SUPPLY BILL 2008

Second Reading

Adjourned debate on second reading (resumed on motion).

(Continued from page 2976.)

Mr GRIFFITHS (Goyder) (15:50): It is my pleasure to have the opportunity to comment on the Supply Bill and to follow the Leader of the Opposition's contribution made immediately prior to the luncheon adjournment. It is interesting to listen to the level of dialogue that occurs between the Treasurer and the leader. There is no doubt that we have a perspective on things and the Treasurer has a different perspective on things, but that is what debate encourages, so let us hope that it continues.

I do indicate that the leader has offered to me the opportunity to be the lead speaker for the opposition on the Supply Bill. I am not sure how long I will go, but we will see. There is no doubt that even in my relatively short time in this house (only 25 months) the budgets produced by the government over the last six years do provide a lot of information and comment. This Supply Bill, as introduced by the Treasurer on 1 April, will make provision for an amount of some $2.3 billion to be available for expenditure before the formal adoption of the budget.

There is great concern within the opposition about the level of debt in South Australia. The current figure, if we look at the forward estimates from the budget which was adopted last year, shows that by 2011 state debt was actually forecast to be $3.4 billion, unfunded superannuation at that stage was $6 billion and the WorkCover unfunded liability was, I think, $843 million as at 30 June. The 31 December figure increased that to $911 million. I might have that slightly wrong. Yes; it might have been March. We now know that it is $925 million. On top of that, we also have the fact that the level of liability for public sector employees for workers compensation is in the vicinity of $400 million. So, quite easily, we are looking at $1.3 billion that is over there, too.

This is more than the State Bank debt disaster during Mr Rann's first attempt at being in government in the period up to 1993; and that is why we in opposition take up this matter quite often. We are sincerely and very deeply concerned about the future financial position of this state. Net government debt is forecast to increase tenfold from this year through to 2011. However, the debt delivers very little in long-term value to our state. The fact is that the government plans to spend more than it is earning and it needs to borrow. The debt is propping up a big spending budget on recurrent costs as much as it is in infrastructure, and that is where there is a lot of concern on our side of the house.

Debt is appropriate, I will not deny that. However, it is important that debt is used to fund infrastructure, because infrastructure is what will be critical to the future of the state. We know from what we hear already that for the mining opportunities that abound in this state to come to fruition something like $20 billion of infrastructure is required. There will be an expectation that much of that will have to be funded by the state government, and we just question sometimes from where the resources will come, because it has been proven over the last six years that this government cannot manage financially, but we will talk about that a little later.

The debt is as a result of bad management with blow-outs in the day-to-day costs and will be difficult to sustain if economic conditions turn down. This is something from notes that were prepared early in this financial year. We all know that since January this year economically across the world there has been a significant downturn. Those of us who have investments in superannuation or shares would have noted a considerable drop. The share market, I think, is trading at about 5,600 indices points down from record levels of about 6,500 some three or four months ago. It is an enormous factor, and it has made a difference to the returns financially of the state funds invested, too. I think that Funds SA has invested something like $13 billion.

The budget for 2007-08 was a disappointment to those of us on this side of the house, and a disappointment, we think, to many people in South Australia. There was nothing in it for families, pensioners or small businesses except higher taxes and charges. Motor vehicle registrations went up and the cost of buying a house went up, as did the hundreds of state fees and charges. In prosperous economic times the Rann Labor government is putting up the fares on public transport (by almost 8 per cent this financial year). Water supply charges increased by 7 per cent. We know that has gone up again. We know that from 1 July water supply charges will increase by 12.6 per cent, and we are told that it will continue to increase by a similar amount for each subsequent financial year until, I believe, 2012 when it will be reviewed again.

Speeding fines have increased by a staggering 20 per cent. All these increases were well and truly above inflation. The Premier promised that there would be no privatisations, but we know that the new $1.7 million Marjorie Jackson-Nelson Hospital will be privately funded and privately owned. Who will make money out of that? Will it be the big banks from Sydney, Melbourne, or even New York? We are not too sure. The superschools will be privately owned as well, as will the new prisons. We believe that these are all broken promises and it is important that we on this side keep the government accountable.

There have also been delays. The new hospital will not be ready for nine years. We are now told that the Mount Bold reservoir is still under investigation—somewhere in the Mount Lofty Ranges. There is no surety that Mount Bold will be the site. It will be a $1 billion project, as I understand, to increase the storage capacity, but who knows when it will happen, if at all. Water security has been one of the most pressing issues facing this state, there is no doubt about that. As a result of a proposal mooted in the budget this year, we now have a commitment from the government that $10 million is being expended on the trial plant at Port Stanvac. We are told that a 50 gigalitre desalination plant will cost $1 billion to construct, and I believe $300 million to connect to the storage facilities and the network.

Ownership is an interesting point. The Treasurer has given some details on that, but what is interesting are the increases in water charges over the next five or so years, starting with 12.6 per cent in the 2008-09 financial year. We have done some sums on that and, based on consumption levels, we believe that the additional amount of revenue raised by SA Water will be in the vicinity of $500 million. The Treasurer has given a commitment to quarantine those funds to ensure that they are available for the desalination plant. Let us hope that happens.

Public transport reform has been officially abandoned in the 2007-08 budget. It is part of the challenge for all governments over the next 20 years to ensure that the public transport network is there, but we still have the oldest diesel rail network in Australia, although an upgrading of a few buses might be happening. South Australians are truly disappointed with our road network. Many of us travel extensively around the state—and I know many members in this place do a lot of driving per year. The member for Hammond (who is in the chamber) would probably travel at least 60,000 kilometres per year. I know that I travel 60,000 kilometres per year. People within my electorate come to me all the time very concerned about not only the level of maintenance that takes place but also the lack of real investment in road infrastructure. They want to see something happen.

There are roads that are terribly thin and the shoulders are quite raised or broken off. There are many potential hazards on the roads. Many people who drive around South Australia are not familiar with the condition of the roads and, if they are towing a caravan or driving a truck and suddenly they hit a big pothole, anything can happen. The condition of many roads is just disgraceful. We know from figures provided by the RAA prior to the 2006 election that, at that stage, there was a backlog of $200 million in road maintenance, and it certainly has not improved. All we have in the budget for 2007-08 is $3.5 million per year over four years to try to fix the $200 million backlog. I do not think it adds up.

I refer to some specific comments which have been made about whether the budget is in surplus or deficit. We on this side have asked the Treasurer quite a few questions about this. He defends his position and enforces the fact that the budget is in surplus. However, the facts are that in two of the three normally accepted accounting measures, the budget is in deficit. He will dispute this, but it is interesting that, after the 2002 election, the Rann Labor government said that it would use the accrual accounting measure, which is net lending over borrowing, and that they would produce surplus budgets using this measure.

This graph shows that, using the Rann government's original preferred budget measure—that is, net lending over borrowing—the budget is truly in deficit. I will emphasise a few figures to demonstrate it: 2006-07, a deficit of $176 million; 2007-08, it is estimated to be $428 million; 2008-09, $383 million; 2009-10, $167 million; and 2010-11, $314 million. Using a cash measure, which the federal government uses, the Rann government is also in deficit. That is the second accounting measure. During these buoyant economic times being enjoyed by federal government and state governments and, indeed, our nation in many ways, the federal government has been able to repay debt, it has been able to plan for the future, whereas the Rann government has had cash deficits totalling $1.423 billion from the 2006-07 original budget figures out to the 2010-11 estimates.

When the original measure of budget net lending/borrowing rapidly turned from surplus to deficit, the Rann government decided to ditch this budget measure and use the only measure left that showed the budget being in surplus—the net operating balance. The budget estimate for the 2007-08 financial year was $30 million; for 2008-09, it was 205; for 2009-10, it was 336; for 2010-11, it was 278. They are the surplus figures that the Treasurer was quoting in the preparation of the 2007-08 budget. Again, we emphasise the fact that that is only one measure of surplus or deficit. In the two measures, including the one he announced after the 2002 election that the Rann Labor government was going to use, a deficit situation does actually exist.

If I can talk about the net debt as it relates to South Australia, budget figures show that the former Liberal government reduced the Rann government's debt and the State Bank debt in 1993 from $11.6 billion down to $3.2 billion in 2001. That was not achieved easily. I was not in this place but I had a perspective on it as a citizen like all of us did and I was worried about the financial position of our state. I know that very hard decisions were made by the Liberal government at that stage. Those decisions affected many people but they had to be made to ensure that not only were we going to put this state on a sound financial footing again but we were going to give people real hope.

In making those hard decisions, we reduced the 1993 debt from $11.6 billion down to $3.2 billion in 2001, and we have seen that drop a little bit and I respect that fact. The 2005-06 estimate of state public sector debt was confirmed as being $2.126 billion, but it is on the rise now; it truly is. If we go out to the 2010-11 forward estimate period based on the budget figures prepared for this financial year, we find that state public sector debt has gone to $3.36 billion.

We also note that general government net debt, which is a component of state public sector net debt, is currently forecast to multiply—and this is an astounding figure over the next four years—by 10 times. It is going to increase from an estimate of $151 million in 2007, jumping up to the estimate of this financial year as at the budget figure preparation of $618 million then increasing through to $1.01 billion in 2009; in 2010, it is going to be $1.165 billion; and, in 2011, the multiplication by 10 times comes into effect at $1.443 billion. Hard decisions were made by the previous government, but it is obvious that this time around it is the opportunity to borrow for recurrent expenditure and not enough of capital investments that is actually occurring.

I want to reflect on a speech that was made by the previous federal treasurer, Peter Costello, on 1 June 2007 when he talked about the financial position of the states. He advised that the states are 'not funding investments from their revenues' and stated:

The States are borrowing—drawing down on savings rather than adding to them—and in this respect adding to pressure on monetary policy...The windfall from the GST revenue and property taxes has been spent in recurrent expenditures.

That is what we are trying to highlight that it is recurrent expenditure and not capital works. He said further:

It has not been allocated to investment...This is why the States have insufficient operating surpluses to fund their planned infrastructure spending and are now engaged in debt financing. Planned state infrastructure spending is also, to some extent, making up for under investment in infrastructure through the early part of the decade...During the longest economic expansion in Australian history, debt will be rising at the state level.

It is important to recognise that. It is not just South Australia; it is the other states of this great nation (also in the hands of Labor) where debt is rising at the state level. From memory, and I will correct this if I am wrong, but I think I have read a figure where in about the 2010-11 period state debt is anticipated at being at something like $70 billion. It is absolutely frightening.

In an interview with The Australian on 12 August 2006, the then outgoing Reserve Bank governor Mr Ian Macfarlane said that the return of states to deficit spending was an issue that could affect monetary policy in the future. So, here you have the then governor of the Reserve Bank and the then federal treasurer Peter Costello both issuing warnings about the financial position of not just South Australia but all the states and it has not been listened to. We on this side keep talking about it but not enough people are actually taking it up.

I want to provide an overview on taxation increases since the 2001-02 financial year. It makes very interesting reading because it sets the scene for what the funding policy of the Rann Labor government truly is. In 2002-03, total tax revenues amounted to $2.431 billion. The budget papers from 2007-08 estimated that income from tax revenues was going to be $3.243 billion. You might wonder—that is a lot of money—but it is actually a 48 per cent increase. Over six years, that is an average of an 8 per cent increase per year. We now know from the mid-year budget review that it has been a 56 per cent increase in state taxation revenues and that is of concern to people.

If we look at what the general government taxation revenue is—and I will break this down into the components that make up state taxation revenue—payroll tax (again starting from the 2002-03 financial year following the election of the Rann government) was $654 million. The 2007-08 budget figure estimate for that was $853 million or a 42 per cent increase. As to taxes on property in 2002-03, the actual figure was $838 million. The estimate for the 2007-08 year was $1.28 billion or a 75 per cent increase.

The Hon. R.J. McEwen interjecting:

Mr GRIFFITHS: Yes, I know. Taxes on gambling in 2002-03 totalled $340 million; in the 2007-08 estimate, it was $406 million or a 30 per cent increase. Taxes on insurance in 2002-03 totalled $254 million; in the 2007-08 estimate, it was $296 million or a 33 per cent increase. Motor vehicle taxes—and the Motor Trades Association has been quite outspoken about its concern about the South Australian car industry becoming uncompetitive—in 2002-03 totalled $343 million; in the 2007-08 budget figures, it was $409 million or a 26 per cent increase. Overall, if we look at all those state taxation measures, it is a 48 per cent increase in six years.

It all demonstrates that the money is rolling in and the money is rolling out, but it is not delivering the services or the infrastructure required by the people of South Australia. Payroll tax is a really interesting one. In the 2007-08 budget period, it was estimated that the Rann government has taken $853 million from 80,000 small and medium sized businesses. When they first came into office in 2002-03 the actual figure was $654 million, so there has been a $198 million, or a little under 30 per cent, increase in payroll tax. The Treasurer has made adjustments, but it is interesting that the excess is still $504,000.

The rate is dropping down. This financial year it has gone from 5.5 to 5.25 per cent, and from 1 July it will reduce to 5 per cent; however, budget estimate figures still show an increase in the income. The 2009-10 estimate is $897 million, and in 2010-11 it is up to $947 million. This has been taken directly out of business—the people out there who are generating the economic opportunities in this state—and it is money that could otherwise be spent on further growing our economy. Businesses are telling us that they want to make sure there is a bit more equity in it; indeed, Business SA has been quite outspoken about the fact that it would desperately like to see an increase in the threshold from $504,000 (which is, I believe, the lowest in the nation) up to $800,000. We keep talking about it, and I know the Treasurer has been petitioned on it, but while he is prepared to adjust the rate levied it appears he will not consider an adjustment to the threshold figure.

I would like to take a moment to look at what the national jobs market says about the South Australian economy. I know (from ABS data) that there are 778,000 people in work in South Australia. We also know that as at April 2007 (I do not have any more updated figures than that, but it is still a fairly accurate reflection) 7.19 per cent of jobs that existed in Australia were based within South Australia. We also know that South Australia's share of the population is 7.6 per cent, which is a bit more than 7.19. It may not sound a lot, but if you equate it back to the job opportunities being missed because of our percentage of existing jobs in relation to our proportion of the nation's population, you see that about 25,000 people who could be at work are not. Now, not only would 25,000 more South Australians being in work benefit our economy enormously: imagine what it would do for the livelihoods of those people.

I would also like to refer to property taxation—and I want to emphasise that I will refer back to the 2002-03 financial year a lot as it relates to now and to the forward projections. Total property taxation collections for 2002-03 were $838 million. The 2007-08 estimate at the time of the budget preparation was $1.28 billion, increasing next year to $1.34 billion and the following year to $1.36 billion. The year after that, 2010-11, it will increase to $1.386 billion. Those are enormous increases, and that is where the windfall revenues have really come from. They have come from property-based taxation; hitting mums and dads, hitting small investors who want to build their wealth, making it very hard for young people to get into the housing market, and making it difficult for people renting homes, as they suddenly find that their rents are increasing through the roof because the people who own their homes want to make sure they get enough revenue to compensate for their expenditure.

Things need to happen. We know that the rental market has a less than 1 per cent vacancy rate, and we know that people are out there bidding for rental properties above the asking price just to ensure that they have a roof over their head. We know the government is out there with affordable housing programs, but we also know that there is a desperate need for a lot more in this state, and more has to occur.

Property conveyancing stamp duty has also been interesting over the last six years. In 2002-03 it was $440 million; the estimate for 2007-08 was $697 million and the forward estimate for the following financial year is $742 million. In 2009-10 it will be $773 million, and in 2010-11 $788 million. Again, that is making housing affordability an enormous issue.

In terms of stamp duty, the median house price in Adelaide at the moment is about $350,000, involving stamp duty of about $15,000 (just off the top of my head). It is interesting to look at the competitiveness of South Australia compared, say, to Queensland, where I know that the corresponding stamp duty cost is about $4,500. So we are looking at a $10,000 to $11,000 difference between what it costs to purchase a home in South Australia and what it costs to purchase one in Queensland.

If we want to attract more people to this state, if we want to make sure people want to live here and enjoy the wonderful climate we can provide (despite the recent rain we have had—thankfully) and the wonderful opportunities that will exist here in the future, we have to ensure that we have a taxation policy in place that allows people to buy a home without incurring the enormous cost of stamp duty to be added to a loan that will be paid off over, say, 25 years. People do not suddenly have that money; they have to borrow it, and those of us who have borrowed money know that for a 25-year loan, no matter what you borrow, you pay back 1½ times that in interest only. So, if you have to spend $15,000 in stamp duty you will pay back $22,000 in interest on that stamp duty over the 25 years.

Gambling taxes have also been interesting. In 2002-03 they were $340 million, and the estimate for 2007-08 was $406 million. There was a slight adjustment downward in the following financial year at $403 million, but I am sure that in the mid-year budget review that figure has gone up a bit. In 2009-10 it is $423 million estimated, and in 2010-11 it is $446 million estimated. In a previous role as shadow minister for gambling, I had the opportunity to meet with groups who had been enormously affected by the implications of gambling addiction, and they painted a very sorry picture. However, I think only about 1 per cent of the revenue received from gambling actually goes towards rehabilitation and assistance for those people.

There are also a lot of increases in fees and charges. The emergency services levy has not actually changed, but we will see an additional $4.5 million in revenue because of the increase in housing valuations. Some would say that the government has been generous to River Murray licensees by contributing $2.2 million to offset the natural resources management levies applicable to that area but, given that these licensees were on zero allocation at the start of this financial year and are now on 32 per cent (and who knows what it will be from 1 July 2008), as well as the fact that their businesses are being ruined by drought, this token gesture, while gratefully received, does not help their cause very much.

The supply charge for water in 2007-08 went up by 6.4 per cent, and usage costs also went up by that rate, and I have already indicated that from 1 July 2008 water costs will increase by 12.6 per cent. Expected revenue from the River Murray levies will grow this financial year by 1.4 per cent.

Public transport single trip ticket prices went up by 7.9 per cent, and the multitrip ticket cost increased by 7.2 per cent this financial year. This financial year, motor vehicle registration went up by 4.5 per cent, and compulsory third party insurance was projected to increase by 3 per cent. Speeding fines went up this financial year by 4.1 per cent but, if you do 30 km/h above the speed limit, it is a 20 per cent increase.

It is interesting that, in an ABC Radio interview on 28 April 2006, when discussing GST revenue received by the state government from petrol, the Treasurer said, 'A 1¢ a litre reduction in petrol pricing is $26 million.' The table I am reading from shows that interstate comparisons with the current stamp duty on motor vehicles of $40,000 paint a very different picture about what it costs to buy a car in South Australia: here, it is $1,540 and in Victoria it is $1,000.

I know that the opposition has certainly been approached by the Motor Trade Association, which is very concerned about its dealers in the South-East, who are worried that they are uncompetitive because people who live close to the Victorian border are deciding to buy their cars somewhere else to save money. That obviously needs to be looked at.

As to unfunded superannuation liability, the budget papers indicate that as at June 2001 unfunded superannuation liability stood at $3.2 billion. In preparation for the 2007-08 budget, unfunded liability was shown to be $5.9 million by 2011. In the last few weeks, the Treasurer has already talked about the fact that, with the global downturn in the economic market, suddenly his budget is under enormous pressure in preparation for 2008-09, and he included the fact that he has to find between $100 million and $120 million to support the unfunded superannuation liability.

As I understand it, the plan is to have superannuation liability fully funded by 2034. That plan has been in place probably since the mid-nineties. In these buoyant economic times, the Treasurer has not brought that plan forward. A lot of people will retire between now and 2034, and the age demographic of the Public Service and members of the Triple S superannuation scheme will demand that costs over the next 15 years will be enormous.

It is interesting to contrast what the state has been able to achieve in six years of very buoyant times to what was achieved by the previous federal government, when federal debt of $96 billion was not only paid off over that 11½ years but money was also put away. The future fund had $51 billion in it to help unfunded superannuation liability. Unfortunately for South Australia, the Treasurer has not made similar provision. As to GST grant revenue—

Mr Bignell interjecting:

Mr GRIFFITHS: True, but financial management also makes a big difference, member for Mawson. In 2003, the Premier stated, 'The GST deal was a total lemon for South Australia.' That is an interesting statement, and I construe it as meaning that the state has been disadvantaged. But that is not actually the case, as we know that GST revenue is certainly above that originally estimated.

We know that in 2002-03 (again going back to the basis of when the Rann Labor government came to power), GST revenue was $2.859 billion. The estimate for this financial year, at the time of the preparation of the budget, was that GST revenue would be $3.855 billion; in the next financial year, $4.075 billion; the following financial year, $4.294 billion; and, in 2010-11, $4.46 billion.

The total GST revenue over the 11 years until the end of the forward estimate period from when GST first came in is $37.7 billion. The interesting point to note is that the windfall, or the additional GST revenue above that originally intended to be received over that same period, is $1.5 billion. Just imagine what you could build with $1.5 billion! It would just about be the Marjorie Jackson-Nelson Hospital or a desal plant that would ensure water security for Adelaide, but we do not have that sum.

