Motions

State Budget

Debate resumed.

The Hon. J.W. WEATHERILL (Cheltenham—Premier) (14:06): The circumstances that South Australia is faced with at the moment demand strong leadership, leadership that takes charge of our own future, not meekly accepting the international and market forces that are washing over our state but, rather, strong leadership that maps out a future direction for our state's economy. This is no less than our families, our children and our communities are asking of us. This is the question on everybody's lips.

The old certainties of life are changing and people want to know what the future looks like for themselves and their families. Fundamentally, they want to know which jobs they are going to be able to get. They want to know which businesses they should be investing in. They want to know what skills their children should be acquiring to permit themselves to participate in this future. I can remember a time seeing some statistics where in western Adelaide one in five people was employed in the car manufacturing sector. My uncle was employed in the car manufacturing sector—

An honourable member interjecting:

The SPEAKER: The member for Unley.

The Hon. J.W. WEATHERILL: —and my mother was employed in the car components sector. This was a story that many South Australians could say about their connection with this industry. It was not just western Adelaide; it cascaded through the whole of the South Australian economy. Much has changed, of course, in the period since the 1950s when those statistics were true and the diversification of the South Australian economy has been well underway.

The internationalisation of the South Australian economy, and indeed the national economy, beginning in 1975 with the unwinding of tariffs, accelerating very suddenly in the mid-eighties through the internationalisation of the South Australian and Australian economies with the great opening up reforms of the Hawke-Keating governments, have accelerated and made changes to the old Playford model. The old verities are gone. The idea of cheap land, cheap power and cheap labour, all behind large tariff walls that protected local indigenous industries, are gone. They are washed away and they are gone forever.

The question becomes: do we stand up as a community and as a government and take charge of our own future, or do we just leave ourselves to the market? This was the choice confronting this government and we decided to seize control of our own future. That is why we stepped up and have put in place a budget which has at its heart jobs for the future of our South Australian community. We have mapped out a plan which has been carefully crafted by a cabinet that has the public policy intelligence to craft those policies and by a party that believes it is the role of government to step up and invest and create jobs in partnership with the private sector.

Strong leadership, competent government and a party that understands its values, these are the centrepieces of what we are putting forward to the South Australian community, and the budget sits at the heart of that strategy. The budget lays down a future fund—$200 million to invest in these fast-growing sectors of the South Australian economy: shipbuilding and defence; renewable energy and mining; tourism, food and wine; health and medical research; and the advanced manufacturing and IT sectors.

What we have established are some magnificent icons which we have invested in as a government in each of those sectors. The first, Techport down at Port Adelaide: the only reason that exists is because a Labor government put it there. The Tonsley precinct: reimagining an IT and an advanced manufacturing future from the ashes of a car industry, an industry rising up from those ashes and an investment to create jobs and opportunities in the car manufacturing industry.

And then one of the most magnificent expressions of values that this Labor government could ever project to the nation and the world—our biomedical precinct. When you come to this state and you see that magnificent building, you see that magnificent South Australian Health and Medical Research Institute building, an icon of health and medical research—

Mr Duluk interjecting:

The SPEAKER: The member for Davenport is called to order.

The Hon. J.W. WEATHERILL: —it projects to the nation and to the world the values of this community. Health and wellbeing count. These are things that are important to us, and we understand the jobs and opportunities that swing from those things.

We also continue to invest in the infrastructure which is necessary to grow some of our old traditional industries that have a new and important future in this international marketplace—our food industry; our wine industry; our tourism sector, which is so inextricably linked with the identity of our beautiful state; our investments in the northern irrigation zone area to open up the literally thousands of hectares of new irrigated land to allow us to grow our food sector to sell our premium product grown in clean water, clean air and in a beautiful clean environment; and premium products exported to the world and a food park which will allow our manufacturing industry to move into those businesses to actually create opportunities and expand, being landlocked in the suburbs as they are at the moment.

Finally, we see the magnificent investment in Our Energy Plan, taking one of the most perplexing issues that is facing our planet and in a clear-sighted way anticipating a carbon-constrained future and realising that the opportunities that exist to first movers who actually are able to unlock the future for renewable energy. Renewable energy is the future for our energy production. While those opposite sit there and cheer those who hand around lumps of coal in the federal parliament, we have clearly seen the future and are investing in a renewable energy future. Mark my words: we will be celebrating South Australia as not only having the cleanest energy and the most reliable form of energy but also the cheapest energy in the nation off the back of our investments in renewable energy. Watch this space, ladies and gentlemen.

These investments that we have made in the state budget have been needed to be funded through sensible measures to raise revenue because we believe that it is appropriate to be delivering sound financial management, so we have presented a series of revenue measures in the budget, the central of which are being opposed by those opposite. But I do not hear them complaining about any of our expenditure initiatives. They do not complain about our expenditure initiatives; they just complain about one of our revenue initiatives imposed on the big banks.

There is an absurdity about this proposition, 'Yes, we are happy to take your expenditure but, when it comes to revenue, we have been worked over by the big banks and we have decided to take that off.' What that effectively means, because they are happy with our expenditure but have deprived us of our revenue, is that that shortfall will now be borne by the people of South Australia. There is no way of actually adding this up that does not lead to that ultimate conclusion. This money does not disappear—

Ms Sanderson interjecting:

The SPEAKER: If the member for Adelaide interjects again, she will be named.

The Hon. J.W. WEATHERILL: This money does not disappear from the budget and those opposite are not seeking to deprive us of the capacity to spend it. They just want to complain about our capacity to meet the revenues necessary to cover it. So what they are expecting is that that should fall on every single South Australian. The deficit that is real, through their conduct, falls on every single South Australian. There is a choice between the big banks or ordinary South Australians, and they chose the big banks.

