Auditor-General's Report

Auditor-General's Report

In committee.

The CHAIR: I declare the examination of the Report of the Auditor-General 2022-23 open. I remind members that the committee is in normal session. Any questions have to be asked by members on their feet. All questions must be directly referenced to the Auditor-General's 2022-23 Report and agency statements for the year ending 2022-23, as published on the Auditor-General's website. I welcome the Premier and the Leader of the Opposition, and I call for questions.

The Hon. D.J. SPEIRS: Thank you. My first question comes from Part A of the Auditor-General's Report, page 7. Is the Premier concerned that because the Auditor-General has been refused access to cabinet documents he has been—and I quote from page 7 of Part A—'unable to form an opinion on whether transactions were conducted properly and in accordance with law'?

The Hon. P.B. MALINAUSKAS: The government has been seeking to work with the Auditor-General to resolve the issue to which the Leader of the Opposition refers. There was correspondence between the chief executive officer of the Department of the Premier and Cabinet and the Auditor-General going back to earlier this year—I think from May, from memory. The Department of the Premier and Cabinet, I know the Leader will understand, is responsible for all cabinet documents. The CEO submitted a proposition to the Auditor-General to contemplate about the verification of information, so that the Auditor-General could satisfy himself that all appropriate measures were in place.

The Auditor-General came back and suggested that that approach was not going to meet all of their requirements and, from memory, in a piece of correspondence that I read from the Auditor-General back to the Department of the Premier and Cabinet CEO, suggested another approach that might acknowledge the government's desire for cabinet confidentiality to be maintained but, at the same time, provide the Auditor-General with the requisite information they require to verify particular decisions. That is something that the government—and I am pretty sure I have stated this publicly—is considering, and we look forward to potentially resolving that matter in the not too distant future.

The Hon. D.J. SPEIRS: On the same matter, is the Premier aware that this is the first time since the Public Finance and Audit Act was introduced in 1987 that an Auditor-General has had to qualify their annual controls opinion?

The Hon. P.B. MALINAUSKAS: I am aware that the government is maintaining a policy that has been in place now for a number of years. The government has not changed any law, the government has not changed any regulation, when it comes to the provision or non-provision of cabinet documents to external parties. We have not changed any policies or procedures since we have come to government; they have been in place for some time. In fact, I understand it is Premier and Cabinet Circular PC047 which outlines the provision of cabinet documents to other bodies, including investigative agencies. From memory—and I qualify that my answer is from memory—I think that was last reviewed during the life of the former government and has not been changed by this government.

The Hon. D.J. SPEIRS: How does the Premier respond to the following comment found on Part A, page 6 of the report:

A situation where the Auditor-General is not able to provide the Parliament and the public with assurance that government services were delivered properly and in accordance with the law, as intended by the [Public Finance and Audit Act], is unsatisfactory.

The Hon. P.B. MALINAUSKAS: The government are committed to making sure that we uphold the laws, policies and procedures to which we are bound. As I said, we have not changed any government circulars that pertain to the provision of cabinet documents or otherwise.

The Hon. D.J. SPEIRS: The Auditor-General lists on Part A, page 8 a range of cabinet documents he has requested access to but has been unable to access. These include more than $20 billion worth of projects such as the north-south corridor and the new Women's and Children's Hospital. My question is: does the Premier agree that this is unacceptable?

The Hon. P.B. MALINAUSKAS: Agree with whom?

The Hon. D.J. SPEIRS: The Auditor-General's concerns.

The Hon. P.B. MALINAUSKAS: I am happy for the Leader of the Opposition to point me otherwise, but I am not aware that the Auditor-General uses the word 'unacceptable'.

The Hon. D.J. SPEIRS: I will rephrase the question. On page 8, there is a list of cabinet documents requested by the Auditor-General, providing insight into the decision-making and financing of those projects, including the north-south corridor and the Women's and Children's Hospital. Does the Premier believe that it is acceptable that these documents have not been provided to the Auditor-General, therefore inhibiting his analysis?

