Economic and Finance Committee: Emergency Services Levy 2016-17

Mr ODENWALDER (Little Para) (12:46): I move:

That the 90^th report of the Economic and Finance Committee, entitled Emergency Services Levy 2016-17, be noted.

The Economic and Finance Committee has an annual statutory duty to inquire into, to consider and report on the Treasurer's determinations in relation to the emergency services levy. The committee has 21 days in which to report on the written determinations after it is referred to the committee. This year the committee received the Treasurer's statement on 20 May and, as required by the Emergency Services Funding Act, the statement included determinations in respect of:

(a) the amount in the minister's opinion that needs to be raised by means of the levy to fund the emergency services;

(b) the amounts to be expended for various kinds of emergency services; and

(c) as far as practicable, the extent to which the various parts of the state will benefit from the application of that amount.

On 30 May, the Economic and Finance Committee held a public hearing and invited representatives from the Department of Treasury and Finance, SAFECOM, the Metropolitan Fire Service, the Country Fire Service and the State Emergency Services.

The Hon. P. Caica: Cast of thousands.

Mr ODENWALDER: There was a cast of thousands, and the witnesses provided the committee with details on the proposed levy for the 2016-17 year. I take the opportunity to thank the member for Colton for his excellent stewardship in my absence.

The Hon. P. Caica: Do I get higher duties?

Mr ODENWALDER: You do not get higher duties, but you get my moral support for the next 24 hours. So, on 7 June the committee tabled its report to meet the 21-day requirement. I take this opportunity to put on the record what a courageous job our volunteers and paid firefighters do, which the member for Colton again knows well—we are extremely grateful. The 2015 Pinery bushfire, which tore through Pinery and the surrounding areas with frightening speed and ferocity, was a recent reminder of the dangerous and selfless work that these firefighters undertake.

In light of that, the committee notes that the total expenditure on emergency services for the 2015-16 financial year is estimated to reach $282.2 million, which is $4 million more than was originally projected, largely due to costs incurred in the response to the 2015 Pinery bushfire. The committee notes that the total expenditure on emergency services is projected to be $289.6 million in the 2016-17 financial year. This will be funded by the emergency services levy component of $287.7 million, and other minor revenues to the fund. This target expenditure is $7.3 million higher than the 2015-16 estimation. The committee was told that this reflects costs of retrofitting safety systems to fire trucks, replacing CFS fire trucks, enhancing South Australia's flood response and incident management capabilities for the SES, and increased training for CFS and SES volunteers.

The total funding target for the emergency services levy has been set at $292.4 million in the 2016-17 financial year, which includes the projected expenditure on emergency services and $2.8 million to the Community Emergency Services Fund to recover costs associated with the 2015 Pinery bushfire. The committee notes that there will be a decrease in the prescribed levy rate for owners of fixed property in the 2016-17 financial year and that the effective levy rate remains unchanged for eligible concession holders. The committee also notes that cash balances in the Community Emergency Services Fund are expected to be $13.7 million by 30 June 2016.

The committee has fulfilled its obligations under the Emergency Services Funding Act. I take this opportunity to thank again the member for Colton for chairing the hearing, all the other current members of the Economic and Finance Committee, and the departmental representatives and the chief officers of the MFS, CFS and SES who assisted the committee. I want to thank our staff—our outgoing executive officer, Kendall Crowe; our research officer, Gordon Elsey; and our current executive officer, Lisa Baxter—for all their assistance. Therefore, pursuant to section 6 of the Parliamentary Committees Act 1991, the Economic and Finance Committee recommends to parliament that it note this report.

Mr KNOLL (Schubert) (12:51): Can I firstly in rising put on record my thanks to the CFS, MFS and SES, the police, community groups and anyone who had any involvement over the past three years, in the past three fire seasons, in the Barossa Valley, Lower Mid North and Adelaide Plains sections of our state. I have been a member of parliament now for just over two years and it is pretty sad that we have seen three very significant fires tackle different parts of my electorate.

We started off, before I was even elected, in early 2014 with the Eden Valley fires, but we also had the Rockleigh fire and the Krondorf fire. In fact, the Krondorf fire was a small fire, we think as a result of a lightning strike on the hillside at Krondorf, not long before the Eden Valley fires started. That was a bit of a wake-up call for everybody to get ready for the pending fire season. Post that, we saw days of grass fires tackling huge areas and affecting quite a number of properties, especially down the Jutland Road-Rhine Park Road end of Eden Valley.