What do we get out of these public investments, the investment in the food park and also the irrigation precinct in the north of our state? This is an incredibly important investment: $7 million to the Food Business Attraction Fund is now available to help businesses looking to relocate into this precinct, a bureau service allowing them to share services together. Many of them are in our suburbs, often in the north and north-eastern suburbs, beautiful food manufacturing businesses that have grown over time, but because they are in suburban areas they are now landlocked. They are having trouble with food waste, they are having trouble getting their trucks into the back suburban streets; they need to expand but they do not have the capacity to do that.

That is why we have created the food park. Applications opened on 4 July, just yesterday, and there are currently four well-known and reputable South Australian companies that are already in negotiations with us to move into the food park. This is what South Australians want to do. They want to grow their businesses and we are prepared to work with them to achieve that.

With the investment in the South Australian Health and Medical Research Institute, we are going to have the Southern Hemisphere's only proton therapy unit. There is a beautiful symmetry between the technology that the Bragg's, the father and son team created, which led to the creation of the X-ray and ultimately the proton therapy unit, discovered here in Adelaide for which they won a Nobel Prize, now returning to this state so that we can cure the diseases that exist not only in this state but in the nation and around the world. Here in South Australia—the intellectual capital and resources that gave us the proton therapy unit were born here in this state. We are going to use those skills and capacities, together with government investments, to create the jobs of the future.

This is a consistent pattern of this government, taking the intelligence, the skills, the capacities of our citizens, not going meekly into the night or allowing the invisible hand of competition to somehow rescue this state, or cuddling up to the banks and somehow hoping they might run to our rescue. No, we are taking charge of our own future. That is why we are investing in jobs in this budget, and that is why we are asking for a modest contribution from the five big banks to help us do it.

Members interjecting:

The SPEAKER: Before the leader starts, I call to order the members for Finniss, Mount Gambier, Mitchell, Kavel, MacKillop, Hammond, Chaffey, Unley, Stuart, Newland, Morialta and the leader. I warn for the first time the members for Adelaide, Mount Gambier, Hammond, Stuart, Unley and MacKillop. I warn for the second and final time the members for Adelaide, Mount Gambier and Unley. Leader.

Mr MARSHALL (Dunstan—Leader of the Opposition) (14:18): I indicate that I would like to amend the motion. I move:

After 'That this house'—delete all words and replace with:

'has no confidence in the ability of this government to create jobs, noting:

1. This is Labor's third consecutive 'jobs budget';

2. South Australia has had the nation's highest trend unemployment for 30 consecutive months; and

3. Introducing a new state bank tax is not the way to turn around the state's jobs crisis.'

We have just had the Premier saying in this parliament that what we need to do here in South Australia is seize control of the problems that exist in South Australia and not let the private sector have anything whatsoever to do with these solutions, that government is the only solution.

I think this really makes very clear the difference between those opposite and those of us on this side of the house who believe in the people of this state, the capacity of the people of this state to get on and to help make this state reach its full potential. We on this side of the house believe that the way to do that is to get government out of the way, especially this government, the worst government in this state's history.

I make this point to the house. From time to time, genuine headwinds come before a government, genuine headwinds come before a state, but never before in the history of this state have we had so many headwinds and burdens inflicted upon a state by the government that is in office. That is what we have after 16 years of failed, divided and dysfunctional administration in this state.

Let me tell you what the government promised. They promised that we were going to have a jobs budget. We agreed this was a pretty good idea, and I will tell you why we thought it was a good idea—because we have had the highest trend unemployment rate in the nation not for one, two, three, four or five months in a row, not for 10 months in a row, not for 20 months in a row, but for 30 consecutive months. This is outrageous! This is what you get when you elect a Labor government here in South Australia.

So we were pleased when the government said, 'Let's have a genuine jobs budget.' Then, of course, we were disappointed when the budget was handed down because was it a jobs budget? No way—no way whatsoever. The centre point was $200 million, yet when we look at the fine detail very little of it was new money. There were very few new initiatives. Apart from what they were offering to trainees and apprenticeships, most of it was just a continuation of the policy settings that they have had in place while they have been presiding over this jobs crisis that now faces the people of South Australia.

If you want to know why we think it was a very poor jobs budget, it is contained within the budget itself. In fact, Treasury tells us unequivocally that we have the lowest jobs forecast, the lowest jobs creation forecast in the nation. That is the outcome of their third successive jobs budget for South Australia: to be the worst in the country, half Victoria and well behind Tasmania. Of course, we read with very great interest on Monday this week, just a week after the budget was handed down, that the South Australian Centre for Economic Studies—an independent think group—said they do not even think that we will get to the position that the government themselves have put forward. So, there you go.

This is not a jobs budget, but I will tell you what it is: it is a tax budget—$200 million worth of jobs initiatives, $400 million worth of new taxes heaped upon the productive component of this economy, heaped upon the mums and dads of this state. Not one person is exempt from the Treasurer's cash grab. Every mum and dad who has a deposit in a bank, every mum and dad or family who have a mortgage on their family home, every kid who is putting money into their bank account at school every single week, trying to build up that nest egg, is going to be hit. The cost of servicing our state debt is going to blow out, but I will tell you the real problem.

