mallee region and the Eyre Peninsula region. The Mallee region is a significant problem, but I guess understandable in some respects, given the relatively low tonnages that would be able to be freighted by rail through the Mallee region. I have been working with your colleague, the member for Chaffey, and speaking closely with Viterra and Genesee & Wyoming about that. I have fewer reservations in the short term about the future of grain haulage on the Eyre Peninsula, I would have to say.

Ms CHAPMAN: So you would be aware, minister, that Genesee Wyoming is not intending to continue the agreement for the purposes of cartage of grain in the Mallee area and that a large national company, Linfox, has been contracted with Viterra to provide that service. Again, I raise this question: has your department done any assessment of what impact the change of this transport mode will have on the road structure in the Mallee region?

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: Will you make that report available to the committee?

The Hon. S.C. MULLIGHAN: I can talk about it in general terms now.

Ms CHAPMAN: Thank you.

The Hon. S.C. MULLIGHAN: If there is less grain being freighted through the Mallee region then there will obviously be higher road freight tasks on the Mallee Highway, on some parts of the Karoonda Highway and on some parts of the Sturt Highway. If indeed what you are saying is correct, that there is an intention not to use the Mallee rail lines to freight grain, we estimate that there will be in the order of an additional 12, I think it is, truck movements per day down the Sturt Highway, approximately four, I think, additional truck movements on selected parts of the Karoonda Highway, and my memory fails me partially, but I think it is six to eight additional truck movements per day on the Mallee Highway.

Those are annualised figures and, of course, it is difficult to predict when trucks may need to move grain either from the farm gate or from particular silos to get either to other freight modal points or, indeed, to port. However, that gives you some order of magnitude about what the impact of closing those two Mallee rail lines may have.

Ms CHAPMAN: So having done that assessment—and whilst they are annualised, of course, in the concentrated period of the grain harvesting there would obviously be many more during the short-term of that period—have you allocated any extra funding for road maintenance upgrades in this area for the 2014-15 year, and/or across the forward estimates?

The Hon. S.C. MULLIGHAN: As I said—and perhaps just to go back a step—we cannot accurately predict when the truck movements will be necessary; it would depend on what arrangements farmers individually, and also collectively—presumably through Viterra—may undertake to move grain from the farm gate to regional silos, or indeed from those regional silos to central collection points like Tailem Bend for example, or if they are going via Loxton and the Sturt Highway to somewhere like Roseworthy. That is why we use the annualised figures.

Given the $9 million a year budget cut we have had in rural road maintenance funding from the commonwealth government, we are investigating what extra resources we may—if we can—be able to deploy, as a sign, I guess, of goodwill and good faith to local communities there, some of whom are concerned not so much with the condition of the Sturt Highway, and perhaps not even so much the condition of the Mallee Highway, but some segments of the Karoonda Highway.

Ms CHAPMAN: Is the Karoonda Highway due for upgrade, in any event, out of your normal road maintenance budget?

The Hon. S.C. MULLIGHAN: I am not quite sure whether we would categorise it as being due for upgrade outside of our normal road maintenance budget. Our road maintenance budget is usually deployed to areas of high need, I think it is fair to say—

Ms CHAPMAN: I think is fair to say that Karoonda is on that list—

The Hon. S.C. MULLIGHAN: Well some parts of it—

Ms CHAPMAN: —because of the mining traffic, as a result of the mines on that road.

The Hon. S.C. MULLIGHAN: I am not sure whether it is as a result of the mines on the road. My advice is that the Mindarie mine is approximately 140,000 tonnes a year, and there is approximately—and this is very approximate, depending on the season—about 300,000 tonnes of grain which comes out of the Mallee region, and I think we are looking at about 170,000 tonnes which would otherwise be taken on rail. That would suggest that the Mindarie mine and the grain task that exists, with the rail grain freight task, are already pretty equivalent, so I do not think you can necessarily sheet the blame home for damaged roads to mining or to grain. In fact, it may be to other heavy vehicle purposes as well. In any event I think the point that you make, and that I make as well, is a point well made: that the Karoonda highway is not what we would call one of our best roads.

Ms CHAPMAN: Has the department done any assessment of the impact of the loss of local carriers in the area for harvest transport?

The Hon. S.C. MULLIGHAN: Do you mean train drivers or do you mean truck drivers?

Ms CHAPMAN: I am talking about small carriers, truck driving companies, as a result of the agreement between Viterra and Linfox.

