Department for Trade and Investment, $106,640,000

Administered Items for the Department for Trade and Investment, $951,000

Administered Items for the Department of Treasury and Finance, $2,365,934,000

Membership:

Ms Pratt substituted for Mr Cowdrey.

Minister:

Hon. N.D. Champion, Minister for Trade and Investment, Minister for Housing and Urban Development, Minister for Planning.

Departmental Advisers:

Mr C. Menz, Chief Executive, Renewal SA.

Mr M. Wood, General Manager, Commercial and Corporate, Renewal SA.

Mr T. Cole, General Manager, Major Projects and Pipeline, Renewal SA.

Mr T. Perry, General Manager, Project Delivery and Property, Renewal SA.

Ms R. Ager, Director, Office of Chief Executive, Renewal SA.

The CHAIR: Welcome everybody. The portfolio is Renewal SA. The minister appearing is the Minister for Housing and Urban Development. I advise that the proposed payments remain open for examination and that the administered items line for the Department of Treasury and Finance is now open. I call on the minister to make a statement, if he so wishes, and to introduce his advisers. I call on the lead speaker for the opposition to make a statement, if they so wish. I call on members for questions.

The Hon. N.D. CHAMPION: I will do introductions first. This is Mr Chris Menz, Chief Executive, to my left, and Mr Michael Wood, General Manager, Commercial and Corporate, and to my right is Tony Cole, General Manager, Major Projects and Pipeline. Behind me is Rose Ager, Director of the Office of Chief Executive, and Mr Todd Perry, General Manager, Project Delivery and Property. I would just like to make a very short statement thanking Renewal SA and all the staff for their hard work on behalf of the state, and I will proceed directly to questions.

Mr TELFER: I will proceed directly to questions. Thank you very much, minister. I will direct your attention, obviously, to Budget Paper 3, page 77, which is the accumulated amount of the Renewal SA budget allocations. Can I firstly ask on the Bowden Gasworks site, what is the status of the review, and is it on track to be delivered within the stated times?

The Hon. N.D. CHAMPION: The review is actually being managed by the Department for Trade and Investment, for probity reasons, so you should have really directed your question to me in the previous session. It is on track, and we do expect it to report along the time lines that I have previously indicated to the parliament.

Mr TELFER: Can you let us know how many more weeks until you expect that to be completed from today?

The Hon. N.D. CHAMPION: No, I cannot give you a blow-by-blow description. It is being managed by the Department for Trade and Investment, and Mr Reynolds, and as I said before the appropriate time and place would have been to ask in the previous estimates. I can understand why the member would ask me now, but because these things are commercial-in-confidence, and there is a great deal of sensitivity about them, I have left that to the department to manage.

Mr TELFER: What is the involvement of the RSA procurement team in the review?

The Hon. N.D. CHAMPION: To clarify your question, are you talking about the review or the sale?

Mr TELFER: The review.

The Hon. N.D. CHAMPION: The review has been undertaken by the Department for Trade and Investment. Renewal SA only provides them with information to AECOM and the reviewing team upon request.

Mr TELFER: Has the proponent MAB expressed any concerns with the review with respect to the timing?

The Hon. N.D. CHAMPION: There are two processes going on here: on one hand there is the government's election commitment to have a review, to release the weightings and other criteria around the Bowden Gasworks proposal, which was announced by the previous government very shortly before the caretaker agreement. So that process is being undertaken by the Department for Trade and Investment, and then Renewal SA continuing their good faith negotiations with MAB. I have not met with MAB, I have left all the negotiations to Renewal SA. MAB have asked Renewal SA about the time line as part of those negotiations.

Mr TELFER: Has MAB expressed concerns to Renewal SA about those time lines?

The Hon. N.D. CHAMPION: These are commercial-in-confidence negotiations, so I do not think it is sensible to characterise them in any way. I think I have provided the information that they were interested, understandably, in the time line, as you are. I have indicated what the time line is to the parliament, and I think I have indicated what the government's election commitment is many times and we have discussed this a lot, but I do not think it is sensible for any of us to set a standard where we would be talking about negotiations or about different participation in the negotiations.

Mr TELFER: I am only asking if they have expressed concern, that is all, not detailed negotiations.

The Hon. N.D. CHAMPION: Yes, but the honourable member would understand that all negotiations, whether they be industrial, whether you are negotiating on your farm or you are on council as mayor and are negotiating, it is just not sensible, where you have commercial-in-confidence arrangements, to be giving any commentary on them, and I will not give any commentary now and I will not be in the future.

