Parliamentary Committees

Economic and Finance Committee: Emergency Services Levy 2018-19

Mr DULUK (Waite) (11:01): I move:

That the first report of the committee, entitled Emergency Services Levy 2018-19, be noted.

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

This year, the committee received the Treasurer's statement on 31 May 2018. 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.

So that we are clear on the services funded by the emergency services levy, the definition of 'emergency service' in the act 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 SA, a member of Volunteer Marine Rescue SA, or a service provided by the South Australian police department related to, assisting with, or incidental to those organisations I just listed.

On 8 June, the Economic and Finance Committee held a public hearing and invited representatives from the Department of Treasury and Finance, SAFECOM, the MFS, the CFS and the SES. The witnesses provided the committee with details on the proposed levy for 2018-19, and 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 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 total expenditure on emergency services for the 2017-18 financial year is estimated to reach $302.9 million, which is $900,000 more than was originally projected. The committee notes that the total expenditure on emergency services is projected to be $318.4 million in the 2018-19 financial year. This will be funded by the emergency services levy component of $137.2 million.

This target expenditure is $15.6 million higher than the 2017-18 estimated income. The committee was told that this reflects growth in basic expenditure and funding provided for several new measures, including improved aerial fighting capabilities for the Country Fire Service and the cost of new enterprise bargaining agreements. This excludes the cost of election commitments that further increase emergency service expenditure. These costs will be funded outside the rate-setting process to remove any impact on emergency services levy bills.

The committee notes that remissions for general property will be introduced in 2018-19, reducing the effective ESL bills paid by property owners. These remissions will reduce 2018-19 ESL bills by some $90 million, consistent with the Marshall government's election commitment. The committee notes that the government will pay $130.3 million into the Community Emergency Services Fund in 2018-19, reflecting amounts equivalent to fixed property levy revenues forgone through remissions and pensioner concessions in addition to contributions on its own property. The committee also notes cash balances in the Community Emergency Services Fund are expected to be $21.9 million by 30 June 2018.

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, the departmental representatives from Treasury and Finance, the chief executive of SAFECOM, and chief officers of the MFS, CFS and SES, who assisted the committee in reporting on the Treasurer's determinations for the 2018-19 emergency services levy. 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 MULLIGHAN (Lee) (11:06): Thank you to the member for Waite, who was swift in his remarks.

Mr Duluk: Efficient.

Mr MULLIGHAN: Efficient, of course. I rise to speak on the Economic and Finance Committee's report into the 2018-19 emergency services levy. Of course, this has been an important issue this time around for the Economic and Finance Committee. When the emergency services levy was introduced in 1998 in the first week of the new parliament after the 1997 election, despite nothing being said about it in the course of that election, immediately an inquiry was started by the then Liberal government to investigate how this new tax could be introduced. In the ensuing outcry over the next 18 months, the Economic and Finance Committee was tasked with keeping a close eye on how this tax was going to be implemented and monitoring it on an ongoing basis.

We have spent some time looking at this tax and, in particular, at whether the new Liberal government was indeed going to keep the promises that it had made to the people of South Australia about the emergency services levy in the lead-up to the most recent state election. They made two election commitments about the emergency services levy. They said that the levy would return to its previous levels, and they said that there would be a 50 per cent reduction in emergency services levy bills. They claimed that this would deliver a $150 saving to the median house value household in South Australia and that this measure would cost $90 million.

Of course, we all knew that they would not be able to do those four things consistent with one another. The $90 million was the estimate of the additional revenue that was raised under the ESL changes in 2014 when we were looking at ways of trying to compensate for the devastating cuts to health and education budgets from the federal Coalition government. We were also deeply suspicious about a $150 saving and whether it could be delivered to households within those parameters. What eventuated? The opposition was proved right.

As has been the way of this new government, they rush out and announce to the media, with scant details, some wonderful new initiative, and when the detail comes out subsequently, of course, it is nowhere near as good as was promised. Even in the Treasurer's own press release, when he identified the median value household in metropolitan Adelaide—not South Australia but metropolitan Adelaide—what was the saving? It was $144. He could not even reach, through sheer stinginess, that extra $5.85 in getting up to the $150 commitment he made to the people of South Australia.

