Statutes Amendment (Budget 2016) Bill

Second Reading

Adjourned debate on second reading.

(Continued from 7 July 2016.)

Ms CHAPMAN (Bragg—Deputy Leader of the Opposition) (17:11): I rise to speak on the Statutes Amendment (Budget 2016) Bill and indicate that the opposition will be consenting to this bill, consistent with precedent. It is a budget bill and, consistent with precedent, budget bills are not challenged in the normal manner of ordinary statutes. This is largely because of the precedent to recognise that the government has responsibility to make the ultimate decisions on how budgets are funded and expended.

Certainly on our side of the house, we are concerned about the implementation and effectiveness of a number of these proposals of the government, and I am going to deal with them in 10 areas of reform that are proposed in this bill. Can I start by saying, during the Treasurer's second reading of his budget for 2016, he described the budget as being some kind of miracle when he described some policies being those of God's work.

That prompted me to think at the time how all these new taxes and increased taxes might apply to Adam and Eve if the Treasurer actually had some responsibility for their making and/or application of what they might be in for in a Garden of Eden run by the Treasurer of South Australia. I cannot imagine that either Adam or Eve, or the apple, or the snake, would have escaped any of these taxes. They might have felt that they were in Purgatory rather than in a Garden of Eden. It is interesting to observe how these amendments to legislation are going to impact on South Australians.

Number one is the wagering tax proposal, an amendment to the Authorised Betting Operations Act 2000. Members would have already received considerable submissions from stakeholders in the community who have exposed, perhaps, the ill thought-out consequences of this legislation. Essentially, it introduces a 15 per cent tax on net wagering revenue, allowing for a threshold of $150,000 net wagering revenue per year being tax free.

As I understand it, this is essentially to capture those who would otherwise not be paying tax in enterprises that operate within South Australia but emanate from another jurisdiction. It will allow for a new licence class and will, of course, contribute moneys, they say, towards the Gamblers Rehabilitation Fund, as these funds are dedicated under statutory provisions, primarily to assist with problem gambling. That is, in itself, commendable but, again, it relieves the government of providing for services from its general revenue.

The second area is the amendments to the Education Act to introduce new fees for persons in South Australia under 457 visas—Temporary Work (Skilled) visas—to pay for their children to attend our public schools while they are working in South Australia. Remembering that people who are here on temporary work visas play a very important role in providing skills and are usually employed to provide those in areas where there is inadequate resource in South Australia, I asked the government to confirm what this would translate to in respect of those who would be liable to pay.

Essentially, it would make provision, as of 1 January next year, for families in this situation to pay $5,100 for each primary school student and $6,100 for each high school student. I assume that to be in addition to whatever fees the school was requiring them to pay, but these are moneys payable to the department towards, presumably, the cost of providing an education to these children.

We have a law in South Australia that provides for compulsory education, obviously, for certain age groups. These people are in our jurisdiction. We welcome them and their spouses and their children. Obviously, the family coming here brings a great economic benefit to the state, yet we are going to charge them for this privilege of attending our public schools.

The case studies provided indicate that, for somebody on a $58,000 income with four children, under a graduated scale, they would pay only $415.40, being 2 per cent of the maximum fee with no means test. On the other hand, somebody on a $70,000 annual income with four children, two in secondary school, two in primary, would pay $5,400 which is 26 per cent of the maximum fee payable if there was no means test, so quite a significant amount of money is expected to come in from these funds, providing about $5 million in revenue to the government.

Personally, I just indicate that I feel this is quite a retrograde step. It is not because we would not want people to make a contribution but, in one of the most disturbing aspects of our budget, I observe that nearly 5,000 more people left South Australia than came to South Australia last year. We know, when we see in the statistics that nearly 5,000 more people have left than have come here, how disturbing our immigration portrait is for South Australia.

The population consequences and the increased strength of the mature-aged in the spectrum are all issues of concern, not the least of which is the loss of the best and brightest amongst our youth, who leave the state. Making it difficult and costly for people who come here to provide skills in areas that we do not have in South Australia only encourages them to leave their children at home in their country of origin. I find that bizarre. Surely we want them to be here, love South Australia, like working here, encourage their children to come here with their spouses and apply to stay on.

Is this not the great immigration dream that we want to achieve in South Australia? Let's face it, for the last 30 or 40 years in South Australia, if we had not had overseas immigration in our state we would have perished in the desert. We actually need people coming to South Australia. Our birth rate is low and our death rate is high. Of course, as the baby boomers move through that spectrum—we all know that is not unexpected, but we do rely on overseas migration, especially with the exodus of our people leaving the state to live in other states. I find this to be a foolish decision on behalf of the government. It is a very short-term gain and it is very disappointing.

Thirdly, we have the Environment Protection Act amendments, which are essentially to change the title of the Zero Waste SA Act to the green industries act. That, together with the 10^th element of this bill, which is the provision for amending the Zero Waste SA Act to allow the formation of the Office of Green Industries SA as a replacing statutory authority to Zero Waste, are designed to introduce a broader definition of application of the funds that are charged. As we know from the provision for a very substantial increase in the solid waste levy, which does not require this legislation but is done by regulation—I think the doubling of that levy. It is a massive amount of money that is going to be injected to facilitate this proposal.

