House of Assembly Fifty-Third Parliament, Second Session (53-2) 53 2 Parliament of South Australia House of Assembly published Grievance Debate Grievance Debate State Budget State Budget Mr KNOLL House of Assembly Schubert Mr KNOLL (Schubert) (15:22): I rise today to talk about the budget process that I have been witness to as a new member of parliament over the first year of my time in this place. May I say first and foremost that as a conservative I believe fundamentally in the institutions of our government. I have a strong respect and a strong faith in documents that the government puts forth and the process by which government goes through to let the people of South Australia know what is going on, especially when it comes to their money and especially when it comes to the treasury and finance department. Last year was my first opportunity to be part of a budget process and to see the excitement that goes on with budget day. There is quite a lot of hype when it comes to the budget release. There is the tense waiting in our offices during the morning, then the journalists all in the lock-up having pizza and full-strength Coke and quizzing the government on its figures and numbers and, in this case, basically an extended repartee on all that is wrong with the federal government without actually detailing any issues that the state government has with its own finances. Then, as an opposition, we get a singular copy of this budget which is then madly photocopied and madly given to shadow ministers to see what it means for their portfolios. Then we come down to the chamber to listen to the speech. At this time can I thank the work of the attendants and the muscular strength they must have in order to be able to deliver these hefty tomes to each member, as we sit here: these beautiful piles of blue books which have become very good friends of mine over the past seven or eight months, as I read through them page by page to delve into the wonderful detail that is the state budget. Very much this budget, in returning to surplus after years and years of deficits, is relying on a taxation revenue-led recovery. It contemplates a 6.9 per cent nominal growth in payroll tax; 14 per cent nominal growth in conveyance duty; 3.9 per cent in gambling taxes; and 6.5 per cent in motor vehicle taxes. I thought, 'Okay, those figures seem quite high; any business would love to have those growth figures.' But let's go down the process—and I trust that the government, having delivered a budget over the life of South Australia's history, should be able to get these things right. But then I read with interest the South Australian Centre for Economic Studies report, which contradicts the Treasury's forecast on gross state product: the government says that 2¼ per cent will be the gross state product growth, yet the Centre for Economic Studies contemplates only 1½ per cent growth. But, again, I thought that I would give them the benefit of doubt. Then we move onto the Attorney-General's Report and Moody's comments that it noted that the state is counting on conveyance duties and payroll tax rising annually to drive annual rises in revenues through to 2017-18, which could be optimistic. I thought, 'Okay. Those words are a little bit cautious,' but I understand that a little bit optimistic may give rise to the fact that these revenue figures could be a little bit heroic in their assumption. Then I went to the Economic and Finance Committee report, where the wonderful member for Bright asked questions on this same topic, and the now retiring Mr O'Neill (and I thank him for his wonderful service to South Australia) contemplated these figures. He said: That's against the background of the global financial crisis, but it is also against the background of the ongoing global economic uncertainty, and budget policy dimensions and decisions for revenue and expense management as a component of management and responsibility by governments in terms of setting revenue targets… If anyone understands what that means, they are a smarter person than I—but I think that it is his way of saying that these figures could be a little bit optimistic. Then, lo and behold, we get to the Mid-Year Budget Review, a much thinner document, and we see the fact that payroll tax has been written down by $25 million, that conveyances have been written down by $39 million, gambling tax by $10 million, land tax by $10 million—for an overall writedown in taxation revenue of $84 million. I do not want to be cynical—I am too young to be cynical—but in this place I am so often given examples to be cynical. When it seems that so many people were able to predict the fact that the assumptions in the budget were a little bit heroic, that everybody could do it, except for the government itself. Can I say that, on this point, my faith in this institution has been dented, and that is an unfortunate reality.