Mr TELFER: Minister, for how long will MAB hold its pricing, given the rapid changes we have seen in construction costs in recent months?

The Hon. N.D. CHAMPION: As part of the process set up by the previous government, the preferred proponent is required to hold all of those numbers until a deal is finalised.

Mr TELFER: Has the delay to the project changed the project's financials, resulting in higher risks to the state, particularly around the cost of remediating contamination?

The Hon. N.D. CHAMPION: Just to take a step back so that the honourable member understands how this is accounted for in Renewal SA's books, the Bowden Gasworks sale would only be accounted for in any way once the agreement is signed. At the moment, Renewal SA is assuming the original plan, which I think dates back to the decision of the government in 2010, if you go back and look at the Public Works Committee hearings that were held at the time. So the current budget assumes that Renewal SA would be undertaking and paying for the remediation on the site.

Mr TELFER: Has there been any consideration by Renewal SA into the potential risks of a change of financials around those costs due to the process?

The Hon. N.D. CHAMPION: It is no different to the previous government's approach. There is a contingency built into all these projects to account for the rising cost of remediation or any other factor that might go into a project. Projects are only put in the books once they are signed. So it is common sense that, for example, if you were going to sell me your house, we would only regard it as sold when you sign the contract and the cooling-off period has finished.

Again, with Renewal SA's projects, it is only when the deal is done that they appear in the budget. Until that time, all the remediation costs and all the other factors around Bowden or any other proposed project are accounted for as part of Renewal SA's accounting, and there are appropriate contingencies left for them.

Mr TELFER: Do you believe that the contingencies that have been set aside are going to be adequate for any of those changes?

The Hon. N.D. CHAMPION: In Bowden's case, Renewal SA had anticipated and projected for a high degree of remediation cost. My advice is that it is already factored in.

Mr TELFER: Obviously, then, Renewal SA has done some work to consider if any changes might be within the contingencies. What I am trying to get to is whether the work has been done to make sure whether any delay due to the review or the process has caused any extra costs that have not been accounted for. You are saying that there is a high degree of contingency.

The Hon. N.D. CHAMPION: On remediation?

Mr TELFER: On the whole project, but obviously remediation is a major component of it.

The Hon. N.D. CHAMPION: It would be fair to say Renewal SA is very familiar with the remediation task on this site. I am advised that they look at it every six months, and they are confident that their numbers adequately reflect the task that we might face.

Mr TELFER: I certainly agree that they are well versed with this project. Has the proponent, MAB, been advised that it may need to restructure its proposal to accommodate any outcomes of the review?

The Hon. N.D. CHAMPION: Advised by whom?

Mr TELFER: Renewal SA.

The Hon. N.D. CHAMPION: No.

Mr TELFER: Has the probity adviser for the project expressed any concerns around the structure of the review?

The Hon. N.D. CHAMPION: The review is, as I said before, being undertaken by the Department for Trade and Investment. One of the reasons we did that is to meet the highest probity standard and to make sure that Renewal SA was separated from the review process because we thought that would be the best thing for the state of South Australia.

Mr TELFER: If the government decides to overturn the independent process undertaken by Renewal SA for the selection of MAB to develop the gasworks site at Bowden, will the government compensate the proponent?

The Hon. N.D. CHAMPION: I will not be entertaining hypotheticals about the future.

The CHAIR: Can we tie it a bit closer to budget lines?

Mr TELFER: Budget Paper 3, page 77.

The CHAIR: I know there is a review. We can talk forever about the review and what might happen—

Mr TELFER: This is about the operations of Renewal SA.

The CHAIR: —but it is highly speculative what that review is going to turn up. If we can make it somewhat tighter. I have been pretty flexible.

Mr TELFER: Indeed. I appreciate that, Mr Chair. I am happy to move onto the next subject matter, minister—and you did direct us in the previous session—with questions about the Australian Space Park. It is to do with Budget Paper 3, page 77, and Budget Paper 4, Volume 4, page 117 is also incorporated within this project. Can the minister highlight if there is any expenditure on the Australian Space Park project in the 2022-23 budget?

The Hon. N.D. CHAMPION: It is proposed that the construction of the park will be done by a private developer, so it is not a cost to Renewal SA in that year. As I described before, there will be the construction. Even when a lease is concluded, after negotiations, then construction will be by the private consortium, then the fit-out, as we talked about in the previous estimates session, will occur, and then it is proposed that the opening will be in 2025.