For superannuants in South Australia, investment share prices have gone down, and their dividends are going to further deteriorate because this government has created a situation where there is greater risk here in South Australia. It is not a jobs budget, it is a tax budget, and let me tell you the reason why. If we look at the detail of this budget in Budget Paper 3, page 14—look it up while you have some time—it shows the projection of state-based taxation revenue, and what does it show? Does it show a picture of the state performing like the Premier has just encouraged us all to think—a growing vibrant economy? No it does not.

I will tell you what it shows. It shows that payroll tax receipts are forecast to go down. Stamp duty tax receipts are forecast to go down. Payroll tax, stamp duty and land tax are all forecast to go down. That is because our economy in South Australia has ground to a halt. There is a $438 million write-down in land tax, stamp duty and payroll receipts in this budget compared to the budget that was handed down just 12 months ago.

Members interjecting:

The SPEAKER: The member for Newland is warned.

Mr MARSHALL: Of course, a massive black hole has now been created. How did they decide to deal with this? It has been created because the private sector in South Australia has given up confidence in this government. They are no longer investing in South Australia. The only entity that has any money to spend in this state is the Labor government. In the private sector there has been a crisis of confidence. In fact, over the five years that this Premier has been in this place, since he knifed his predecessor, South Australia has averaged an economic growth rate of just 1.4 per cent—half the national growth, a fraction of the fast-growing states in Australia—and that is the problem. Our economy has slowed and our state-based taxation revenue forecast has gone through the floor.

When your economy slows and the consequence of that is that your state-based taxation revenue slows, what do you think the logical response would be? We would say that the logical response would be to provide some stimulus, provide something that is going to give the private sector and households some encouragement to go out and spend. We said, 'Let's put $360 million back into the economy.' What did they do? They took $370 million out of the economy, because they are addicted to taxes and they are addicted to spending. They think they are the only game in town and the simple fact of the matter is they have been in government for 16 years and we can all see the consequences of a bad government for this state.

This government has not only failed the people of South Australia in terms of the economy but they have also failed the people in terms of their energy policy, their taxation settings and the regulatory burden that they put on every single business and every single household in South Australia. They thought that this new tax grab, this $370 million hit to the people of South Australia, was going to be enormously popular. They thought this was going to be a fantastic idea. They thought they would take a swing at the banks, but they missed and they hit the people that they, on that side of the house, are pretending to protect. They have hit the people of South Australia. The people of South Australia have woken up to the spin that has been coming from that side of the house for an extended period of time.

I think the people of South Australia are very smart; I think they are very savvy. I think that they can tell when they are being conned. The government would have you believe that there are no consequences whatsoever of having a go at the banks. But do you know what the people of South Australia have told us? They have told us that there is not one person in this state who really believes that the banks are going to pay the bank levy. They believe that the people of South Australia—mums, dads, kids, grandparents and superannuants—are going to pay. Those people who are looking for a loan for their business to expand their operation, those people who are looking to invest in South Australia are saying, 'There's too much risk and too much uncertainty in South Australia. We have a government that changes its mind, changes the policy settings and we are not going to be investing in South Australia.'

If the people of South Australia have worked out that this is a con, then it begs the question: who did the Treasurer and the Premier seek their economic advice from? This is a pretty interesting question. We asked the question yesterday in the house, 'Did you speak to any of the business leaders in South Australia?' In fact, the answer that was given was very disparaging. There was scoffing at successful people who have put their own capital on the line to create jobs because they think they are in the business class, the employer class. They treated them with disdain because they do not like people from a private sector.

Who did they speak to? Did they speak to their key economic advisers, the Economic Development Board? No. Did they speak to Rob Chapman at the Investment Attraction agency? No. Did they speak to any of the business advisory groups or business industry sector groups in South Australia? No.

Yesterday, I asked the Treasurer a question: did you speak to any one of the 145,000 small businesses in South Australia? Do you know what he said? Not one—because he says that he has an entitlement. Can you believe he used that word, sir? An entitlement to inflict this tax on anybody he likes, and he believes that we on this side of the house should just suck it up and pass their bad tax. Well, let me tell you that that is not going to happen.

The Hon. T.R. Kenyon interjecting:

Mr MARSHALL: We are drawing a line in the sand—no more bad decisions from this hopeless, dysfunctional failure of a government. We have the opportunity to block this very bad measure, and that is exactly and precisely what we are going to do. Some people have made some comments about how we arrived at this position, but the important point for everybody to understand is that we have arrived at the right position.

The SPEAKER: The member for Newland is warned for the second and final time.

Mr MARSHALL: We have arrived at the right position. We have arrived at a position that is in the best interests of every single South Australian, the best interests of those people who are wanting to get ahead in life, the best interests of those people who might want to grow their business, the best interests of the next generation and the best interests of those people who are wanting to invest in the future of South Australia.

I give this commitment: should we have the honour of being elected as the government of South Australia in March next year, we will not be playing tricky, political games with potential investors in this state. We will be providing certainty to those people who want to come to South Australia and who would like to invest in South Australia and who have already invested in South Australia. We are going to put the people of South Australia first. That is what the Labor Party in South Australia has failed to do over such an extended period of time.

I have opposed this tax since the moment it was first mentioned. It is a bad tax. It is going to hit the people of South Australia. All the people on this side of the house have been opposed to this new tax. Now that we have the opportunity, we will move to extract this bank levy in this house. We encourage any members of the government, any member of this house, to join with us. Let's knock it out here in this house. If we are unsuccessful, we will again move to take this tax out in the Legislative Council.

