Economic and Finance Committee: Emergency Services Levy 2017-18

Mr ODENWALDER (Little Para) (11:44): I move:

That the 95^th report of the committee, entitled Emergency Services Levy 2017-18, be noted.

The Economic and Finance Committee has an annual statutory duty to inquire into, consider and report on the Treasurer's determinations in relation to the emergency services levy. The committee has 21 days to report on the written determinations after it is referred to the committee.

This year the committee received the Treasurer's statement on 30 May. The Emergency Services Funding Act requires the statement to include determinations in respect of the amount that needs to be raised by means of the levy to fund emergency services, the amounts to be expended for various kinds of emergency services and the extent to which the various parts of the state will benefit from the application of that amount.

Just so we are clear on the services funded by the emergency services levy, the definition given to the 'emergency service' in the act is very specific. It means a service provided by the South Australian Country Fire Service, the South Australian Metropolitan Fire Service, the South Australian State Emergency Service, Surf Life Saving South Australia, a member of Volunteer Marine Rescue SA or a service provided by South Australia Police related to, assisting with, or incidental to those organisations I have listed.

On 7 June, the Economic and Finance Committee held a public hearing. We invited representatives of the Department of Treasury and Finance, SAFECOM, the MFS, the CFS and the SES. These witnesses provided the committee with details on the proposed levy for the 2017-18 year. On 20 June, the committee tabled its report to meet the 21-day requirement. I would also like to take this opportunity to acknowledge the tremendous work that all our volunteer and paid emergency services responders do, which the community relies upon and for which we are extremely grateful.

In light of that, the committee notes that the total expenditure on emergency services for the 2016-17 financial year is estimated to reach $291.7 million, which is $2 million more than was originally projected, largely due to extraordinary costs associated with the extreme weather event in September 2016. The committee notes that the total expenditure on emergency services is projected to be $302 million in the 2017-18 financial year. This will be funded by the emergency services levy component of $291.5 million.

This target expenditure is $10.3 million higher than the 2016-17 estimated outcome. The committee was told that this reflects growth in base expenditure, funding provided for the enhancement of SES and MFS call response systems, the purchase of new protective clothing for MFS firefighters, and training delivered to Volunteer Marine Rescue members and SES volunteers.

The committee notes that there will be a decrease in the prescribed levy rate for owners of fixed property in the 2017-18 financial year, and 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 $22.3 million by 30 June this financial year.

The committee has fulfilled its obligations under the Emergency Services Funding Act 1998. I take this opportunity to thank the current members of the Economic and Finance Committee, departmental representatives from Treasury and Finance, the chief executive of SAFECOM and the chief officers of the MFS, the CFS and the SES who assisted the committee in reporting on the Treasurer's determinations. 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) (11:48): I rise to make a contribution on this report. As is customary, the opposition has agreed to note the report whilst reserving the right to discuss some of its contents.

I want to firstly break down the revenue side of the equation and then talk about the expenditure side of the equation in the second half of my contribution. We have seen huge increases in our ESL bills since 2014-15, when the removal of remissions saw an extra $90 million being levied against the people of South Australia. What we have seen since that time is a 2 to 3½ per cent increase in the ESL.

Essentially, what happened two years ago was we made an allowance to be recovered of about $7.5 million for the Sampson Flat bushfire. That bushfire happened six months before the end of the financial year, and that money was sought to be recovered. Last year, we saw the Pinery bushfire stripped out, and a separate increase of about $2.8 million to the ESL was sought specifically to cover that fire. But what was interesting to me was that even though we separated that amount and asked for the $2.8 million, which is less than the $7.5 million that was asked for the year before, we still had an effective increase of about 3.5 per cent.

But if we were to discount the fact that the Sampson Flat bushfire recovery was a one-off, we were essentially in real terms providing somewhere north of a 5 per cent increase to the ESL in the 2016-17 year. So, it was not surprising this year that we had a smaller increase. There was a small reduction in the rate, which was offset by an increase in property values, which essentially gave us a zero nominal total increase. Having said that, there were discussions about the floods and the costs that were associated with having firefighters and emergency services personnel come in from interstate to help fight that fire and the various associated costs. It was a separate incident, and a separate bucket of money was not sought outside of the normal ESL process.

We have seen ESL increases well above inflation. We have seen ESL increases with the removal of the remissions showing huge increases to the bills that people pay in their household, and that has an effect. It has an effect in the form of the number of people who are not able to pay their ESL bills. The most surprising statistic that we heard on the day was that there are now 21,000 people who have not paid their ESL bill at a total outstanding debt of $12.5 million. That is up from about $4.5 million to $5 million in the previous year. That is a huge increase.