We then move on to 2015, when we saw the Sampson Flat bushfire rage for many days and wreak havoc. I think about 30 or 40 houses were lost. Luckily enough, in that instance no loss of life occurred. It wreaked huge havoc on the southern part of my electorate and indeed threatened the homes of my uncle and my grandfather, who were able to tell me firsthand some of the experiences that I would be hearing from other members of my electorate. It was the good work of the agencies that helped to save both of their properties.

Then we move on to 25 November 2015, when catastrophic fire conditions turned into a fire that has since been found to have broken every single fire map model that has ever existed. Fires are not supposed to be able to move that quickly, but they did. The Pinery fire was really only the one afternoon from about lunchtime. It really hit my end of the electorate at about 3 o'clock in the afternoon and by about 8 o'clock the forward advance of the fire front had stopped.

Having now lived, especially as an MP, through these three major fire events, to see how the services have grown and improved the way that they operate is extremely commendable, especially in relation to communication, or attempted communication. When the mobile phone tower is shut down, I am not sure what it is we are supposed to do in terms of communication—I suppose rely on the Government Radio Network, but certainly that creates difficulties for members of the public. We really did see an improvement also in traffic management and access to people's properties.

I want to put on the record my thanks to the three services, especially, as well as the police and everyone else involved for the way they dealt with it. It certainly did provide better outcomes for people, even after we take into account the tragedy of the loss of the lives of two people and also the 80 to 90 houses that were lost. I also want to place on the record my thanks to Greg Crossman, Mr Nettleton and Mr Beattie from their respective services for their work.

On this side of the house, we realise that, when governments waste money—and I know this is a bugbear of mine—there is less to spend on front-line services. That means that, potentially, less money is spent on equipping our SES, CFS and MFS to do the work they do which is so valuable and which has genuinely saved houses and lives in my community. I found some of the things that came out at the hearing on the ESL a couple of weeks ago extremely frustrating.

The first thing that frustrates me is the fact that the government came out trying to tell us that the increase to the emergency services levy was only 1½ per cent this year. Technically, they are correct but, in actuality, they have taken the $7½ million one-off Sampson Flat fire cost recovery from last year and, essentially, annualised it. Instead of taking off that $7½ million to create the new baseline and work up from there, they basically absorbed that $7½ million, which was supposed to be a one-off, turned it into the new baseline, then set the increase from there and asked for their $2.8 million for the Pinery bushfire on top of that.

If there is a significant fire event in this state, the state government will charge people—and rightly so—for that fire the following year to recoup that money, but what South Australians do not realise and need to realise is that they will continue to pay for that fire every single year after that. You do not just pay it once. You pay for it in the first year after the fire event. Then you pay for it every single year after that and it is used as a new baseline from which fees will continue to go up and up. So, it is not a 1½ per cent increase: it is a 4 per cent increase, and South Australians should be very aware of that.

I think that if all that money went to front-line services, the people of South Australia would be happy with that. Indeed, I think that is what they think happens, but it does not. The money goes towards bureaucracy and those types of things and also towards failed reform processes which end up costing money which comes out of the ESL. The bill for this reform process continues to rise. In last year's hearing, we heard about the $550,000 in staff. Earlier this year, we heard about a $300,000 redundancy payment to the MFS chief, Grant Lupton, who was promptly replaced two weeks later. In this year's hearing, we hear that Mr Crossman was made permanent in September and I think it is a great appointment. Certainly, there is nothing wrong with that.

We also hear that the initial review by Ernst & Young comes and goes and is rejected. Because of this botched reform process, we have to have another report to review the review, costing $120,000. Then, for the month of June last year, a reform unit sat there doing nothing. That office costs $535,000 a year and sitting there for a month cost $44,000 while the government had to decide what it wanted to continue to do in the area of emergency services reform.

Now, the 2021-25 strategy is going ahead. I hope that it actually achieves some results, although we understand that quantifying the savings of the virtually co-located agencies—well, we will wait and see what that says. Interestingly, when Mr Jackman was asked by Mr Speirs, 'So, it's safer to leave the staff there?'—and by 'there' he meant by keeping them in agencies—in trying to defend the bureaucracy, Mr Jackman's answer was:

I don't think you need to be that clever to work out that bodies inside government that are predominantly administrative by nature are under a lot more financial and fiscal examination than organisations where people wear a uniform and have high degrees of public visibility and are seen by the public as absolutely delivering what they want. I suspect the three gentlemen on my left in their uniforms are far safer than a black-suited bureaucrat.

I seek leave to continue my remarks.

Leave granted; debate adjourned.

Sitting suspended from 13:00 to 14:00