I want to talk about the public sector, and I will again quote from the Treasurer when he provided an answer to a question during estimates on 18 October 2006. He stated, 'Getting a proper handle on the exact number of government employees is difficult.' I would have thought that it would be quite easy, but it turns out that it is not. That same day the Treasurer commented:

We do not have full confidence in the numbers that have been produced. We are not confident in the data collected by the Office of the Commissioner for Public Employment, despite its best endeavours.

We know that, when the Rann Labor government came to power in 2002, at the end of that financial year the total number of full-time equivalents in the Public Service was 69,770. From official reports, we can identify that, as at the end of June 2003, it was 71,373; at the end of June 2004, it was 72,141; at the end of June 2005, it was up to 76,720; and at the end of June 2006 it was 78,228, which is an increase of 9,344 from 2001 to 2006.

We now have some updated figures to show that the number has gone up by 12,000. It is interesting that the budget figures in those same times identify an increase of only 2,344 full-time equivalent employees; however, there is a difference of 10,000 public servants. If you use conservative estimates, you can identify that an additional 10,000 public servants per year is an impost of probably $650 million on the budget which, over a four-year term of government, equates to $2.6 billion, and that is an enormous amount.

I know that the Premier talks quite often on talkback radio about the fact that additional public servants have gone towards the additional 700 doctors, and I think that he quotes an additional 2,500 nurses and the intention to have another 400 police. On this side of the house, we do not deny the need for those people to be there, but we question the fact that those numbers do not add up either to 12,000 or to the 10,000 difference between the budget figure and the actual figure of people working in the Public Service. It is important that controls are put in place.

Again, the Treasurer is recorded in Hansard on 19 September 2006 as saying, 'We do not walk away from the fact that managing the numbers in the public sector has not been as good as it should have been.' I think that is a bit of an understatement. We on this side want to make sure that the appropriate number of public sector employees are there to provide the services that South Australia needs. There is no doubt about that, but there have to be controls in place. There have to be ministers out there who will ensure that people are appointed to work within their departments when it is justified and when they know about it, because it is obvious to us that, if budget figures have identified that 2,300 people should be employed when in reality it is 12,000 people, then somebody is not doing their job properly.

The Treasurer has also implemented things like the Public Service cap, but I am not sure if it has actually worked very well. Even since it was introduced a year and a half ago, we still have numbers exceeding the cap figures identified. The Treasurer is still not able to accurately identify the number of people in the Public Service, so we are a bit worried that things are not going too well in that regard.

Infrastructure spending is something I want to focus on for a little while too, and it is an important issue because it affects the future of this state enormously. We on this side are constantly told by the government that the Liberal Party, when in government from 1993 to 2002, barely spent anything on infrastructure. We know that with a debt of $11.6 billion and a deficit each year of $300 million, there were enormous challenges out there to fund the infrastructure that South Australians need.

I can actually say with some degree of pride that I am aware now that during the period from 1997-98 through to the 2001-02 financial year, after the Liberal Party had had the opportunity to consolidate certain things, to actually project its vision of what the state needed and to actually start funding some projects, an average of $771 million was spent on infrastructure each year during that period.

I think that it is important to look at that as a percentage of the state budget revenue because that is the true reflection of the government's commitment to infrastructure spending: in 1997-98 it was at 11.5 per cent, with $807 million being spent; in 1998-99 it was 10.3 per cent, with $751 million being spent; in 1999-2000, it was 11 per cent, with $838 million being spent; in 2000-01, it was 8.8 per cent, with $716 million spent; and in 2001-02 it was 8.7 per cent, with $741 million being spent. Again, I point out that an average of $771 million a year (amounting to an average of 10.1 per cent of the state budget) was spent over that five-year period.

Since the Labor government came into power, we have seen some interesting figures too. In 2002-03, it was $703 million, or 7.5 per cent; in 2003-04, it was $849 million, or 8.5 per cent; in 2004-05, we have an estimated figure of $975 million, or 9.2 per cent; and in 2005-06, again, an estimated figure of $914 million or 8.1 per cent. We have seen some significant jumps in the last two years: there is no doubt about that. In 2006-07, it was an estimated figure of $1.169 billion, or 10 per cent; and in 2007-08, $1.482 billion, or 12.2 per cent.

We argue that, especially in the last two financial years, a lot of that money that has gone towards infrastructure is not actually capital spending: it is maintenance work. I think that $150 million spent on re-sleepering a railway line is actually a maintenance project, but the Minister for Transport says that it is actually capital works. Even if we are generous enough to include that, the average spent is $1.015 billion for each of those six years, but if you relate it back to a percentage of the total state budget revenue, it is actually 9.3 per cent.

Rather than being told that South Australia under a Liberal government did not have enough money spent on capital works and infrastructure, we actually find out the truth: if we actually compare like periods, we find that over a six-year period the Liberal Party spent 10.1 per cent of state budget total revenue, whereas the Labor Party spent 9.3 per cent. That is something that the people of South Australia need to understand. In difficult times, the Liberal Party still managed to contribute an enormous amount of money (both in dollar terms and as a percentage of its budget) to capital works. Labor is not doing quite as well. Even then, we actually managed to control spending on projects. We know that the Northern Expressway was originally costed at $300 million, and then it was out to $550 million; and now, with further proposals contemplated, it could be another $1 billion on top of that.

I want to speak about some of the major projects that have occurred in South Australia. We have the $1.7 billion proposal for a new hospital, which we know will not be completed for 10 years and which, interestingly, is to be funded via a 30-year lease. We do not know what the cost of that lease will be. We do not know what the comparative cost would have been for government itself to borrow the money and build the hospital as a project. I would have thought that, if you did your homework properly, you would actually have those figures. Indeed in a briefing provided to the opposition which quite a few members on this side attended with some of our staff and at which the Under-Treasurer and others were also present, we asked that specific question.

We asked, 'What are the comparators? Where is the information that proves that the public-private partnership option works in the case of the Marjorie Jackson-Nelson Hospital?' We were given an answer that did not really reassure me that the necessary work had actually been done. I support the principle of public-private partnerships, but I do so on the basis that I want to see the comparators between PPPs and the total cost over the life of a project, compared to the 'government-owned and built' cost. That is what we have not seen. We will keep asking questions on this side of the house because we want to know. With the Marjorie Jackson-Nelson Hospital being, I believe, the largest public-private partnership project to occur in the nation, as it is proposed, it is important that these questions are asked.

We have made some observations over the last couple of years that the government talks a lot but never actually builds many things. The Techport Australia Common User Facility was costed at $226.5 million in 2006-07, but we know that it has blown out to $243 million. That is another $16 million that the South Australian taxpayer will have to find from somewhere. I want to talk about some other privatisation projects, and it is interesting that the Premier signed this 'No privatisation' decree immediately after the election and, all of a sudden, we find out that there are a few projects happening. The super schools program is privatisation. The intention to build gaols and to replace James Nash House at Murray Bridge is also privatisation. I think, though, from what I understand, these facilities, especially the gaol, will be near capacity as soon as they are occupied, so that is a challenge for the state.

The South Australian rail system, the only diesel rail fleet in the country, has not been upgraded. The government has, though, committed funding for the maintenance of track to replace ageing sleepers with concrete sleepers on the Belair and Noarlunga lines and I think that is the cost that was included in the capital infrastructure project. Again, we reinforce the fact that it is maintenance, not capital. Over the past three years, the Liberal Party has called for electrification of the rail system. All users of Adelaide public transport would know that the trains do not run on time and that there are problems with the track running speeds and breakdowns in signalling systems.

We know that the trams are causing people to faint, by the sound of it, from recent publicity. They are told to dress lightly, and it has been quite cold, between 17° and 18°, people are jumping on trams and they are still fainting—let alone what it was like during the hot weather in March. It is a crazy system where a tram is purchased, not necessarily because it is the best one, but because it is the one that can be delivered on time, to meet a budget and election promise, but is it truly the one that South Australia needs to go forward over the next 20 years? Is it going to deliver everything that people who use public transport in Adelaide will require? I think we can ask a few questions about that.

We have had some questions in the house today about the Port River bridges and the work that is occurring down there. We know that the opening bridges will be an extra cost of $100 million over the life of the project. We believe that a lot of wrong priorities are in place: the tramline extension was a $31 million project; and we questioned some of the Thinkers in Residence program, which was $1.4 million over three years. There are many clever people in South Australia too who could contribute to what South Australians need. Let us ensure we use the intellect that exists in our state.

We know that in relation to public servants, the blow-out by a fraction over 10,000 full-time people equates to $2.6 billion over four years. We know that, among ministerial staff, spin doctor numbers have increased by something like 84, which amounts to $6.3 million per annum or $25 million over four years. It is hard to imagine that the constant need to deliver a message requires the appointment of 84 people at a cost to South Australians of $25 million.

Mr Kenyon interjecting:

Mr GRIFFITHS: Increased spin doctor numbers; spin doctors. We also have the additional cost of the Independent ministers' offices, that is $2.5 million a year or $10 million over a four-year period. For stages 2 and 3 of the Queen Elizabeth Hospital redevelopment, the cost has blown out from $60 million to $317 million and the project is now delayed until 2011, so that is an additional $257 million. The Northern Expressway, as I mentioned before, was originally costed but we have been told that there were scoping problems, and that has gone from $300 million up to $550 million. For the South Road projects, the cost of the Port Road/Grange Road tunnel has increased from $122 million to $245 million. That estimated figure was provided to me, so we can look at that. The Anzac Highway underpass has increased from $65 million to $118 million.

An honourable member interjecting:

Mr GRIFFITHS: True. The Bakewell Bridge underpass increased in cost from $30 million to $41 million and the Techport Australia Common User Facility, as I mentioned before, has increased from $226.5 million to $243 million. If we look at the total cost over a four-year period for these things, which we think are either blow-outs or wrong priorities, it is only a fraction under $3.5 billion.

I will focus for a little while on SA Water's contributions to government and capital works, which is a passionate issue for me. As a person from the regions who would love to see his regional communities grow but who knows they are held up by a lack of an improved reticulated potable water supply, I am truly amazed at the money that comes out of the SA Water budget and goes into state coffers.

We know that, since 2002-03, the total stripped from SA Water customers and not made available for infrastructure spending is $1.688 billion. In 2007-08, it was estimated that the dividends and payments to the government from SA Water would be $275 million. Last year's Auditor-General's Report to the parliament highlighted that the Rann government is actually treating SA Water as its cash cow, even though during a period of drought and water restrictions, the state government's own water utility is being starved of money to carry out capital projects, and that is what needs to happen. I quote the Auditor-General's Report, as follows:

For the corporation to maintain or increase the level of capital expenditure, it will have to increase its level of borrowings. Put simply, the corporation's ability to generate cash from its operations is not sufficient to fund its payment commitments to the government and maintain its current level of capital works.

That is from the Auditor-General's Report for the period ending 30 June 2006.

It is interesting to look back to when the Rann Labor Government came into power in 2002-03 and to note that the level of dividend to parliament, or to the Treasury coffers, was $165 million. In 2003-04, it was $164 million and, in 2004-05, it was again $165 million. Then there was a quantum leap forward, in 2005-06, to $217 million. It came back a bit, in 2006-07, to $204 million and in 2007-08 it was $189 million, but I reinforce the fact that, in that six-year period, the total contribution to government in dividends from SA Water was $1.688 billion. Those figures certainly speak for themselves.

The government has milked SA Water, increasing its take from the corporation from $206 million in 2001-02 to $386 million in 2005-06 and then on to $275 million in 2007-08. That is a 34 per cent increase since the last Liberal budget. SA Water's capital works spending on repairing pipes and building new infrastructure has changed from $174 million in 2003-04 to an estimated $235 million in 2007-08. However, of this, only $12.1 million is actually for new works and that is for the Clayton water supply pipeline, the Morgan-Whyalla pipeline and the Virginia-Angle Vale reuse extension.

Another issue I want to focus on is the shared services reform. We have heard much in this place and there has been a lot in the media about shared services. Anyone who works within TAFE, health or the Department for Environment and Heritage has been concerned about their job, especially if they are defined as being a back office person and they work in accounts payable or receivable, payroll or human services-type functions.

We know that, especially for those in regional areas, it is anticipated that there will be 256 full-time equivalent positions cut. I know from my discussion with people who work within those departments and who live in the regional areas and are upset about this, that a lot of those jobs are part-time. They are not full-time. So 256 full-time equivalents probably relates to something like 500 people. If we look at the drought situation and the importance of a wage in a regional community, you cannot suddenly take up to 500 people out of the regions, because it is not just the financial implications but, importantly, it is also the social implications also.

These people do not want to leave. They want to keep their jobs and continue to work in areas that they love, and they want to continue in the jobs they are passionate about, but their opportunities are being taken away from them because the government is intent on trying to save money under shared services reforms.

Already we know that this program has been delayed, and we know that there have been problems associated with it. We know that the costs associated with creating shared services this financial year are actually more than the reduction in cost will be. There is money being expended to save money in the longer term, but you have to question the need for it. In this time of drought, especially in the regions, you have to try to put more people into regional areas, not take people from them.

But it is not just the regional areas that will suffer. Probably about 2,000 people working within suburban and CBD areas will be affected. They will all be told that if they want to keep their jobs not only do they run the risk of not having it any more but, if they do manage to keep it, suddenly they have to work out of a CBD location. These people want some surety.

In the final moments of my contribution I want to refer to some of the figures in the midyear budget review as at 31 December, produced by the Treasurer and published I think on 24 December. General government revenue for 2007-08 is above that forecast in the budget by a not insignificant amount, that is, $252 million. Suddenly, the government has $252 million extra to spend in this financial year.

From 2007-08 through to the 2010-11 forward estimate period, it is interesting that total general government revenue has been revised up, again by an enormous figure, that is, $1.888 billion. Members should remember that the midyear budget review was as at the end of December and the budget was presented in the first week of June 2007. In that six month period not only was there going to be additional revenue of $252 million in the current financial year but also, over the forward estimate period of four years, it is nearly $1.9 billion.

Taxation revenues are also above those forecast in 2007-08, by $173 million. From 2007-08 to 2010-11, total general government taxation revenues have been revised up by a total of $638 million from the original preparation of the 2007-08 budget. That $638 million comes out of the pockets of every person who lives in South Australia and spends money and owns a home here. These people are screaming for more assistance. General government expenses are also above those forecast in the 2007-08 budget by, again, another enormous amount, that is, $199 million.

So, not only has the income gone up by $252 million, but expenditure has gone up by $199 million in this financial year alone. From 2007-08 to 2010-11 total government expenses have been revised up by a total of $1.473 billion. Again, during the six month period between the preparation of the budget and the adoption of the midyear budget review of the forward estimate period, we are looking at an additional $1.473 billion extra being spent.

Employee expenses are also interesting, and I believe it is something like $5 billion per year. For those forecast in 2007-08 to the midyear budget review figure it has gone up by $75 million. Over the forward estimate period for 2008-09 to 2010-11, employee expenses have been revised up by a total of $541 million from the 2007-08 budget.

You have to look at the fact that we know industrial action is being taken by doctors in the public health system and they want quite significant pay rises. We know that teachers are asking for pay rises as well, and TAFE employees are asking for pay rises. I know that late last year agreement was negotiated with the 4,200 police officers in South Australia for pay increases. There are a lot of demands out there.

Minister Michael Wright, in his negotiation, faces a lot of challenges, but forward estimates certainly indicate there is an enormous amount being spent on public sector employee expenses. If it is around $5 billion now and it is going up by $541 million, that is at least a 10 per cent increase.

Again, I want to enforce the fact that the budget does remain in deficit on two of the three of the normally accepted accounting measures. The Treasurer continually disputes this. He conveniently is using an accounting measure that proves he is in surplus. We remind him of the fact that when he was appointed Treasurer in 2002 he identified the system he wanted to use. Because circumstances changed and those figures no longer looked attractive to him, he suddenly changed his mind.

It is with a great deal of pride that we in opposition have decided that South Australia's tax system needs a bit of reform, and we have invited the South Australian public to contribute to that. The Treasurer has belittled our efforts and, after the announcement of our tax discussion paper about two weeks ago, he came out in the middle of the afternoon and said that the policies of the Liberal Party will bankrupt the state. He has conveniently forgotten that the discussion paper was not our policy but reflected the comments received from the 45 people who made submissions—the 45 people who have a deep interest in the state on behalf of the thousands of people who are worried about the taxation policy that exists. There is a lot of interesting comments in it. We look forward to 12 May when we have our tax summit in the House of Assembly chamber, and we are hopeful of having at least 100 people here who want to contribute to the tax debate in this state. Taxation debate will drive policy determinations: there is no doubt about that. There will be some things that come from that day that we will use and some that we will be unable to use. However, importantly, we are giving South Australians a voice, and that is what the parliament should be focused on.

Taxation creates the opportunity to provide services, and the Treasurer in answers about tax reform, after initially not only belittling us but also condemning our proposal, said that tax reform was not required. It was pretty interesting that, within about a week of that the 2020 Summit was held in Canberra and, suddenly, the Prime Minister is saying that a root and branch approach to tax reform, state and federal, is required.

We have asked the Treasurer questions about this, and he has recognised that, in some ways, the Prime Minister's comments were appropriate. He has gone on to defend himself by alluding to the issue of reform on taxation transfers between the state and the feds. However, it is important that South Australians have their say, and we think that 12 May will provide that opportunity. We think it is important. We know that people will access it and we look forward to the debate. It is interesting because $2.3 billion is a significant amount. It is a percentage of the state budget which we do not necessarily have a chance to review but we must approve that expenditure.

We want South Australia to move forward, too. South Australia deserves to ensure that the level of taxes that are raised in this state provide the level of services and infrastructure that it requires. The last six years have proven that that is not the case. The last six years have proven that a party is in power that cannot manage itself. The last six years have proven that a party is in power that cannot ensure control of its expenditure or, indeed, the number of people it employs. The last six years have proven to many South Australians that, upon reflection, they probably made a poor choice with respect to whom they voted for in 2002 and 2006.

We hope that from 2010 members on this side of the house transfer their seating arrangements to the other side of the house and that we have the opportunity to make sure that the future of this state is bright. Budgets will be an enormous challenge, there is no doubt about that. The pressing need for infrastructure and services will challenge anyone in government. However, we believe that we have the skills. We certainly have the endeavour.

While I have varied somewhat from the Supply Bill and the debate on the $2.3 billion, it has been a great opportunity to reflect upon the mistakes this government has made over the last six years and to comment on where opportunities will lie to enable members on this side of the house from 2010 when we have control of the Treasury books to make a difference to this state.

Mr WILLIAMS (MacKillop) (16:47): Again, we come to discuss the Supply Bill to provide for the payment of government expenses in the interim until the budget is brought down and passed through the parliament. So, interestingly, we must try to understand what might or might not be in the budget. This job is becoming easier each successive year since this government has been in office, because it has now got form and we have a fairly good understanding of the way in which it operates. I do not expect to see too many changes from what has occurred in recent years—unfortunately!

Something interesting happened in question time today. The Treasurer, by way of interjection during the fracas, said across the chamber to members of the opposition, 'You're jealous of me.' I want to make it quite clear to the Treasurer that I do not think that any of my colleagues would be jealous of him. I certainly am not. I would certainly not wish to be wearing the mantle that the Treasurer of South Australia wears. I would certainly not wish to be seen in the way that he will be seen and judged by history as we move forward in this state.

Treasurer Foley and the Rann Labor government will be seen as one of the most inept treasurers and governments this state has ever had. That is a big call when one recalls the last government Mr Rann was in—the Bannon Labor government—in the 1980s and early 1990s. That government lost in a number of financial disasters, it was just not the State Bank. It lost billions of dollars. I would contend that the current government has been just as wasteful if not more wasteful and has cost the state of South Australia—the people, the citizens of this state—even more than was lost in the State Bank disaster just those few years ago.

The Premier and the Treasurer will continually come into this place and argue that South Australia is doing very well. They will argue that employment is up and unemployment is down. They will argue all sorts of figures. The Premier always argues about the exploration figures in the mining sector. The reality is that those figures simply reflect the amount of money that BHP Billiton is spending in developing its project and doing the feasibility study to change the way in which it mines at Roxby Downs and to increase vastly that operation to become, as we all acknowledge, probably the biggest mine in the world.

Ironically, that operation would not even be there if the current Premier was as effective as he makes out he is back in the early 1990s. He would have stopped it. He was the one, no doubt, who penned the words 'the mirage in the desert' that were uttered by the then leader of the opposition (John Bannon) who later became premier. He called it a 'mirage in the desert'.

The vast majority of the exploration figures that keep getting quoted in South Australia are related to work at Roxby Downs—what we call brownfields exploration as opposed to greenfields exploration. Mining activity in South Australia will increase, I hope, dramatically over the next period, and I am talking about the next 25-30 years.

I sincerely hope that South Australia will emulate what has happened in Western Australia over the last 30-odd years. Western Australia took the plunge to accept mining and to encourage mining houses to operate in that state in the early 1970s, at the time, again, when Labor governments (certainly here in South Australia) were still peddling the nonsense that mining was raping and pillaging the state and that it did not want to have anything to do with it. I am pleased that the current Labor government has seen the error of its ways and now has become more pro-mining, more accepting of mining.