Mr TELFER: Do you have a time line on, firstly, expected construction starting and completion dates?

The Hon. N.D. CHAMPION: We are projecting out, but the first step is to successfully conclude an agreement with both a lease and a private developer and then everything flows from that. As I said before, you can see from our budgeting in the Department for Trade and Investment that we have budgeted for the fit-out. We are very hopeful that this will proceed as the previous government expected. I am leaving it, obviously, to Renewal SA. We want to make sure that we get the best possible deal for the state of South Australia. I know Renewal SA have a keen eye for good value and good negotiation, so we should let them do their work and I am confident everything will flow from that.

Mr TELFER: Do you have any insight into when the agreement with the developer might be finalised time wise?

The Hon. N.D. CHAMPION: I think it would be foolish for me to speculate about that. These are commercial-in-confidence negotiations. We want them to happen in good faith for the progress of the state. I would be happy to facilitate for the opposition a briefing if they wish, but I would be reluctant to speculate in estimates hearings about it.

Mr TELFER: Is the minister confident that it will be completed in time to have the construction begun for the estimated 2023-24 fit-out, and to then be looking at the completion date at the end of June 2025?

The Hon. N.D. CHAMPION: We would not have budgeted for it if we were not planning to have the fit-out in that year.

Mr TELFER: I am asking about the process.

The Hon. N.D. CHAMPION: Of course, but we have to get the lease negotiated. I think it is sensible for all of us to leave that to Renewal SA. They have a very good chief executive and negotiating team. We should leave that to them and then in subsequent estimates I am sure you will be asking me about the fit-out and the construction. Essentially, our aim as a government is as bipartisan as it can get with the previous government.

Mr TELFER: Indeed, I am sure I will be referring to these notes as I look at the next estimates. Can you give me an insight into the federal government's support level for the project through grants and funding?

The Hon. N.D. CHAMPION: Again, I think we went over that a little bit in—

Mr TELFER: And you sort of passed it to this session as well.

The Hon. N.D. CHAMPION: There is obviously complex interaction, and I think we talked about that. It would not come to Renewal SA; it would come to the Department for Trade and Investment. Obviously, I will undertake to talk to the federal minister, Ed Husic, who I served with in the national parliament and who I know well and who I am very pleased is now the industry minister. I will undertake to find from his office an answer. I am sure the member for Elizabeth would know Minister Husic's Chief of Staff, Mr Brett Gale. He is a friend of South Australia. I will undertake to find out for the opposition the status of those payments.

Mr TELFER: Thank you. Do you have an insight into how many companies will be able to make the Space Park their base?

The Hon. N.D. CHAMPION: Four to five major companies, but we are also anticipating that there might be growth in the future and are planning for that growth.

Mr TELFER: Adelaide Airport was highlighted as a prospective location for the Australian Space Park. Have you spoken to Adelaide Airport in relation to this since becoming minister?

The Hon. N.D. CHAMPION: I had an introductory meeting with Adelaide Airport in my office and it was raised as a general issue, but I have left all the negotiating to Renewal SA, as you would expect. These are important negotiations for the state. Renewal SA has a process where they look across the state, look at making sure they get value for money for the taxpayers of South Australia.

Mr TELFER: Flowing on from that, are any other locations for the Australian Space Park being actively considered?

The Hon. N.D. CHAMPION: There has always been a range of options, and I think it is sensible in any commercial-in-confidence negotiations that Renewal SA might enter into that I do not speculate about those options. I think it is important that the opposition do not speculate about it either. We hope to continue in the same endeavour and with the same energy with which the previous government approached this very important initiative. I am very confident that Renewal SA can successfully conclude their negotiations so we can get on with building a space park and then driving this industry.

Mr TELFER: To clarify, the negotiations with Adelaide Airport have commenced, but there has been no agreement as yet reached?

The Hon. N.D. CHAMPION: That is correct.

Mr TELFER: Is there an insight into a target of when the construction will commence?

The Hon. N.D. CHAMPION: If the negotiations are commenced and concluded, we would expect construction to begin next year and the fit-out and all the rest of it to follow, and for it to open the following year after that.

Mr TELFER: Can you clarify that 2024-25 when construction—

The Hon. N.D. CHAMPION: For opening.

