Bills

Public Finance and Audit (Treasurer's Instructions) Amendment Bill

Second Reading

Debate resumed.

Mr TARZIA (Hartley) (12:27): I also rise today to support the Public Finance and Audit (Treasurer's Instructions) Amendment Bill 2014. My comments will be in a similar light to those of the members for Stuart, Hammond and Schubert. I will certainly support the bill, but I too will seek some explanation, as have the members before, from the Treasurer, hopefully in his closing remarks. Oversight of public statutory authorities is extremely important, and it is imperative for this parliament to do so. As the member for Stuart highlighted, there are a number of questions about the bill that remain unanswered, and I welcome the Treasurer's explanations.

The bill, which was tabled on 29 October, clarifies many matters relating to the application and scope of Treasurer's Instructions and does make minor amendments of a statutory law revision nature. I understand that the amendments do seek to improve the general understanding of the relationship between Treasurer's Instructions and provisions of the act, which provides a public authority with various functions and powers.

I understand that WorkCover is a public authority for the purpose of the Public Finance and Audit Act. It is extremely important and it is intended to be subject to the requirements of that act and Treasurer's Instructions.

I understand that we have requested details of the government's legal advice on this issue. The government advises that the Solicitor-General disagrees with the view on WorkCover's interpretation and that the bill is intended to ensure that WorkCover, and any other public authority for that matter, has to comply with the Public Finance and Audit Act and Treasurer's Instructions. I have been told that we have asked for details of the government's legal advice. Whilst I understand that these things are subject to all kinds of privilege, I would just seek a little bit more clarification in regard to this issue from the Treasurer.

Subject to this being noncontentious, I will be quite happy to support the bill. As I said, oversight of statutory authorities is extremely important. Otherwise, the bill is quite concise, it is common sense, and I would be happy to support what looks to be quite a pragmatic approach here. I commend the bill to the house.

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy, Minister for Small Business) (12:30): I want to thank members for their support and thank the opposition for taking a principled position on this. It probably will delight the public to know that the Liberal Party do not oppose everything the government does and a large majority of legislation we introduce is supported in a bipartisan matter. It is good to see that the younger members of the opposition are taking a much more fiscally responsible position than their older counterparts who they one day will be replacing.

It is important that Treasurer's Instructions are followed, for a number of reasons. I want to clarify to the house why it is important that the Treasurer's Instructions are there. We want to give guidance to statutory boards about how they procure things. The cabinet, and therefore the elected representatives of the executive, has a right to know what long-term contracts people are entering into. The reason we want Treasurer's Instructions there is that these boards are unelected. They have no mandate. The mandates they have are from this house.

There were some questions raised by members opposite about clarity between Treasurer's Instructions and where there might be some ambiguity about what would apply. Let me be very clear: the parliament is supreme. If the parliament has allocated a provision or a responsibility to a certain individual or organisation about whether to procure products or enter into contracts, that remains. What the Treasurer's Instructions in that case will do is service as a guide and make sure that we are always informed. I am not attempting in any way to subvert the democratic rule of the parliament where there have been past pieces of legislation enacted that have not been repealed which give people authority to expend money. Let me be very clear about that.

Public authorities—you wanted examples and WorkCover is an example that is important to note. It is important that all corporations which have, in effect, created monopolies because of legislation enacted in this house do inform the government of the day of what they are doing when they enter into commercial contracts. That does not necessarily mean that we would stop them, but what is important to note is that we know exactly what it is they are doing. They are not autonomous, and I mean that in the broadest way possible. I am not attempting to subvert the role of boards; I just think the taxpayer has the right to know how money is being expended by these boards. Also, the taxpayer has a right to understand before the event rather than after the event in an annual report.

That can be controversial for some board members. Some board members are selected for their expertise in a certain field. They go on to these boards and they do exceptional work for the government and the people of South Australia for very limited recompense. These board members are not in it for the money, let's be clear about that. They are in it because they want to benefit the people of South Australia and they want to be able to contribute back to the local community. I think the people on the WorkCover board, the Motor Accident Commission and the HomeStart board are generally giving back to their local community. Whether it be Funds SA, or any other board, these people generally have a very good level of skills, the state is utilising their skills and we pay them very little in return for that.