The Hon. S.C. MULLIGHAN: I met with Viterra and Genesee & Wyoming, along with minister Brock and the member for Chaffey, and Viterra put it to us that a very significant proportion—indeed, well in excess of 90 per cent—of the local grain freight task is currently carried by (and I use inverted commas, for the benefit of Hansard) 'locals' for trucks. I have not been made aware of what arrangements, if any, have been made if it does eventuate that the rail lines are closed, but I think both the member for Chaffey and I made it pretty clear to Viterra that in the unfortunate circumstances that these rail lines do close, we would expect them to use their best endeavours to give first priority to local truck operators.

Ms CHAPMAN: Given that situation is known to you now, minister, that it is imminent, are you going to ask your department to do any assessment of the impact that would have on local carriers who, of course, will no longer be required? These are carriers in the district who might have five, six, 10 trucks that are currently doing their grain haulage who will no longer have a job.

The Hon. S.C. MULLIGHAN: No-one has put to me, except you in the political forum of estimates, that locals are being cut out of carting this grain. What Viterra has said to me and also said to the member for Chaffey in the meeting that we had collectively is that they put a strong focus on using locals. So, I will wait to be informed by Viterra to see what their freight arrangements are.

Ms CHAPMAN: Will that be too late, minister, given your government's commitment to the procurement of opportunity for local contracts? It will be too late when Viterra and/or Linfox or any other large carrier have signed the contract.

The Hon. S.C. MULLIGHAN: If you say that it is too late in the event that Viterra gives an undertaking to both sides of politics in South Australia that they will employ locals for the cartage of grain and then they continue on and deliver on that commitment, then no.

Ms CHAPMAN: In any event, you have not done any assessment at this point, your government has not done any assessment in relation to what impact that would have on them?

The Hon. S.C. MULLIGHAN: No; I think that is an unfair representation of what I have just explained to you.

Ms CHAPMAN: Let us hope I am wrong. Highlights for 2014-15, page 99. A highlight of 2013-14 was the changes to drivers licensing for residents of the APY lands. You may not recall, but there was legislation passed to facilitate the streamlining of that. Can the minister please confirm the cost of the program for 2013-14 and how many drivers obtained a licence using it?

The Hon. S.C. MULLIGHAN: Did you say 'the minister has' or 'will the minister'? I got the impression that the Minister for Aboriginal Affairs might have confirmed that.

Ms CHAPMAN: It says a highlight for 2013-14 was the changes to drivers licensing for residents of the APY lands. This is a highlight that has already happened.

The Hon. S.C. MULLIGHAN: I understood what you just said was that the minister has given those figures and I thought you might have been referring to the Minister for Aboriginal Affairs.

Ms CHAPMAN: No, I am referring to page 99. I am simply asking the cost of the program for 2013-14.

The Hon. S.C. MULLIGHAN: My understanding is that the legislation was changed in 2013-14 to enable the scheme that you describe to occur from 2014-15 onwards, so it is too early to be providing those figures.

Ms CHAPMAN: I assume from that that no-one has actually got a new licence under that scheme yet because it has not actually been implemented?

The Hon. S.C. MULLIGHAN: That may be your assumption, but as—

Ms CHAPMAN: Is that correct?

The Hon. S.C. MULLIGHAN: I cannot confirm that. As I said, it is too early to provide those figures.

Ms CHAPMAN: Could you ask your advisers?

The Hon. S.C. MULLIGHAN: My advice is that it is correct, no-one has been provided with an exemption at this stage.

Ms CHAPMAN: What is the estimated cost of the program for 2014-15 and how many people are expected to obtain a licence?

The Hon. S.C. MULLIGHAN: My advice is that the program is estimated to cost $1.12 million. I am not 100 per cent sure if that is for a financial year or the total cost. I am also advised that we cannot make any estimates about how many people are likely to benefit or take advantage of this change in policy.

Ms CHAPMAN: At the time of the debates, minister, there was some discussion about, I think, some 10 or so being available pretty much straightaway—from my own personal recall of the debates on this—who have already been identified as suitable for this program, hence why I am asking for some assessment about what the $1.12 million is going to be spent on.

The Hon. S.C. MULLIGHAN: My understanding is that at the time of those debates you allude to there were 10 people who were immediately thought to come into the scope of this. My understanding of the scheme is that this is a scheme which is very much dependent on the individual circumstances of people who may be eligible for the scheme. The way the scheme is effectively applied to these people is that it is case managed. I cannot give any further detail at this point about how much more broadly this program may apply to people on the lands.

Ms CHAPMAN: Is it intended that it will be reviewed in this current financial year?

The Hon. S.C. MULLIGHAN: I will have to check that.

Ms CHAPMAN: Perhaps when you do check it you can identify the progress of that program.