What has happened here is that, in addition to renaming the Waste to Resources Fund, which is where the levy under this procedure is destined, it will go to the Green Energy Fund instead. However, this fund is going to have two very important areas of expansion. The first is that it can be for projects to deal with climate change and the second is to deal with disaster recovery measures. I notice the government's first initiative is to deal with climate change initiatives within the CBD of Adelaide. I do not know about you, but sea level seems to be one of the most important issues and I am a bit surprised that is only going to be dealt with in Adelaide, seeing that I think we are the state with the longest coastline in the country outside of Western Australia, yet we are not allowing this first lick of money to be allocated outside the CBD.

The second initiative is to meet the cost of disaster recovery measures. I will have some questions for the Treasurer in due course about how that money is going to be applied: for flooding, bushfires, damage to property, loss of stock, other areas of disaster that might deal with collapse of buildings in an earthquake, the invasion of a disease to South Australia—we have had bird flu and other scares. All these disaster situations do come from time to time and they are very expensive, especially bushfires in South Australia.

Is the government just going to rape this fund to enable it to prop up its own costs in respect of disaster provision, which is currently done through contingency funds in other departments? I would like some answers to that because it seems to me that people pay their solid waste levy through their councils and other collection agencies in good faith that it is going to be applied for the purposes of recycling and ensuring that our waste disposal is minimised to landfill, etc.—all those good initiatives.

It seems to me that this is a pure cost-shifting exercise of the expenses of government through their normal departmental obligations. They are now going to be raping this fund, which has a lot of money in it I might say. I think about $89 million is sitting in this fund, of which less than that has been paid out over the last 13 years.

I am not happy that they are even continuing to charge this while they have so much money in the fund and that they are going to double it and then rape it for its own benefit. I would like to know, and I think it is reasonable that we should know in the parliament, whether the government is going to use this, make it available to entities such as Renewal SA, as part of joint venture developments, like the new initiatives recently announced at Port Adelaide for two property housing developments and one soil remediation program at the Cruickshank area.

Is the flood mitigation in the Port River to be taken into account? Is that going to give an excuse or a hook upon which Renewal SA can come along and say that they want $10 million out of this fund to be able to deal with flood mitigation because it is a climate change issue, or give some other excuse to be able to raid the money? These are the sorts of questions we should have answered from the government, and we need to have them in response to this bill.

If for whatever reason it turns out that we are not going into committee on this bill today, I am happy for the Treasurer to get some answers for the parliament, or at least to make them available prior to the consideration of this matter in another place. Can I move to the fourth initiative, that is, amendments to land tax. At first blush, I thought this was a very generous matter, allowing for non-vacant land and non-residential land owned by sporting and racing associations to be exempt from land tax. It turns out it does not apply to very many across the state.

I was thinking that all those sporting associations with ovals might get relief, but a lot of them do not pay land tax anyway. It does relate, however, to areas where they might have a facility and just down the road they have another clubroom or the like, on which they do pay land tax. It is to remove any provision there. There are two years land tax free for those who might be leaving their property and rebuilding their principal place of residence—in other words, during a time of major renovation. It is reasonable that that issue should be cleared up; I think it has been unreasonable to expect people to pay it during that time.

Personally, I think it is still an unreasonable expectation that for people who have to leave South Australia or go to a country area to get work—and who have a principal place of residence in Ceduna, but who have to come to Adelaide to get a job or vice versa, which may not be immediately rentable or tenantable so that they can recover some money on it—land tax applies because they have vacated the property as they have had to chase work somewhere else.

I think that it is time that the land tax matters be reviewed, as the Liberal Party had previously proposed on a number of occasions, including to consider whether we should have a property—a property being identified as the first property—as such identified by the owner as being land tax exempt, even if the party was not living in it at that time. The structure of our land tax law at present is very much focused on recovering money, and I thank every day former premier David Tonkin for introducing the provision for land tax exemption on the principal place of residence. That is something we have to help housing in this state.

The fifth issue is the provision under the Mining Act and Petroleum and Geothermal Energy Act 2000, and this relates to royalties. Under the law at present, the royalties, which is the tax paid by mining companies to the government, is the responsibility of the Minister for Mining Resources and Energy. Presumably, he presents to the cabinet his recommendations in respect of this. A lot of it is bound by statute and, of course, on top of that we have indentures, for example, dealing with Roxby Downs and large operations such as Santos, which is now a publicly listed company with no restrictions on it, that have special indentures of this parliament. So, it is highly regulated anyway.

This amendment is designed to make the Treasurer the person who is responsible for determining the royalties. Ironically enough, it is still to be in consultation with whomever is the Minister for Mineral Resources and Energy. As I understand it from the briefing provided, cabinet would still make the final determination on these. I am curious about why this is necessary. I am particularly curious as to how it is going to work, given that in the current government the Treasurer and the Minister for Mineral Resources and Energy is the same person.