One thing that does disturb me is that with the largesses that are flowing to the state—and we are seeing that just with the increase in the value of the minerals being mined in this state—we have seen a dramatic increase in the royalties flowing to government from the mining sector, yet we have seen a diminution of the amount of money reinvested back into the mining sector by the government. Whilst we have seen a vast increase in royalties, we have seen a lessening of the money spent by government in the mining sector. Talk to any mining house that is out there either wishing to explore or exploring and wishing to expand, or wishing to convert an exploration licence into a mining licence, and they will all tell you that the permitting part of Primary Industries in the mining sector is short staffed and has been for years, and the government will not put in resources to ensure that the permitting for mining exploration and mining licences is done in a timely fashion.

That has been going on for years. I am no longer shadow spokesperson for mineral resources but, when I was, I used to regularly attend functions held by the mining industry and that was a common complaint, and nothing has changed. I watch each year. I still have an interest in that area, and every time I pick up the budget papers, I look with keen interest to see whether the government has increased its expenditure in that area, and it just does not happen. Why? The budget is out of control, that is the problem. We do not see monies being spent in areas that we would have expected with the incredible growth in revenues that the government has seen in the whole of its six year term.

There has been incredible growth in revenues. I will not detail all that because my colleague the member for Goyder has just spent a considerable time detailing the figures. We all know that the growth in revenues has been nothing short of startling. It has had little to do with government policy. Certainly, I would suggest, it has been created in spite of the policy of this current state government. When we compare the growth in some of the headline numbers that the Premier and the Treasurer use about things such as employment, total employment and industry growth in various sectors of the economy with the other states, relative to the other states we are going backwards. That is why I say Kevin Foley will be seen (as he deserves to be) very harshly by history. He will be seen as the captain of the economic part of the ship that saw it wallow while the other states forged ahead. That will be the legacy of this current Rann government.

We used to say 'missed opportunities'. It would be nice if we could couch this in terms of missed opportunities, but I say that we should now be talking about the disaster that has befallen this state. Kevin Foley, the Treasurer, keeps talking about the fact that he has always had surplus budgets and that the former Liberal government could never create a surplus budget. We know that that is a nonsense. We know that the first budget he brought down was a deficit budget. It only looked to be in credit because he delayed the transfer of a significant payment of some $270 million from the old South Australian government financing authority and the South Australian Asset Management Corporation. He delayed that payment so that, instead of falling in the 2001-02 year, it fell in the 2002-03 year.

The effect of delaying that payment, the effect of changing Rob Lucas's last budget, made that budget look like it was in deficit. What Treasurer Foley did was take the $270 million which was provisioned for in Rob Lucas's last budget and say, 'Whoops, sorry, I need that $270 million in my first budget so that I have a surplus and also so that I can say that you had a deficit.' That is fact; that is what happened. It has been documented. Things went along pretty well in the next couple of budgets because the revenues exploded, but, at the same time that revenues exploded, so did expenditures, and that is where Treasurer Foley, Premier Rann and the current Labor government have let this state down. They have allowed expenditure to balloon out and to become totally out of control.

The opposition keeps quoting the 10,000 plus unbudgeted public servants. I know the Treasurer and the Premier will say, 'We have more police officers, nurses, doctors, school teachers, etc.' They talk about more nurses, and I think the most recent figure the Premier mentioned was about 2,200. I would like to know how many full-time equivalents that is because I would suggest that it is much less than that. I know that, when the figure was about 1,300 in full-time equivalents, it was close to half of that because we know that many in the nursing profession work part-time. Notwithstanding there might be 2,200 new names on the employment registry, many of them are part-time and the full-time equivalent increase is much less than that.

However, that is not the point. The point is that they were budgeted for, as were the 400 extra police officers. We are talking about 10,000 plus public servants who were not budgeted for. The cost of that year in, year out, a recurrent cost that is now locked into the South Australian budget, conservatively would be $700 million a year. The point is that, if Treasurer Foley was able to have controlled his big spending mates on the front bench, his big spending cabinet from day one, each year South Australia would have had that sort of money available for the sort of projects that we now need, the sort of projects that we will now put on the credit card—things such as new schools, new hospitals, new water infrastructure, desalination plants. As a state we cannot afford to do the sort of things that we need to do.

I believe that South Australia will not get any money out of the $10 billion that was put on the table by the Howard Liberal government to fix up the River Murray, Murray-Darling Basin and that whole system. I do not think that that money will be spent in South Australia. I cannot see too much of the portion that was to be spent on infrastructure and upgrading of existing infrastructure being spent in South Australia. I talk to the irrigators and grape growers down at Langhorne Creek. They have an industry worth half a billion dollars a year but they cannot access water and, if they could access water in the lakes, it would be of a quality that would probably kill their grapevines. It would certainly mean that the grapes they harvest would not be suitable for producing high-quality wine. So, there is an industry worth half a billion dollars a year, and they need a pipeline at least from Jervois at a cost of about $60 million.

Because of the poor negotiating skills of the Premier, it looks like South Australia has negotiated itself into a position where it will not be able to access any of the money out of Canberra for that project or the other proposed pipeline projects around the Lower Lakes. So, that industry worth half a billion dollars a year will be left to wither on the vine. Not only has the state squandered its opportunity through its lack of negotiating skills, it has also failed to run a decent budget for six years and to capture the increase in revenues to have money available for those sorts of projects. That is a serious problem.

The state government jumped at the opportunity to throw tens of millions of dollars into helping workers when Mitsubishi closed down, but I have not seen one cent (or the prospect of one cent) being spent to save the Langhorne Creek grape growers with their half a billion dollar a year industry.

The Premier goes down there with a TV camera, has his picture taken for Adelaide news services, but he will not sit down to talk and negotiate with those growers or that industry. That is the sort of problem that we have. I know that the Premier's hands are tied because he has a Treasurer who has mismanaged the state for six years and he now no longer has the money. All the significant projects that have been looked at will have to be funded from the private sector.

This is the premier who signed a document (another one of his stunts) to say that he would not have any more privatisation in South Australia. At every opportunity, he tries to suggest that the Liberal Party is all about privatisation. That is what he does on a daily basis when he gets an opportunity. The reality is that we are going to have private schools where the private sector will build and own our schools. We are going to have private hospitals where the private sector will build and own our hospitals. We are going to have private prisons because the private sector is building and owning our prisons.

The Premier will say, 'But in the hospital the state will still employ the doctors and nurses, therefore, it is not privatised.' Give me a break. It is privatised—it will be owned and funded by the private sector. South Australia has been sold out by this government at a time when we have had an incredible increase in the revenues flowing into government.

I go back to the Treasurer's claims about having a budget surplus. The reality is that, in the current budget to 30 June this year, the Treasurer claims that he has a $30 million surplus, but what he does not say is that it has only been achieved because he has gone out and borrowed $428 million. It has been a fair while since I have done grade 3 arithmetic, but I reckon if you borrow $428 million to get a $30 million surplus, you are going backwards at the rate of about $398 million. That is the way I figure it. As my colleague the member for Goyder pointed out, of the three methods you can use to measure your budget position, whether you use a cash system, an accrual system, a net lending/borrowing measure or a net operating balance, the only one that shows that this government can have a credit balance or surplus is the net operating balance. If you applied that measure to any budget brought down by any government in the history of this state, you will always get a surplus.

When you use net operating balance, all it means is that, whilst you still have a capacity to borrow money to cover your expenses, you are always going to be in the black because that is what it is measuring. But when you actually measure your net position which occurs if you use a cash base measure or a net lending measure, you get a real picture of where the state is going, and this state is going backwards. It is going backwards at a rapid rate. We know at a time when we have had this huge excess of cash coming into the Treasury coffers, we are increasing our borrowing—$428 million in the current year. Over the next few years, it will be hundreds of millions more, and that is not counting the deficit that has been run up by signing contracts with the private sector to take over ownership of our schools, hospitals, prisons and water infrastructure, and that is billions of dollars.

I have mentioned water infrastructure but I have not even talked about the borrowing in that area. We have these government financial corporations all out borrowing money. In the case of SA Water, the Auditor-General has been pointing out for years now that SA Water cannot fund both its capital works and the dividends it is forced to pay to the government, and SA Water itself is borrowing to put money back into the Treasury coffers. Not only is Treasurer Foley borrowing himself, he is also forcing the government-owned corporations to borrow on his behalf. So, when we get to the situation where we need to build something like a desalination plant or other major water infrastructure, we have to get the private sector to do it because we have wasted the money. That is the problem we have. South Australia will continue to go backwards relative to the other states for as long as this government is in office. That is my contention because I cannot see this government changing tack at this point.

Time expired.

The Hon. I.F. EVANS (Davenport) (17:07): I wish to make some comments in relation to the Supply Bill and I commend the members for Goyder and MacKillop on their contributions. I do not intend to repeat their arguments because they have outlined the opposition's position in relation to the budget, taxation and expenditure, and the wrong priorities of the government. I guess I want to take those contributions and bring them down to a local level to show how the government's lack of priority and lack of budget management has an impact on local communities.

The first example is three community organisations that are at war with this government and the Adelaide City Council over the Adelaide Aquatic Centre—and they are Swimming SA, Diving SA, and Water Polo SA. Seven years ago next month the former government—and I, as minister—announced that it would build a world-class Olympic-style swimming centre at Marion. Now, for six years this government has stuffed around and tried to deliver a pool to Marion. For six years this government has messed around with that particular project, and during those six years there has been an ongoing battle between the Minister for Recreation, Sport and Racing, the Adelaide City Council, and the three aquatic organisations regarding the Adelaide Aquatic Centre.

The Adelaide City Council has had a gutful of waiting for the government to make a decision, and has written to the various organisations saying that as of 30 June this year the council will introduce a new charging regime. The charging regime it is to introduce is outrageous; it will cost those organisations over $200,000 a year extra and will bring into the Adelaide City Council something like $600,000 to $650,000 extra each year. The council is doing that because the state government has failed to make a decision about extra funding to the council as a way of supporting Diving SA, Swimming SA and Water Polo SA.

Why should the state government be contributing to the Adelaide City Council's costs in relation to those sports at the Adelaide Aquatic Centre? The reason is that those three sports have elite level programs—that is, state level programs—operating at the aquatic centre. Now, there are not many pools around where you can actually play competitive water polo or have an elite level water polo program. There are other pools where you can have the swimming program, because it is simply a 50 metre long pool—although we all know that the Adelaide Aquatic Centre does not meet current standards for international competition, which is another reason the former Liberal government announced the Marion aquatic centre proposal.

However, for Diving SA there is no facility in South Australia, other than the Adelaide Aquatic Centre, that has a 10 metre platform and a pool deep enough to provide for an elite level program. The government's indecision, the Minister for Recreation, Sport and Racing's inability to make a decision, means that Diving SA is facing a bill of over $200,000 extra each year from a very small parent and fundraising community. We all accept that diving is not the biggest sport in South Australia, but we make an important contribution to the Australian Olympic team and the broader diving program. For that organisation to have to find an extra $200,000 or $220,000 a year means only one thing—the organisation will cease to exist come 30 June, or thereafter, because it will not be able to pay the extra cost to the Adelaide City Council.

The member for Goyder indicated that the government has an extra $248 million in its forward estimates this year in its mid-year budget review. So, why is this minister so incapable of making a decision to support these three organisations? You might recall that this is a government that found $200,000 to do the garden outside the new 4 to 5 star hotel in Port Lincoln. It contributed $200,000 to a garden, but when the diving, swimming or water polo organisations go to this government they get the cold shoulder. It is an example of how the government's lack of budget management has delivered a very bad outcome for those community organisations.

What the government is doing to those organisations is outrageous; they do not deserve it. Surely the government can find the money to assist them. It is not the fault of Swimming SA, Diving SA or Water Polo SA that this government has not delivered, in six years, on the Marion aquatic centre project. The Minister for Health writes in The Advertiser how this government is concerned about obesity. Well, I could not stop laughing when I read that article, because this government has done absolutely nothing for community recreation and sport other than cut its funding and cut its programs. There is no better physical activity than aquatic-based sports, because the weightlessness of the body in the water means that there are less joint and tendon injuries. So, anything aquatic based is a fantastic fitness and exercise routine.

However, this government has failed to deliver on this program. The first thing it did was cut $7 million to $10 million out of community recreation and sports grants, and it recently cut the Premier's Be Active program grants. All the physical activity teachers in schools will tell you that those cuts by the government were an absolute nonsense. That is an example of how the macro issue, the lack of budget control, delivers real pain to our schools, our community organisations and, in this case, to the aquatic organisations.

The member for MacKillop raised the issue of extra public servants within the bureaucracy. I make the point that I wish just one of them in minister Wright's office (and I am not particularly worried which one) would pick up the question on notice I asked six months ago today. I just wish that one of them would put it in front of the minister so that I could get an answer. It was a pretty simple question. I keep asking the minister informally across the chamber, 'When am I going to get an answer?' Today I asked him whether he had shot the carrier pigeon, because I assumed that it was coming by pigeon post as it had taken so long.

The question about the policy of the minister and the government on how they deal with sport and recreation grants is not difficult; it would have been in place for six years. They have been making grants for six years. I simply want to see what their policy is in writing. Surely one of them can pick up the answer and give it to the minister.

In my electorate of Davenport, the budget problems deliver negative results, and I will give a few examples. I have spoken informally today to the Minister for Transport about parking at Eden Hills Railway Station. As the name indicates, Eden Hills is not flat; it is actually quite a steep bit of country. The railway station is well used and has very limited parking.

For three years, I have been trying to get the government to buy a piece of vacant land adjacent to the railway station and the railway line to increase the car parking at the station. I have even approached the landowner, who has given me their approval, in writing and on letterhead, to sell the land to the government. This has been given to the minister's office on a number of occasions, and I have lodged a petition on behalf of the electors. I suspect that it is the fault of the department that I cannot get a decision out of the government to buy a block of land to increase the car parking at Eden Hills Railway Station.

If they have an extra $248 million, as their forward estimates suggests, I say: why not? If we are to get traffic off the road, I invite the minister to do this exercise: on any school day, get to Blackwood at around quarter to eight and try to come down Old Belair Road. I have stressed to the minister's office and his public servants that there needs to be an investment in the road network between Blackwood and Cross Road so many times that I have lost count. There needs to be a traffic management plan for Black Road, Flagstaff Hill, to Cross Road. In my view, there needs to be consideration of an extra lane between Blythewood roundabout and Fullarton Road because Blackwood Park is being developed in the electorate and will comprise 1,200 extra homes, which is 20 per cent extra housing in the district.

Not one dollar is being contributed towards the management of the increase in traffic. There are 600 new homes, and the other 600 blocks are being sold. Within three years, the full impact of that traffic management will be apparent. I say to the minister, or to any of his officers who are listening or who will read this: pick up your traffic management report from your department and it will tell you that, when the 1,200 homes are built, there will be 5,000 extra traffic movements a day at Blackwood roundabout.

Park a public servant there and get them to look at Blackwood roundabout today. It is a log jam both during the morning peak, going into the city, and the afternoon peak, coming home from the city. When a freight train goes through Blackwood crossing, which is 150 metres from Blackwood roundabout, the whole thing just locks up.

If you do not want to send a public servant there, send an email to your public servants in the department of transport. About 60 or 70 of them live at Eden Hills, Blackwood or Bellevue Heights, and they will all tell you that the local member is right. I go to the public meetings, and I ask the public servants to come with me and see the traffic problems. Privately, they all agree, but they need the government to act. If you think that Britannia roundabout is a traffic issue, I invite any of you—any of the minister's officers or the minister himself—to come to Blackwood and go down the hill on any school day. There needs to be an investment in the road infrastructure at the Mitcham hills area.

The government's budget mismanagement means that at this time that investment is not forthcoming; in fact, it has gone backwards. The first act of the Rann Labor government was to take $900,000 out of the upgrade of Old Belair Road. It was a $1.8 million project, and the first thing the Rann government did was cut it in half. These sorts of local issues highlight the impact of a budget getting out of control, as the member for MacKillop claims it is getting out of control.

Other issues relate to education, such as Hawthorndene Primary School, which is saving up for a sports hall. The cuts to its programs mean that the sports hall is now many years away. It did not have to be, but the way that this government handles education means the hall is many years further away than it needs to be. Because the population growth in the area is at an all-time high, the Eden Hills school needs an asset management plan because many of its buildings will need replacement. The school will need a long-term asset management investment by the state government to replace and improve the existing facilities.

The other issue is public transport. The Mitcham hills area has less public transport now (with more population) than it had six years ago, because the way the bus timetable is worked out, if your population growth is not in the state's priority areas, then you simply do not get investment. The areas that will attract investment are the faster-growing areas such as Mount Barker, some of the northern suburbs and maybe some of the southern suburbs when they come on stream, but if you are a medium-range growing area, you actually attract less investment because the bus contracts which this government supported—even though they do not support privatisation, every single minister voted to renew the privatised bus contracts—reward the bus contractors based on patronage. So the bus contractors look at where they can get the most patronage and that is in the fastest growing areas, and that means that slow-growing areas or old areas that are declining in population get less service.

What we need is an investment in cross-suburb small bus commuting. There is a significant need for the mature aged, the disabled and young mums to be able to go 10 or 15 minutes across suburbs. That investment is not being made by local government, and it is not being made by the state government. The problem with the public transport system is very simple, in my view. The public transport system was designed many years ago when the majority worked from nine till five in the city, so you have this very lineal public transport system coming into the city. It is great if you are going there, but the reality is that the workforce is spread, and a lot of people do not go to the city to work.

We need a different focus on the public transport system other than the city. That said, there need to be improved public transport services. I know I have argued for an improved road network; the reality is that about 85 per cent of people use cars, and 15 per cent use public transport. There needs to be a coordinated investment program in those areas in my electorate. I know I have spoken about my electorate, and I have done so quite deliberately. I have done so to try to illustrate that the budget overruns and mismanagement highlighted by the member for Goyder and the member for MacKillop have a very real impact at the local level, and it is at the local level where the pain is really being felt as a result of the inaction of this government.

Dr McFETRIDGE (Morphett) (17:25): It is interesting to speak to financial bills because I remember that when I did my first budget I said that I was no economist, and I said that economists were only put on this earth to make meteorologists look good. I had to pay penance at the bureau, and the meteorologists really took umbrage. I think it was at the last budget that the Treasurer said that he was hoping the drought would break, so I then said that the economists were hoping that the meteorologists would make the budget look good. That has not happened.

South Australia is going very well. I said, in the WorkCover speech, that the economy in South Australia was booming. I should have really said that the national economy is booming. South Australia's economy is going very well, but as I will read into Hansard a bit later on—and I will not read all of them—26 different sources in the last two years have indicated that South Australia could be doing much better.

I want to start my contribution with a little bit of history. The Premier, when he was discussing the ills of WorkCover, I think at the Labor Party executive meeting recently, likened the WorkCover unfunded liability to the State Bank blow-out, and that gives a little more credence to our referring to the unfunded liability as the State Bank Mark II.

When we were suffering the ills of the State Bank, really hard decisions had to be made, and one of those decisions was to sell off or long-term lease—people say 'sell'—the electricity assets of South Australia. We have been roundly criticised by the government for that ever since, but we should all be reminded of Standard and Poor's comment, in one of its reports, that the AAA rating that the former Labor government lost had been reclaimed because of the hard yards done by the former Liberal government in reducing the state debt by selling off the electricity assets.

One of the reasons the electricity assets were sold off was associated with the national electricity market, and that was a situation brought about by the Keating Labor government. I know that this morning we debated the national gas measure in this place and, while my understanding of it is not that deep, I believe that it sets up a national gas market similar to the electricity market, and I should remind the house that it was the Labor government that sold off SAGASCO (the South Australian Gas Company) into private hands many years ago.

Decisions have to be made, and those decisions can be criticised at a later date as being the wrong decisions, but I think history will say that all of those decisions have been the right decisions for the future of this state. In fact, let us look across the border at our eastern cousins and see what is happening over there. They have budget issues similar to ours, where you need to spend on infrastructure, public works and many other issues such as health, law and order and education.

There is no doubt that you need to spend and there is only so much money in the pot. It is a bigger pot, but there is only so much money there. What is the Iemma government doing in New South Wales? They are going to sell off and privatise their electricity. The Bob Carr government tried to do this in the late 1990s, and we all remember that Maxine McKew's partner, Bob Hogg, did a terrific report recommending the privatising of electricity back in 1997, I think it was. The Carr government got rolled by the unions then, but we see now that the Iemma government is standing up to the unions and saying, 'We have to do this. We have to raise the money from the sale to put into rebuilding the state.' There are still a number of Labor members of parliament in New South Wales who are dead against this, but what do we read in the Sydney Morning Herald last Saturday? This is very important because of the fact that we have the federal president of the ALP as our Premier, and I suggest that he look at what the New South Wales ALP president is saying. The article states:

The president of the New South Wales Labor Party has confirmed he will protect any Labor MP who votes against the privatisation of the state's electricity industry...Bernie Riordan, secretary of the Electrical Trades Union, and chairman of the ALP's powerful administrative committee, has told the Herald that MPs who uphold party policy by defying the Premier will not be expelled or lose their endorsement.