Mr TELFER: For opening. And that it is when it can be available for companies to start operating from?

The Hon. N.D. CHAMPION: Predicated on a successful conclusion of leasing arrangements, and obviously they are still being negotiated.

Mr TELFER: Is the minister taking any additional steps to make sure that we retain the first mover advantage that we have and that we keep attracting investment and manufacturing to the Australian Space Park? What is the minister doing proactively to try to make sure we lock that in and maximise the opportunities?

The Hon. N.D. CHAMPION: These are leasing arrangements. The first section of it is properly left to Renewal SA's management.

Mr TELFER: Indeed.

The Hon. N.D. CHAMPION: And I think that is appropriate. As I said before, this is a bipartisan endeavour, but there might come a time when the minister, and indeed the shadow minister, might be out there pumping up the industry and trying to facilitate it. Obviously, DTI will be doing their approach to Invest SA and all the rest of it, but at the moment, at this phase, the appropriate thing for a minister to do is to leave these negotiations to Renewal SA to undertake on behalf of the state of South Australia.

Mr TELFER: The question was not about the negotiations. It is about what you are doing as a minister to look at that next step. You are not actioning anything at the moment? You are waiting until the agreement is in place and construction has begun? There is nothing happening at the moment?

The Hon. N.D. CHAMPION: There is plenty happening. There is a budget allocation to it.

Mr TELFER: That is what I am trying to work out: what role you have as minister in that.

The Hon. N.D. CHAMPION: One has to be careful, I think. There are commercial negotiations. I trust Renewal SA; I have a high degree of trust in the expertise of the management team of Renewal SA and I am confident that they can successfully conclude this sensitive stage of this project. Once that is concluded then obviously there is a role for the government, but you do not put the cart before the horse.

Mr TELFER: No, but you want to know where your cart is going.

The Hon. N.D. CHAMPION: Two country boys arguing.

Mr TELFER: Yes, that is the problem. I will cast the minister's attention back to the general Renewal SA, Budget Paper 3, page 77. Can the minister advise of the status of the Playford water recycling scheme?

The Hon. N.D. CHAMPION: Renewal SA is continuing to attempt to source water for this very important project, both for open space and for residential. I suspect the honourable member knows that this has been an ongoing issue for some time and it properly should have the attention of estimates, but at the moment Renewal SA is still negotiating.

Mr TELFER: Negotiating with who?

The Hon. N.D. CHAMPION: I have some history on water projects in the north.

Mr TELFER: I can imagine.

The Hon. N.D. CHAMPION: I could talk for a long time about the Bunyip water scheme, which was originally the Gawler water re-use scheme, but of course there is also a range of water projects: the northern areas irrigation scheme—

Mr TELFER: Do not divulge too much. I am happy to look at the Playford water recycling scheme.

The Hon. N.D. CHAMPION: There is some interaction, though, between sources of water across the north. Renewal SA is in negotiations with the City of Playford and the northern area irrigation scheme to try to see if there is an offtake of water that might be used for the residential areas and for open space.

This is an issue that has run across a couple of different governments. There are some technical challenges, but it is a worthy aim. My experience with water projects across the north—and the reason I mention Bunyip water scheme is that the Bunyip water scheme, which now provides water to the western Barossa, was originally supposed to provide urban water for Gawler. Often these projects are very tough to negotiate and sometimes they take some time. Renewal SA is endeavouring to make that project work.

Mr TELFER: You have mentioned that negotiations with the City of Playford are happening. Has the minister or Renewal SA had any negotiations with Water Utilities Australia in relation to its proposal?

The Hon. N.D. CHAMPION: Renewal SA has been talking to a range of parties across the north in relation to water.

Mr TELFER: Is it Renewal SA's position that the most cost-effective option for government is for all allotment connections within the scheme to be disconnected?

The Hon. N.D. CHAMPION: That is not the preferred option or approach. The preferred option or approach is to obviously get water to complete this project. I might add that there have been a huge number of water projects across the north and, as I said before, there are challenges in delivering them. The City of Salisbury, and Playford, had the first aquifer storage recharge, so there has been a great ambition in the north about water. Our preferred outcome is for the scheme to begin operation but, clearly, there is always going to be an option there to do what the member articulated.

Mr TELFER: That being the case, is Renewal SA undertaking a risk assessment relating to the abandonment of this scheme?