Some community expectations would think it is quite a lot of money but, when you are hiring financial experts to sit on the Funds SA board and you are paying them a certain level per year, the expertise we are getting for what we pay far exceeds that, so the benefit to the state is quite large. Treasurer's instructions are not there to try to tell them how to do their job; they are there to be a guiding principle about what the elected government and the parliament would expect as being good financial management.

Of course, being a Treasurer, it is important to note that there are people throughout government, which is a very large organisation, who are expending tax dollars and some of them are doing so in our name and we find out about it after the event. I cannot be in every boardroom in every board meeting in every office when a contract is being entered into, but Treasurer's Instructions are there to make sure that that money is expended in a prudent way. It avoids any complications or accusations of corruption or collusion. I think it gives a protection to people who serve us so well on these boards.

Is it perfect? No, it is not. Will mistakes be made? Yes, they will. Human nature is such that no instruction that the Treasurer sends out will be perfect, but I think it is important to note that what I am attempting to do, and what the government is attempting to do, is make sure that public authorities are governed in the most proper manner possible, with an eye always on the Treasurer's Instructions. Like I said earlier, if the parliament has already given authority to another organisation to act, this does not seek to subvert that. What it seeks to do is be a guide.

Mr van Holst Pellekaan: So, if ever there is a conflict, the public authorities act would take precedence?

The Hon. A. KOUTSANTONIS: I will take advice on that but I am pretty sure that is accurate. As my Treasury official just said to me, it is there to complement and offer a guide. Do you want to go into committee?

Mr van Holst Pellekaan: I'll sort it out now, if that's okay.

The DEPUTY SPEAKER: No, you probably shouldn't.

The Hon. A. KOUTSANTONIS: We probably should go into committee: it would be the proper process. I am happy to take questions on it, and you may want to do a deeper dive into some of the clauses, which is fine by me. I think it is an important piece of legislation, and I think it does show that the Liberal Party is maturing in its cooperation with the government and accepting that their job is to help the government introduce legislation that actually improves the financial outcomes. If you look at my second reading speech, and I do not know if it is disorderly to refer to it, Madam Deputy—

The DEPUTY SPEAKER: We've all memorised them.

The Hon. A. KOUTSANTONIS: I'm sure you have, Deputy Speaker, because you are the most diligent member of the house.

The DEPUTY SPEAKER: You are buying those calendars later, are you?

The Hon. A. KOUTSANTONIS: I'll be buying the calendars later, yes, ma'am. If you look at the amendment bill report, it talks of the main purpose of the bill being to make it clear that a general provision in the act establishing a public authority, such as a power to enter contracts or even a more specific provision such as a requirement to have a particular body approve a contract, will not override the requirement of the Treasurer's Instructions applying to a public authority, for example, requiring an approval of the Treasurer or delegate to be obtained before entering into the contract. While these matters can be clarified in the relevant charters and directions of particular bodies, these amendments are designed to improve the general understanding about the relationship between the Treasurer's Instructions and the provisions of any act providing a public authority with functions and powers.

What the government is saying is that, while the act and the parliament is supreme, these Treasurer's Instructions which can be issued are a guide. They do not seek to override the functions and power. If there is some ambiguity or some need for clarification, crown law advice should be sought and crown law advice is what should be followed.

If the government has a particular problem, we can always return to the parliament to amend these acts, but I think the fastest and most efficient way of doing that is by clarifying what the role of Treasurer's Instructions are, to give people in these public authorities better clarity. It is not perfect. What would perhaps be perfect would be to individually amend every act, but I think that would take a very long time and waste the time of the parliament.

What this does is, I think, give a clear intent to what we are attempting to do. Even more importantly, the bipartisan nature of the support of this bill should send a very clear message to all our public authorities about how seriously the parliament takes Treasurer's Instructions, whoever the Treasurer is, and making sure that there is good financial management in place.

With that, I again thank the shadow minister and members of the opposition for their support and their remarks. I thank the Department of Treasury and Finance for all their work in preparing this. Of course, I thank parliamentary counsel, the Crown Solicitor's Office and all those fine, hardworking public servants who worked so hard to bring the bill to the house.

Bill read a second time.