The people of South Australia cannot afford this additional, differential constraint on our economy. That is the key point. This is not a national bank levy; this is an additional, state-based item that is going to put us at a competitive disadvantage with every other state in Australia. Those opposite think that they are on a winner. Those opposite think that this is a great idea and that it is going to be very much loved by the people of South Australia. If that is the case, my challenge to each of them here today is, 'Put your money where your mouth is.' Here is the challenge: you declare it as a bill of special importance; it will give you the trigger for an election. Go to the people of South Australia. Do not inflict this on them, but go to the people of South Australia.

I will tell you what we do on this side: we trust the people of South Australia to make the right decision in the best interests of the people of South Australia. That sets up a very, very clear opportunity for people at the next election. You can have another four years of failed, divided, dysfunctional government that want to basically tell you they have the answer to every solution, that cannot keep the lights on, that have highest taxes and increasing taxes—you are not even going to know about the new taxes you are going to get until they are sprung on you—or hit the reset button and have a refreshed line-up, a Liberal reformist government that is once and for all going to put the people of South Australia first in this chamber.

Members interjecting:

The SPEAKER: The members for Davenport and Mitchell are warned a first time. Apart from regrettable interjections by the member for Newland, the Leader of the Opposition was heard in silence. I trust the opposition will present the same courtesy to the Treasurer.

The Hon. A. KOUTSANTONIS (West Torrens—Treasurer, Minister for Finance, Minister for State Development, Minister for Mineral Resources and Energy) (14:34): Thank you, sir. The Leader of the Opposition says, 'Bring us your investment. You're welcome here, unless of course you're in the oil and gas industry, then you're not welcome here. But, of course, unless you're in the nuclear industry, please don't come here.' Of course, if you are attempting in any way to honour a tradition that has been in place in this state since 1857, this opposition under this leader is wrecking a precedent that has held South Australia in good stead since we came here. Members opposite have to ask themselves—

Mr Whetstone interjecting:

The SPEAKER: The member for Chaffey is warned.

The Hon. A. KOUTSANTONIS: —a very serious question. They have followed this leader to ban unconventional gas in the South-East despite overwhelmingly the oil and gas industry being a major employer in this state. They have followed him to end the debate on the nuclear royal commission. They have followed him time and time again on his jaunts that have moved the Liberal Party further and further away from who they really are. Now he asks them one more time, 'Do it one more time for the Gipper. Ruin a tradition that we have had in this state since 1857.'

Mr Wingard interjecting:

The SPEAKER: The member for Mitchell is warned for the second and final time.

The Hon. A. KOUTSANTONIS: 'Follow me over the edge,' he says. What do they all do? 'Yes, sir.'

The Hon. J.J. Snelling: Lemmings.

The Hon. A. KOUTSANTONIS: Lemmings—just follow him. Well, okay, this is the new paradigm now. The opposition says that from now on budgets are not sacrosanct. From now on, governments do not have a right to set a budget. Governments have no right to set their agenda. There will be an election whenever the upper house says that they do not like a measure. That is the new test the opposition are setting—fine. If they think that they are better at this than us, they are dreaming. They are dreaming because what they about to unleash, because of their loyalty to a failure, to a man who tells his constituents to vote Labor time and time again, and what they are saying is, 'Look, we're so desperate we'll say anything. We'll say and do anything to win.'

I was talking to my colleagues privately saying that if the Liberal Party actually believed that they were going to win the upcoming election they would have supported this measure and then said, 'We're taking it to the election and we're going to withdraw it after the election.' You would have suggested an amendment that it not take place until later. But, no, what have they done? Panic—and they are trashing convention with it. What they are actually voting against are payroll tax cuts to small business. What they are actually voting against are measures in the budget bill that help South Australians grow their economy; that is what they are voting against.

They think that they can govern from opposition. They think that they can carve things out, but there are consequences for wrecking governments' budgets. As the Premier has said, we have offered the parliament a budget that has revenue and expenditure. Our revenue exceeds our expenditure, the budget is in surplus and we can manage our debt. Rather than tax five banks, the opposition now say, 'No, we want South Australians to foot the bill,' because they have not once suggested a spending measure that we should stop.

In fact, they cry out that there should be more in the regions. They want more spending, yet, rather than support us on two taxes that no South Australians will pay—that no South Australians will pay—what do they do? They take the side of the big banks; one meeting with one bank and he is there. The Leader of the Opposition has said he has been consistent. He has had two positions on this: a variable and a standard rate position. He started off saying, 'I'm opposed to this. In fact, I was opposed to the Prime Minister's tax; I just didn’t say anything to anyone. I am going to let it pass because it is a convention,' but then he has a meeting with a bank and then he meets with the banking association.

The question is: why is he here and why aren't they? Why are we speaking to the monkey and not the organ-grinder? Who is really running the opposition? How can you possibly say on budget day that you are going to support this measure because it is a convention that governments' budgets are passed and then later, after meeting with the banks, change your opinion? As we know with the banks, when they give you an investment they expect a return. What is the return they expect from the opposition? What is it that they get for their opposition, for breaking up a convention we have had in this state since 1857?

I thought you were Tories. I thought you were traditionalists. I thought you supported conventions, but not anymore. We shall see that you will reap what you sow. That reaping that members opposite are inflicting on the people of South Australia is appalling, absolutely appalling. The Leader of the Opposition all of a sudden thinks that he is onto a winner. These are the facts about the South Australian economy that the Leader of the Opposition ignores. In 2014-15, on a per capita growth basis of state gross product, South Australia ranked where? If you believe the opposition, we were last. We were third. In 2015-16, if you believe the opposition, we came last. We were ranked third, and in 2016-17 where we were ranked? Second, but the opposition are constantly out there talking down South Australia. He says he wants this state to have the same average growth as that of the nation. That means we need to slow down because we have exceeded GDP growth. Our gross domestic product has grown faster than the national economy, but the Leader of the Opposition says, 'No, no, no.' He pretends that somehow we are behind the eight ball despite us growing.