The Hon. N.D. CHAMPION: Renewal SA would furnish me with a risk assessment in any circumstance, including this one, if that were appropriate.

Mr TELFER: Has Renewal SA done any calculations on the financial impact of abandoning the scheme?

The Hon. N.D. CHAMPION: They have, but they have not been finalised.

Mr TELFER: Is there an expected conclusion date when those numbers will be finalised?

The Hon. N.D. CHAMPION: In the next six months.

Mr TELFER: Until such time as the government does decide to change the scope of the Playford water recycling scheme, is Renewal SA continuing to install the infrastructure that goes along with that?

The Hon. N.D. CHAMPION: Yes.

Mr TELFER: Flowing on from that—no pun intended—how many houses are getting water through the purple pipe scheme?

The Hon. N.D. CHAMPION: At the moment, it is the same as the situation that occurred under the previous government, which is that they are relying on SA Water for potable water. The purple pipes have effectively not been connected.

Mr TELFER: There are none going through?

The Hon. N.D. CHAMPION: No. It has not changed from when you were previously in government.

Mr TELFER: Continuing on page 77, which is Renewal SA, and talking about aircraft maintenance at Edinburgh, what is the status of this project?

The Hon. N.D. CHAMPION: If I might praise my predecessors, this is a very good project. It is in my electorate, my previous federal electorate. It would be fair to say that Edinburgh has been transformed over the last 15 years. To give you a potted history, I was on the first Public Works Committee that approved some of the very important upgrades to that base. There has been a strong degree of support from the state government—of either persuasion—to deliver investment in that area, and we are going to continue with that. It is a very good project.

Renewal SA is currently in negotiations about a lease, about facilities, but essentially this project has a high degree of bipartisan support. It creates jobs, it creates a skill base, a very important skill base in avionics, a highly technical and highly capable skill base, which we think will be a great benefit to the country and the state. So if I might praise the former government, this was a very good project and Renewal SA is doing its very level best to advance it.

Mr TELFER: Is there an insight when it is expected that this development will commence?

The Hon. N.D. CHAMPION: It is still on track I think broadly to finish all the negotiations, and all the appropriate passage through government, and to begin in 2023 and finish in 2025.

Mr TELFER: Begin construction in 2023-24?

The Hon. N.D. CHAMPION: 2023 to 2025.

Mr TELFER: Is it envisioned that the state will be the owner and developer of this facility or will it be developed for the private sector to manage?

The Hon. N.D. CHAMPION: That is still a matter of negotiations between the commonwealth and the state government through Renewal SA.

Mr TELFER: Has there been work done to estimate what the cost might be to the state if the state-owned option is undertaken?

The Hon. N.D. CHAMPION: Negotiations are still ongoing, but we anticipate it would be cost neutral. Overall, there might be some infrastructure costs on one side, but there would be a lease on the other, and we think that would broadly be cost neutral. Of course, the great benefit to the state is having the facility and the skills base and another addition to the Edinburgh defence base complex.

Mr TELFER: Can I draw the minister's attention to Budget Paper 3, page 80, full-time equivalents. Can the minister explain the reduction in FTEs at Renewal SA over the forward estimates?

The Hon. N.D. CHAMPION: That just reflects the ebb and flow, and completion of projects. Renewal SA is not like a normal government department. They are project based, so they hire people for particular projects, and once those projects are completed they move off to bigger and better things, hopefully.

Mr TELFER: Bigger and better than Renewal SA? They must be big and very good. I will continue to look at some of the different aspects of Renewal SA work, and referring to page 77 of Budget Paper 3, which is the one we have been concentrating on. Can the minister give an update on Renewal SA's involvement in the investigation into Buckland Dry Creek's involvement in the mangrove dieback?

The Hon. N.D. CHAMPION: The honourable member should go out the door, turn right and go down to estimates for the Deputy Premier and environment, or there is the Department for Infrastructure and Transport. It is not something that Renewal SA is involved with. We are a landholder at Dry Creek and the salt pans, and it is a very important site to the state, but we are not involved in that aspect of it.

Mr TELFER: What is the status of the Buckland Dry Creek application for future use of the Dry Creek salt fields? Is it something which Renewal SA would be involved with?

The Hon. N.D. CHAMPION: It is a planning matter, so you can ask about that—

Mr TELFER: When you put your next hat on.

The Hon. N.D. CHAMPION: Yes, when I put my next hat on—as a useful demarcation; you can tell I am a trade union member.