The Hon. P.B. MALINAUSKAS: There are only so many ways I can say the same thing. The government is simply adhering to the government and Premier and Cabinet circular that has been in place, including throughout a significant part of the former government's life. As is evidenced by the necessity for the Auditor-General to request these documents, there is not an absolute right or entitlement that the Auditor-General has to cabinet documents. We have not changed the law here or the regulation.

As I stated earlier, the government is open-minded to exploring various mechanisms that might be able to provide or furnish the Auditor-General with the information they require without compromising the key elements of cabinet confidentiality, which we are keen to preserve and uphold. One thing I would note is that I have been advised that the Leader of the Opposition has been contacted himself, requesting authorisation for access to cabinet documents that relate to the life of the former government. The Leader of the Opposition, as I am advised, has not responded positively thus far to the release of those cabinet documents. This is the advice that I have been given.

Mr Cowdrey: By whom?

The Hon. P.B. MALINAUSKAS: The government. If that indeed is accurate, as I am advised is the case, then it would seem that there is a huge degree of consistency between the government's position and the Leader of the Opposition's. The only inconsistency, of course, would be between the Leader of the Opposition's non-response to those requests, or non-positive response to those requests, and his stated public position that all cabinet documents should be made publicly available.

The Hon. D.J. SPEIRS: I do not have any, unless a request has come in within a matter of days that has not yet reached me. Chair, forgive me here, but the Premier has made an accusation of sorts and, unless that correspondence has come in within the last few days, I can confirm to this house that I have granted access to every single one of the documents that took place under the Liberal Party's four years in government—unless there has been an imminent request that we have not yet processed. My practice is to require the Auditor-General access, and perhaps we can revisit that in this place later if the Premier gets further advice.

I will move on though to the commentary in relation to sporting club and local infrastructure grants, which were provided as a result of election commitments. The commentary is on pages 6 and 7 of Part A. How can the Premier guarantee the payment of sporting club and infrastructure grants has been done in accordance with the law?

The Hon. P.B. MALINAUSKAS: Because cabinet approved them.

The Hon. D.J. SPEIRS: How can the Premier guarantee his government is making decisions in accordance with the law if the independent Auditor-General cannot be sure?

The Hon. P.B. MALINAUSKAS: Because cabinet approved them.

The Hon. D.J. SPEIRS: Is the Premier concerned with the Auditor-General's findings that the sports rorts grants, otherwise known as the sporting club and local infrastructure grants, were:

…conducted outside the public sector framework.

That quote is from page 7 of Part A of the report.

The Hon. P.B. MALINAUSKAS: Obviously I have read the part of the Auditor-General's Report to which the honourable Leader of the Opposition refers. There are a few things I would say in response to that. The Auditor-General is in effect suggesting that election commitments that are made by a political party or a political leader or a local MP should be subject to a post-election analysis conducted by the Public Service to determine their validity of sorts. I completely disagree with that proposition. I think it runs contrary to the central premise of the way our democracy operates and our system of government.

The notion that election commitments should be reassessed by the public sector to determine what should be funded and what should not be would render election commitments somewhat meaningless. That would be a fundamental distortion of our political system as we know it. I have said this before and I think it is worthy of repetition: if the opposition believes it wants to adopt the Auditor-General's methodology, they should say it.

They should simply say it because then, when we fast forward to the 2026 election, every promise that has been made—obviously the Leader of the Opposition would have to stand up at community forums, in debates on TV, their television commercials, and say, 'We commit to X, subject to the approval of a faceless bureaucrat who is not up for election, and they will determine whether or not this policy goes ahead.' That would be the practice they would be applying, which they are entitled to do. I will not be doing that.

I believe that the responsibility of elected officials, when they make commitments to their electorate, is to make sure that that commitment is deliverable in the first instance, and then, if it is, commit to it and, if they are able to receive the mandate of the electorate, then go about executing that, to which they are held to account in any event.