The Hon. S.C. MULLIGHAN: My advice is that it would be a little bit early to review it within the course of the first financial year, or even after only one financial year.

Ms CHAPMAN: One of the reasons I ask that is that it was a fairly novel approach. There had been a trial of a similar project in the Northern Territory, and there was a fair bit of goodwill from the parliament to support the project to enable people who might have lost their licence or not ever got their licence. Sometimes these people clearly were able to drive and probably are driving, but without a licence, and it would give lots of job opportunities for those who could be transporting camels for the program up there, for example, and it would be meritorious to have support.

So, a bit of a wing and prayer in the debates as to how effective this would be, so we would be keen to hear as to the progress of it, and in particular if there are those on the way to being achieved to do the concentrated program, which would be tendered out, and then have a chance to get their licence.

The Hon. S.C. MULLIGHAN: As you say, this is a novel scheme. It is a complex scheme in that the approach to the individuals is very much one that depends on their circumstances, case by case, and also requires quite an amount of case management. From a public policy perspective, it would be reasonable to say that providing early updates, before there has been sufficient opportunity to roll out the scheme, may give the unfortunate opportunity to misjudge the success or otherwise of this program. Perhaps I can undertake to provide you, deputy leader, with some updates from time to time and, at an appropriate juncture, we can provide some more fulsome detail to the parliament after—I would have to give it some thought—but perhaps a couple of years.

Ms CHAPMAN: Has the contract even been issued, because these were not identified persons who were ready to go, was the impression we were given, and that really the government just needed to find someone who was prepared to go up there and do this program. I appreciate that that in itself might have been difficult to achieve, but have you actually even contracted anyone to do this yet?

The Hon. S.C. MULLIGHAN: My understanding is that these individuals were not ready to go, as you assume they were. They were identified as being individuals who may take advantage of this particular program, but as I have said this is a program that requires very specific case management and an approach that is tailored to each individual. To infer there has been some failure or fall down in the process between making the legislative provision available in one financial year, being able to commence the program in the current financial year some three weeks and two days ago, is a bit tough, I think.

Ms CHAPMAN: Has someone been contracted to do it?

The Hon. S.C. MULLIGHAN: My understanding is that two departmental field officers will provide the necessary services in order to conduct this program.

Ms CHAPMAN: Are they already up there starting the program?

The Hon. S.C. MULLIGHAN: My understanding is that we are seeking to interview people this week.

Mr WINGARD: I refer to Budget Paper 4, Volume 3, page 74, regarding the greenways and cycle paths. In 2012-13 $2.6 million was spent, in 2013-14 $3.8 million was spent. Why has the government left the Greenway program unfinished until 2035? Why has it been shelved?

The Hon. S.C. MULLIGHAN: You may recall, member for Mitchell or other members of the committee, that there was an election commitment by the government in 2010 for a period of four years to commit $3 million to the Greenway program. The idea of the Greenway program is to provide cycleways along the major transport corridors. An existing one that we are all familiar with, for example, is the Linear Park cycleway. Works have commenced and, I understand, largely been completed for the Mike Turtur bikeway along the tram corridor down to Glenelg, and at the Marino Rocks Tramway. Also nearing completion, but with a little way to go, is the Outer Harbor or Port Adelaide Greenway along those respective rail lines, the Seaford and the Outer Harbor rail lines. That project was a four-year commitment of $3 million per year from 2010-11 to 2013-14.

Mr WINGARD: Again, I ask why it has then been left unfinished, why you did not complete the Greenway project. You said there are bits missing; I am just wondering why they are still missing.

The Hon. S.C. MULLIGHAN: My advice, if I recall it correctly, is that the 'finishing touches' to be put on the Outer Harbor Greenway, for example, require some signage and possibly some line marking to be done by the council, rather than the government, hence why no expenditure in 2014-15 from the state government perspective. I understand that all of the other works necessary from the government's perspective on those three greenways have been completed.

Mr WINGARD: So from the government's perspective they are completed?

The Hon. S.C. MULLIGHAN: That is my advice.

Ms CHAPMAN: Minister—

The Hon. S.C. MULLIGHAN: Sorry, deputy leader, before you begin, I should also identify that one of the topics of some discussion this afternoon, the ITLUP, identifies further greenways. Once funding becomes available, that may be one of the projects we select for funding, whether it is in the next five years or into the future.

Ms CHAPMAN: One of the projects raised during the election by me was the concern about adding a bikeway along Portrush Road. There was some media at the time, and your predecessor was alerted to this, I think. You, as a new minister, indicated that you would look into that, particularly given that we have just recently lost a pedestrian who was run over by a large heavy vehicle on Portrush Road, that being a transit which has some 3,000 heavy vehicles a day go down it. Has that matter been reviewed by the department and has it been put on hold?