Mr TELFER: It is very useful for you, maybe not for the committee.

The Hon. N.D. CHAMPION: No, it is not an attempt to evade it. I would welcome the question in planning.

Mr TELFER: Has Renewal SA been involved with any negotiations with that potential development proposal?

The Hon. N.D. CHAMPION: I can only speak for the time I have been the minister. There is a picture pre-March, and I think there was a broad approach pre-March where Renewal SA and the other agencies that were interested in this area were working, but there has been nothing since March that has changed on that.

Mr TELFER: I was asking about Renewal SA's involvement, not just you as minister.

The Hon. N.D. CHAMPION: No, but I am talking about Renewal SA as well. Basically, there was an approach pre-March and there was a bit of activity—we can get into this in planning—but my understanding is that that stopped, and since then there has been, if you like, no change, other than it had gone up.

Mr TELFER: So there are no ongoing negotiations that Renewal SA are involved in when it comes to the potential Buckland Dry Creek land development?

The Hon. N.D. CHAMPION: No, it is in abeyance I think I would say.

Mr TELFER: Are there any land swap considerations proposed between the Buckland Dry Creek proposal and land held by Renewal SA on behalf of the state or other land parcels in the area held by the state?

The CHAIR: To clarify your question, when you say 'land swap', what do you mean by that—between government departments or between—

Mr TELFER: If there are Renewal SA managed/owned land that may be considered in part of a negotiation that might happen, is that something which—

The Hon. N.D. CHAMPION: A negotiation with whom?

Mr TELFER: You are saying that planning is involved in that aspect. If planning is looking at negotiations, are conversations being had with Renewal SA as the landowner?

The Hon. N.D. CHAMPION: Just to be clear, are you talking about Renewal SA talking to other departments or agencies of government, or are you talking about Renewal SA talking to the private company that is out there, just so I am clear? You can ask both questions, but I—

Mr TELFER: I am trying to get my head around where the arrangements are between different aspects—

The Hon. N.D. CHAMPION: Perhaps I could answer your question. The Dry Creek salt pans basically stretch from Port Wakefield Road and the expressway. There are the salt pans—Renewal SA owns two-thirds of the salt pans, roughly 397 hectares—then there is a portion of land owned by the Department for Infrastructure and Transport, which obviously includes the expressway, the superway, and if you move further north there is an area of mangroves which is a mixed ownership of DEW and the Buckland Dry Creek company, and then there is an area next to Port Wakefield Road basically owned by the Buckland Dry Creek company. There have been no negotiations between Renewal SA and that company—is that clear?

Mr TELFER: Yes, I am trying to work out the delineation that you created between the activity planning is involved in, negotiations-wise.

The Hon. N.D. CHAMPION: Planning do not do negotiations. Planning have a distinct role, and we can get into that under the planning portfolio. Renewal SA is the landholder. Obviously, it is a complex set of arrangements, but I want to be clear with you that Renewal SA obviously has talks with other government departments about matters, and that is entirely governed by all the Treasurer's Instructions and all the normal rules that government has. Then there is a private landholder, and I want to be clear with you that there have not been any negotiations—because you used the term 'land swap', and I am not quite sure what that means—with a private landholder by Renewal SA.

Mr TELFER: Thank you. What are the litigation and legal actions that Renewal SA is currently involved in?

The Hon. N.D. CHAMPION: There is one matter that is before the courts, and it is an employment-based matter.

Mr TELFER: Is there an estimation or expectation of what the cost of these actions is projected to be in 2022-23?

The Hon. N.D. CHAMPION: It is before the courts, and I do not think it sensible to talk about those figures while it is before the courts.

Mr TELFER: Has Renewal SA budgeted money for litigation and legal action?

The Hon. N.D. CHAMPION: There is a general allocation made for litigation, and this fits under that general allocation.

Mr TELFER: Continuing on, I refer to Budget Paper 3, page 77. We will talk about Lot Fourteen. Has Renewal SA executed a development agreement with Quintessential Equity for the development of the Entrepreneur and Innovation Centre building at Lot Fourteen?

The Hon. N.D. CHAMPION: That agreement was signed in 2020.

Mr TELFER: The development agreement?

The Hon. N.D. CHAMPION: Yes.

Mr TELFER: What support is Renewal SA providing, on behalf of the state government, to Quintessential Equity to help facilitate them to achieve the precommitment level to commence construction?