The counterfactual to what the Auditor-General is proposing is of course that governments get elected and then potentially do not honour commitments that have been made, which I do not think would do much to reassure the community of the democratic process more broadly. I am familiar with the remarks that the Auditor-General has made. I respectfully have a very different view to the Auditor-General. I think elections matter. I think democracy is sacrosanct, and I think if the people of South Australia provide governments with a mandate to deliver on their election commitments then governments are duty-bound to do their best to deliver upon them.

The Hon. D.J. SPEIRS: Referring to the various pieces of commentary I have already quoted across pages 6, 7 and 8 of Part A, and the Auditor-General's views that are put across there, my question to the Premier on that would be: what does the government stand to lose by granting the Auditor-General full access to cabinet documents?

The Hon. P.B. MALINAUSKAS: The compromising of cabinet confidentiality. The Leader of the Opposition, I think, would well appreciate that cabinet is a very unique forum.

Mr Cowdrey: You were fine to give them to him when you were last in government.

The Hon. P.B. MALINAUSKAS: Sorry, what was that?

Mr Cowdrey: You were happy to give them to him when you were last in government.

The CHAIR: The member for Colton should not be interjecting, and the Premier should not respond to interjections.

The Hon. P.B. MALINAUSKAS: The member for Colton should assess his facts. The Leader of the Opposition would well be aware that cabinet is an important and unique forum in a number of respects. One of the key elements that underpins the deliberations of cabinet is to know that they are happening with the sanctity of cabinet confidentiality and cabinet solidarity, the central principles to the Westminster system that the Leader of the Opposition understands all too well, particularly not just because of the fact that he was a former minister of the Crown but, indeed, because he was the cabinet secretary, I understand, in the former government.

That is something that we believe is worthy of preservation. As I have suggested and reiterated both publicly and in this forum, we are a government that is open-minded to engaging with the office of the Auditor-General to make sure that we can find a way to achieve a balance between the preservation of cabinet solidarity and the deliberations that are happening within it, and furnishing the Auditor-General with the information they require to be able to do their job in a manner that they deem appropriate. We are trying to achieve that balance. Like I said, with the most recent correspondence from the Auditor-General to the office of the Chief Executive of the Department of the Premier and Cabinet, suggestions have been made that are under active consideration by this government.

The Hon. D.J. SPEIRS: Is the Premier and the government concerned or fearful that full transparency might reveal mismanagement or decisions that go against the public's best interests?

The Hon. P.B. MALINAUSKAS: No.

The Hon. D.J. SPEIRS: Again, referring to the commentary of the Attorney-General in this section, what message does the Premier believe it sends to the public when the government restricts independent oversight bodies from performing their duties to the fullest extent possible?

The Hon. P.B. MALINAUSKAS: I would seek to explain to all concerned that the government has not changed any rules or regulations that relate to the availability of cabinet documents. These are the same rules and regulations that were in place under the former government.

The Hon. D.J. SPEIRS: How does the Premier plan to address the growing concerns around secrecy and transparency, especially when it comes to the Auditor-General's role? In this year's report the Auditor-General has suggested (again, Part A, page 6) that legislative change could achieve what his transparency goals and access to documents aim to achieve, but the government is refusing to progress the opposition's bill that would do that very thing.

The Hon. P.B. MALINAUSKAS: I think it is telling what the Leader of the Opposition refers to. The Leader of the Opposition appears to be advocating for legislative change. Now, why would there be legislative change? Well, it is because the opposition is advocating for a change in the rules, changing rules that—

Mr Cowdrey: No, a change in the outcome. It's change based on what you're doing.

The CHAIR: Member for Colton, you are warned for a second time.

The Hon. P.B. MALINAUSKAS: —were in place throughout the entirety of the former government. I am happy to keep reiterating that, as a government, we are very keen to work with the office of the Auditor-General and we are aware of one option that might be able to resolve the matter, and that is something that is under active consideration by this government that I hope will be resolved in the next few months.