In New South Wales they can cross the floor if they feel really strongly about a particular issue, but you watch what happens if one MP in this place or the other place steps out of line over WorkCover and sticks by their principles and crosses the floor. They will not be protected by the ALP; the federal president will not protect them. They will be disendorsed and we know they have been threatened with that if they step out of line. It is an atrocious thing to have happened. So the fact that—

Mrs GERAGHTY: I rise on a point of order. The member for Morphett has just made a statement that is clearly wrong and misleading to the house. He said that we have been threatened and that is clearly incorrect.

The DEPUTY SPEAKER: That is not a point of order. Member for Morphett.

Dr McFETRIDGE: Thank you, Madam Deputy Speaker. I understand that the government does not like its dirty washing being hung out in public, but that is the information that I have been given and I can name names, if they want, as to who went and spoke to the left and who went and spoke to the right. We can name names if you wish, and we have got them. The government needs to recognise that what it is doing is not being supported by its members. We know of at least 12 of them in this place who are not supporting it, and yet we do not see them being given the opportunity to stand up their for principles, unlike their colleagues in New South Wales. Certainly the Labor Party is not going to protect them here like the Labor Party is protecting its members in New South Wales, and that is just a sad fact of life.

The more pertinent matter in relation to this supply bill is the need—as the Treasurer indicated—to pay my wages. I would like to say that I do not need those wages. I certainly do need to have some income. I have done very well in business over the years and I have some good investments, but I do require some income from this place, so I thank the Treasurer for saying that it is helping to pay my wage. I just hope that it is not—

The Hon. G.M. Gunn: And they're getting good value for that.

Dr McFETRIDGE: And they are getting very good value for that money, I point out to the member for Stuart. Even if I do say so myself, I work very hard for my constituents in Morphett and I deem it a pleasure to be serving those constituents. They pay a lot of taxes to this government, particularly in stamp duty and land tax down there because property values have significantly increased in recent years in my electorate of Morphett.

I know of one hotel down there in respect of which I think they said they are paying $1,200 a week in land tax, and that seems an extraordinary amount—perhaps it is a month. Surely, nobody would be paying that much a week, but I will check that tonight. However, it is an incredible amount, and I was shocked to hear this at the time—in fact, so shocked at the amount they were paying that I cannot remember the exact amount! Either way, $1,200 a week or a month in land tax is still far too much to be paying because that comes straight out of the business.

It is important that we realise how much money is coming into the coffers of this government. As the member for Goyder, the member for MacKillop and others will be saying later on, this government is rolling in money. When we look back at the history of the income received from the hand-working taxpayers of South Australia, we see that it has gone up significantly. I am told that in our last budget in 2001-02 it was about $8.54 billion, but what do we see now? In the current budget for 2007-08 the estimate is over $12 billion—about $12.4 billion. That is a significant rise in income. Where has it come from? It has come from the GST.

We know that this Labor government opposed the GST, yet they would be the last ones to think about scrapping it now. They realise that it is a broad-based form of taxation that is generally a fair form of taxation, and certainly it is bringing a significant amount of money—far more than anybody could have ever expected—into the coffers of this government. Where does that money go? It goes into a lot of places, but unfortunately a lot of it is going into recurrent expenditure.

The areas that I am really interested in today are those associated with my shadow portfolios: Industry and Trade, Science and Information Economy, Transport, Industrial Relations and Aboriginal Affairs. The money that has gone into those various portfolios over the years is significant, but they still need more, and the priorities really need to be re-evaluated so that the state is able to catch up with the rest of Australia. The top item, though, obviously is the transport budget. The transport budget really requires significant spending in order to get our buses up to scratch.

The buses are getting old and tired. Some replacement buses have been provided for in the budget, but what we need, I am told by bus industry experts, is at least 40 extra buses. Some people say up to 100 buses, but I am told at least 40 buses. They are not just replacements for old buses, they are extra buses to run on the routes now that are really being taxed to the limit. I was talking to a young chap last night who said it is standing room only on the buses. We have had people fainting on the trams, but he said it is really stuffy on the buses as well.

The idea of the member for Davenport of looking at different types of public transport is one that we will certainly be considering, and we are more than happy to listen to his ideas. Regarding the trains, we will be interested to see how the new timetable for the Gawler line has been received. I am already receiving information that people are not able to get to work on time. The DSTO employees out there now have to rearrange their day to make sure they can get in and out of Salisbury on time. I am hearing that people are just not able to get on the trains at the stations they used to get on.

My old station, Chidda, is out there. I lived out there and went to Elizabeth South Primary School and Salisbury High School. It is not just Jimmy Barnes who knows that area out there. I know that area well. My mother still lives at Elizabeth Vale. She has a good local member in the member for Little Para and has had dealings with her office, and it will be sad if the member for Little Para leaves this place at the next election. We need to provide transport that is going to work, and we will see the results of the government's fiddling at the edges in changing the timetables in the next few days, I am sure of that, when the complaints start coming in about the train timetables.

The bottom line is that we need new rolling stock and increased capacity, and this government has done nothing about it. It has taken some seats out of the trains so you have to stand up. That is its way of increasing capacity on the trains. It is just not acceptable. We see promises of rail revitalisation, which is really maintenance by another term, for the Noarlunga line. We are seeing nothing on the overworked 40 kilometres of the Gawler line, and we really need to ensure that is given priority in the future for the people in the north. Certainly, rail electrification is something the Liberal Party will look at as part of its policy proposals for the upcoming election.

Of course, there are the trams. I will not start on trams today. I only have seven minutes left and I need seven hours to talk about what is wrong with the trams and the things that have gone wrong, and I guarantee the Minister for Transport will hear a lot more about the fiasco that is the tram system in South Australia. I weep for what could have been, and what should be there and is just not there. So I am very concerned about that.

The fact is that the economy is going well, but this government wants to be very careful that it does not kill the goose that has laid the golden egg. By a geological accident, we happen to have all the minerals here so we will have a huge opportunity to maximise income from that, but what we will see is a government that has no plans for spending money on infrastructure.

SACOME says that $20 billion is needed for infrastructure to cope with the mining boom that we are on the cusp of, as they said this morning. We are not seeing any of that coming from the government. Most of the hundreds of millions of dollars—probably hundreds of billions of dollars—that is planned for development and infrastructure and projects in South Australia, I think more than 90 per cent—probably closer to 95 per cent—is private money, so the government really needs to think about what it is going to do to ensure that it has a vision like that of the Liberal Party—a 20-year vision.

As the member for Davenport said, a lot of what the government is doing is messing about with spin and fanfare, which really is not hitting home with some of the punters, particularly some of the rural punters. I was at Cleve the other day—I went across on the ferry and had a beautiful trip. However, it is bad luck that the Lucky Bay road is not finished: it is still dirt. I met some of the transport operators and spoke to some of the business people over there, and I point out that, while this is a national plan to increase the registration on trucks, it will hit home very badly for some of our country cousins.

The owner of a supermarket has contacted the government. I have a copy of his email which was given to me when I was over there. He is lamenting the fact that the registration cost on B-doubles is going to go up from a bit over $8,000 to over $14,000. It is nearly an 80 per cent increase in registration. The government should be putting a cap on that and somehow easing the burden of the flow-on effects. As this supermarket owner says, there is nothing he can do other than pass it on to the customers and, as he points out in his email, those customers are suffering from drought and interest rises and now they will suffer from increased rate rises.

The federal government is also making changes to the excise on diesel so there will be an increase in diesel prices which will flow on to transport which will increase prices for consumers and also the cost of production of commodities. We know—and the member for Stuart will be able to tell us a lot more about this—that that area is quite a huge grain producing area, so the cost of producing those commodities will increase dramatically.

The government really needs to take note of the grass roots opinion out there— whether it is in the northern suburbs, across on the West Coast or at Eden Hills. It really does need to listen to them, because it has a golden opportunity. The money is coming in in truck loads. The Treasurer will be like the bloke on the Lotto advertisement in the back of the truck who is jumping up and down trying to keep the money in the truck because it is overflowing. That is what he is like.

The economy in the state is going very well and the national economy is booming, but it is my sad duty to say that I was wrong when I said that the economy in South Australia is booming. It is going well but it is nothing like it should be. There are 26 different pieces of advice that this government has from credible organisations such as Access Economics, the Centre for Economic Studies, ANZ Australian Property Outlook, etc. It has had 26 different pieces of advice about the deficiencies in the South Australian economy, and I will read some of those into Hansard now. Access Economics in June 2007 stated:

The states wasted much of the money dropped on their doorstep during the good times. Or, in other words, the states wasted much of the money from the housing boom (which came to them via stamp duties and land taxes) and are now in deficit as a result.

Another comment from Access Economics at the same time states:

Population growth remains well behind matching national gains and the [population] composition runs the risk of being its Achilles heel in the next five years.

It is talking about the South Australian population here. It continues:

That can be seen in the state's workforce participation, which remains flat as a tack and well below the (still climbing national) average.

That comment was made by Access Economics in June last year. The other comment made by Access Economics in December 2007 was:

South Australia was the slowest growing of all state and territory jurisdictions in 2006-07.

The economy is going well but not as well as it should be. Why? As the members for MacKillop and Goyder have said, because of the financial mismanagement of this state. The quotes go on and on, and I will use the last minute of my time to read a few more of them. In January 2008—just last January—the National Australia Bank's Monthly Business Survey stated:

[Across the states] business conditions have also generally deteriorated in recent months—and probably most notably in South Australia.

Our economy is going downhill. What we will see is a state that will languish if we do not do something about it. If we do not get the government to start looking at its priorities, if we do not get a Treasurer who has his fingers on the pulse of the economy of this state, the South Australian taxpayers will rue the day they ever voted this Labor government in, and they will certainly rue the missed opportunities, the lost opportunities, that have been handed to it by a financial windfall from not only GST, land tax and stamp duty but also the windfall that will come from the geological accident that is South Australia with its huge mineral resources. We have a huge opportunity and it is being lost.

Time expired.

The Hon. G.M. GUNN (Stuart) (17:45): I am reluctant to get to my feet—

Mrs Geraghty interjecting:

The Hon. G.M. GUNN: I am pleased that I have the full concurrence of the Government Whip, and I am sure that she will accede to the comments that I will make briefly. I am not sure how many debates of this nature I have been involved in—

Mrs Geraghty: Many.

The Hon. G.M. GUNN: Many.

The Hon. R.J. McEwen: You make the same speech!

The Hon. G.M. GUNN: No. The Minister for Agriculture does not want to judge others by his own inadequacies.

The Hon. R.J. McEwen: It will be the same speech.

The Hon. G.M. GUNN: No. Because he does not have the wit or the wisdom to have an independent view at the present time, the Minister for Agriculture does not want to judge other people. One thing I have always prided myself on since I have been in this august and esteemed chamber is that I have been of independent mind. I do not take kindly to people trying to coerce me into doing things that I do not think are right, proper or in the best interests of my constituents. I think, perhaps, it may have kept me in this place.

The Supply Bill is one of the most important measures that comes before this house. It gives the government the ability to continue to fund the various provisions of services: education, health and hospitals, and various other agencies of government. Of course, the debate is whether the government has those priorities right or whether it has spent money in an unwise fashion. In my constituency, which is large (it is not quite as large as that of the member for Giles; it used to be larger), there are many areas of concern. I have an electorate which is basically in two parts: an agricultural and pastoral area; and an urban centre at Port Augusta. It is true that the Australian economy has been going exceptionally well, and that is thanks to the commonsense policies implemented by the Howard government. It got rid of the debt, it gave leadership and it put in place provisions which have allowed state governments to have the revenue they needed to provide the basic services of government.

I am delighted that the Minister for Aboriginal Affairs has come into the house because, in my brief contribution this evening, I want to know whether the state government has provided money to the Dieri Corporation, which is an Aboriginal corporation and which has an office in Broken Hill. My understanding is that some $600,000 has been spent to buy two blocks of land in Port Augusta West, and there is concern about what will be put on those blocks because the land is currently zoned 'rural living'. They are large blocks. People have built homes on them knowing that they will have some space. Questions have been asked, so I want to know whether the state government has put money into it. The interesting thing about the purchase of this land—

The Hon. R.J. McEwen interjecting:

The Hon. G.M. GUNN: The minister wants to listen; he might learn something. The interesting thing is that the land was bought by one Stephen Kenny. He is well known to me. He grew up behind me. He went off the rails a bit. He represented David Hicks, I understand, and that is a matter we could debate. However—

Mrs Geraghty interjecting:

The Hon. G.M. GUNN: Yes, Stephen Kenny and/or nominees. I took the trouble to have a look at the titles—you have to get behind these things—and I found out that it had been purchased by the Dieri Corporation. My questions are: first, why is its registered address in Broken Hill; and, secondly, a sum of more than $600,000 is involved, so what is this company going to do with it? You cannot put a commercial thing on it.

The Hon. J.W. Weatherill interjecting:

The Hon. G.M. GUNN: I hope it is, but I hope it is not taxpayers' money. I thank the minister. I hope it is not taxpayers' money because I think that taxpayers' money in Port Augusta can be spent in a number of other areas which may be more productive. There is an urgent need for more aged accommodation for all sections of the community. Very large amounts of money are needed. If we are going to have all this development, people will have to start planning a second bridge there. Huge investment will be required. There was some suggestion that another 3,000 people will live in the city. If that is the case there will have to be new water mains because it is very difficult to get connected to the current system.

But the even more important question is whether any attempt will be made to change the zoning. That is the question. Will the state government attempt to override the City of Port Augusta's current rules, because my constituents want to know. I will put some questions on notice. I am pleased that the minister is here. He has heard what I have had to say. A number of questions need to be answered because there are concerns that there may be inappropriate development. People have purchased their blocks with a clear view, with an expectation, that they will have plenty of room around them. They are five-acre blocks. They have made very large investments in building homes. They are very concerned that already there have been 30 or 40 vehicles on a weekend on one of these blocks, and they want to know whether this will continue. They have been to see me and, as their diligent local member, it is my job to ask the questions and to—

Mrs Geraghty: They might have been having a barbecue and invited their friends.

The Hon. G.M. GUNN: If the honourable member wants to have this in her electorate she can. My constituents would be delighted. My constituents have got some concerns, and if you want me to continue I very happy to do so—

The Hon. R.J. McEwen interjecting:

The Hon. G.M. GUNN: I do not mind what the shadow minister thinks. They can shift the blocks down to the electorate of Morphett if they want to, or to Mount Gambier. My constituents have spent hundreds of thousands of dollars and they want to know who will be alongside them and what sort of development. Without fear or favour, let me assure members, we will find out, and I do not mind whose toes I step on because these people have spent hundreds of thousands of dollars—hardworking, good South Australians—with an expectation that they can live there free from social problems. They have moved there to get away from social problems, and if you put people there who have no regard for other people's property or privacy, you will have a problem.

Mrs Geraghty interjecting:

The Hon. G.M. GUNN: If the honourable member does not understand what I am saying, I am very happy on a future occasion to put it on the record, chapter and verse, because I believe that, if you buy a block of land on a certain set of conditions, you should expect them to be upheld. The other matter which in the limited time I have available to me—and I am normally a person of few words in this place—I want to draw to the attention of the house is what is happening in agricultural areas. In the past few weeks, there has been a great deal of discussion in various publications around the country and internationally. There was quite an interesting article in the Financial Review today about the high cost of food and the effect it will have on people of limited means.

That may be so, but what has to be clearly understood is that, if you want food production to continue and to increase, you have to do a number of things. That is, the farming community has to be paid a decent reward for the effort they put into growing the product. At the present time, people have to understand that, when superphosphate has reached over $1,100 a tonne, the cost of Roundup (glyphosphate) has increased rapidly and the cost of diesel is over $1.50, the cost of production per hectare has gone up dramatically. As the member for Morphett rightly pointed out, if these out-of-touch bureaucrats in Canberra continue to jam up the costs of road transport, that will affect everyone in South Australia, and the further you live from a capital city the more difficult and the higher the cost will be. If you live at Marree, Innamincka or Penong, you will be paying more, and it is an impediment these people should not have to carry.

The other challenge (which for some reason best known to itself the government has declined) is to allow people to move to growing genetically modified crops. I put it to the house that, no matter what decision we make in this house, it is only a matter of time before there will be genetically modified crops. If we are to meet the demands of the world for food, then we have to grow more per hectare. There are very few places in the world where you can expand agricultural production—there are probably some spots in South America and Africa—so more has to be grown per hectare.

The question I pose to the Minister for Agriculture, Food and Fisheries is: how do they intend to stop genetically modified crops coming into South Australia? I ask: have they taken into account the provisions of section 92 of the constitution? I put it to the house that there will probably be a challenge. Far bigger fish have been fried in relation to section 92 in the past, and I suggest the minister reads the excellent editorial in the Victorian Country Times which has gone into this in some detail. However, if members talk to people in Canada and the United States, they will clearly indicate to you that there is no alternative.

I have had the privilege of talking to the secretary of state for agriculture in Kansas. I understand that it is the biggest wheat growing area in the world. I have spoken to the people in the department of agriculture in Alberta, Saskatchewan and Nebraska. When you see the Roundup Ready beans and so on and you see the advantages, and when you see the canola crops that have been grown in Canada, then it really does give you something to think about. In Alberta, the scientists said to me that if we want to do what is right for mankind and if we want to be able to provide high quality food at reasonable cost, then we have no alternative and we must move down this track.

We have been modifying crops for a long time and all this is doing is hurrying up the process. It is giving us the opportunity to use fewer chemicals to grow more per hectare and therefore be more productive. That in itself must be a good thing. I would think that most people, particularly those in the environmental movement who do not like chemicals, ought to support it because this means that you use fewer chemicals. I do not know any farmer who buys one litre more than they have to, because using chemicals is a very expensive exercise and it also takes time to spray the chemicals. Agricultural practices in South Australia and this country have proved to be some of the most successful in the world.

One thing that people in primary industry need is for petty bureaucracy to get off their backs and to give them a fair go. As I said in this house the other day, a few months ago, a constituent in the Riverland said to me that every time he sees a blue number-plated car drive up the driveway, he knows that the people in the car are not there to help him, they are there to hinder him. I think he was absolutely right. This particular gentleman—

The Hon. R.J. McEwen interjecting:

The Hon. G.M. GUNN: No, this was Sir Humphrey one or two, but he had a pair of air-operated secateurs and he was up a ladder. He came down the ladder and stood fairly close to the fellow, and the bloke decided that it was time to leave. The poor bloke was trying to pick his oranges. This year, because he does not have any water, he probably does not have any oranges. Nevertheless, this house has to ensure that, when it passes legislation, some of the provisions do not mean more forms, more levies or more penalties: it is not helping productivity. It is annoying and frustrating busy people who are trying to make a living. One of the other challenges facing agriculture is the ability to get labour. We just cannot compete with the mining industry which is creating opportunities and benefits which the agricultural sector cannot in any way meet because it does not have the resources and the ability to pay the salaries.

[Sitting suspended from 18:00 to 19:30]

The Hon. G.M. GUNN: I am pleased to continue my grievance with a few brief comments in relation to the Supply Bill. In considering this bill, we should be very aware of the change in economic circumstances which appears to be on the horizon. If I was one to make predictions, I would suggest that, in looking at the state budget, we should be aware that there will probably be a considerable tightening of credit. I think there will be other pressures on the economy which will probably affect the household budgets of many people in this state. We have to be very careful in any legislative program that we put forward that we do not unduly affect the economic capacity of our citizens to produce, because it is the role of state governments, in forming budgets, to ensure that they provide adequate services to their citizens.

In my constituency the most challenging services that can be provided are those which ensure that all sections of the community have reasonable access to a good education. The most isolated people in my constituency and in the member for Giles' constituency often have difficulty in accessing certain facilities, and here I refer also to the importance of maintaining health services. The difficulty that volunteer groups such as the ambulance, CFS and others are having in attracting and retaining their members is something that we also need to address, because it would be absolutely unacceptable not to have reasonable ambulance services.

The volunteers do a wonderful job, as do the CFS and the MFS and other service providers. There is a need to maintain hospital services in these isolated communities. When people look at them purely in economic terms, the budgets may not add up too well, but it is important to remember that people in isolated and small rural communities need these services. We will not keep people there unless they have those services. In a modern democracy people are entitled to have a fair share of the resources. Just because you live at Leigh Creek or Marree, it does not mean that you are not entitled to those services.

I firmly believe that for the small communities the budget and the money allocated in this Supply Bill should be utilised to provide those services, as it should be used to ensure that small business is able to continue to provide goods and services. Tomorrow I will talk about the difficulties that one of my constituents has had at Innamincka. There are other service providers in rural South Australia, and one of the real challenges is to make sure that, in the great gusto of the new federal government, it does not sweep away programs that are proven to be very successful.

The AusLink road recovery spending program has been an outstanding success in not only rural South Australia but the whole country. Roads have been sealed which otherwise would never have been sealed, giving those communities reasonable access. It is absolutely essential that those particular programs continue, otherwise the pressures on those rural communities will be even greater, and it is also necessary to maintain the mobile phone system.

We have just had the CDMA system shut down. I am one of those who believes there is a proper role for the federal government to provide adequate subsidies to make sure places like Marree, Innamincka and Blinman have a mobile phone service.