He then says that the only investment in South Australia is from the government, yet when state final demand was released just recently to the March figures, the biggest increase in state final demand that gave us a second highest growth in the nation was from where? The private sector—4 per cent—yet members opposite continue to perpetrate this myth that there is an investment strike despite Liberty today buying Arrium.

Apparently, no-one will invest in South Australia other than the increase in state final demand, other than people purchasing Arrium, other than the oil and gas industry, other than BHP spending millions of dollars operating the mine and other than Carrapateena, but of course members opposite think that banks make these investments, not people. They think that these people, the banks, are the ones who are taking the risk, not the people who are borrowing the money. What are we asking for in return? One-third of 1 per cent of their super profits.

Mr Whetstone: Another tax.

The SPEAKER: The member for Chaffey will withdraw from the chamber under the sessional order for the next hour.

The Hon. A. KOUTSANTONIS: The NAB, $6.4 billion in profit; Westpac, $7.4 million—

Mr Whetstone interjecting:

The SPEAKER: You will do it now or you will be named.

The honourable member for Chaffey having withdrawn the chamber:

The Hon. A. KOUTSANTONIS: —ANZ, $5.7 billion; Commonwealth Bank, $9.2 billion; Macquarie, $2.2 billion. In terms of their total salaries, because apparently they cannot afford to pay us $19 million to $20 million each they would be paying us, in terms of total expenditure on executives and senior executives NAB spend $35 million a year on salaries on senior executives by paying their chief executive over $6 million a year. Westpac pay their chief executive $6 million a year and pay $41 million to their senior executives. ANZ pay their chief executive $5 million a year and their senior executives $44 million a year. CBA pay their chief executive over $8 million a year and their senior executives over $48 million a year.

Yet, when the commonwealth government introduced their levy, did the Prime Minister ruin the investability of this nation? Did he ruin foreign direct investment in Australia? Did he make Australia less competitive? No, he did not. Did they pass on the cost to a captive country that had nowhere else to go? No, they did not. Why? Because the commonwealth passed legislation to protect them, the same legislation we are passing, yet one meeting with one bank and he folds—one meeting with one bank and he folds.

He is taking the Liberal Party away from its base. He looks down at you and he does not recognise you. Playford looks down at all of you and says that you are not the party that he created in this state. You are opposed to investment in gas, you are opposed to bringing in new industries and now you want South Australians to pay more taxes because you are opposed to a bank levy on the most profitable undertaxed part of the Australian economy. You are all a disgrace.

Mr KNOLL (Schubert) (14:43): I rise to support the amended Liberal Party motion in the debate we are having today. This is extraordinary, what we have just heard from the Treasurer. It is extraordinary that somehow this Treasurer has not even remembered his first economics lesson in year 10 at high school—the idea that there is no such thing as a free lunch.

The Treasurer just stood up and said that no South Australian will pay this tax. Well, I do not know where the money is going to come from, but it is either going to come from consumers, it is going to come from business, or it is going to come from the 150,000 people in South Australia who have bank shares or everybody's superannuation. The Treasurer can decide potentially which one of those groups gets to pay, but someone always has to pay.

This government has a history of trying to hoodwink South Australians. It has a history of this behaviour. They stand up here and they are in complete denial of basic truths. They are in complete denial of why our electricity prices have skyrocketed and complete denial of their own complicity in not being able to keep people safe, whether that be at Oakden, whether that be people in our child protection system, or whether that be every South Australian.

Now they stand up and deny basic maths. They deny physics. They deny basic year 10 economics. They stand up here and think that somehow the people of South Australia are just going to swallow it. Well, they do not. In fact, the most exciting figure that I saw in the mass of polling that was done over the weekend was the fact that 77 per cent of people understand that they are going to be paying this tax.

The 30 members (or thereabouts) opposite may not understand it, but the South Australian people get it. The South Australian people are smarter than this government. They woke up long ago to the spin, the empty rhetoric, the diversionary tactics, and the complete and outright mistruths. In the same vein, this government stood up on budget day and said—and the Treasurer just said it again—that South Australians will not pay this tax. They thought they could stand up here and be really smart and tricky, and I agree with the Treasurer that they are better when it comes to craven cynical politics than we are.

We will vacate the field when it comes to craven cynical politics, because he thought he was so smart that he could stand up and create this wedge that somehow the South Australian people were with them. We Liberals have always been for lower tax. Tom Playford who is looking down upon us today was for lower tax, and so are we. We have been consistent since the day this party was formed and they thought they could create this wedge, but guess what? They thought that the South Australian people were mugs. They took South Australians for fools and South Australians have resoundingly said, 'We are smarter than our government and we know that we are going to end up paying this tax.'

South Australians are too smart to buy the spin from the Premier. He has got up and talked about the heavy dead hand of government as it glides over everything that it surveys in South Australia. Let's look at the facts. Let's look at basic mathematics. What has this delivered us? It has delivered 7.1 per cent unemployment, the highest in the nation. What it has delivered us is six out of eight in economic growth.

The Treasurer wants to talk about state final demand. He certainly does not want to talk about the economic growth figures at 1.9 per cent. Somehow that inconvenient fact gets washed away, that only Tasmania and Western Australia were worse off than us in 2015-16. But it is okay, he just chooses to selectively quote the figures that prove his argument. Last year, 6,500 South Australians voted with their feet to leave South Australia because of this government, another inconvenient fact that the Treasurer and the Premier do not want to hear about.