The Hon. D.J. SPEIRS: I move to the information technology general controls commentary on page 25 of Part A of the report. In that section, various control deficiencies in the state government's information technology environment are highlighted by the Auditor-General. Page 25 states, and I quote:

It is disappointing that our ITGC reviews regularly highlight these types of control deficiencies. I would again encourage all agencies to be more diligent in addressing them as part of their regular management of security measures and practices.

Premier, do you have reservations about the current status of the state government's cybersecurity preparedness, especially given we are about to embark on the largest expansion of defence-related projects in our nation's history through the AUKUS agreement, much of which will occur here in South Australia?

The Hon. P.B. MALINAUSKAS: I think it has been acknowledged not just across the country but around the world—particularly in the West—that cybercrime is on the rise and the volume and scale of cyber attacks continues to increase to the extent that it represents a material challenge and threat.

The commonwealth's Australian Cyber Security Centre had more than 76,000 cybercrime reports in the 2021-22 financial year, and the Office of the Australian Information Commissioner has received 1,748 breach notifications over the course of the past two years from private organisations alone.

This is something that we do accept is a major challenge and a significant threat that has been discussed repeatedly in a number of forums and certainly has been a matter that has been the subject of discussion at national cabinet. We have seen around the country the devastating impact that cyber attacks can have, particularly on people's confidence around the security of their data—particularly from private organisations. We continue to work through the Chief Information Officer within government, along with other frameworks around the country, including under the Cyber Incident Management Arrangements for Australian Governments, to support strategic coordination of response efforts into various cyber incidents.

As a government, we continue to review our cyber practices and provide advice. The Department of the Premier and Cabinet regularly provides advice to various agencies in respect of these matters to try to continuously improve the area and make sure that we are deploying best practice in terms of policy and also technology, to protect the interests of South Australians through their government.

The Hon. D.J. SPEIRS: Has the Premier and his department any plans to introduce legislation or regulations mandating stricter cybersecurity standards for government departments and agencies, given the Auditor-General has identified these issues year after year?

The Hon. P.B. MALINAUSKAS: I think the Leader of the Opposition would be aware that my understanding is the Auditor-General's concerns here have been around for some time. It is not a recent development. In terms of the government looking at various options about how better to improve government's response, how better to regulate the area in a criminal sense and also in a government's performance sense, and how are we structured to make sure that governments and their various agencies have a coordinated response in respect to this, is something that is under constant review.

The Hon. D.J. SPEIRS: The agency audits, and specifically page 322 of Part C, highlight specific dollar value reductions in spending associated with cybersecurity resilience in the Department of the Premier and Cabinet. Can the Premier outline what the specific reduction in spending on cybersecurity was?

The Hon. P.B. MALINAUSKAS: I will have to take that on notice for the Leader of the Opposition.

The Hon. D.J. SPEIRS: There was a decrease in expenses for contractors, including contractors associated with cyber-resilience projects. Which contractor has been engaged previously and is no longer engaged? That refers to Part C at page 322. I acknowledge the specific nature of that question and understand if the Premier wants to take it on notice.

The Hon. P.B. MALINAUSKAS: I am advised that there is a whole suite of various ICT contractors who provide services to government. I do not think we have a copy of that full list available here, and certainly what the changes in that list look like, so I think it might be one I am happy to take on notice.

The Hon. D.J. SPEIRS: Thank you, Premier. If you could take that on notice that would be good, but could you also provide the nature of that contractor's work at a high level, to gain an understanding of where the gaps might be?

The Hon. P.B. MALINAUSKAS: I am more than happy to look at that.

The Hon. D.J. SPEIRS: Thank you. I move on to another part of the report, which is Part C, Agency Audit Reports, pages 316 through to 322. The Auditor-General's Report highlights $38.4 million was spent from the Major Events Fund. Can the Premier provide a breakdown of how that funding was spent?