We are trying to encourage tourism, and thousands of people love going to the Flinders Ranges and other outback areas, especially Europeans who want to see open spaces. They do not want to see cities. The first thing that strikes them when they go to places like Blinman, Wilpena, Parachilna or Marree is the vast open space. That is what they want to see. We have to make sure they have some services and they are prepared to pay for services. They like good facilities and they want to be able to ring home, turn on the TV, look at the satellite television, and they want to be able to have a good trip. They do not want to get bogged. They do not want to be in too much dust. They think they are roughing it when they are going in an air-conditioned coach. Well, if they get in a few potholes or in some mud they are really roughing it.

In conclusion, I want to say that programs, like the sealing of the Wilpena Road, are a leftover from John Howard. The passing lanes that are going on the road to Moomba and the extra money being spent on the Marree Road are all essential and very good. We want to be thankful but there is still more to be done and, therefore, we should be doing these things to support the tourist industry.

Time expired.

Ms CHAPMAN (Bragg—Deputy Leader of the Opposition) (19:36): Thank you, Mr Speaker, and I am honoured with your presence during this supply debate. I rise to speak on the Supply Bill 2008 which essentially makes provision for the first $3 billion to ensure that our public servants continue to be paid and that services continue to be provided in South Australia in the forthcoming financial year. In expressing my plea to the government, I wish to address three matters that I want it take into account in this budget.

This week we celebrate the Royal Adelaide Hospital Week. A government advertisement today states:

We invite you to celebrate RAH Week with us. RAH week celebrates the contribution the hospital has made and continues to make to the South Australian community. There will be displays in the main entrance foyer showcasing many of the hospital's departments and services including Cardiovascular Service, Health Promotion, Occupational Therapy and the Burns Unit, to name a few.

I am a member of the opposition who applauds the extraordinary history and contribution the Royal Adelaide Hospital has made to the health and wellbeing of South Australians for well over 100 years. It was a sad day last year to hear the government's announcement that it will close down the Royal Adelaide Hospital and move the major tertiary hospital services of this state to the other end of North Terrace. Why? Because it destroys utterly the collocation of a major tertiary hospital, research centre and teaching facility adjacent to the University of Adelaide. It destroys that collocation and its extraordinary advantages.

So important are they that all around Australia they are building and rebuilding hospitals in a collocated arrangement, yet this government wants to tear it down and relocate it to the other end of North Terrace, spending nearly $2 billion to do it, at a time when it says it is under pressure with financial constraints. So, we do applaud the Royal Adelaide Hospital and the opposition's clear position is that this hospital should be rebuilt, and it will be built when we have the opportunity if we achieve government in 2010.

An honourable member interjecting:

Ms CHAPMAN: No; it is very important that it be recognised. In the same breath, the government has introduced legislation this week to enable the abolition of the IMVS act which effectively brings about the confiscation and compulsory acquisition of $100-odd million worth of assets and an income stream into the public sector, which will shortly be under the control of Dr Sherbon. I suppose the capturing of that raises the question as to how funding is going to be raised. We have the Glenside campus of the Royal Adelaide Hospital which is an institution which has provided mental health services since 1870 in this state, and about 42 per cent of it is about to be sold off to provide a supermarket and private housing, and the government will retain that.

It also announced in last year's budget that it is going to sell three sites in metropolitan Adelaide which are currently occupied by drug and alcohol services and that they will be relocated in a rebuilt facility at the corner of the remaining Glenside property. So, the sell-off of major assets seems to be the theme, and the promise of big, new, shiny replacements in 10 or so years to deal with our health.

There is one particular aspect that I do want to deal with when I speak on the Supply Bill, because there is one area which I think is in critical need, and that is to do with veterans and the provision of services for them. As many would know, World War II veterans are eligible under a gold card arrangement to have health services in any public or private hospital for whatever ailment and the commonwealth will pick up the tab.

There is a blue card equivalent for those who have seen active service in other conflicts. As I understand how that works, it is that they can have free medical services for an injury, condition or disease arising out of the service that they had. There has to be some direct relationship, as I understand it, to the period of conflict in which the injury, disease or condition was sustained.

In South Australia—uniquely in this country—we have the Repatriation General Hospital. I raise that because the opposition has a number of concerns as to the continued independent governance by the retention of its own board. We have no doubt that the government has made it absolutely clear that it wants to get rid of the board. It says that it will do it when the veterans—or, as the Premier says, when the diggers—want it, and we have no doubt that they are burrowing away into an opportunity to ensure that happens. So, I expect we will see the demise of the board by 30 June 2008.

Here is the critical matter I want to raise: whilst veterans have access to the general mainstream hospitals, and many of them have to wait in line in those hospitals, sometimes for years on waiting lists for elective surgery, the Repatriation General Hospital has a mental health service. It is called Ward 17. In most veterans hospitals around the commonwealth, as I understand it, Ward 17 is the psychiatric hospital and facility for those requiring help. That is a facility which has not been upgraded for many years, and I think it is important that the government address this issue.

It has rebuilt, from the design and idea of former minister for health Dean Brown, Ward 18, which is a facility which has housed 30-odd patients from Glenside Hospital who have been transferred, that is, civilian patients, if I can describe them in that context. The reason this is so important is that the Department of Veterans Affairs states that some 40,000 veterans receive compensation for mental health conditions and that the current estimates indicate that about 22 per cent of the DVA treatment population receives some form of mental health treatment within any given year, which is much higher than the population at large.

This is terribly important. There are three main areas where veterans need assistance, I am informed. One is post-traumatic stress disorder, and that is probably not unexpected. Combat or war-related post-traumatic stress disorder has a profound effect on the health and quality of life of veterans, peacekeepers, defence personnel and their families, and it is very important that this be treated, with sometimes many years of treatment.

There are anger management programs that have been developed by private mental health facilities particularly to assist veterans, and it is very important that we offer that service for those who are suffering from an understanding of anger, aggression, depression, anxiety and the like. We also have alcohol and drug treatment rehabilitation programs which are also very well used by the veteran community.

It is important that we appreciate the high level of dependence on mental health services of veterans and the importance, therefore, that we at least maintain a reasonable standard of facility for them. I urge the government to take this into account when it is considering its capital works for the forthcoming budget.

I turn briefly to the question of child protection. Families and Communities is the department which is largely responsible for the protection of our children. On 1 April, we received a comprehensive report from former Justice Mullighan QC who was the commissioner appointed by the parliament to undertake an inquiry into children who had either died or been victims of sexual abuse whilst in state care. That has gone over a number of years and has been a gruelling task for the commissioner and those advising him.

The commissioner has come up with 47 recommendations, and the government has announced that it will respond to these by mid-June. I am concerned about that because that is after the budget and, as many of the recommendations the commissioner has suggested will require some financing, we will perhaps be looking at the 2008-09 year before there is any chance of provision for them. I hope that is not the case, and I hope the government does understand the pressing need to deal with this.

Recommendation 43 of the Children in State Care Commission of Inquiry urges the government to establish, as a last resort placement, a secure care therapeutic facility to care for children exhibiting behaviour placing them at high risk. I raise this because this is a proposal that the Liberal Party presented as a policy initiative during the 2006 election in terms of runaway children to enable them to be held in short-term, safe, alternate care. This is still a very important initiative, and we absolutely welcome the commissioner's recommendation in this regard. He understands all too well the need to protect vulnerable children who put themselves at risk when running away from state care and who, for a myriad of reasons, are unable to be safely accommodated with their parents or original guardians. It is very important that we ensure that these children are not left to fend for themselves on the street or remain in unsafe environments.

Backing this up is recommendation 47, which recommends that offences be created to allow the prosecution of people harbouring or communicating with children in state care contrary to a written direction. This is also a very important initiative and one that we welcome, and we ask the government to seriously consider it. Hopefully, we can look forward to seeing legislation that provides for this. It is one thing to provide a facility for the very pointy edge of children who will not, cannot or decline to be accommodated in foster care arrangements or other state facilities; it is also important that we do not allow the children to be harboured by adults who may abuse them whilst in their care.

We have yet to receive a report from commissioner Mullighan on the abuse of children in the APY lands. The opposition asked the government last year to extend the inquiry to all the Aboriginal lands in South Australia but it declined to do that. There is every indication that the APY lands report, which was due at the end of December but which has been extended until tomorrow, will be as shocking as the first one, and we urge the government to take notice of that.

I would like to refer to the case of a baby girl who died while in foster care in 2004. The mother says that she is seeking an apology and compensation from the government following the release of the first Mullighan report, and says that she does not want anything to happen to anyone else's baby. The story of this little child (and the mother has given permission), who has been the subject of a coronial inquiry, is that young Elizabeth Edwards was born on 4 September 2003 and died while in foster care in 2004. A coronial inquest into the death found that it could have been avoided. The Mullighan inquiry revealed that approval for foster care, granted to the foster parents involved in Elizabeth's death, post dated the incident; even more shocking was the fact that there was no information on the foster parents' file about the death.

Clearly, the record-keeping of the department has come under scrutiny, and the report recommends urgent changes to the Department for Families and Communities' record-keeping systems in order to prevent such tragedies. The opposition endorses that. It is important that the government understands that not only does it have a responsibility to protect these children but also that, where there is avoidable damage to children, it understands that it has responsibility even for something as simple as record-keeping. This will ensure that we have accurate and efficient records that can prevent the death or harm of children, and it will assist in averting the potentially fatal situations that we must all work together to avoid.

It is a shocking story, one of hundreds recorded in that report and one which will require financial dealings. The government has announced that it will make provision for some compensation for these children (some who are now adults) who were victims whilst residing sometimes in foster care, sometimes in past institutional care, but under the supervision and responsibility of government and ministers. We are yet to see how that will unfold. It is a first step. I want to place on the record my thanks to members of parliament, particularly the Hon. Rob Kerin, who fought very hard over a number of years to have the inquiry the first place.

I wish to relate a housing matter which astounds me. In the six years of this government we have had announcements about all sorts of things: telephone assistance lines as to where to get accommodation; new websites; new pamphlets; some low interest loans that have been expanded on previous models; and legislation to deal with housing affordability, such as requiring developers to have as 15 per cent of every property development affordable or high-risk housing, which ultimately became a voluntary option in that legislation.

We have had these announcements along the way. We have had what I call boutique developments funded or supported by the government to provide for little clusters of housing. However, the situation is this: we have 30,000 people on the waiting list for housing, for access to housing in this state. Many of them have multiple needs, such as mental health issues, single parents with dependent children living with them, people with disabilities, chronic levels of poverty, and the like. They are in desperate need of housing and they will never ever be in the category of people who can afford to access the private rental or purchase market. The circumstances at the moment make it even tougher. We know about those national aspects.

However, on 13 February 2002, Premier Rann announced an election promise prior to the government being successful in that election. He stated, 'There will be no sale of our Housing Trust.' There had been repeated criticism of this by governments in the previous two decades which covered the Bannon, Brown and Olsen administrations. There had been enormous criticism of the sell-off of public housing without a replacement and expansion of affordable and accessible housing for those who cannot access the private market.

Yet, within five years, having sold off nearly 6,000 houses in that first period—that is, from taking office until 2005—by 2007 minister Weatherill announced that it was going to sell off another 8,000 houses. He said it was necessary to make that announcement because the government had an obligation to pay a commonwealth debt. He complained, probably as most state housing ministers around the country did, that in 1996 when the Howard government came in it reduced the overall funding under the Commonwealth-State Housing Agreement for access to funding the development of housing—and he was right. All of them suffered the same plight.

However, the interesting thing is that all the other governments, except in Tasmania, had been able to increase their housing stock in the lifetime of their governments, whereas we had continued to decrease ours. Let me give members an example: notwithstanding the claims of the necessity to sell off stock to save the Housing Trust, the truth of the situation is that, from 1996 until the end of 2005—that is, over a 10-year period—New South Wales, Victoria, Queensland and Western Australia have had an increase in the total public and community rental housing stock.

In New South Wales it went from 133,675 to 138,580; in Victoria from 66,934 to 71,042; in Queensland from 54,224 to 57,289; and in Western Australia 35,799 to 37,392. What happened in South Australia? Well, in that period we plummeted by about 9,000 dwellings, from 60,698 to 51,628. Now we are about to have a huge sell-off of another 800 homes a year. So, I do not accept, and I do not think that the parliament or the people accept, the excuse for the need to sell off homes because of the funding situation under the federal housing agreement. Except for this state and Tasmania, every state has been able to increase its stock.

An honourable member interjecting:

Ms CHAPMAN: And Tasmania. That is not acceptable. It is not sufficient to complain about this and not have some parity with the rest of the country.

As I say, the government's answer is to have these boutique proposals for small numbers, and we get these announcements of 20 or 30 at a time. Let us hope that it does provide the people concerned with secure and safe housing. However, 30,000 people are on the list. When I asked the minister last year how much longer someone in category 3 would have to be on the waiting list for a Housing Trust home, if someone else had already been on it 17 years, he could not give an answer. He said, 'Well, if she has a chance to get into category 1 or 2 and get up the list, she might have a chance to get a house.'

The real answer is: there is no chance at all of getting a Housing Trust home. She may as well be taken off the list. It is cruel to leave her on it, as she will never get a Housing Trust home or affordable housing in this state as a category 3 person. Why? Because she is not in the category of high need, and she will never qualify.

Time expired.

Mr GOLDSWORTHY (Kavel) (19:56): I, too, am pleased to make a contribution this evening to what is obviously quite an important piece of legislation, that is, the Supply Bill, which ensures that adequate funding and resources are channelled into the respective areas of government—the bureaucracy, the departments, the police, the emergency services, and all those very important undertakings—to maintain the operation of the state until the budget is brought down and, consequently, the funds flow for the ensuing 12-month period.

As we have heard over the course of the afternoon and into the evening, particularly from this side of the house (and this has been put very well by the Liberal leader, the deputy leader and other members), the condition of the state's economy and finances could be in a significantly improved position.

I think I am someone who has a reasonably positive outlook, and I like to look at things in a positive light and assess them objectively. The figures before us (and in previous careers I have had some experience in looking at figures, assessing them and deriving outcomes from them) reveal that this government has had the best economic times of any government in the history of this state, as the leader quite accurately pointed out earlier this afternoon..

Over the past six years or so since this government has taken office, we have seen an increase in revenue of almost 50 per cent. It was about $8.5 billion in 2001-02, and this year it is $12.4 billion. If you look at the forward estimates, you will see that in 2010-11 the estimated revenue is $13.8 billion—almost $14 billion, which is an incredible amount of money by any stretch of the imagination.

I have not done this research, but I intend to do so, that is, to go back to the historical figures of the state and see when there has been a budget increase of 50 per cent. Through the nineties the budget was tight. The Liberal government came to office after the absolute debacle, crisis, or whatever description you like to use, of the State Bank collapse.

Actually the budget decreased, so the Liberal government at the time was trying to maintain services with a decreasing budget. I intend to do that research, and go back through the years to see how many budget cycles it took for it to get from, say, $4 billion to $8 billion when we left office.

As the leader quite accurately highlighted in his speech earlier, with the windfall revenues that the Treasurer has been so fortunate to receive, two gorillas in a Volkswagen—if you picture that, that's quite an interesting image—could have managed the budget and the economy of this state. The Three Stooges could have managed the budget with the windfall revenues, and we saw this quite humorous website a couple of weeks ago where the Premier, the Deputy Premier and the Minister for Infrastructure appear as the Three Stooges. I think that that is quite an accurate comparison in today's political environment and the current economic situation that the state should be enjoying.

We should see an enormous amount of infrastructure and improvement in delivery of services resulting from the significant windfalls that the Treasurer and the government are receiving. Highlighting some other figures, the 2007-08 midyear budget shows that the Premier and the Deputy Premier, who is also the Treasurer, will collect $3.9 billion more in revenue this year than the former Liberal government collected back in 2001-02. What has happened to it? Where is the dividend for South Australia? What have we done with that additional $3.9 billion? Have we seen any significant improvement in our hospitals? No, we have not.

We have this grandiose half-baked scheme to build a hospital down on some railway yards for about $1.5 billion. What an incredible amount of money and, as the leader points out, it is over a 30-year term, which is no better than a hire-purchase finance agreement on your car. The total sum repayable over that period is a bit like a housing loan, only in a significantly greater amount. A mortgage is repayable over a 30-year term and you might borrow, for example, $150,000—

Mr Kenyon: For a car?

Mr GOLDSWORTHY: No, I am talking about a home loan. In amortising a home loan of $150,000 over a 30-year term, you pay significantly more, obviously, than that original principal of $150,000, and exactly the same will happen with this newly-proposed hospital down at the end of North Terrace. We just heard the deputy leader speak about the reasons why the hospital should not be built down there.

We have the university adjacent to the current RAH precinct, and we have the Medical School on the same side of Frome Road as the hospital. It is a teaching hospital, with a proud history in the state in training world-class doctors, and now we will see that being relocated to the other end of North Terrace, creating a whole host of logistical problems.

The state Liberals' policy—a very good policy I must say—is to rebuild. We can build a new hospital on the existing RAH site for a significantly lesser amount than the (likely) $1.5 billion that it will take to build the Marjorie Jackson-Nelson Hospital, and that saving of roughly half a billion dollars will go into improving the health services delivered to all of South Australia—and I will speak about some health services in my particular electorate shortly.

I also highlight that the government has massively underestimated its revenue collections every year. In the period from 2002-03 to 2006-07 the government collected almost $3 billion more than it anticipated, mainly from state-based taxation (including land tax) and significant windfalls from the GST—a taxation that every Labor government in the land opposed. Every Labor government around the nation opposed the introduction of a GST, but they certainly do not oppose it now because they realise it generates an incredible amount of money that goes to all the states through the horizontal fiscal equalisation formula. I know that the Treasurer likes to run out that terminology from time to time in order to indicate that he knows a bit about money and managing the economy, and so on. The point is that the GST has been a windfall for all the states.

Members opposite opposed it—like they opposed Olympic Dam and Roxby Downs—but today the Premier was in here crowing about how tremendous BHP Billiton is. We supported BHP Billiton's investment in the state, but the Premier opposed. We know what he did when he was a staffer to a former premier. He undertook some scurrilous activity at the time by releasing a report to the media. That activity was highlighted and the credibility of Mike Rann as a staffer was certainly tarnished as a consequence of that activity.

Labor strongly opposed Roxby Downs and now members opposite are its strongest supporters. One cannot have one's cake and eat it; one cannot say one thing one day and say something else another day. Members opposite have to be consistent in their policy. If they are not they will lose credibility out in the community.

Mr Kenyon interjecting:

The SPEAKER: Order! The member for Newland is out of his place.

Mr GOLDSWORTHY: And interjecting, Mr Speaker.

The SPEAKER: He can interject, as long as he is in his place.

Mr GOLDSWORTHY: The government keeps changing its position on these extremely important state initiatives and state projects and members opposite lose their credibility in the community. The way in which the polls are trending at present, the government is going this way and the opposition is going that way, and the community is starting to realise that members opposite are all about symbolism, stunts and pranks—and nothing more.

What have you done in the six years since you have been in government? We have a tram down King William Street and North Terrace and everyone is complaining about the traffic jam on the corner. We could have told the government about that. In fact, we did tell members opposite about it at the time. We told them it would create traffic problems along North Terrace, but they did not want to know about it. The tram was going ahead and that is the only thing the government has built—and it cost $10 million more than was originally budgeted for. It was costed at $21 million and it has blown out to $31 million, and if I had the time I would give more examples.

We want to know where the money has gone. I can tell members where the money has gone. It has gone in the unaccounted-for explosion in Public Service numbers. The figures from the Commissioner for Public Employment show that between 2002-03 and 2006-07 there has been a blow-out of 17,000-plus full-time equivalent public servants. That is an increase in public servants above budget. We know that the Treasurer in estimates a couple of years ago disputed those figures. He said:

We do not have full confidence in the numbers that the OCPE have produced. We are not confident in the data collected by the Office of the Commissioner for Public Employment despite its best endeavours.

The Treasurer has put a question mark over those figures, but if we look at the figures in the budget papers—the information the government provides to the parliament, to the state and the community—we find that they show from 2002-03 to 2006-07 that there has been a blow-out of 10,000 plus FTEs in the Public Service. That is where all the government's money has gone: in an uncontrolled blow-out in the Public Service.

During estimates last year and the year before the state Liberals continually asked: where are those people? We do not see many more police on the beat. We have a crisis in our hospitals at the moment, with 100 plus doctors in our public hospitals threatening to strike or resign. God help us! If they walked out, where would the public health service be? I am not joking—this is a seriously concerning issue. If 100 plus doctors walked out of our hospitals, what would happen? It would be tantamount to the State Bank again. John Hill, the Minister for Health, has a lot of work on his hands to endeavour to rein in that issue.

I have friends who are doctors and by nature they are not militant, complaining, whingeing people but are highly trained, caring, compassionate and professional. Their ideology, their reason for going into medicine, is to try to help the community, to help people less fortunate in the community who suffer from ill health. That is their motivation for studying medicine and becoming a doctor. The government has an enormous amount of work on its hands to remedy the crisis we face in our public hospitals.