Unlike this economically illiterate government that needs to go back to high school, we on this side of the house and the South Australian people are one. We understand that increased taxes hurt our economy. We understand that increased taxation hurts households. Most importantly, we understand that increased taxes hurt jobs growth. We have the extraordinary situation where somehow the Treasurer was talking today about the fact that nobody is going to pay this bank levy, but in the same breath yesterday was advocating for a GST on financial services.

Who pays for the GST, Treasurer? Who pays the GST? Every single South Australian would pay under that measure. Every single business, every single sole trader, anybody who ever had an idea in their head that they would dare to employ a South Australian would pay, and they will pay under this tax.

The Hon. P. Caica interjecting:

The SPEAKER: The member for Colton is called to order.

Mr KNOLL: This is a government that did not see a problem that a tax could not fix—the car park tax, the state-based carbon tax, the rubble royalties tax or the massive increase to the emergency services levy. Tax is always their answer. If you have a problem, let's tax it. The thing is that South Australian people have had enough.

Yesterday, in question time, the Treasurer used the word 'entitled' seven times in relation to increased taxes. Here is a man who thinks that it is his birthright to keep his hand in the pocket of every single South Australian. I reckon I have about $4.50 in my pocket and I wonder how much he is going to come after. I think that every single South Australian should be worried about any loose change they have in their pocket because the Treasurer is coming after it.

We on this side of the house are at one with the South Australian people and we have an opposition leader who actually understands economics. We have an opposition leader who understands how to create jobs. We have an opposition leader who has put out more policy to this stage of the electoral cycle than any other leader, any other generation. We have been prepared to put our ideas out there before they become law and actually have them debated. We have put out there that we are going to reverse the government's disastrous decision on the emergency services levy and take it to an election.

We have put out there that we are going to cap council rates in South Australia and take that idea to an election. We have put out the idea that we are going to deregulate shop trading hours so that people can actually shop when they want to shop and compete with online businesses, and we are going to take that policy to the election. We are going to take Globe Link, an idea about actually helping our exporters to improve their export capability, to an election. There are also new trade offices and major events funding. We have put so much policy out there that we are willing to debate at any point in time, anywhere.

We have a Liberal leader who has been prepared to put ideas out there for discussion and for consultation, two things that were missing from the bank tax announcement—consultation or discussion.

Ms Sanderson: Announce and defend.

Mr KNOLL: Announce and defend is alive and well, and the worst excesses of premier Rann have come back and the Premier of this state, who pretended he was a clean and new brush, is simply an old feather duster trying to paint himself as someone in new clothing. What we need in South Australia is somebody who is prepared to put an idea on the table, debate it, discuss it and help the South Australian people to be brought with it when it comes to doing it.

That means we are going to have a stable, methodical, potentially sometimes boring government, but what business wants is a boring, stable government. Business wants somebody who understands that lower taxation is actually the way to create jobs and that we are actually going to be the adults at the table, as opposed to the craven, cynical spin masters opposite who simply come into this place trying to dream up some new trick or some new wedge to somehow again screw with the people of South Australia in trying to win an election.

With all these policies that I have talked about, what is the one factor that they all have in common? They are all designed to create jobs in South Australia. This is what a jobs budget looks like. This is what a jobs plan looks like. I will be very proud in March 2018, next year, when we can put this plan into action. This is what real leadership looks like. This is what real character looks like. Mugging South Australians is not leadership; it is lazy. It is lazy policy. This government are going to get exactly what they deserve when the people of South Australia get their final chance to have their say on this government.

Mr Marshall interjecting:

The SPEAKER: The leader is warned for the second and final time.

The Hon. M.L.J. HAMILTON-SMITH (Waite—Minister for Investment and Trade, Minister for Small Business, Minister for Defence Industries, Minister for Veterans' Affairs) (14:52): Hasn't it been wonderful listening to the auditions from those opposite—one who wants to be Premier and one who wants to be leader? The rhetoric, the lack of substance, the lack of knowledge about economic matters, the lack of detail in their arguments, the lack of economic savvy and the apparent lack of understanding about how business works nationally and at the state level are simply breathtaking.

As to this Liberal world of no taxes, where we are not going to pay any taxes and they are going to go up to the machine and pull the lever and jobs, like popcorn, are going to rush out of a gate and fill up a bucket, and it will only take six months, I am glad the member for Schubert talked about year 9 economics, because that is what we have just heard. Somebody must have told the leader in grade 8 or 9 that if you cut taxes, well, obviously jobs just flood at you.

It is not as easy as that. You know what? If you cut taxes, you have to find the money from somewhere. How do you do that? Do you add to state debt? Do you cut 20,000 public servants—she is not here—or perhaps 30,000 or 40,000? Let's just go to a milk-off and think something up, but the money has got to come from somewhere. This wonder world of no taxes, that is what we are being promised.

I do not think South Australians are stupid enough, though, not to ask the question, 'Where is the money going to come from?' That is before we even posit the question touched upon by the Treasurer about whether, if ever South Australians were brave enough to elect those opposite, they would ever be able to get a budget through the house. I think the precedent they have created might put that at risk.

A lot of what has been posited during the debate so far is simply false. It is made up. It is wok-in-a-box economics. We know that. The Treasurer's budget is moving money from big businesses making super profits—the four big banks that, compared with British and American banks, are two to 2½ times to three times more profitable. These are the most profitable banks in the world. They are undertaxed, according to all key economic commentators. They are making $30 billion a year. They are paying themselves extraordinarily. They have admitted themselves that they can afford to pay this tax with ease. The Treasurer is giving that money to the little guys. He is giving it to small business. He is giving it to entrepreneurs. He is handing it to them in the form of payroll tax cuts and grants for R&D and to assist them to grow their businesses.