The CHAIR: Just for my benefit, what page was that?

The Hon. D.J. SPEIRS: Page 316, in Part C. That is the Agency Audit Reports.

The CHAIR: Yes, I have found it.

The Hon. P.B. MALINAUSKAS: Thank you to the leader for his question regarding the Major Events Fund. The Major Events Fund was used for a range of different purposes across the financial year. The Leader of the Opposition would be aware that the government had a very specific election commitment to try to pursue the attraction of major events to the state. Obviously, there have been a range of major events that we have been able to announce over the course of the last 18 months since the election—the beach volleyball championships, investments through the Adelaide Festival, the Webex PGA event, the securing of the British and Irish Lions tour coming to South Australia, which the Scots are in, and obviously the AFL Gather Round and LIV Golf.

We have not been able to provide a specific breakdown of exactly how each event gets X amount of dollars because of the commercially confidential nature of those major events and the fees that are attracted. That is a policy that has been in place for some time. It is there principally to preserve the government's position in a negotiating context so we do not have a situation where we are constantly having to barter or negotiate between various events around how much we pay. We would rather negotiate on an individual basis and maintain the strength of the government's bargaining position.

The CHAIR: The time allocated for the examination of the Auditor-General's Report for this section has expired. I thank the Leader of the Opposition and also the Premier. I now welcome the Treasurer and the member for Colton, who I understand is the lead speaker for this part.

Mr COWDREY: I will start in a similar vein to the previous session in regard to part A, pages 6 to 9. Is the Treasurer concerned that the Auditor-General has been unable 'to form an opinion on whether transactions were conducted properly and in accordance with law', in particular around some of the biggest infrastructure projects in our state's history?

The Hon. S.C. MULLIGHAN: I think it is clear that the Auditor-General would like to have the capacity to read the entirety of the cabinet submissions and attachments with respect to these particular matters. I have to say it has always been my understanding that what is being sought in relation to these projects—for example, the north-south corridor, the Women's and Children's Hospital; I think he also makes reference to the redevelopment of the Adelaide Aquatic Centre—is evidence that the decision has been taken by the appropriate decision-making body, which is cabinet.

It is one thing to have evidence of a decision and, once a decision is taken, then that decision is carried out according to the requirements of the public sector, whether it is Premier and Cabinet Circulars or whether it is Treasurer's Instructions, and all of the policies and frameworks that the relevant government agencies are subject to. It is one thing to know that the decision has been taken lawfully by the appropriate body, but I think it is something in addition to that to then say that that requires every page of each of the cabinet submissions and all of the associated documents that go with that.

Mr COWDREY: Does the Treasurer have any concerns that, for the first time since the Public Finance and Audit Act—an act that he is responsible for that was introduced in 1987—an Auditor-General has had to qualify their annual controls opinion?

The Hon. S.C. MULLIGHAN: I am not sure about the assertion that this is the first time that there has ever been a qualification of a controls opinion. I do not have the report in front of me, but my recollection is that last year's Auditor-General's Report chose to qualify his audit opinion with respect to the sporting and community grants that were lawfully considered and approved by cabinet and then appropriately given effect, largely, by the Department for Infrastructure and Transport. This is a matter of opinion. The Auditor-General has obviously felt so strongly about this particular issue that he has chosen to qualify his opinion.

My perspective on this is that I am entirely comfortable that the appropriate body that is entitled but also required to make the decision, whether it is for the grants that I referred to or whether it is for these three infrastructure projects, that that body cabinet has made the lawful decision and has authorised the initiatives and the expenditure of public moneys on those initiatives. If the Auditor-General remains dissatisfied with that because he has not had the benefit of reading all the cabinet submissions that he has wanted access to, then that is a matter for him. I am entirely comfortable that cabinet has made those decisions as the appropriate body responsible for making decisions, particularly on such sums of public money.