It just goes to show what a dour hand is at the tiller of this government at the moment—that of the Hon. Mr Lucas in the other place. We also know that a 50 per cent reduction in bills has not been provided either because the amount of revenue being raised from households has continued to increase. This includes the 2018-19 year, so it is well beyond what a $90 million relief would provide. That has also been borne out when we look at the impact of these changes to the emergency levy rates on households.

The people who receive the least amount of relief are those people who purport to be the traditional constituents of the conservative party here in South Australia, those people who live in rural areas and in regional centres around South Australia. They are the ones who do not get anything like, on average, the $150 or $144 saving on their properties. Why is that? It is because the way that these changes have been implemented provides the bulk of the relief to high-value households in metropolitan South Australia.

If you happen to live in a major town around South Australia, if you happen to live in Mount Gambier or Millicent, if you happen to live in Port Augusta or Whyalla, if you happen to live in Port Pirie or Port Lincoln, or if you happen to live in any of the other towns around regional South Australia where the median house value is $200,000 less than it is in metropolitan Adelaide, then you will be getting less relief from these changes put forward by the Liberal government. It is extraordinary that in their first tax-cutting measure, so proudly spruiked by this government, they would turn their back on their traditional constituency and leave their own electors out in the cold.

However, it gets worse. It is not just those regional communities who are copping it in the neck despite what was promised to them at the election; the people in other types of properties who were promised relief are also not getting it. It was extraordinary for it to come to light under questioning of Department of Treasury and Finance officers that people in special community-use properties would receive, on average, only a $20 reduction. That is not even one-seventh of what was being provided to people in the metropolitan area and not even one-half of what was being provided to those regional and rural communities.

What sort of properties are special community-use properties? Are these the people who can do without the greatest amount of assistance when it comes to bill relief from this government? Let's have a look at the list on the schedule: orphans' accommodation, retired and aged accommodation, social welfare accommodation, charitable organisations, public halls, Scouts, Girl Guides, places of assembly, cemeteries, and YMCA and YWCA facilities. These are the people who have also been left out in the cold by these cuts.

In fact, the people who have received the most relief and are going to benefit the most, according to the information that was eventually provided to the committee by the Department of Treasury and Finance—well after the report had to be signed off by law by the Economic and Finance Committee—come from the postcode 5061. Who would have thought that the member for Unley is the most influential member of the government caucus? His constituents in Unley, Unley Park, Hyde Park or Malvern are the ones who will receive 2½ times the average benefit of people in metropolitan Adelaide. Those people will receive nearly ten times more relief than all those households in regional and rural communities.

Mr Duluk interjecting:

The SPEAKER: Order! The member for Waite is called to order.

Mr MULLIGHAN: It is extraordinary where this government's priorities are. If I were a member of parliament who had been freshly elected from the communities of Yorke Peninsula or perhaps from the South-East, I would not believe that I had been left out in the cold by my own caucus colleagues funnelling all this relief into the postcode of 5061. Well, I guess it is not what you know in this game, is it? It is who you know, and haven't they delivered to their traditional base?

Another thing I would like to say is that households were promised $90 million of relief against their bills, and that has not been delivered either. We found out that households will receive $71.8 million of relief on their bills. Where is that extra $20 million going? It is going towards increasing the emergency services budget, which has been dialled in by this new Treasurer and this new government.

Of course, no-one objects to more spending on emergency services. I was standing in this place only yesterday talking about how good the Grange Surf Life Saving Club is and how good the Semaphore Surf Life Saving Club is, let alone all the other emergency services: the SES, the CFS, the MFS and so on. They do a wonderful job. No-one is complaining about an increase in their budget, but when we are told that people will get $90 million of relief we expect the government to deliver on their commitments, and they have not delivered on their commitments.

Once again, they rush out with a press release. They try to gain as much favourable coverage as possible and then wait until the grotty detail comes out later. That is when South Australians know they are copping it in the neck. That is what happened when the member for Schubert came back with his dud infrastructure deal, and that is what looks like happening when the Premier and the state Treasurer come back with what is looking like a dud GST deal. We expect better from this government. We expect them to deliver on behalf of South Australians, not be supplicants to their political masters in Canberra.