Obviously, he is not going to be responsible for royalties as Treasurer, then consult with himself as the Minister for Mineral Resources and Energy and say, 'Well, this is what I've decided. I'm now telling myself what I've decided, and I am then going to advise myself in consultation on what I should do about it.' Obviously, that is patently absurd. It was concerning to me that no-one came along from the briefing to deal with questions on this other than an adviser to the Treasurer's office.

In all seriousness, we do need to know in these circumstances whether in fact it is the intention of the government, or a requirement under the practices of cabinet, that in those circumstances a person needs to be appointed as an acting mineral resources and energy minister and that during the course of the consultation on this matter they can independently advise from the department of mining, mineral resources, etc., the Treasurer.

Treasurers obviously wear a different hat. They have a different role, they have a different responsibility. They are not always well liked by other ministers because, of course, to some degree they are the keeper of the money and they exert a fair bit of pressure. I am concerned to some degree that this is going to be a transfer of responsibility. Certainly, the Treasurer and Treasury ought to be available to cabinet and indeed to these ministers to give advice on the consequences of certain initiatives, the modelling that has been undertaken and the like.

Ultimately, ministers, whether they are ministers for health, mining or anything else, need to take responsibility and keep on taking responsibility for the costs they might recommend be incurred within their departments, and Treasury is there to provide advice on the operational matters. I am not happy about this type of transfer. What I do say, though, is that the Treasurer, especially as he is a minister promoting this bill and also happens to be the Minister for Mineral Resources and Energy, should give some explanation of how that is going to operate.

The sixth matter is the Passenger Transport Act amendments to introduce a $1 taxi levy. Much has been in the public arena about that matter. Obviously, it has some detractors as to how that will operate and what financial consequence it will have on others. I do not think it is necessary to make any further comment. The seventh matter is to amend the Real Property Act 1886. This will provide for the Registrar-General and deputies of the Registrar-General and, as is described by the Treasurer, other officers to be Public Service employees; in fact, it is to be the Registrar-General and the deputies.

The rest of the people who are employed at the Lands Titles Office, or the Land Services division, are not going to have the same protection, in the sense that they can be in anyone's position. Clearly, this is designed to accommodate what the government intends to do, that is, to commercialise the land services group. In fact, the Treasurer admits it when he says that these amendments will allow the government, if it makes commercial sense, to commercialise some of the transactional services currently provided by the land services group.

I simply make this point: if it was not already decided by the government to sell this, why do they need to pass this legislation at this point? Answer: because they do intend to sell it. Clearly, they intend to sell it. Clearly, they have done the work on the modelling to identify that. The Treasurer has consistently come into the chamber, in response to questions on this, and made it clear that other jurisdictions are considering it and that it is a good idea. Just as he has done with the Motor Accident Commission, this is going to be flogged off. The only sacred cows in this whole organisation are the people at the top—they have to remain as Public Service personnel.

There is an amendment to be introduced in respect of delegation powers, which otherwise under this bill are far too wide, to ensure three things: first, that the indefeasibility of title of registered proprietors is not to be affected by this restructuring; secondly, the exclusive power of the Governor to prescribe fees or charges payable in respect of matters under this act; and, thirdly, the operation of the scheme for compensation is essentially protected.

That helps because, as I am sure others would have, I read with horror the delegation powers that were otherwise drafted in this bill, but the government seems to be quite happy to dispose of this asset without adequate protection. Caught out, they seemed to be prepared at least to introduce some modicum of protection. They were prepared to go down a whole list of protective measures in dealing with the MAC legislation when they were forced to go through a statutory path and to be able to promise to South Australians that in selling off the insurance stream from the Motor Accident Commission they would protect certain things, including privacy of data and the like, and yet they were prepared to try to sneak this through, I suggest, without that sort of protection.

Eighth is the amendment to the Stamp Duties Act which allows for some extension to a statewide eligibility for off-the-plan projects on which there are contracts, and I think that is a good initiative; certainly industry has been calling for it for a long time. There seemed to be no rhyme or reason for giving preference on this to a limited geographical area, favouring an area, I note, within Adelaide, of assets owned by the government and/or Renewal SA, and so I have always been sceptical about why this was restricted, but at least they have finally agreed to expand it.

There is a variation to deal with tidying up in relation to some technical matters on charitable issues and also to deal with removing stamp duty to certain specified goods or classes of goods under prescribed goods. It will be a bit more of a streamlined process and that seems to be sensible. The government has been a bit slow in coming to attend to this, but we welcome it.

Finally, is the ninth matter, that is, changing the obligations or trying to make it clearer what obligations there are of a taxpayer in what they have to pay pending an appeal on a dispute of a primary tax matter. The statutes are to be amended to make it clear that only 50 per cent of the primary tax in dispute before the appeal can be lodged, as opposed to 50 per cent of the whole of the amount of the tax assessed, inclusive of interest and penalty tax, so hopefully that will make it clearer. The 10^th matter I have already dealt with in item 3 in respect of the green industries measure. With that, I hope that the Treasurer will turn his mind to some answers and not rush to give us further bills that will further destroy the Garden of Eden.

Debate adjourned on motion of Hon. T.R. Kenyon.