We have heard about how many people the banks employ. What about the 140,000 small businesses? What about the 250,000 to 300,000 people they employ? They need a bit of a hand up, because when those opposite and their colleagues in Canberra closed the automotive industry, they left South Australia in a tight spot. When they failed to stand up for all the industries mentioned by my parliamentary friend the Treasurer that they wanted to close down, they cancelled jobs.

Mr van Holst Pellekaan interjecting:

The SPEAKER: The member for Stuart is on two warnings.

The Hon. M.L.J. HAMILTON-SMITH: What we are doing is stimulating those jobs by moving the money from those who can pay to those who cannot. I think those opposite might be surprised at how the people of South Australia receive that news. The claims that this is somehow going to cost South Australians a lot and be a disincentive to investment simply do not stack up. The financial commentators decry that point. Basic business savvy would tell those opposite that that is not the case. It is a claim that simply does not stack up. The banking association got torn to pieces on ABC TV this morning trying to defend that very point. They were unable to verify their claims.

It is not backed up by any evidence of a slowdown in inquiries at our Investment Attraction agency, let me tell you. In fact, we are at the centre of investment interest, and announcements just today underline that point. In 20 months, the agency has created 18 projects, nearly 6,000 jobs and $1.1 billion worth of capital expenditure, delivering a benefit of $4.7 billion. They are over here telling us that no-one wants to come and invest in South Australia. The only trouble is the facts do not support their arguments. When the facts change, you change your arguments.

Members opposite, there is hardly anyone over there who has ever been in government. There is hardly anyone over there who has run a significant business. Wake up. Find out what is really going on in the business community. You are wrong. Companies such as Boeing, PrimeQ, Neon and Babcock are coming here. They want to invest, and the bank's argument that they will not come because the banks are paying an extra levy or an extra tax is simply false.

In relation to trade, I must say the opposition are particularly naive. The leader talks about our share of exports seeming to have declined a little bit. He seems to have missed something. There was this thing called the mining boom. It was in Western Australia and it was in Queensland. Do you know that Western Australia exports 42 per cent of Australia's total exports? They dig it up and they sell it. Good for them. Aren't they lucky? What does he think, that you pull the popcorn machine and out they will come, masses of jobs? He is going to come in there, pull the lever and within six months all our problems are gone. It is naive. It is silly. To present these arguments in the house is simply foolish. To block this measure and create the precedent they are creating is a mistake not only for this budget but for parliamentary democracy in the house.

On trade, we have $15.2 billion worth of exports. We do not have the oil, gas, coal and minerals of Queensland, New South Wales and Western Australia, but we do pretty well. It has gone up extraordinarily—72,000 meals go on the table every night directly from exports. We are punching above our weight on services—11 per cent growth compared with 9 per cent annually. The number of small businesses exporting is heading towards 2,600 and is up 8.6 per cent. The national rate is only up 5.4 per cent, and that is before we get onto small business, the people who are generating $34 billion are significantly more than the opposition's friends in the banks.

What is the budget doing? The Treasurer is using the money raised from the tax and the levy on the banks to deliver the lowest payroll taxes in the nation, Job Accelerator Grants, apprentice and trainee incentives, export assistance to small business, red-tape reductions and an Industry Advocate policy that has seen the amount of access to local contracts rise from 52 per cent to nearly 90 per cent for South Australian businesses.

We are deploying those funds to do good things for jobs and growth in this state. The wok-in-a-box economics opposite presumes that this will be passed on. I will tell you who is waiting in the wings for the big four banks to pass this on to those poor consumers. I will tell you who is waiting: Adelaide Bendigo Bank; the Beyond Bank, formerly Community CPS; the Members Equity Bank; Suncorp Bank; HSBC; Credit Union—

Mr Pisoni interjecting:

The Hon. M.L.J. HAMILTON-SMITH: There he is, jack-in-the-box, Mr Speaker.

The SPEAKER: The member for Unley will leave the chamber for the next hour for that disgraceful outburst and if he says anything on the way out, he will be named.

The honourable member for Unley having withdrawn from the chamber:

The Hon. M.L.J. HAMILTON-SMITH: And the People's Choice Credit Union—these other institutions that are not involved in this measure are waiting in the wings for that to be passed on. It is called competition. During the GFC, the big banks swallowed a lot of their competitors. There needs to be more competition and this measure will encourage it.

The threat of a collapse is simply wrong. Tony Pearson of the Australian Bankers' Association, who graced the chamber yesterday, tried to run the argument, as I said, on ABC TV. Virginia Trioli tore him to pieces this morning. Mark Bouris, the founder of Wizard Home Loans, Australia's second largest non-bank home lender, says, 'The banks have no reason to pass on the levy and, if they do, customers will simply shop around.' In late May, Bouris addressed that assumption that the federal levy—

The Hon. A. Koutsantonis interjecting:

The SPEAKER: The Treasurer is warned.

The Hon. M.L.J. HAMILTON-SMITH: —will be treated as a cost on banks and passed on to customers as fee increases or interest hikes. A raft of commentators are making it clear that the banks can absorb this tax and actually, in many respects, it is simply rebalancing the ledger. As the banks continue to tell us with their friends opposite that it is all doom and gloom, they run advertisements, no doubt generating thousands of dollars of revenue for the commercial media, talking down the state, rubbishing our state, and sledging our state. Why? To save themselves some taxation revenue.