Talking about the blow-out in public servants, I will cite a couple of examples. Where are these people and what jobs do they do? I live in the Adelaide Hills and my next door neighbour lives a couple of hundred metres down the road. He has a burglar alarm on his house with a flashing light if the alarm goes off. My wife was home the other week and the neighbour's house alarm went off. She rang the 131 444 number—the police line to which you report incidents—and she said that she thought something untoward might be happening at our neighbour's home. Our neighbour is a policeman, and my wife told the police reporting line that there was a potential burglary going on in the home of one of their own. The response was, 'Oh, we don't come out to house alarms; it's probably monitored anyway.' They had no idea whether or not it was monitored. My wife was talking about one of their own, and they were not even prepared to send out a patrol to check on whether a burglary was taking place at the home of one of their own.

So, where are the extra 400 police that the Treasurer when minister of police promised the state? When I was a lad I used to drive around and have a bit of fun around the district or just cruise around on a Saturday afternoon, and there used to be patrol cars constantly cruising up and down North East Road, through Tea Tree Gully and around the north-eastern suburbs. Now if you drive around you would hardly see a police car all afternoon. Where are the extra police? They are nowhere!

The Hon. J.M. Rankine interjecting:

The SPEAKER: Order! The minister is not only not in her seat, but not even sitting in the benches. The member for Kavel.

Mr GOLDSWORTHY: Thank you, Mr Speaker. The claims of this government that it has increased police numbers is a farce. It has not increased police numbers at all because, if it had, it would have more police out in patrol cars, out on the beat, who would be able to check on potential burglaries, even in one of their own members' homes, so it is an absolute nonsense.

I close by touching briefly on another point regarding matters in my electorate and that is the stark lack of funding for infrastructure. I have raised in the house before—and I will continue to raise it until something happens—the critical need for a second freeway interchange on the South-Eastern Freeway at Mount Barker. As we speak, 835 new homes are being built in Mount Barker. A whole tract of farming country has been opened up for residential development and, if a second freeway interchange is not built, it will cause absolute traffic chaos. We heard the member for Davenport talk about traffic related issues in his electorate. I tell members that it will be tenfold worse in Mount Barker than the member for Davenport was describing.

Time expired.

Mr PENGILLY (Finniss) (20:16): I am very pleased to make a contribution tonight. Like the member for Stuart, I am becoming reluctant to get to my feet, to quote him, but never mind, I will try and entertain the troops here tonight for a while. I thought the member for Kavel did an outstanding job and, quite clearly from the interjections from the chamber, and the gallery as well, he is no doubt hitting the mark, so I am pleased to come in here and have a few words to say myself.

Given who is present in the chamber, I think it would be appropriate to start my few words with the local government portfolio. I am beginning to wonder where this government is going with local government. There is no direction and there are no policy announcements. I am of the view that the minister has been told that she is not allowed to do anything, so she follows along the way things are, we are not going to have anything new and we will not disturb the troops anywhere. I think it is imperative that the government does spend a few dollars and does try to introduce a few reforms into the government, and I will be interested and most keen to see them when they are presented to the chamber. At this stage—

The Hon. J.M. Rankine interjecting:

Mr PENGILLY: Ah, a voice from the deep. There is nothing happening.

The SPEAKER: Order! The minister knows better.

Mr PENGILLY: Thank you, Mr Speaker, for that protection. I need some protection from time to time because I am a quiet fellow. I think local government is looking for some direction, and after tonight the government could introduce into the chamber some worthwhile reforms and ideas on where we can go. I will be pleased in a bipartisan manner to assist the minister at any time possible to come up with some reforms. We have this department for local government relations, but I am not sure that that hard-earned money is being spent properly and I think we will need to have a good look at that in due course. I look forward to the budget and, indeed, to budget estimates where we can go through some of that material in detail.

Councils are no different from a lot of organisations. They are facing increased cost pressures. Of course, interest rates are knocking their ratepayers around and making it more difficult for people to pay rates and for business to develop. The price of fuel is one of the major issues for councils at the moment in framing their budgets for the next 12 months. Fuel prices are horrendous and councils are locked into performing certain tasks that they have no way of getting out of. I think one thing that the government needs to look at is the enormous windfall it has had from the GST, which is something it had previously rejected. It needs to pass a bit down the gravy train and try to assist local government. As my good friend the member for Kavel said, it is well known that members of the Labor Party did not want the GST at all.

Mr Goldsworthy: They hated it.

Mr PENGILLY: Yes, they hated it. They never wanted to see the GST. But, my God, don't they love it now! If they want to sit over on the other side and drink vinegar and suck lemons, that is fine. We want to get on with the job. Local government needs assistance, direction and leadership and, God knows, it is not getting any leadership from the Rann government: it is not getting anything whatsoever.

Mr Piccolo interjecting:

Mr PENGILLY: My good friend the member for Light, who was a mayor in another life and a former colleague of mine, knows how hard it is. He should be arguing strongly for local government to receive some help. I now wish to turn to the tourism portfolio. We seem to have a bit of a hiatus here—

Members interjecting:

Mr PENGILLY: I am having trouble being heard, Mr Speaker. There are a lot of interjections.

The SPEAKER: Yes. The member for Kavel will stop interjecting while the member for Finniss is speaking.

Mr PENGILLY: Thank you very much indeed, Mr Speaker, for that protection. We will move on, because I can always come back to local government. I am very happy to come back to local government, but I think that perhaps I should talk about one other area in my portfolio, that of tourism, and my concerns about the reductions to the marketing budget and, indeed, make a plea to this government—and I am glad that the minister is here, because she can pass it on to cabinet.

I hope that, in its wisdom, the government will put more money into marketing for tourism in South Australia, because it is absolutely dudding the show at the moment. It has cut back the budget and placed another 40 people, I think, into the administration area of the SATC at the expense of the marketing budget. The problem with my friends on the other side is that they do not really understand business. They are put in this place by people for whom they have done favours, or whatever. I know that the member for Napier has run a successful business but, when I look at members on the other side, I do not reckon there are too many others who have done so. If you put them all up against the wall, you might get one or 1½.

If you want to make a dollar you have to spend a dollar, and if you want to spend a dollar in the right area in tourism you have to put it into the marketing budget. Our representatives need to travel overseas and around the rest of Australia and tell people what South Australia has to offer. It cannot be left up to the operators all the time. You cannot cut off your nose to spite your face and put more people in the bureaucracy: you have to get out there and spend hard dollars on marketing.

One may well ask: how does Pengilly know anything about that? I used to have a bit to do with tourism: I was involved in the industry. Apart from being a mere humble farmer I have also been involved in tourism and I know something about what goes on, and I can tell members what the industry is saying; it is saying that we are rudderless with respect to tourism. It is all well and good to run around and turn up at events, but we have to do the hard yards if we want visitors to come to South Australia and, indeed, to Australia.

This area has been steadily eroded and cut back and, in these times of high fuel prices and high interest rates, South Australians are looking extremely carefully at where they spend their money. In fact, even when considering a day trip to my electorate or to the Barossa or the Yorke Peninsula, people are starting to look at those things. It is starting to become a luxury, because they are looking at $100 just on fuel for a day out. A lot of working families do not have that sort of money to toss around on that kind of thing. When they have to pay their mortgage and pay for their children's education and school charges, and so on, these things become very difficult. So, the first things they cut out are the luxuries.

You only have to look at what happened today regarding Le Cornu's, which has cut back workers. The unions put out the story that they had not been consulted and this had not happened, or something else had not happened. I can tell the house that I have seen the letter, and they knew all about it. My colleague the member for Unley can produce it, if he has not produced it already. They knew all about it—they were telling porkies. Everyone knew what was going on, and they fluffed around the edges and put out this story that they had not been consulted.

Well, I can say to the house that is it absolute, total nonsense. (I was going to use another term but I am too polite.) I want to see the Rann government and the minister push the cause of marketing in the state budget this year and show what she is made of and advance the cause of the tourism sector in South Australia. It is a huge sector as far as employment goes, and putting money into marketing has an enormous multiplier effect, which would be in the best interests of the South Australian economy.

Let me turn to the southern suburbs. We have had a few ifs, buts and maybes and a bit of a chat here today about the northern suburbs, and a few people got their fingers burnt. I can tell you, Mr Speaker, that the amount of money this government is putting into the southern suburbs is an absolute disgrace, and it should be ashamed of itself. How the Rann government can stand up and say that the southern suburbs are getting a fair deal, I do not know. I say to the members who come from that way: you want to get a few of the phone calls I am getting, and I intend to raise the matter of one of those phone calls tomorrow in another forum in this place. I can tell members that they have had a gutful in the southern suburbs. They are fed up to the back teeth. They have antiquated, clapped-out trains that do not run—

Mr Piccolo: And a one-way road.

Mr PENGILLY: I am glad the member for Light mentioned that: that is really good of him. I am absolutely delighted that he mentioned the Southern Expressway, because when the Liberal government, led by Dean Brown, was elected in 1993, this state was stone, motherless, flat broke because of the incompetent mob of clots on the other side. And who was part of that team? None other than Premier Rann. He helped bankrupt South Australia.

So, if the member for Light wants to raise the matter of the Southern Expressway, let him go for it, because I can tell members that if you want to shut down the thing tomorrow you will find out how popular that would be. The money was found from a state that was in an absolute debacle and that road was built; and, for the member for Light's benefit, provision for the other half of the road was put in place and is still there. But what has this mickey mouse outfit done about it? Absolutely sweet Fanny Adams! Not a thing! They sit there and make fun of it, but I can tell members that it is a fantastic piece of road that was put in with no money, and it should be completed, and you people should be held to account for your failure to do it.

Mr Pederick interjecting:

Mr PENGILLY: And then we get the member for Bright who, in her budget reply speech, stands up and waffles on about railway sleepers. I tell you what they want down there: they want the train extended to Seaford. They want reliable, clean and good trains. Perhaps the government can electrify the train system. Perhaps it could get busy and do that, because I have not seen too much action down there.

Mr Pederick interjecting:

Mr PENGILLY: The more you talk I am just starting to get warmed up, member for Hammond. You will be right: you will get your turn. Quite frankly, the amount of money that has been put into that area is an absolute disgrace.

Let me turn to something else. We have got a department, or a section of the government, that is allocated for the southern suburbs. I think it has two staff. So what do people say to me? They ring me up and say, 'Where can we go into this department?' I say to them, 'You have to catch a train; it might take a while. Or you can drive in, because it is slap bang in the middle of the city. If you come into the city you'll get bogged down on North Terrace, because Patrick's trams have stuffed up the traffic. But get in there, and if you find a car park then you can find the Department for the Southern Suburbs. There is only two of them and, if you're real quick, you'd be able to make an appointment.' The government says, 'Yes, we've got a Department for the Southern Suburbs, but it is on North Terrace.' That is pretty handy for those people down south. You have got people in all sorts of bother down there. Mitsubishi has gone. Very few people out of Mitsubishi have found jobs. I saw some figures very briefly today. I do not have them in front of me, but very few people from Mitsubishi have found jobs.

The minister was running around having a bit of love-in last night saying, 'Everything is tickety-boo. We're putting millions of dollars into it.' These people need jobs now. They need to be able to earn money to pay their mortgages, to feed their family and to put their kids through the multitude of things they need, whether it is education or sport. That is what they need. They do not need hollow promises from the Minister for the Southern Suburbs. They need action and they need it now. I am very pleased that the mayors of Marion, Mitcham and Onkaparinga are doing something, because if you wait for this lot over the other side to do something nothing will ever happen—we'll all be dead! It is a travesty of justice.

I really do not know what is going on with this government, where it is coming from or what it is doing. Apart from the three on the front bench there (who you hear every day), the rest of them over the other side are sucking vinegar and lemons—not looking happy, not doing anything. They all look as though they do not want to be here. Even when one of their backbenchers gets up to ask a question, they are all waffling on down here on the front bench. I think it is absolutely disgraceful.

The Hon. J.M. Rankine interjecting:

Mr PENGILLY: Here we go again! It's started already! The contempt with which the people of the southern suburbs are held by this Rann government is just amazing.

Let me turn to another area of my portfolio. The Liberal Party has had a shadow minister with respect to veterans for a time, and it is actually going quite well. We have picked up on a few things. The Rann government wanted to dud the vets at the Torrens Parade Ground. Well, we held it to account on that. Now what do we have? We have this wonderful announcement on ANZAC Day that we are getting a minister for veterans affairs. You beauty! I reckon we have won that round. I will be delighted to see how that goes. I will be delighted to see how the government will create this department, who it will put in there and who will head it up. I reckon I can guess who will head it up. I reckon I can guess that already. I know that, but we will keep that one secret for a while.

Moving between the southern suburbs and my electorate, I would just like to pick up the issue of the road between Adelaide and the South Coast called the Victor Harbor-Adelaide Road. Just as a starter, it would not be a half bad idea if you could even do something about getting off the Main South Road—or the Victor Harbor Road, vice versa—when you are coming back onto the Main South Road. It is an absolute bugger's muddle!

Cars are piled up there a kilometre long on busy days. You cannot get off there. It is a little like the Britannia roundabout. The government has not fixed that up. There is a host of things the government has not fixed up. It stuffed up the Murray; that is what the Rann government has done. It stuffed up the Murray. It has got no answers, and it cannot even come up with a decent solution to—

Ms Breuer interjecting:

Mr PENGILLY: I will turn to the member for Giles' area in a minute. I had a very nice cup of coffee up there just recently. I had better get going. I raise that point. That 20 minutes has gone quickly! A few things need attention in my electorate, none more so than the new TAFE college to replace the abysmal disaster down there at the moment which was promised in 2002 by our government, the Liberal government, and which was just abandoned by this Rann Labor government.

You ought to be put up against the wall and shot. Everything is there. I have put up the ideas. Fortunately, the minister listens to me, for which I am most grateful. I find him a fine fellow, indeed, and I am sure he is working hard, but I reckon he gets rolled in cabinet time after time. It is a bit like backflips on disability things. There are some major issues in my electorate, and I will briefly run through them. Public transport is a large issue, with a large community of retired and elderly people and also people on lower incomes who cannot afford to travel back and forth. Public transport between the South Coast and the metropolitan area is critical. The poor old councils, once again, are trying to put something in place, and they are struggling to do so. I think they will. We have three very good councils on the Fleurieu—Yankalilla, Victor Harbor and Alexandrina—and they are working well together.

Water is an issue. We need water on the western Fleurieu. You cannot keep sticking $300 million a year into the general revenue of SA Water and not spend anything on infrastructure. Honestly, you guys on the other side could not run a chook raffle. If you ran a chook raffle, I reckon that, if you won it, you would get feathers and no meat. That is how I reckon you are going—feathers and no meat. Another issue is crime on the South Coast. I am receiving constant complaints and concerns are being raised about crime and the lack of police around the place. They try very hard. I conclude my remarks.

Mr PISONI (Unley) (20:37): I, too, rise to speak on the Supply Bill. I want to point out and reiterate what some of my colleagues have said previously. We have seen an enormous growth in the state budget. We have seen a growth from $8.7 billion in 2001-02 to an anticipated $13.8 billion by 2010. That is an extraordinary amount of increase in revenue. It amounts to $5.29 billion extra in government revenue that this government has received through the introduction of the GST and gaining GST revenue, and the enormous increases in revenue from property taxes, stamp duties and payroll tax.

Payroll tax is an interesting scenario. I am the shadow minister for small business, and as a former small business person I did pay payroll tax. We have seen a 45 per cent increase in the collection of payroll tax in that same period: $601 million in 2001-02 to $871 million now. We have seen an increase in the number of businesses that are caught in the net of payroll tax, if you like. Businesses have grown, payrolls have grown; and payrolls have grown even if the number of staff has not grown because we have had a growth in wages during that time. In 2001-02, just over 7,000 businesses were paying payroll tax, but now over 9,000 businesses are paying payroll tax. They write a cheque out to Mr Foley at a rate of $5 for every $100 they pay their staff.

I welcome the debate that Martin Hamilton-Smith, our leader, has brought to South Australia on tax reform. I am looking forward to our summit on 12 May in this house. We have received over 40 submissions from business groups, business people and the general community about reform to taxation. Of course, the Prime Minister, Kevin Rudd, has also said that taxation reform should be a major priority and, in particular, he was referring to state tax. We have had some major reforms in the federal arena, with the introduction of the GST, which the Labor Party opposed at two federal elections and has opposed at every opportunity it has had in this chamber. The Labor Party opposed the introduction of the GST, yet it is a major tax reform that has given us a growth economy—an economy that has provided enormous benefits and enormous growth to the state budget not just here in South Australia but also around the country.

Something that many people tend to forget is that the top marginal tax rate in 1996 was $50,000—you had to earn only $50,000 and you were paying 47 cents in the dollar, plus your Medicare levy. Now, of course, with the new round of tax cuts to take effect in July, you will have to earn $180,000 before you pay the top marginal tax rate, and that is nowhere near 47 cents in the dollar. So, there has been significant tax reform. When Prime Minister Rudd said that we need tax reform in this country, it is obvious he was talking about state taxation reform, because we have not seen any changes in state taxation; there has been no significant reform for many, many decades.

If we look at the increases in property taxes—again, a tax on investment—we have seen a 96 per cent increase in revenues raised through property taxes. Tax on insurance has gone up 33 per cent, and motor vehicle taxes have gone up 26 per cent. This is a state that relies heavily on motor vehicle manufacturing, yet we see motor vehicle taxes are up 26 per cent. We have seen no financial relief for long-suffering families and businesses, no stamp duty relief for first home buyers, and no extra concessions for financial assistance for older South Australians.

As a matter of fact, first home buyers have really done it tough. I am not sure I am ever going to get rid of my kids. They are 12 and 14, and they have their own area upstairs—their own lounge room and their own room—and we have made it comfortable for them. We certainly hope they will be able to afford to get into the home market when they are ready to leave home because, as much we love them, we do not want them still living at home when they are in their 30s, and we certainly do not want them bringing up their own families in their parents' home.

Stamp duty plays a large role in home affordability. City planners and architects are telling me that one of the biggest problems we have with housing affordability and supply in South Australia is that we do not have housing choice. The reason we do not have housing choice is that it costs a lot of money to sell one house and buy another because of the stamp duty you have to pay. For example, in the electorate of Unley, the average price of a home is around $700,000, and stamp duty on that amount is nearly $32,500. Even if you buy a modest property valued at $300,000, which is around about the median house price in South Australia, you are paying nearly $11,500 in stamp duty.

So, what do young couples who marry in their mid-20s and make a lifestyle choice to be life partners do? They are not necessarily ready to start a family at that time, but they go out and buy the family home immediately, rather than buy a smaller apartment in, say, the city. We need more life in the city, we need more young people living in the city. We have plenty of room for higher density housing within the square mile of Adelaide, particularly in the south-western corner where there are plenty of facilities. It is near the market, restaurants, parks and gardens. It is a great place for young people to live, particularly if they work in the city.

However, if they were to spend a couple of hundred thousand dollars on an apartment in the city, they know full well that they will have to pay nearly $7,000 in stamp duty and then, in five years' time when they are ready for the family home, they will have to fork out another, say, $11,000 to $16,000 in stamp duty for the family home. So, they are going out and buying that family home immediately, and that is reducing the choice of housing that people have here in South Australia.

At the other end of the scale, we see couples who we describe as empty nesters. Their children have grown up and moved out of their home and, consequently, a three or four-bedroom house is no longer required by a couple who may be contemplating retirement and a lifestyle closer to where the action is: where the restaurant or shopping strips are, or at the beach. They have very large stamp duty costs, of course, when they sell their home and go out to buy their apartment. Even though they might end up with a bit of money to put in the bank, the government could take up to $30,000 or $40,000 of that in stamp duty.

Consequently, the net effect of that is that they are not selling their home, which puts pressure on the price of the typical family-type home, because the stock is being locked up and it is not being sold. It is simple supply and demand economics, and I note that the member for Finniss, with his worldly experience, is very familiar with that.

We have seen a dramatic increase in GST payments to the states. When the GST was first introduced, it was a little over $2 billion and now we are heading up to nearly $5 billion. The government is rolling in money, yet we see fights and readjustments to budgets. In my portfolio, in particular, we had a relaunch of the Premier's be active challenge earlier in the year. This is what happens, of course, when we keep recycling the same marketing, the same announcements or the same stunts, which this government is used to doing and on which this government has modelled itself.

We saw that again by the Premier himself this week when his major economic contribution to the debate was to write a letter to the Reserve Bank, knowing full well that it is independent. He did not just write a letter: he wrote the letter, held a press release and made a ministerial statement—a big song and dance about writing a letter to the Governor of the Reserve Bank, begging it to hold down interest rates. Of course, we all know that the Reserve Bank is independent. The previous Howard government made it so and, of course, the new Rudd government intends to keep it so.

The Premier feels that this is a way for him to look as though he is doing something when he knows full well that he is not. He is out there offering false hope. It is a bit like a recycling of stunts, and that is all we are seeing from this government. The government has been in office for six years and we have not seen any new ideas; even its stunts are recycled. This was the third occasion on which the Premier wrote to the Reserve Bank. What happened since the first time he wrote? Since the first time he wrote, we have seen 13 increases in interest rates by the Reserve Bank.