The Hon. S.C. MULLIGHAN: Yes, it has been reviewed by me and no, it has not been put on hold.

Ms CHAPMAN: So the person I saw out there photographing on the side of Portrush Road is advancing the project—is that the position?

The Hon. S.C. MULLIGHAN: He could have been an ornithologist, as far as I am aware.

Ms CHAPMAN: I think he was a pretty easily identified DPTI representative, but in any event, it is on its way, is it?

The Hon. S.C. MULLIGHAN: Yes.

Ms CHAPMAN: Well, we will see. I refer to page 90, the $100 million MAC road safety funding. Was the $100 million funding provided to the government from projects such as the Britannia roundabout upgrade and Magill and Glynburn roads intersection paid into the Highways Fund?

The Hon. S.C. MULLIGHAN: My understanding is that the $100 million MAC contribution to road and other road safety projects is a matter for the Minister for Road Safety. Nonetheless, I can provide some information about the relationship to the Highways Fund. My understanding is that those projects are funded from the Highways Fund, but I have to say I could not get into the grotty detail about the timing of the transfers from the Motor Accident Commission to Treasury's Consolidated Account and from the Consolidated Account into the Highways Fund.

Ms CHAPMAN: I have not asked for the dates of transfer. I am just asking whether the $100 million actually was paid ultimately. Minister O'Brien had the initial conduct of this, although I think that was scant, to say the least, in the sense that the announcement had been made in last year's budget and he was not terribly familiar with what it was going to be spent on other than what was announced, or the detail about who had it or who had control of it. Hence, I am asking today, did it ultimately find its way into the Highways Fund, which is in your department?

The Hon. S.C. MULLIGHAN: My understanding is—I could not comment specifically about projects—that the $100 million was paid from the Motor Accident Commission to 'Treasury', most likely the Consolidated Account, and then as projects are identified and funding is to be released to carry those projects out, that money is released from Treasury into the Highways Fund and then paid for the purposes of those projects.

Ms CHAPMAN: So how much is due still of that $100 million to be paid into your Highways Fund?

The Hon. S.C. MULLIGHAN: In very general terms, I think what we understand is that there were two broad allocations into the future. There was the $52-odd million and the $47-odd million and that is broken up between the financial years of 2013-14 out to 2018-19. Some projects are quite longstanding. In fact, in particular, the 2018-19 one I understand, is the APY lands. Given the disaggregation of the $100 million over that forward estimates period, my assumption, and I would have to check this, is that that money would be released from the Consolidated Account into the Highways Fund which would then be released to pay to whoever is undertaking those projects.

Ms CHAPMAN: If you could check that minister to identify how much is still due from the Treasury/Consolidated Account to complete that exercise for the projects. I appreciate you are getting it drip-fed—as you say, the projects are coming through—but if you could get the amount you are still due to be paid from that fund. Will all the funding that the government anticipates receiving from the privatisation of the Motor Accident Commission be paid into the Highways Fund as it currently exist or will the Highways Fund be changed?

The Hon. S.C. MULLIGHAN: That is a good question. My understanding from the Treasurer, and this is really a matter which is best directed to him, is that whatever proceeds are realised from the MAC process would be, I presume, made available to the government, whoever contracts with the government under that arrangement—to Treasury—and then if they are to be paid into the Highways Fund they would be done so. I am not aware of any necessity or plans to alter the Highways Fund. I think there may have been alterations to the Highways Fund in previous years but I am not sure that they are related or anything to do with these sorts of processes.

Ms CHAPMAN: The only reason I ask is because you are the minister responsible for the Highways Act 1926 and I assume your acting director is the current acting commissioner for highways and that is an act that is allocated to your responsibility. The government has already announced that they are going to put this money from the fund into the Highways Fund. It has certain controls under this act, and I would just like to know if there is any proposed change to the administration of that fund or how it is going to operate for the purposes of receiving those funds?

The Hon. S.C. MULLIGHAN: I am not aware of any need or necessity to change the Highways Fund but if that does become a necessity into the future then I will obviously be bringing a bill to the house.

The CHAIR: I would like to move on to public transport if you want to change your advisers, minister. I understand we have a change of personnel.

Membership:

Mr Tarzia substituted for Ms Chapman.

Departmental Advisers:

Mr L. Di Lernia, Deputy Chief Executive, Public Transport Services, Department of Planning, Transport and Infrastructure.

Mr T. Crackett, Executive Director, Business Services, Department of Planning, Transport and Infrastructure.