Well, I tell you that there are two certain things in life: death and taxes. Those who can pay are being asked to pay so that those who need a hand up at the moment can be assisted to do better. That is where the jobs are in small business. By the way, it is not BankSA; it is Bank New South Wales, a wholly owned subsidiary of Westpac, and it is worth remembering. I would say to South Australians that there are South Australian options for them.

Members interjecting:

The SPEAKER: The member for Schubert is called to order. The member for Kavel is warned and the Treasurer is warned for the second time and the last time. The member for Morialta.

Mr GARDNER (Morialta) (15:02): This has been a deeply disappointing display by a dysfunctional Labor government that has long forgotten that they are here to represent the people of South Australia and do what is in their best interests, yet the people of South Australia cannot turn a corner these days without being mugged by this Labor government that does not care for their future, but only cares for their own political survival.

We have had a lot of discussion in the last few days about conventions and the Treasurer today and the member for Waite have said that this convention, which has apparently stood since the 1850s, is being broken, but I would say that I would rather break a convention than break the state—break the state for the second time when we are talking about matters to do with the State Bank.

This convention, which apparently the Treasurer says will rain fire and brimstone upon the people of South Australia and any future government, which the Minister for Health said would rain fire and brimstone on any future government when this opposition did the right thing by the people of South Australia in blocking the car park tax in 2014, is not worth anything if it damages the interests of the people of South Australia, because they are our first, second and third responsibilities as members of parliament. We swear an oath that we will support their interests and their needs.

In fact, this government was not interested in supporting convention at the 2014 election when they said, 'Don't vote against the car park tax because there is a convention in place with the 2012 decision to remove the costs orders against police,' which was another example of a bad tax measure put into a budget, and in the best interests of the people of South Australia the opposition supported the opposition to it.

And of course there is the biosecurity tax, which this government also tried to put into a budget and which the member for Waite supported the opposition on—the member for Waite supported the removal of it, as he did the cause for a reversal of onus. This is a government that does not have the interests of the people of South Australia in their heart, and they are using this convention as a fig leaf to cover their shame. The fact is that the opposition is acting to protect the interests of the people of South Australia, and that is what we are here to talk about today.

The Premier started his speech by talking about leadership. Leadership—from this Premier. Let's have a talk about the Premier's examples of leadership. This is the sort of person who went to an election promising that he was the only person who would protect the people of South Australia from an increase in the GST and then went on national news to fight for an increase in the GST. This is the Premier who went to an election promising that he was the only person who would protect the people of South Australia from a nuclear industry starting in the state and then, as soon as the election was over, he went to the people of South Australia and said, 'We want to have the world's biggest nuclear dump here in South Australia.'

This is the sort of person who would get elected to parliament and, three elections in a row, go forward on policies, such as no privatisation despite the privatisation of the forests and the MAC and the Lands Titles Office to come. This is the sort of person who would go to an election and win an election three times on a promise that no Labor government would ever, ever sell the Repat and then, once he is elected, would act against the interests of the people of South Australia to sell the Repat.

This is the sort of person who would put $600,000 of taxpayers' money into a joint venture with the Adelaide city council and a private company to run a stall at a beer festival in China without doing any due diligence and then, when it goes bad, he will walk away and blame everyone else involved except for himself. Who would go into business with this guy? Who would invest in a state where this is the sort of person running the show?

The Hon. A. Koutsantonis interjecting:

Mr GARDNER: Who would possibly invest in this state under this Premier?

The SPEAKER: The Treasurer will not get any further warnings.

Mr GARDNER: The Treasurer has been warned three times and he still does not get it. This is the Premier who promised a kinder, a gentler politics. This is the Premier who came to office promising a break with his predecessor who would have a debate-and-decide approach, not an announce-and-defend approach. The reality is that this Premier makes Mike Rann look like Mother Teresa by comparison.

Here is his latest scam on the people of South Australia: pick a target in the banks which he assumes everyone will be happy to kick, surprise them with a raid to demonstrate his masculinity and to try to win some cheap populace points despite the disastrous consequences for the state that he pretends and purports to lead, despite the impact on confidence, despite the impact on jobs in South Australia, despite the impact on South Australia's reputation interstate and internationally and despite the potential impact on every mortgage holder, every business with a loan, every person who wants a job in this state, anyone who holds shares in superannuation. It will make the cost of doing business in South Australia more expensive, and it will make the cost of living in South Australia more expensive.

The trick is that the people of South Australia, as the Leader of the Opposition correctly said, are smarter than this government. The people of South Australia, as the member for Schubert correctly said, know that this tax will impact on them and their cost of living. The Liberal Party is only interested in protecting the interests of the people of South Australia, and they will see that. We are prepared for this fight, and we will fight this tax through to the election.

So much for the leadership of the Premier. What about the toadies who surround him—the South Australian Labor Party? Not content with having broken South Australia once with their State Bank disaster, they are now seeking to break South Australia again with their state bank tax disaster. This is a state that understands what that pain has meant when it has been inflicted before, and they will not stand for it again. The Liberal Party of South Australia will not stand for it again. We will block this tax, and this government must take this to an election—an election that I am confident they will lose because the South Australian people know that they deserve better.

Ms BEDFORD (Florey) (15:08): I will not keep the house. I just want to let you know that I have listened to all the debate and I find myself in the invidious position of being unable to support either proposition in its entirety.

The house divided on the amendment:

Ayes 19

Noes 22

Majority 3

Amendment thus negatived; motion carried.