So, I would say to the Premier: please do not write again, because we cannot afford it. Just keep that in your back pocket, Premier. We have 'Rann Gets Results I'. It is a bit like a Rambo movie: the first one works really well; it is a sell-out and everybody loves it. Rocky I is another one. There was a slight change to that movie for the next release, whereby Rocky II had a reasonably good following, but the audience numbers dropped off a little bit. Then, of course, Rocky III and Rocky IV came along and they were the same as the others. People get bored; they have seen it all before. They know what the story is going to be, and they lose interest. That is what is happening with the Rann government. We are seeing 'Rann Gets Results I, Rann Gets Results II', and now we are into 'Rann Gets Results III'. However, it is not a blockbuster, I am afraid.

It is interesting that, after the Premier's stunt yesterday, we had the Minister for Transport telling The Advertiser this morning, 'We don't do stunts. We are a government; we don't do stunts.' Well, this government lives on stunts; it thrives on stunts. Basically, if we do not see a stunt from the government, we do not see anything happening at all, unless, of course, it is a backflip, a reaction to a media scandal, or something that has been leaked out of the government that it has lost control of.

Let me get back to my portfolio and the Be Active grants. Here we see another stunt and an almost Academy Award performance from the Premier and the Minister for Education. We have a program called Be Active—Let's Go! which is funded to the tune of $4 million. That funding includes equipment, training of teachers and additional facilities for schools to get kids out there in the playground. Of course, that program was successful: it got kids out there, running off the energy they were consuming, getting fitter and becoming healthier.

However, despite all the money that the government has been raking in, we see a cut to this program from $4 million down to $425,000 a year. What do we get for that? We get kids sitting at computers. We were told that kids live too much of a sedentary lifestyle. The Premier rebadges an active program, for which $4 million a year has been provided, and cuts it back down to $425,000. He puts his name in front of it—the Premier's Be Active Challenge. What does he think that is worth—$3.5 million a year? I do not know. He puts his name in front of it and it is relaunched as the Premier's Be Active Challenge.

I think that the media is waking up to this game. A media alert went out to the TV stations for the launch of the Premier's Be Active Challenge and, guess what? No one turned up! They have worked it out. It is a cut; they know it is a cut. The media is becoming wise. As I said, they are now up to 'Rann Gets results III, IV or V'. It is not as interesting; it is not as sexy as 'Rann gets results 1'. It is not the blockbuster sell-out that it used to be. But, of course, that is an example of where a stunt has backfired, and we have exposed it for the con that it is.

Another example, of course, is that we are told about the education revolution coming out of Canberra, yet what the Rudd government did not tell us is that it has to be funded by the states. The commonwealth government will supply the computers, but if you want to plug them in that is your problem. 'We'll deliver them in their boxes at the door. You go and fund all the costs of setting it up and the recurrent costs. If you don't have enough power to the school, well, that's your problem. You have to fund it.' When I asked the Treasurer what was happening with those negotiations he said he was in dispute with Canberra over the issue. Yet, here we are, passing legislation for another $3 billion-odd of funding, and we still do not know how these computers will be plugged in or how they will be funded or maintained.

The state government's own transport and energy site will tell you that it costs $150 a year to power each computer. And, of course, once we get into the detail, we realise that it is for years 9 to 12—it is not every secondary student—and it now looks as though the program will be rolled out over a longer period. All the schools that bought computers under the Investing in Our Schools program will miss out. Those schools that spent their Investing in Our Schools money on maintenance and building programs, which the state government should have been funding, will get their computers if they are in a lower socio-economic area.

None of the schools in my electorate will benefit from this so called education revolution. There is no funding for this computer infrastructure, and Gillard has said, 'You state Labor governments supported us; you were out there spruiking for us at the last election, and the least you can do is help fund our election promises.' How can they do that? How can they do that when the education minister attempts to raid a fund that has been set up for disabled artists just because she is rewriting her music program so it can be used for disabled children?

The minister has put an application in to the Richard Llewellyn Disability and Arts Fund for $60,000. The application limit is $30,000. Where do you get advisers like that? Where do you get advisers who know so much about every little bit of government money that is out there? How callous are they to take it away from organisations such as Autism SA, the Alexandra Devitt-Lansom and Amputees in Touch organisation, the CanDo4Kids organisation and the Elizabeth Special School? These are all competing for those funds next to DECS.

One of the major criteria, of course, of the application is that the application must come from somebody with a disability—that it is within the definition of eligibility. So, I am not quite sure that the DECS application qualifies in this instance.

Time expired.

Mr PEDERICK (Hammond) (20:57): I rise today to make a contribution to the Supply Bill. This government has the distinction of being the highest taxing government in this state's history. If that translated into improved services and infrastructure for South Australians we could perhaps forgive this extraordinary level of taxation. Unfortunately, this government may well also become known as the most wasteful in the state's history. Its poor management of the extra revenue flooding the state's coffers represents a missed opportunity characterised by massive cost blow-outs on major projects and the neglect of much of the state's vital infrastructure. Water, water, water—oh, and railways—just being some examples.

One would have expected that with such massive income the state would be flush with surplus funds, yet a comparison of general government revenue and expenses figures over the past five years shows a disturbing fact. The total revenue in 2002-03 was $9.3 billion, while the total expenses were $8.9 billion. The difference is $400 million, which as a percentage of income is around 4 per cent. In 2007-08, the total revenue is stated as $12.4 billion, while the expenses are $12.3 billion. The difference being $100 million. That, as a percentage of income, is around 1 per cent. The same calculation on the years between indicates a general downward trend, with the estimates for 2010-11 showing a figure of close to 2 per cent.

It is worth bearing in mind at this point that for the first two years of this government the surplus was greatly enhanced by the carryover of $270 million in South Australian Finance Authority dividends. In case honourable members have forgotten, this was described at the time by former New South Wales auditor-general as an 'accounting fiddle'. Couple this with the implementation of new taxes: the River Murray levy draws in $22 million; gaming machines tax has increased by 31 per cent over the past six years from $312 million to $400 million; property taxes and stamp duties have almost doubled over the last six years from $731 million to $1.43 billion; motor vehicle taxes have gone up 26 per cent from $324 million to $406 million; insurance taxes are up 33 per cent from $223 million to $296 million; and there has been a boom in payroll tax of 45 per cent from $601 million to $871 million. This government has given itself a massive annual pay increase—almost $4 billion more than the last Liberal government—yet, and as I just mentioned, the surplus this year is expected to be less than at any time since 2002.

In keeping with the perception of the formalised trickery described earlier, this government continues to hide serious unbudgeted increases in expenses behind huge underestimates of its annual revenue collection. Contrary to its 2002 election promise, the South Australian government's general taxes will have climbed more than 50 per cent—so much for the promise not to increase taxes.

A good proportion of this has come from high property tax collection which, as I have said, has almost doubled since 2001-02. With the exception of Victoria, South Australia has the highest stamp duty payable on property acquisition in the country. While the government seeks ways to increase the state's population and maximise economic opportunities presented by the mining boom, the affordability of housing—particularly for first homebuyers—is deteriorating. With average house prices around South Australia at $320,000, stamp duty concessions for first home buyers cut out at $250,000. It ought to concern every South Australian, especially parents, that the percentage of those buying their first home has fallen by 35 per cent in the past six years from 20 per cent to just 13 per cent.

Payroll tax has become another little goldmine for this wasteful government. With the lowest threshold in the country of $504,000, payroll tax will reap 45 per cent more than it did in 2001-02. Is it any wonder that the state's employment growth, measured against the national jobs market, has fallen significantly?

The subject of the state's unfunded WorkCover liability has been debated at length in this house recently. From a figure of $276 million in 1994-95 grading steadily down to $56 million, it has climbed steeply to sit at $844 million last year, with forward projections even higher. The chart of those liabilities for the period 1994-95 to 2006-07 looks like the Mount Lofty Ranges next to the Himalayas—and, as everyone knows, very few have climbed Mount Everest and many have died trying. The Treasurer and his Minister for Industrial Relations would find Montefiore Hill a challenge.

The wastefulness of this government is well evidenced by two things. One is the blow-out in spending on major projects such as road extensions, bridges, tramlines, underpasses and hospital redevelopments. The list goes on. It is mirrored by the huge increase in the number of public servant full-time equivalents since 2002-03, not to mention the 84 extra ministerial staff the government has bestowed upon itself in the 2007-08 budget.

The second example of wastefulness is in the SA Water figures. In the past five years over $1.7 billion has been skimmed from SA Water customers. That might have seemed reasonable had the money being reinvested into vital water infrastructure—and how timely that would have been. As well as management and storage issues, the condition of much of the state's water delivery infrastructure has been largely ignored until now, and now we are in serious trouble with nowhere to go but beg our eastern state neighbours for enough water to survive. In 2006-07 less than 4 per cent of profits generated by SA Water found its way back for water storage and delivery infrastructure projects. That is just $11 million out of a total profit figure of $314 million; we can only wonder where the rest of that money went. Now that the state's water alarm clock has finally shaken itself off the government's desk and crashed to the floor, the public will be asked to find more money to fix what it has, arguably, already paid for.

It is almost impossible to talk money, budgets, surpluses, deficits and money management in South Australia without mentioning the State Bank debacle of 1992-93. As much as members opposite might moan that we always bring it up, it is perhaps fitting that we do because we recently commemorated another ANZAC Day, with its familiar and important catch cry of 'Lest we forget'. We will make sure that the public does not forget the State Bank debacle and the $11 billion debt bestowed on this state. The former Liberal government showed great fiscal skill in dealing with this mess left by the former Labor government, some members of which are, sadly, still with us today.

If the former Liberal government had been able to apply those same skills to focus on building the economy, rather than repairing it, one wonders where we would be today. I confidently suggest that the levels of taxation could be well below current levels and the state would be better placed to maximise the opportunities that currently exist, as well as deal with the extraordinary problems we currently face.

I would now like to discuss issues that affect not only the seat of Hammond locally but the state as a whole, especially regarding the lack of water infrastructure spending. On 6 November 2006, Premier Rann announced, 'We are going to build a $20 million weir at Wellington.' There was no thought of whether it would supply water to all the Lower Lakes communities, the tens of thousands of people, the billions of dollars worth of industry below Wellington, until the government said, 'Hang on, we'd better do some testing and see how sound the base is; see what the soil is like under the river.'

It could have looked at the reports from the 1930s and the 1960s which would have told it exactly what it would have found between Pomanda Island and the McFarlane property at Wellington. It would have found silt, silt and more silt. I have heard that, even recently, some test drilling has been done to 170 metres and it is just silt. This was found out years ago. Down the track I will be endeavouring to find out exactly how much money has been spent on soil tests, etc. It has tested 14 sites and it still has not come to the realisation that not only is it a terrible idea to build a structure in the river but it is not feasible where it wants to do it because it will be a sinking structure. The minister has finally admitted that.

It will cost at least $200 million by the time they allegedly reckon they will pull it out. My argument is that they will tip 700,000 tonnes of stone into that river, if it comes to that, and most of it will sink, never to be seen again. That will probably be the excuse not to bother with it.

We have seen what has been done to local communities, not only blocking off wetlands but backwaters where people access water. What has been done to Lake Albert? It has had to cut Lake Albert off from Lake Alexandrina. It has nowhere to go if it uses the excuse of acid sulphate soils in Lake Alexandrina. There is not another lake to protect that waterway. It is water from down that once mighty river—the Murray.

It is an absolute disgrace that we have a billion dollar industry at Langhorne Creek that is going to be on its knees because the government will not fund a pipeline to keep that industry going. It has just decided, in its so-called wisdom, that it will cut these people off, cut major industry off, major employers and several large towns. In Meningie, the shop owners and businesses in the town are down to 50 per cent turnover. It is just outrageous.

The people at Langhorne Creek are at the stage of deciding whether they will go ahead with funding for their own $60 million pipeline. I know it is on a knife-edge and that decision has to be made very shortly. They know that they cannot get it constructed before next vintage. The other problem is that, even if they do build it, they do not know what allocation they can get down that pipe.

I also want to talk about the lack of interest in the Narrung and Poltalloch peninsulas. It will not be until the media start to give things a run that we might see Mike Rann, minister Maywald and occasionally minister McEwen have a set-up and stage-managed meeting with a few growers because they do not want to be out with a large group of people as they might get some tough questions.

The community at Narrung deserve a new pipeline from Tailem Bend, and it should be funded for $40 million and of an appropriate size, starting with a 400-millimetre pipe. Instead, what I believe they will do is suck off already extended pipelines from Meningie and Cooke Plains and put in a pipe with a diameter that is too small so that there is no room for expansion in the future.

The dairy industry has gone down there: people have sold their herds or cut off the heads of their cows. What does the government think? It does not seem to care, although it has quite happily taken hundreds of millions of dollars of tax from these areas. It has been quite happy to take this tax revenue and let people go without water.

The government should watch Landline this weekend, when it will see old men in the mud trying to access water. That is what this great state has come to for people to get drinking water into their homes. They went to the federal election with Kevin Rudd talking about equity and access for all Australians, but all we get out of the federal water minister is more talk about what they will do with water.

I want to talk about public sector employment. The government budgeted for 2,000 extra public servants, but all of a sudden it has 12,000. What a shock and what a horror! Do we know where they are? It is not been outlined to us, although 10,000 extra public servants over four years will cost $24 million or $25 million. It is just out of control.

Getting back to the water debate on the larger state scale, the Labor government did not decide to build a desalination plant until Mike Rann got over his phobia of worrying about whether it might rain. I still believe he has that phobia because the government now has the outrageous idea that it will build a desal plant it reckons it can switch off. It is just a crazy idea.

They want to increase the state's population to two million people. I have no problem with population growth, but you have to give them something to drink and they have to be able to wash. What will happen because of lack of action will be an absolute disgrace. You might think that it is out of sight, and out of mind below Wellington, but it will come home to roost when B-doubles are carting bottled water just so that people can drink. That is what will happen if we do not have a good winter. It is exactly what will happen, and I bet that it is in your disaster plan somewhere. It is absolutely outrageous.

First, we were told that the government wanted to expand Mount Bold but, all of a sudden, it got cold feet and said, 'Oh, no. We will check 139 different sites in the Mount Lofty Ranges.'

Mr Venning: They can't make a decision.

Mr PEDERICK: They can't make a decision to build another dam. I would not have so much trouble with their building another reservoir, except that they will still suck on the Murray to fill up the darn thing. I was going to say 'dam thing', but that would probably be swearing.

Mr Venning: It's a pun.

Mr PEDERICK: Yes; it is. Instead of wasting a billion dollars on a reservoir, do something with stormwater catchment.

I want to speak about another infrastructure issue in my electorate, that is, the new high security prison complex at Mobilong. Okay, we have been lumbered with it, but the government better make darn sure that it does the upgrades and puts in the transport infrastructure so that we can get people to Murray Bridge and back to Adelaide, or wherever they have come from, with decent bus services for visitors.

We also need roads, like Bremer Road in Murray Bridge, fully upgraded with a proper intersection, and other infrastructure items will need to be done to ensure that too much strain is not placed upon the Rural City of Murray Bridge. That is where I am afraid it will land, because they will pass the buck when they want to scrimp on a bit of money when they build this prison.

Roads and ferries are major issues in my electorate. There are eight ferries that cross the River Murray, and only a couple, I believe, are still carrying full weight. It is totally outrageous that the government finds it too expensive to fix the upstream ferry at Mannum for $500,000. I hope there are not headlines one day telling us that emergency services were held up because they could not get from one side of the river to the other, and someone dies. I hope that does not happen, because I will probably know the person.

This government is outrageously tight with money when it should be awash with GST funds. The roads in the outer regions are just a disgrace. A 10-kilometre stretch of the Pinnaroo to Loxton Road should be rebuilt. I have no problem with the fact that the Berri Hospital will be the main regional centre for health, but you have to get the people there. If the government is not going to fix the roads, it had better get more health helicopters and make sure that there is plenty of Flying Doctor access, otherwise people will have to travel too far and lives will be at risk.

Just in closing, I am concerned about health services in the region. There are rumours that several hospitals might be turned into aged care facilities. I have no problem with aged care, but you still need acute care. We are used to travelling hundreds of kilometres to get services in the country, but we are also used to our acute care facilities. I marched on this place over 20 years ago with a group to save the Tailem Bend Hospital and, if I have to be involved again, I will be. We must make sure that we have health services for outlying regions and not just some wang dang fandangled hospital in Adelaide.

Mrs PENFOLD (Flinders) (21:17): I rise to support the appropriation from the Consolidated Account for the financial year ended 30 June 2009 of $2,300 million to provide for the first three months' expenditure of the 2008-09 financial year until the budget receives assent, despite disagreeing with what much of the expenditure will be used for by this government.

While this government is spending millions of dollars expensively retrofitting solar panels and wind turbines to government buildings and schools to provide power that they already have, in the electorate of Flinders (which covers an area of 55,000 square kilometres, the size of Tasmania) communities with similar expenditure to supply power would be able to create long-term wealth and jobs where they do not now exist. Schools, hospitals and businesses can be retained, ensuring the survival of small communities that are under threat.

The multiplier effect, in economic development and jobs, of government infrastructure expenditure put in the right place is at least six times but, on Labor's gimmicks, it is none. In fact, these are depreciating assets that continue to cost the taxpayer in depreciation and replacement cost. However, I do not think that this government has any understanding at all of the multiplier concept, or if it does, the government does not care that it is wasting millions of dollars of taxpayers' money.

Water is of the greatest importance to the constituents of South Australia at the present time because of the droughts across the nation and the threats posed by global warming. Yet, this government is continuing to allow its monopoly provider, SA Water, to procrastinate. Money is being spent on mini hydro-turbines on reservoir pipelines to produce a minuscule amount of power. There is $46 million being spent to fit out SA Water's new headquarters, which they do not even own. Numerous more executives are being employed at salaries of over $100,000 per year. Thousands more taxpayers' dollars are being spent trying to stop people using the product—water—that it has a monopoly to supply to the people of South Australia.

In my own electorate the privately-funded solar-powered mechanical vapour compression desalination plant proposed for Ceduna more than two years ago has been lost, and people are still having to replace thousands of kilometres of pipelines, water softeners, water heaters and electric jugs because of the foul water being provided by the government through SA Water. Instead of desalinated water being provided where it is badly needed by private enterprise for about a dollar per kilolitre, a pipeline was built by SA Water to bring 1.4 gigalitres of water from the ailing River Murray at a total cost of $48.6 million.

The new technology that was to be used for the desalination plant in Ceduna has been taken to Queensland for two commercial projects in that state, and the owner has advised me that he does not expect to be back. Meanwhile, mining is happening in my electorate. If we are to do any value adding we will need large quantities of good water. One of these is at Ceduna where Iluka is developing a very large high quality mineral sands deposit, which we should be processing before it leaves our shores.

There is a large, world-class, high quality deposit of kaolin near Streaky Bay which is suitable for use in paper making and which will be developed in the next few years but, again, it needs to be processed before it is sent overseas. Processing requires copious amounts of high quality water. Instead more community water consultation is taking place.

It is that waste of money by this government and SA Water about which I want to talk because, while payroll, property, gambling, insurance, motor vehicle and other taxes are increasing and causing grief to many people, nothing will hold us back as a state as much as the need for expenditure on infrastructure, particularly for water. It is one of the biggest expenditure items of the new federal government with a huge $12.9 billion being announced by minister Penny Wong yesterday to be spent over the next decade. It frightens me that this Labor government and SA Water will have a major influence on how our share of that money and our taxes will be spent to provide South Australia with the infrastructure it needs to enable us to thrive into the future, particularly in regional areas.

A strategic objective of SA Water is to 'plan, develop, operate and maintain our infrastructure to consistently meet the needs of our customers and owner'. Unfortunately, the emphasis has been on the needs of the owner at the expense of the customers. Given the government's control of SA Water this is not surprising. However, it ignores the fact that $7 billion in assets held by SA Water belong to the community—and the community should come first.

If the government as the ultimate controller of SA Water decided to reduce the dividends paid into general revenue and that water would be provided at the lowest cost as needed, based on reasonable expectations of increased demand, the cost of these consultations could be avoided. The community is currently being questioned about what it wants with virtually no information on the cost of the alternatives. The cost to the community exists, whether incurred by individuals, SA Water, the government directly or the government and councils as subsidies. The cost of emotional and political decisions, not based on either logic or need, are enormous.

The present requirement for new houses to have water tanks is one of the most irrational decisions, as the amount of water saved of the average 270 kilolitres normally consumed by households is miniscule. In my view, the cost to produce water of high quality and quantity where it is needed should be the only issue. The costs would include placing a value on externalities, for example, environmental costs and possible benefits, such as removing an existing environmental problem. If one asks the public to make decisions on what it wants with virtually no information on the cost it is equivalent to asking a jury for its decision without a court case examining all the issues. One gets an emotional, not a rational, response.

Juries are well supported because they are seen to make good decisions, but this is dependent on the quality of information provided and tested. This information is not being provided. Why are the most important decisions not on the table for discussion and community view? For instance, why are we not debating the justification for permanent rationing of water? It cannot be denied that 'permanent conservation measures' are a form of rationing. Why is water targeted and nothing else? Is there something unique about water that attracts this special attention?