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

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

Ms J. Tepohe, Director, Finance, Department of Planning, Transport and Infrastructure.

The CHAIR: I understand the member for Mitchell will be the lead speaker for the next half an hour. Go ahead, member for Mitchell.

Mr WINGARD: I start by referring to Budget Paper 6, page 80, Budget implications, and Public transport cost recovery—special events tax. Is the minister able to provide a list of events that you expect to be included in this measure, events that will be associated with the public transport cost recovery special events tax?

The Hon. S.C. MULLIGHAN: I begin by correcting the member of Mitchell's nomenclature. It is neither a levy nor a tax. The use of either term would imply a consistent charge which would be applied to a broad number of people for a common purpose, and that is not what we are looking at here.

What we have said is that for public commercial events of over 5,000 people, they will be required to notify the government with at least six months lead time. We have also said that for events which have already been planned and 'set in stone' we will not be applying this new measure to them but, for those events of attendees of more than 5,000 people, they will be required to notify the government.

That will give the government the opportunity to sit down with the venue manager and, perhaps subsequently, the event organiser, to discuss the nature of the event, how many people are likely to come to the event, how long the event goes for, how people are expected to move to and from the event (whether it is in dribs and drabs over a long period of time or en masse over a shorter period of time) and examine how they are likely to do that, whether it is by car, public transport or a mixture of both, and whether public transport services, as scheduled, are able to accommodate that or if, indeed, there need to be additional public transport services provided to accommodate the event.

In the event that additional public transport services are required, is it desirable for the venue manager and event organiser that that should be free public transport or public transport made available at the ongoing regular public transport rates, depending on whether they are on a week day, a weekend, in peak hour, etc.

We will have a discussion after all of that decision tree is climbed through, to continue the analogy, to see if there are additional public transport services and additional costs likely to be incurred in the provision of those public transport services and how the costs for those might be met. We envisage that it is likely there will be a combination of people who can contribute to that. It could be the venue manager, it could be the event organiser, or it could be, indeed, people who are attending the event, or a mixture of all three.

Mr WINGARD: That was a long-winded answer to the question of which events it would be, and I did not hear you name an event. I am just wondering how you came up with the $3.921 million in cost recovery for 2015-16 if we do not know which events are going to be hit.

The Hon. S.C. MULLIGHAN: I think it is fair to say that, based on past experience, we have a fair handle on the number of events and the number of events which at least we think we would need to be notified of—not necessarily captured by this measure and cost recovery applying to them, but the number of events that we will be need to be notified for, nonetheless. It may be as many as 100 events. Then we would go through, as I spelled out in some detail earlier, that decision making, along with the venue manager and the event organiser, to work out what the right solution is and who should pay for it.

Mr WINGARD: Given that six months lead time, can you identify the first event that will be subject to cost recovery?

The Hon. S.C. MULLIGHAN: Perhaps not the first event but a perhaps prominent series of events, and that would be the 2015 AFL season, for example. We would sit down with the SMA, as the venue manager, and talk to them. I guess we have the experience of how this year has gone and the costs of providing that. My understanding is that the 'football' contribution (which I think relates mainly to the SMA but I do know that the two AFL clubs make a contribution currently) is based on what the case was down at AAMI Stadium.

On our best endeavours at AAMI Stadium, a stadium which had a capacity of approximately 50,000 people, with the then Footy Express services, which were bus only, we were moving in the order of about 10,000 people, or about 20 per cent of the capacity. We are, of course, moving numbers far in excess of that. I think the average is somewhere in the order of about 25,000-odd people to and from the game. The costs that are being incurred back at AAMI Stadium and continuing on by football, by the stadium manager, is approximately, I think, $730,000.

We estimate our cost of providing the free public transport in total at being approximately $2½ million, so you can see that a significant amount will be made up by them and, as I was at pains to say earlier, it will be up to the Stadium Management Authority and the SANFL and the SACA as their two composite members and of course the two football clubs, which are particularly interested in the AFL season, to work out how to divvy up those costs.

There are varying schools of thought on that, I think it is fair to say. I think there is one view, and I am not necessarily saying it is mine, that if you are delivering 25,000 people for free to an event on your doorstep and you are slugging them $8.50 for a beer and presumably something in the same order of magnitude for a hot dog, then you can understand that the SMA may have a significant role to play in meeting those costs.

Mr WINGARD: With the greatest respect, if you are not calling it a tax and you are going to charge them $2.5 million, you cannot keep saying it is for free. It is $1.75 million that we are making up there, so you can confirm that $1.75 million will be divided by the two AFL clubs. That will go towards football. That is what you are saying, as far as I can check the numbers.