Mr COWDREY: Treasurer, the Auditor-General lists a range of cabinet documents that he has requested in relation to significant transactions and infrastructure projects of government within the report at page 8, what we have calculated to be more than $20 billion worth of projects. Do you believe it is appropriate under the Public Finance and Audit Act for there to not have been appropriate scrutiny of these projects based on the Auditor-General's inability to access documents sufficiently?

The Hon. S.C. MULLIGHAN: Again, I think these are matters of opinion. One is: can the Auditor-General feel satisfied that the decisions to proceed with these initiatives have occurred in the appropriate forum and under the appropriate legal authority? I was not here for the previous session that the Leader of the Opposition was questioning the Premier about. I do recall, and I think it was from the previous year's Auditor-General's Report, that there was reference to the fact that the Auditor-General had made requests for particular cabinet documents. There was a discussion about that with the Auditor-General.

If I am not mistaken in recalling this, there was the offer of providing the evidence of the cabinet decision, i.e., that the lawful authority had been given by cabinet to approve those initiatives along with the expenditure of the relevant sums of public money. My recollection—and again I will correct this if I am misrepresenting what the Auditor-General's comments have been—was that that was not satisfactory for the Auditor-General and that it remains his strong preference that, rather than just being given the evidence of the lawful decision, he gets all the associated documents.

I think, as I said before, there is a difference between getting access to evidence of a lawful decision and the predilection of the Auditor-General that he should have all the information that cabinet was provided in deliberating the decision that was eventually reached. There is a longstanding convention in executive governments, formed pursuant to Westminster governments, and that is that there is cabinet confidentiality. The cabinet retains the capacity to deliberate free from scrutiny. I think we are on delicate ground now, where we move beyond the Auditor-General being provided with evidence of lawful decision-making into an environment where the Auditor-General insists on having a ringside seat at those deliberations, and by that I mean having all the material that cabinet is able to consider in the course of its deliberations.

Mr COWDREY: In the Treasurer's response, he references cabinet confidentiality—of course noting that under the previous Weatherill government, where he sat within the cabinet, the cabinet at the time was happy to provide sufficient documents to the Auditor-General in the early years of that government. If you make a comparison of jurisdictions around the country, there have been no issues for the federal Auditor-General in accessing appropriate documentation or cabinet documents through a matter of pure convention.

If we look to our west, in Western Australia the then McGowan government moved government-led legislation to provide express access to the Auditor-General in the hope that transparency, government accountability, would be seen as being at the forefront for that government. If you look to our east, in New South Wales the then Perrottet Liberal government moved a government bill of a similar nature to provide express access to the Auditor-General. Why is it that South Australia is different? Why is it that the South Australian government has no interest in providing the Auditor-General the access that he needs to undertake his work to effectively scrutinise this government in the decisions that they are making around multiple tens of billions of dollars of taxpayer money?

The Hon. S.C. MULLIGHAN: There is no difference between the approach of this government and the approach of the previous Liberal government. The framework is exactly the same. There is a process, in fact, which was put in place I think in either late 2018 or 2019 by the former Deputy Premier of the Marshall government. That framework remains in place; that is, the Auditor-General of the day can request, of the government of the day, access to a cabinet submission, and a consideration is made as to whether that is released. So nothing has changed there. This government does not have a different regime compared with what the previous government did.

In fact, I remember—I think it was when the Auditor-General's Report was released in 2018—bemoaning the lack of access to cabinet submissions because no regime had been put in place, which had been promised by the previous Liberal Premier and the previous Deputy Premier. So, again, I do not think it is entirely accurate to characterise the behaviour of this government as being somehow completely at odds with the behaviour of other governments around the country or, more to my point, the behaviour of the previous Liberal government.