In this place, we talk about the cost of living, about the pressure that families are under, and sometimes it can be an esoteric or abstract discussion. People can glibly say that there are people out there doing it tough. The ESL hearing this year brought home in a very real way the fact that we can number these people. There are 21,000 families out there who are struggling to pay their ESL bill; 21,000 families who have most likely prioritised paying their increased electricity bill, who most likely have prioritised paying their kids' school fees or putting food on the table. When it comes to this tax, even though interest will then be levied against that outstanding amount, people have chosen to pay for other things in order to keep the lights on in their household and put food on the table. These 21,000 families are sending a very clear signal to the government that they are struggling.

The fact that we have seen a threefold increase in the amount of outstanding debt speaks to the fact that this problem is getting worse. It is getting worse because people are paying more for utilities, whether they be water or electricity, and people are paying increased taxation. The ESL and the increases to council rates are probably two of the most significant examples. For me, this was a very clear opportunity to understand and make a connection to the very real problems that 21,000 families are telling us they face.

This is why we in the Liberal Party have a very clear position on how we are going to fix this problem, and that is to return to the average household $150. That is a significant commitment. It is going to be a significant commitment and a significant hit to the budget, but it will not lead to a decrease in the amount of funding for the emergency services agencies of $90 million. It will not.

When the government say that, they are flat out not being straight with the South Australian people because, when the remissions were removed in the first place, that did not lead to a $90 million increase in the amount of funding that emergency services got. That $90 million went to general revenue. The extra $90 million that South Australian households paid displaced government revenue that came from general government revenue coffers. So, when we reverse this decision and put that average $150 back into the South Australian household pocket, it will come from the same place, and that is from general revenue.

The government are out there trying to muddy the waters to try to confuse people into thinking that somehow the $90 million increase all went to emergency services—it did not, and I find the comments frustrating and, borderline, worse. They are probably as ill informed as they are offensive. This will be a clear point of difference between the Liberal Party and the Labor Party at the next election and it will provide two alternative views on how we look at taxation.

We have a higher taxing government that looks for ever-increasing ways to punish anyone who tries to own the Australian dream or a party that seeks to make it that bit easier to put food on the table, that bit easier to pay your ESL bill, that bit easier to get on with life. We know that putting that money back into the pockets of South Australians means that that money will flow through our economy and stimulate our economy, and that is why tax cuts are so important in the mix of any government: to try to stimulate growth within the economy. We know that stimulating growth is code for new jobs—something this government would like to learn something about when it talks about job budgets, whilst at the same time jacking up taxes.

On the spending side of the equation a lot of good and worthy work is being done. We heard that the MFS will be $2 million over budget this year, mainly because it has an ageing workforce, a higher workers compensation liability and plenty of blokes with long service leave and annual leave built up, and those liabilities weigh heavily on the department. It is something that no doubt they will have to deal with. We asked questions around the Mount Barker CFS and whether or not that would be switched to an MFS station. I put on the record now a concern that has been highlighted to me by a local lawyer from Mount Barker, Dan Cregan.

He has raised with me the issue of how we will deal with this transition from a CFS station, which is much loved by the community and which has performed a very professional service in a high growth area of our state for a long time, to an MFS station. No time lines were given and no understanding of how the process would work, but I put on record the fact that, if the government is going to switch (and there is a long-term goal by 2020-24 to put this in place and switch to MFS), those hardworking CFS volunteers, who have been doing this on a volunteer basis for many years, should be given the first opportunity to apply for those retained MFS positions.

Those people who were willing to give of their time voluntarily should be afforded the first opportunity to apply for those positions, and it is something I will push for as the shadow minister and something I know Dan Cregan, as a local community advocate, will be pushing for. I look forward to a sensible resolution on that issue as it transitions in time to come.

Mr DULUK (Davenport) (11:58): I know that I do not have a lot of time left on this report. I will make a few brief statements now and make some more at a future date. I would like to speak to the emergency services 2017-18 report, as provided to the Economic and Finance Committee. I am sure that in a future contribution the member for Elder would like to make some comments about the emergency services levy and the report as well.

Following on from the member for Schubert, on 7 June we had some hearings in regard to the ESL for the next 12 months, and it was an opportunity to get a bit of an indication of the priorities of the government in terms of ESL spending. We have seen the government make an announcement that in 2017-18 it is, essentially, going to return—

The DEPUTY SPEAKER: Are you going to seek leave to continue your remarks?

Mr DULUK: I seek leave to continue my remarks.

Leave granted; debate adjourned.