The Hon. S.C. MULLIGHAN: No, that is not what I am saying at all. I am saying that—

Mr WINGARD: Football will not pay that?

The Hon. S.C. MULLIGHAN: I am saying that the legislation is designed for the venue manager, whether that is the venue manager at Adelaide Oval, being the SMA—

Mr WINGARD: In this case it is football you are talking about.

The Hon. S.C. MULLIGHAN: No, I am talking about the Stadium Management Authority, which is a private organisation comprised of the SANFL and the South Australian Cricket Association—

Mr WINGARD: With the greatest respect, the example you gave was football. That was the example you were referring to.

The Hon. S.C. MULLIGHAN: For football games, yes, but let me be very specific and very clear about this. The legislation is tailored at the venue manager. I will give you perhaps another example aside from Adelaide Oval and the Stadium Management Authority—not the football clubs, but the Stadium Management Authority. Another one would be Clipsal and the Clipsal 500. If we are providing public transport services there, the venue manager, which might easily be confused with the event organiser, is the Adelaide City Council.

We would be talking to the Adelaide City Council about delivering in the order of 270,000 to 290,000 people over four days there. Of course, they are going to go very quickly to the event organiser, the South Australian Motor Sport Board, but the reason why the legislation is drafted as it is for the venue manager is to recognise that these are commercial events. The venues are provided on a commercial basis to the event organisers and, as such, the venue manager, the event organiser as well as anybody who may attend those events all may or may not have a role in meeting the cost of that.

I will take you up on this again: just because an amount of money is raised, it does not mean it is a tax or levy. Taxes and levies are amounts that are charged on a consistent basis on a collective group of people. For example, land tax, the emergency services levy, stamp duty and income tax all have prescribed rates which apply either to properties or to individuals on a consistent basis. What I am at pains to point out here is that we are not applying a certain dollar amount on a consistent basis for certain individuals. It may be that people turn up to events—

Mr WINGARD: Can you tax a group, though, as well as an individual? Can you put a levy on a group? The Stadium Management Authority might disagree with what you are saying and say they are being levied for their events over 5,000 people.

The Hon. S.C. MULLIGHAN: Yes, but it is on a consistent charge that is being applied across all events and for all people who have a commercial interest in those events.

Mr WINGARD: If the Stadium Management Authority has an event of over 5,000 people, you will hit them with this cost recovery?

The Hon. S.C. MULLIGHAN: No, I will speak to them about their event and see if we need to talk about providing public transport services to them. In the event that we do need to provide public transport services, we would then investigate whether the existing scheduled public transport services are sufficient to meet their needs. In the event that they are not sufficient to meet their needs, we will have a conversation with them about what level of services would be required to meet the needs of that event and then we would have a conversation with them about whether those public transport services should be free or whether they should be ticketed. If they are free or if they are ticketed, we will then have a discussion about how we would recover the costs for those additional public transport services.

Mr WINGARD: Just quickly on that, which might clarify the point here, what about the Australia Day concert at Elder Park?

The Hon. S.C. MULLIGHAN: No, we would regard those sorts of large-scale, free of entry, community events which are longstanding as non-commercial events and community events. We would still meet with them, we would still discuss public transport needs, indeed, we may even provide public transport services ticketed or free of charge, but it is our very strong intention that the scope of this cost recovery regime is limited to commercial events and events where there is not a broad community interest. Let me give you another example, the Christmas Pageant. We would want to talk to the Christmas Pageant, but we have no intention whatsoever of talking about recovering the cost of public transport. That gives you an idea of the sorts of delineation that we put between what a commercial event is and what a community event is.

Mr WINGARD: Is there any chance you could put a list out to let people know?

The Hon. S.C. MULLIGHAN: We have already started doing this. We have been meeting with venue managers and also event organisers and we have been talking through the specifics of the regime because it is very easy for people who are not informed to misrepresent the regime, whether it is by mistake or whether it is by design, as has been the case since the release of the state budget and we clarify the purpose of the scheme and we start commencing having those discussions about it.

As I have said, for those events which have already been organised we are looking not to apply the regime to them. We are also asking people to give us notice at least six months out from their event, so you can see or get the impression that we are putting a fair period of time between now or, indeed, whenever the act becomes gazetted, if and when it passes through the house, and that we will be talking with venue managers about their events.

Mr WINGARD: Had specific approval been provided by cabinet or the minister for increased expenditure for free public transport services for football at Adelaide Oval prior to Rod Hook announcing the 2014 AFL season arrangements during the election campaign?

The Hon. S.C. MULLIGHAN: I am sorry, I missed the first part of that question?