Of course, as the Auditor-General reflects on in his report, decisions are being made around access to those documents, and if I recall—I am not reading it as I am speaking—perhaps in the last year's report, if not in this year's report, there was a reference, and an offer had been made to the actual cabinet decision itself to provide evidence that the decision had been taken lawfully and appropriately by cabinet. My understanding from reading the Auditor-General's Report is that he remains unsatisfied with that. These are matters of opinion; he has chosen to express his opinion in a manner that suggests that getting evidence of a lawful decision is not sufficient for him, and I guess that is a matter for him.

Mr COWDREY: In relation to your answer, I will ask the question more plainly: what has changed in your approach between your time in cabinet in 2014, where you were happy for those documents to be provided to the Auditor-General, and the approach of the current government?

The Hon. S.C. MULLIGHAN: To the extent to which cabinet may or may not have discussed these matters—I am obviously not going to canvass that in here, particularly given my earlier comments around the important principle of cabinet for any government being able to deliberate confidentially and amongst itself—these are assessments taken at a point in time about a particular submission.

There are considerations that have to be reached: for example, whether cabinet submissions are released relevant to a current government or to a previous government. The process should be about that. The process is the same even though the decision may be different. Again, I am at pains to point out that from my reading of the Auditor-General's commentary in this report and last, he even makes it clear that the government has been at pains to provide him the lawful evidence that we thought would suffice for him to offer an unqualified opinion, but he has rejected that.

Mr COWDREY: In regard to your previous answer, did the current situation regarding the government's working interactions with the former Auditor-General have any influence on the introduction of a bill to this place that would allow the government of the day to appoint an Auditor-General for only a 12-month period?

The Hon. S.C. MULLIGHAN: I do not believe we have sought to introduce a bill to appoint an Auditor-General for 12 months. My understanding is that there was a request by the Ombudsman to have a legislative provision enacted that would enable an ombudsman to be appointed for a seven-year term, and that there was some debate amongst those in the other place about whether that should be a one-off or seven-year terms and you could have more than one term. I think that informed the perspective that you have one person who is an independent arbiter within the public sector, if I can put it like that, with the Ombudsman having that, and that might be appropriate to extend it to the Auditor-General as well.

Mr COWDREY: I move on to Part A, page 19, in regard to cybersecurity and the Auditor-General's reference in section 6 that:

All information held by SA Government agencies is subject to confidentiality, privacy, security and administrative processes of varying degrees.

He also goes on to reference that:

The critical processes for information and data assets are:

collection and capture

storage and retention

maintenance and protection

effective use.

With particular regard to retention and protection—not to labour the point; I only ask this again because we have not had a clear answer from you in other forums—in regard to the recent Super SA member data breach, when was the Treasurer first informed that Super SA members' personal data had been uploaded to the dark web for the very first time?

The Hon. S.C. MULLIGHAN: I was informed on Thursday the 12^th of the cybersecurity incident which saw the access of data from the third-party provider. I think you have asked me a question in question time: was that briefing specific about the dark web or not? I certainly came to understand that the incident involved information from what we understand at this point in time, I think, to be an international actor accessing the information on the servers—that may not be technically the correct word—of Contact 121 and posting references to that information, or references to that data, on the dark web.

If that information was specifically provided to me the first I knew of the incident, on Thursday the 12^th, I cannot recall off the top of my head, but I am happy to go back and try to refresh my memory to the best that I am able and bring back a more correct answer. Obviously, the member for Colton has his own motivations; it is breaking news that cybersecurity attacks where data is stolen and posted on the dark web are somehow a revelation about cyber attacks on government agencies or third-party providers. It is unfortunately, for those attacks that are successful, par for the course.

My consideration, first and foremost, has always been how quickly we can let the members know, and I think all members in this place have already heard me reflect on that. Certainly, while this incident happened over a period of some weeks before ultimately Super SA was able to accurately advise its members of what had happened, it is a substantial improvement on how the original breach was managed in 2019. I would hope, in the regrettable event that this ever occurs again in the future, we would be able to respond in a more timely way once we know the particulars of that particular incident.

