ZOOS SA

The Hon. J.J. SNELLING (Playford—Treasurer, Minister for Workers Rehabilitation, Minister for Defence Industries, Minister for Veterans' Affairs) (14:08): I seek leave to make a ministerial statement.

Leave granted.

The Hon. J.J. SNELLING: Last week, cabinet approved a further $1.2 million, to be met from the Department of Environment and Natural Resources, to ensure that Zoos SA could continue to operate in the 2011-12 financial year. In November last year, the government reached an agreement with Zoos SA to increase its annual operating grant, from $3.1 million to $4.5 million, and for that grant to be indexed. As part of that settlement, the government also provided a $2.6 million loan to Zoos SA, while Westpac significantly reduced its loan from $25 million to $7.5 million.

Throughout 2011, the government had brought forward $2.3 million in future years' funding to Zoos SA to allow it to continue operating and to pay overdue creditors. When conducting its financial plans for the future, and in particular for the 2011-12 financial year, Zoos SA believed that $1.2 million of that $2.3 million was a one-off grant and had made its financial plans accordingly.

Following the settlement last November, Zoos SA wrote to the government of its understanding that the $1.2 million was a one-off grant. In September last year, as part of the provision of the $1.2 million, the Department of Environment and Natural Resources wrote to Zoos SA, and I quote from part of the letter, 'The Government will provide to the Society a one-off special purpose grant in the amount of $1.2 million.'

All the public statements I made at that time and since then had clearly expressed that all money that had been given to Zoos SA, up to the November settlement, were drawdowns from future years. Nonetheless, I can understand why Zoos SA, based on the letter from the department, would reasonably understand it was a one-off grant and base its planning for the 2011-12 financial year accordingly.

Following this misunderstanding, the government was left with a choice. We could do what the opposition would do and allow the Adelaide Zoo—

Members interjecting:

The SPEAKER: Order!

The Hon. J.J. SNELLING: —allow the Adelaide Zoo—an iconic South Australian institution—to be unable to meet its financial obligations and potentially close or we could act quickly to continue to keep the zoo open. That is why cabinet approved $1.2 million to be met from the environment department's resources to allow the zoo to keep operating in the 2011-12 financial year.

There has been speculation about the management style of Zoos SA and its internal staff structures. As Treasurer of South Australia, my first concern is the financial future of Zoos SA and I would like to put on the record in this house that I have full confidence—

Members interjecting:

The SPEAKER: Order!

The Hon. J.J. SNELLING: —in the chairman of the board of Zoos SA, Kevin McGuinness, who has worked—

Members interjecting:

The SPEAKER: Order! Members on my left, I cannot hear the Treasurer. Order!

The Hon. J.J. SNELLING: —tirelessly to ensure the organisation has a sustainable future. Zoos SA is working with the government on a business plan which we expect to receive in coming weeks. The member for Davenport suggested in the media over the weekend that we should not have provided further funding to Zoos SA without that business plan. Unfortunately, animals being fed, staff being paid and the zoo remaining open cannot wait for a business plan.

I make no apology for doing what we have done to keep the zoo open. I have full confidence that, with the reduction of Zoos SA's debt from Westpac and the increase in its annual operating grant, together with the indexation of that grant, Zoos SA has a sustainable financial future.

Members interjecting:

The SPEAKER: Order!