The Hon. N.D. CHAMPION: We are the landlord; that is our relationship as part of the DA. As I understand it, that particular proposal is looking for some commonwealth tenants. It might be of benefit to the state to have commonwealth leases or tenants. So that is there as well, but basically Renewal SA is their landlord.

Mr TELFER: Is there no other support or involvement?

The Hon. N.D. CHAMPION: Like any good landlord, we are an advocate for them.

Mr TELFER: Is that advocacy proactive?

The Hon. N.D. CHAMPION: It certainly is.

Mr TELFER: Can you give some examples of how Renewal SA is proactively supporting Quintessential Equity?

The Hon. N.D. CHAMPION: They are meeting with them monthly, and they are certainly assisting them with getting some tenants, like any good landlord would.

Mr TELFER: What is the construction timetable for the development of the Quintessential Equity development?

The Hon. N.D. CHAMPION: I note that Renewal SA is under instruction from DPC, so this all goes through the Premier. It is anticipated that if the pre-lease arrangements can be met, construction would begin in 2023 and be completed by 2025.

Mr TELFER: So 2023 to 2025; there are a lot of projects in that range. Certainly, it is going to be a busy time for Renewal SA. After 2025, will there be an expectation that tenants can occupy the development?

The Hon. N.D. CHAMPION: Yes.

Mr TELFER: Has there been any additional direction from the minister to Renewal SA in relation to this development?

The Hon. N.D. CHAMPION: This is run by DPC. The same governance arrangements that existed under the previous government exist under this arrangement. DPC are the project lead and Renewal SA operates under instructions from them.

Mr TELFER: What is the current residential land supply in the metropolitan area of Adelaide, and what proportion of land is held by Renewal SA?

The Hon. N.D. CHAMPION: The first part of that question is a question for planning because they do land supply. I would have to check with Renewal SA. I might take that on notice for you.

Mr TELFER: It would be interesting to know. So you also would not know how many potential residential land allotments Renewal SA would estimate that it holds?

The Hon. N.D. CHAMPION: Generally on this, land supply is an interesting topic for Adelaide. I think we will be examining that in detail, probably in the next estimates but almost certainly as we do the regional plans for the 15 to 30-year process and also when we do the one for Adelaide. That is where land supply issues will come up and you will be able to get a good understanding of land supply issues.

I would say this about land supply: it is different in different places. Recently, I went down to the South-East. It is a very tight housing supply down there not because of land supply but because, in effect, there is a market failure down there. You cannot build a house without making a loss. The price of land is neither here nor there, it is actually being able to construct in those areas.

Mr TELFER: It really is around Renewal SA's role in that. I do not want to get into planning because I will take your answers away in the next hour.

The Hon. N.D. CHAMPION: What I am flagging is I do think there is a role for Renewal SA not just in the city but also to look at the regions, and we have been doing that.

Mr TELFER: We have discussed residential; what about industrial land? Is there an insight into the current industrial land supply in the metropolitan area, and what proportion of that land is held by Renewal SA?

The Hon. N.D. CHAMPION: We do have a significant industrial landholding, but one of the difficulties is that—dare I say it, Gillman is the obvious example of where significant work would have to be done to bring that to market. We do have significant employment lands, industrial lands, but they are at varying, different stages. It is a similar picture for residential as well. There are some residential opportunities that also need work, and Bowden is a classic example of that.

Mr TELFER: Do we have an estimate as to how many potential industrial land allotments Renewal SA holds?

The Hon. N.D. CHAMPION: It is a complex picture, and we might provide some information to you on notice. There is industrial land that is ready for market, industrial land that is ready for market but might be allocated for defence projects and then there is potential industrial land that has to be remediated or developed.

Mr TELFER: I certainly would appreciate that being taken on notice.

The Hon. N.D. CHAMPION: Sure.

The CHAIR: Last question.

Mr TELFER: I have a block of about 25 with five in each.

The Hon. N.D. CHAMPION: Do you want to read them in?

Mr TELFER: We could. I was very keen to make sure we had an understanding of what role you see Renewal SA playing in that land supply, both residential and industrial, because as you have well highlighted, the issues—

The CHAIR: Maybe you could use another forum to canvass some of those questions because the time has expired. I declare the examination of the portfolio of Renewal SA completed. The examination of the proposed payments for Administered Items for the Department of Treasury and Finance are referred to Estimates Committee A for further consideration.