I think we should look first at the nature of water. It is inexhaustible. It covers 70 per cent of the earth's surface. Unlike most commodities it is totally recyclable when used. It is probably the cheapest commodity we consume. Desalinating water costs about $1 to $1.20 per tonne. What else costs so little to produce? If desalinated using renewable energy—wind or solar—it would probably have the lowest ecological footprint of any substance used by humans. It is the cheapest commodity to distribute right into the houses of the consumer, using existing pipeline infrastructure, with no mess—completely safe and ready to use: 10 out of 10 for convenience. What other high quality product can be continuously distributed to virtually every household and business in the state for under $2 a tonne?

It is a necessity for life, similar to food but vastly cheaper to provide. It provides many other benefits: hygiene with dishwashing, showers and toilets, the pleasure of long, hot showers and the mental health benefits of beautiful plants and gardens. It can be used to grow and keep alive in droughts crops, vines and fruit trees, providing food, trees and beautiful gardens which reduce CO₂ accumulation. Through its use employment is provided for thousands of people in the state in both regional and city areas and in some of the most pleasant fields such as viticulture and landscaping.

With all these benefits, why is the cheapest, most convenient, most ecological commodity, which is critical for hygiene and horticulture and which provides a lot of pleasure with our culture of gardens, targeted for permanent restrictions? If the aim is to reduce the average footprint, why is water chosen? Why not put restrictions on the type and amount of food produced? In the United States of America food production consumes about 17 per cent of all energy and we assume it is the same in Australia. We could have SA Food—a monopoly that would ration food, help government finances, reduce the cost of obesity and reduce the cost of medical facilities in the future. Food is available in unlimited quantities; why not the other essential—potable water?

We could require all private city vehicles to be purely electric in 20 years and increase wind power to provide extra energy and eliminate four-wheel drives and large private motor vehicles that not only pollute but also consume a non-renewable resource. We could eliminate where possible the use of bricks, concrete and steel. Cement for concrete produces 5 per cent of greenhouse gases worldwide—about twice that of air travel. Why not require all houses to be built of plantation timber, with no CO₂ and sequestration combined? All of the above would be vastly more effective at reducing the individual footprints but lack one attribute: they are not controlled by a government monopoly.

The obvious conclusion on why we have consultations and do not get information on costs is that it is the best way to achieve what the government wants, namely, to avoid rational decisions if they do not suit their plans. I am concerned that it is more of a process of exhausting people with inappropriate ideas than one of gaining local knowledge and ideas with consequent benefits. Instances of the government making irrational decisions include imposing the requirement for water tanks on new houses when it is of so little value, it is so costly and it adversely impacts on home buyers who can least afford it.

Waterproofing Adelaide estimates the cost at $5.40 per kilolitre. Why is the government subsidising tanks in existing houses? Is it to get the emotional kudos without having to reduce transfers of profits to the government or increase water rates to finance new infrastructure? Why put the $48.6 million pipeline from Iron Knob to Kimba, supplying either the Murray or desalinated water, while preventing a much cheaper alternative at Ceduna? That pipeline has annual costs of $2.9 million, in interest at only 6 per cent, $700,000 annually straight line depreciation, operating costs of, say, $300,000 and a water cost if desalinated of, say, $1.7 million (that is at $1.2 per kilolitre) at a total cost of $5.6 million annually for 1.4 gigalitres of water, or about $4 per kilolitre.

How can this be justified when Ceduna was offered desalinated water? Unlike the pipeline, this was almost completely greenhouse and pollution free, as it would have used solar energy and the saline water was to go into the existing Cheetham saltpans. Compare this with the Whyalla desalination plant planned for BHP using mainly coal or gas for energy, pumping the saline water into the reverse estuary in Upper Spencer Gulf, plus the substantial extra pumping costs using the same energy source.

The only logical reason is that SA Water is owned and managed as a government monopoly and the government and SA Water are determined to maintain that monopoly, no matter what it costs the community. This monopoly currently pays 96.5 per cent of its profits into state revenue. It pays twice as much to the government as it has expended on capital items over the past five years. What is the opportunity cost of the pipeline decision? What would over $50 million have done elsewhere, if expended usefully? What is the cost of this stupidity of incurring a greater cost for the supply of a basic commodity such as water, when it could have been supplied much more cheaply as and where it is needed by private enterprise?

Further, the compound effect of this annual loss of about $4 million, when compounded over the life of the pipeline of about 70 years with interest on the cumulative losses ($1.16 per kl—the highest rate versus $4 cost), plus losses of water that are not chargeable over that time, adds up to billions of dollars that have to be paid by future generations, and this is only one project.

Water tanks are probably more costly although disguised and diffused in subsidies, new building costs and over many households. It is a hard-headed and deliberate program of maintaining the monopoly of SA Water—and monopolies, by their nature, will do everything possible to prevent competition. This imperative of SA Water is reinforced by the government, which is determined to maintain the income it generates and not have it white-anted by competition. Forcing change on monopolies can be done only by introducing competition or by legislation. For this reason, they are not allowed to exist in private enterprise and there are massive penalties to prevent it. A monopoly owned by a government has even more monopolistic power in practice and is much better able to prevent competition.

The question for all communities is how to break this monopoly. SA Water could own and operate the pipelines, another government entity could own state water resources and private enterprise could be allowed to bid against that entity for the supply of water. It is complex, but the critical need is to avoid politically motivated decisions. The cost of not having water or providing it in the wrong way is too great. We are not a third world country. We may be the driest state in the driest continent, but should that make us the most miserable with such a basic commodity as water? People have just as much right to have the pleasure derived from a large garden, using a normal shower head and having a good shower and even having fountains, spas and pools.

It is the community's right to have adequate water supplied at the cheapest cost. This can be done. The method depends on the circumstances. Modern technology enables unlimited supplies of water to be provided by desalination at a cost that is expected to be as low as $1, possibly less (1,000 litres or a tonne). Using wind power means insignificant greenhouse gas being produced. Saline water can either be put back into high energy sea areas, or mixed with low salinity sewage discharges to bring them up to sea water salinity levels, or made into salt.

There are apparently well over 7,000 such desalination plants around the world. Stormwater collection and similar methods may be economical in special circumstances, but rarely. They normally require costly collection facilities, large storage and a duplicated supply system, which can be very expensive. Additional costs may be offset by environmental benefits and justify this alternative. Pricing can be on the basis of normal consumption of existing cheaper supplies being at current prices (which only covers basic distribution and administrative costs). Any consumption above that would be at the desalination cost plus other costs; perhaps up to $2 per kilolitre in total. That is cheap. What other high quality commodity can be delivered to your door for $2 a tonne every day of the year?

At present, we pay an average cost of over $1.50 per kilolitre for the first 250 kilolitres when fixed supply charges and River Murray levies are included. Why deprive those who want additional water for an extra 50¢ a kilolitre? If someone wants an extra 50 tonnes it will cost, say, $2 per week. Our market system for all other commodities matches supply with demand through prices. This cannot happen with water in South Australia due to the monopoly of SA Water's limiting outside access to its pipeline systems. I support the Supply Bill, with reluctance.

Mr VENNING (Schubert) (21:35): From the outset, I indicate that I support the bill. A supply bill will be necessary for the first few months of the 2008-09 financial year to fund government departments and agencies and to ensure that all associated costs are catered for until this year's budget is passed through parliament.

Before I launch into the body of my speech, I want to say that tonight I have a unique opportunity. I want to send my best wishes to the Hon. Frank Blevins, who I understand has been through a pretty torrid time and has been hospitalised. Who would have thought that, as a result of falling off a ladder, he would have gone through this? Even though Frank comes from the opposite end of the political spectrum to me, when I first came to this place he was deputy premier, and I greatly respect the man. He was a man who had not received a great education, but he was certainly one of the best performers that I have seen in this place, because he could get on his feet when the place was in turmoil and get into the mix of it. By the time Frank sat down, the place was totally subdued. He was a master of the voice, and I respect the guy.

I want to say a few things tonight that have never been said before. People ask me: 'Why did you take on politics?' When your father is a politician (and the son of Jack Wright, who is in the chamber, would understand this), it is not automatic that you become an MP. I was first asked by the Hon. Frank Blevins to join this system as an adviser. Would you believe that? He set up a committee called the South Australian Rural Advisory Committee (SARAC) back in the early 1980s. He asked me to sit on the committee, and I did. I did not think that it was disloyal, and he received some very good advice. I had my fingers on some of the measures that the Labor government of the time (the Bannon Labor government) introduced, and I respected that. That is how I became interested in the process, and Frank understood that. I was from the other side of politics, and he knew my father. As the member for Lee would understand, that is how I got started. I wish Frank Blevins all the best.

Tonight I was privileged (as is the case with all members) to have dinner here with some very good friends. One was Mr Grant Andrews (who was the secretary-general of United Farmers and Stock Owners for almost 30 years here in South Australia), along with his brother Neville and their wives Judith and Audrey. Grant said that, of all the ministers—particularly the Labor ministers—Frank was the best, because you knew exactly where you were with him, and he was great. Some of the things that he did for rural people should never be underestimated. So, Labor governments can deliver for rural people. Frank did, and we respect that: we have not forgotten it. We wish Frank all the best at this time, because what he has been through has been pretty horrific. If he happens to read this speech, we wish him all the best, and we thank him.

I want to make some comments in relation to the Supply Bill and discuss the opportunities that South Australia has missed out on due to the Rann government's inability to manage the large amount of state and other tax-generated revenue that the government has had available to it since the election. You have heard this ad nauseam, Mr Speaker, and I apologise for that. In the six years since the Labor government came to office its revenue has increased from $8 billion to more than $12 billion per year, in addition to many other extras, such as poker machine revenues and speeding fines (to which I have contributed, before anyone has any false impressions).

State taxes and levies are up by 48 per cent over this period, while property taxes have increased by a staggering 75 per cent. According to the analysis of the state budget papers, The Advertiser revealed in January last year that since coming to power six years ago Premier Rann and his government have collected approximately $30 billion in state taxes which, combined with GST payments and grants from the commonwealth government, makes this the wealthiest government South Australia has ever had—at least in terms of money it has at its disposal.

But what have we to show for it? We have no desalination plant, no extra health services, and no electrified rail network—although we do have a tram line which is causing traffic chaos in the CBD. Just go out of the front door and check! When members came to work this morning, what was it like coming up North Terrace? It is a disgrace. It should have been a looping tram line. The government does not seem to be able to get it right, whatever it does. Where has all the money gone? Do we have better health care, better public transport, better roads or water security infrastructure? No, we most certainly do not have.

In this financial year the state government is expected to take a record $3.4 billion in state taxes, which equates to $2,156 for every person in South Australia. However, I am certain that this increase in revenue has not been matched by the state government in recurrent spending obligations. South Australia has just recorded the highest inflation rate of all our capital cities in Australia. That is a fact. Our CPI rose 1.5 per cent over the last quarter, compared with an average increase across the rest of the nation of 1.3 per cent. So we have topped the poll on the wrong issue. We have the worst cost of living figures in the whole nation. The cost of petrol and groceries is similar nationwide, so why do we score so badly? The answer is: because we have such high taxes and so many levies that the financial impact on South Australians is measurable.

Mr Piccolo: I've come in for you.

Mr VENNING: Thank you. The member for Light has arrived, sir, to hear my speech so I will jazz it up a bit. Is the spending by Premier Rann (and the member for Light and his government) of such tax-generated revenue measurable? Is the state government delivering value for money to the taxpayers of South Australia?

Mr Piccolo: Yes.

Mr VENNING: The member for Light says yes. I think he should go out the front door and check. Mr Speaker, I do not believe so. In fact, the answer is an emphatic no. We must fast-track the desalination plant. Heavens above, we are now into the seventh year of the worst drought we have ever had, and what do we have by way of a desalination plant? Western Australia will have its second plant operating before we even get the first brick laid, so what the heck has been going on here?

The dithering about to make the decision to construct it took 18 months, and now the quickest time in which it can be completed is four years. If it does not rain in four years, members had better buy shares in a bottled water company. It is absolutely ridiculous: we need water now. I hope that money is spent in the upcoming budget on fast-tracking this major project more than six months earlier than was recently announced. Why are we mucking about with a trial plant? Heavens above! Just go and copy what the Western Australians have done!

All we have got for our water dollars is a very swanky SA Water head office in Victoria Square. What an insult! How insensitive is that? The people of South Australia have generated $1.6 billion in revenue for SA Water through their water bills and I think they deserve to see some fast action for that sort of money. The revenue that the state government has had at its disposal since being elected in 2002 would fund nearly 30 desalination plants, yet we do not have even one. Western Australia will have two before we even start.

It seems that little of the revenue generated by SA Water has been made available for water infrastructure spending; it has been available just for spending on their own backsides and for building their own swanky office, and that is the greatest disgrace. It should never have been allowed to happen. While the rest of the state dries up and becomes more parched, SA Water has built itself a palace on Victoria Square. And how much has been said about that in the media? How much of this has been raised in the house? It is very insensitive timing: that is all I can say. It is a disgrace! In its Waterproofing Adelaide 2005-2025 documents, the state government clearly stated:

The South Australian government will develop a state policy towards desalination that addresses planning issues, access to saline water, disposal of brine and management of other environmental aspects.

That was three years ago. Premier Rann's desalination working group has been at it for more than a year now—hard at it for a year—and we still do not have a confirmed location, an environmental assessment or a genuine time frame for completion. That must be remedied in order for South Australia's reliance on the River Murray as a major water supply to be reduced. One never discusses religion in this place, but I think that the government is hoping with all hope and prayers that it will rain, but it has not. We had some rain the other day.

Mr Piccolo interjecting:

Mr VENNING: I do, too, and there is no politics in that. I do, too. Everyone is advantaged by good rain, and the rain the other day, I have to say, was a blessing. I want it to rain that much again this week. I do not know what we have had tonight. I have been around for some years, as members know, and I have never seen a period quite like this—never.

Mr Piccolo interjecting:

Mr VENNING: I have been in here 18 years. I am 62 and I have been a farmer. I worry. I hope this is not a trend that will continue. I was a sceptic towards climate change, but I can tell members that I certainly am not now. I just worry about the future. Our farmers and irrigators are losing everything they have—in some cases losing orchards and farms that have been in their family for generations. They are struggling to live and put food to eat on the table each week. Can they survive until 2011-12? I hope so, but look at the huge cost today of farming—the cost of fuel, the cost of fertiliser, the cost of seed, and the list goes on. There are huge costs.

Unless you have a good crop you will not make any money at all, and a lot of farmers are realising this. When you look at the Stock Journal, you can see the farms on the market. I have never seen it like this before—not ever; and, as I said, I am 62 years of age. I had Grant Andrews (general secretary, United Farmers and Stock Owners) in tonight, and he said that he cannot recall a period like this. Without government assistance he does not know how farmers can continue. Look at the price of food across the world. Look at the price of rice—it has doubled in the last four weeks. You just wonder where we are going. You can talk about fuel costs and everything else but when food is expensive (and in many cases it will not be available), just check what will happen. It will be serious indeed.

We have not paid our farmers enough to produce food, and that is why they are not going to produce it. We have got farmers all over the country not producing rice and not producing cotton, because they do not have the water. We also have farmers in South Australia not producing wheat and not producing barley because it is just not worth them to do it. As I said in a contribution the other day, unless governments come to the party and subsidise some of these input costs they will not grow it because they will go broke doing it. So, what is the bottom line? We do not have food. In the end, without food where are you?

You will have banks saying, 'We will not finance your crop anymore.' I have been blessed; I have been very lucky. The fact that I am in here gives me an extra insight; it also gives me an extra income, which goes back to the farm. I just wonder how they can survive until 2011-12. I hope they can, but I know that many will not. This up and coming budget must include money to ensure that the desalination plant comes online as quickly as possible with no more delays. It must also include provision for those suffering enormously from the drought. They need more assistance, and such assistance should not be restricted only to those in the agricultural sector: it should be made available to many other business suffering from the drought.

There are those with boating and marina businesses who cannot carry on due to low river levels, and members heard me talk about the ferries today ad nauseam. Along with those experiencing hardship due to the downturn in business, boat refuelling companies, houseboat cleaners and the like are all affected. They should not be forgotten. Training, assistance with improvements to businesses and farms (where viable to keep them going), and subsidies for input costs, along with financial and emotional counselling, all need to be part of the package. A spokesperson for the Premier told The Advertiser in January this year:

While the previous Liberal government under invested in our infrastructure and in vital services such as health, law and order, education, this government has a huge infrastructure program under way.

With the state government currently being so flush with money, having more money than any other state government has ever had, along with recently undertaking huge a infrastructure program, one must ask why it cannot find $500,000 to fix the concrete ramp of the upstream ferry at Mannum.

Members cannot understand what a shocking inconvenience it is when people cannot cross that river, and it is 70 kilometres to go around. It is beyond politics. It is not fair and it should not be allowed to continue. I received a response to a request I made in February to have the concrete ramps of the ferry extended from the then acting minister for transport, Paul Caica, and I quoted that letter today. Today I also raised that matter with the Hon. Patrick Conlon. I do believe he is listening. I hope there is something in the budget to help.

The people of Mannum are asking that they not be forgotten and that they be considered because they do pay their taxes and the River Murray levy. They are asking this on behalf of their families and their children, particularly if there is an emergency because the hospital is on one side of the river and they are on the other. How would you like to have to travel 70 kilometres to get to your hospital? You would not do that. I cannot believe that.

The government can afford huge cost blow-outs on road infrastructure projects. Massive cost blow-outs and broken promises seem to have been the norm for the government. The cost of the Northern Expressway (which I think is essential) has ballooned from a $300 million project to a $1.5 billion project. The Port River bridges (which I supported but not to lift), what a mess that project has become: $47 million over budget and still no completion date, and still not operating. I am giving the minister every credit here, I will not criticise him for this. I know there are problems with bearings and all sorts of things, and I appreciate the frankness with which he has dealt with me and I will respect that. In the end, it has to work and it has to be working very quickly.

The South Road underpass increased from $65 million to a last estimated cost of $188 million, and the expenditure on the Bakewell underpass blew out by $30 million—and the list goes on. Of course, we have the tramline extension. I love trams but I only wish they had not done what they have done. As I said in the first place two or three years ago, why did they not take the trams down, say, Morphett Street, across North Terrace and up, say, Pulteney Street—one single line? Would that not have been a fantastic and better way than what we have now? What we have done to King William Street is absolutely appalling. We would have had the best of both worlds; we would have had trams.

I understand that the government will buy some new trams. I think it has learnt a lesson: they will be wider bodied, there will be many more seats in them and better air-conditioning. However, you will not be able to run these trams together. This current tram and the new tram will not be compatible, so you will not be able to run them on the same line because one will be wide bodied and one will be narrowed bodied. Okay, you made a mistake. Be strong enough to say, 'Okay, we will put the new trams on a different line.' It will be a problem, but I believe the new trams will be multiconnecting: you will be able to put them together like a train and it will be worthwhile.

I also reflect on the mess that the government has with WorkCover. Been there, done that; discussed all that last week. It is damn sad that we have reached this point. We just needed a government that was much more responsive to the problems at hand. I think we need to address that. The budget is only a few weeks away. I have been in this place for 18 years, and for the last seven or eight years I have been pushing one strong issue, that is, a new hospital for the Barossa Valley.

Most members and members sitting here tonight have been to the Barossa. I am very pleased that you have not been sick because, if you were taken to the Angaston Hospital, you might have had a cultural shock because this is a facility that is totally worn out and way below standard. Beautiful Barossa, magnificent Barossa, South Australia's showpiece, but if you had cause to visit that hospital you would think, 'What is this? Have I come to a second grade hospital?'

All I can say is that we are running into a budget. I have every respect for minister Hill—I have every respect for three or four ministers over there. All I want in this budget is a mention, be it one word, a phrase, or a paragraph saying, 'First, we recognise that the Barossa hospital is there; and, secondly, we recognise that something needs to be done.' This government has been in government for six years and not once has it even mentioned that the Barossa has a problem with its hospital I know that the minister visited the other day and received a delegation that I represented, and I am pleased about that. He is diligent; I would never criticise him, and I have not done so. I trust the gentleman.

All I want from this budget is a line saying that there is some money that indicates we are going to do something for the Barossa Hospital somewhere down the line. I am pleased to see that the member for Light is still in the chamber, because he has heard this argument before, not just from me but from locals, and we have adjoining electorates. Even if it is $500,000, or only $100,000, for some study, or something to say, 'We the government appreciate the problem in the Barossa and we will do what is responsible and start thinking about an upgrade or replacement of this hospital,' I would be grateful, because the present situation is not just good enough. After about six years of my pushing this matter kindly and nicely, it is time to say, 'You are not dinkum.' The people in the Barossa pay their taxes, and they deserve a much better deal.

Time expired.

Bill read a second time.

The Hon. M.J. WRIGHT (Lee—Minister for Industrial Relations, Minister for Finance, Minister for Government Enterprises, Minister for Recreation, Sport and Racing) (21:57): I move:

That the house note grievances.

Debate adjourned on motion of Mr Venning.