Mr WINGARD: I will slow down, my apologies. Had specific approval been provided by cabinet or the minister for increased expenditure for free public transport services for Adelaide Oval by Rod Hook prior to the election?

The Hon. S.C. MULLIGHAN: First of all, as I had to remind the deputy leader who should know better, we do not talk about what may or may not have been discussed or approved at cabinet. Second of all, I am not sure whether the quantum was such that an approval was required and, thirdly, I would have to check if that was indeed given.

Mr WINGARD: You will check to see if it was before or after when that decision was made?

The Hon. S.C. MULLIGHAN: Once I have worked through—sorry to use a terrible phrase, I just cannot think of anything better—that decision tree, I will determine whether it is appropriate for me to make a response to the committee.

Mr WINGARD: That is fine, thank you; the phrase is no problems at all. If I can move on to Budget Paper 4, Volume 3, page 73, investments in new projects. I am just wondering, given your reports on radio today, what the estimated cost of fare evasion in 2013-14 was and what percentage of commuters were fare evaders in 2013-14?

The Hon. S.C. MULLIGHAN: The estimated fare evasion in dollars for 2013-14 was $3.152 million and on a weighted basis we feel that represents 3.77 per cent.

Mr WINGARD: Thank you. In comparison to the previous year? Do you have those figures?

The Hon. S.C. MULLIGHAN: I do not have that information with me. I would have to check whether we have that information. Perhaps it may help the committee if I provide some background on fare evasion. The experience of both transit police and PSAs is that fare evasion tends to be more prevalent on trains and trams, for different reasons.

With trains, for example, people may well be riding train services within lines, not necessarily departing at the Adelaide Railway Station and not necessarily boarding at the Adelaide Railway Station, both of which require you to validate your ticket or Metrocard when you pass through the ticket barriers. So, we make an estimate—and it is nothing more than an estimate; we have little evidence to support the estimate—that there is a level of fare evasion that occurs between stations, for example, and that informs our thinking when it comes to trains.

With regard to trams, we have a complexity in that there are two segments of the tramline which are free for people to ride. Between the Entertainment Centre and South Terrace, people are not required to pay to ride that tram service. I think there are also three stops in Glenelg, between Brighton Road and the terminus at Moseley Square, where people are not required to validate their ticket. The concern can be whether people are boarding either in those free areas and assuming a seat or standing somewhere on the tram vehicle and then not doing the right thing once they pass into a ‘ticketed zone’.

Mr WINGARD: When people are fined in that situation, do you give out expiation fines as well as expiation cautions like the police do? Is that how the fines are handed out?

The Hon. S.C. MULLIGHAN: There are a few approaches. Just to close off my earlier point, it could be that people are boarding in areas where they are not required to validate their ticket, where they can travel for free, and then they find themselves in the ticketed part of the corridor. Or it might be the other way around, where people think, ‘Well, I’m a few stops out of South Terrace heading into the city; I’ll chance it, what’s the risk?’ They jump on and they do not pay and they travel in to their place of work, for example, into the CBD, without paying. So what we have is both transit police and PSAs and they undertake operations both in uniform and undercover, and they are able to issue expiation notices for $220 to people who have not done the right thing.

As to the use of cautions as opposed to the issuing of expiations, I have to say that I am not 100 per cent familiar with the prevalence of issuing cautions. My advice is that we do not tend to issue cautions. What we may do in some instances, for example, is if somebody has the incorrect concession or if they claim a concession fare and they are not able to substantiate that they are entitled to that concession fare, we may give them a small window of time to be able to come back and demonstrate that they are in fact entitled to that concession.

Mr WINGARD: So unlike the police, who can give an expiation fine and an expiation caution, the transit police or PSAs cannot do that? Cannot or do not?

The Hon. S.C. MULLIGHAN: My advice is that generally they do not. It appears that they may have a discretion, because I have some figures here—and this is not necessarily related to fare evasion, I should caution before providing the figures. In 2013-14, there were 4,808 transit incident reports and 3,984 expiations issued. So we are talking about one in six of those transit incident reports. They may be cautions or they may be some other incidents that were not followed up with either a fine or an arrest.

Mr WINGARD: So the system is different to the police system? Even when police come on and are involved in these operations that you have had recently, they can give an expiation fine and/or a warning or can they only give the fines, as you are pointing out?

The Hon. S.C. MULLIGHAN: I am not sure it is the case that they are restricted and they must provide a fine. I think the advice is that they tend not to issue cautions; they tend to fine people. That is really because, as I spelt out, we estimate that we are losing $3.152 million in fares through fare evasion, and when you contemplate that we collect in the order of the mid 80s in millions of dollars of revenue, that is a significant proportion, some 3.7 per cent. We need to get the message out there.

We have 60-odd million passenger journeys each and every year across buses, trams and trains, and there are a significant number of people who do the right thing. I get a lot of correspondence into my office, and I know that I have had several members of parliament write to me about this, saying 'Look, this person thinks they have extenuating circumstances, is there any discretion that can be shown?' I have to say that I get a fair bulk of correspondence which also says 'Do know what really gives me that heebie-jeebies, minister Mulligan? It is that I did the right thing and validated my ticket and I sat there on the service that the government is providing today and saw one or more people board and not do the right thing.'

Mr WINGARD: I fully understand what you are saying. I just want one last bit of clarification, if I can, from an official point of view, again just getting clarification between transit police and police from SAPOL that they do issue expiation warnings and fines. If you just give a warning, from a transit police officer or PSA's point of view it is just a verbal; if you are given a piece of paper that is a ticket. Is that the case? I do not expect you to know that, minister, but I am hoping that someone alongside you does.

The Hon. S.C. MULLIGHAN: I might have to come back to the committee with an answer because, as you can imagine, the abilities and powers of a PSA are quite separate from the ability of a transit police officer. Transit police are sworn officers with all the same training and all the same powers as a normal police officer; it is just that they are dedicated to the transit corridors and to the public transport system.

Mr WINGARD: Could you ask for that answer now for me? Is that possible, to clarify that now?

The Hon. S.C. MULLIGHAN: The advice I have—and I am happy to bring back better particulars to the committee on this—is that both PSAs and the police have a discretion to issue a warning. What may happen in other instances is that a name and address may be requested from the offender by a PSA. That is then provided to the regulatory section, and then an expiation can be issued to that person. So it is not necessarily on the spot but it is not too far from the spot.

Mr WINGARD: So the issuing officer can make the decision as to whether it is a fine or not, even if the transit person has said otherwise?

The Hon. S.C. MULLIGHAN: Yes. My understanding is that they do have that discretion, but that in practice we tend not to use the discretion as far as possible. Of course, I should also make it clear that PSAs do not have the sorts of powers that police do in terms of detention or arrest for people who are not necessarily just fare evaders but who are not doing the right thing on public transport; if there is drunken or disorderly behaviour or antisocial behaviour, or assaults or anything like that.

Mr WINGARD: Just to jump quickly to Budget Paper 4, Volume 3, page 95, the 2013-14 estimated result/2013-14 budget. It states that the $7.1 million increase in expenses is primarily due to the bus substitute service and other operating costs in 2013-14 to support the rail capital program. I am just wanting to know what was the impact on total revenue of the bus strike in February 2014 when SouthLink company bus drivers walked off the job, and was the cost of the strike borne by the bus company or the government?

The Hon. S.C. MULLIGHAN: If you think about the impact on revenue, yes, you might think that we were collecting less revenue, but we were also procuring less services from bus contractors. My understanding is that it is just as valid a point to make that if we are procuring less bus services, for which we do not fully cost recover through public transport fares, any cost to the government in lost revenue may in fact be netted out by not having to pay to procure those services.

Mr WINGARD: They were still running the services, they were just not collecting tickets.

The Hon. S.C. MULLIGHAN: That was an incident that I am aware of, or incidents of which I am aware, but if we are running less bus services, if we are procuring less bus services at a point in time, if as part of a strike action, for example, buses are not being operated full stop, let alone whether they are operating and picking people up, but if they are not being operated full stop we are obviously not paying the bus operator to procure those services. Given that we do not fully cost recover for bus services then whatever cost we may have borne, in theory, through not collecting fares from those other incidents may well have been reduced or even netted out from not having to procure other bus services.

Mr WINGARD: Would you mind getting back to the committee with a figure from when they were not collecting bus fares, if there was a—

The Hon. S.C. MULLIGHAN: As you can imagine, the way in which we can estimate patronage is through validations, so if people are not paying to ride public transport, they are not validating, it can be very difficult for us to make estimations about patronage, hence it would be difficult to make an estimation of the number of patrons on a vehicle who have not paid, because other than having to sit down and review CCTV footage we do not have a reliable system like the Metrocard system gives us of boardings on buses, for example. So, that may be difficult but we can look into it.

The CHAIR: Thank you, minister. There being no further questions for the minister, I declare the examination of the proposed payments for the Department of Planning, Transport and Infrastructure and administered items for the Department of Planning, Transport and Infrastructure completed. I lay before the committee a draft report.

Mr GEE: I move:

That the draft report be the report of the committee.

Motion carried.

At 17:02 the committee concluded.