Mr COWDREY: In regard to the previous answer, are you able to clarify for the house now how long the information or the threat was available on the dark web? We have had varying accounts in the Budget and Finance Committee and then public statements from the Premier subsequent to that, the difference between 'three weeks' and 'a short period'. If it is the Premier's answer that was correct, that it was 'a short period', are you able to define for the committee what 'a short period of time' is?

The Hon. S.C. MULLIGHAN: I think part of the confusion lies not necessarily with the committee or the member but in the complexity of accurately communicating what went on here. There are two things to be considered. One is the existence on the dark web, as I am advised, of the threat to release data, and then there is the presence, for whatever period that was, of data itself on there. I think that is what might have led to some of the consternation from either the member or those opposite in response to the quite detailed and fulsome evidence that was provided to last week's Budget and Finance Committee.

We know that the chronology of the events starts from mid-August and moves through into the September period when this incident was first made clear to government—or specifically, I should say, Treasury and Super SA—but then there was a period of a further number of weeks in order to understand what had actually been posted and the extent to which—I think what our concern here is—member data, or information regarding the members, was able to be accessed.

That is perhaps why you have that concern, member for Colton, about getting varying reports, that it is either three weeks or roughly thereof or it is shorter than that. I think it relates to the fact that we are talking about the same incident but two different issues within that same incident. One is the threat—the threat is issued, as we know, because there is usually a demand that goes with that—and then there is whether that threat is ever made good and whether data is actually able to be accessed.

Mr COWDREY: Thank you for providing information. Can I ask the question again? How long was the data on the dark web?

The Hon. S.C. MULLIGHAN: The threat of the data release was existent, I understand, for a longer period of time and then there was the contention about a shorter period of time when data was actually able to be accessed. As I said in my first answer to this last Tuesday or whenever you first asked me the question, this process is being superintended by the Department of the Premier and Cabinet.

Perhaps for completeness sake so that I am not giving incorrect information to the house, I will redouble my efforts, checking with what they have so that we have the most accurate information for the benefit of the member in the house.

Mr COWDREY: So, despite the three minutes of information telling me that I was the one who was confused, you still cannot provide accurate information to the house about how long the data of Super SA members was on the dark web. You have your chief executive sitting next to you. You cannot tell us.

The Hon. S.C. MULLIGHAN: I think what I just said to the house was not necessarily it is your fault for being confused, I said what has led to some confusion is the fact that while we are talking about the one incident there are two different things happening. One is the overall, as we understand it, longer standing threat of a release of data and then what is specific to your point: how long was data started actually up and able to be accessed?

I am sorry that I am at pains to make sure that I am accurately explaining exactly what is going on and that I am willing, in an effort of openness and transparency, to make sure that you are getting the most accurate information that is able to be provided. But I am the Treasurer, here with me are senior officials from the Department of Treasury and Finance, and as I said in my previous answer this is an issue which has been superintended from day one by the Department of the Premier and Cabinet, just as those very significant cyber incidents, particularly the one in November 2020, were managed by DPC. I am happy to take the question on notice and bring back as accurate an answer as I and the government are able for the member's benefit.

Mr COWDREY: With all due respect, I am not going to be lectured about transparency and openness by somebody who has refused to provide any transparency and openness or detail to this very parliament.

The Hon. S.C. MULLIGHAN: I take exception to that, Chair. I have made it clear in my responses both in question time and also now in this forum that we are providing information. We are providing information as we have it accurately to hand, and we remain committed to do that, and I have indicated again that I will take that question on notice and provide accurate information to the member.

Mr COWDREY: So, Treasurer, you are going to have the chamber believe today that, over the last two weeks the line of questioning has gone on and information has been presented by the CE at the Budget and Finance Committee last week, you have not sought nor has your CE sought to bring information to this house of that nature to provide that answer to the house today.

The Hon. S.C. MULLIGHAN: You asked me a question not about the incident but when did I first know about the dark web element of the incident. Then you asked a subsequent question about how long was the information up, because the Premier said this at this time. That, to me, as in you member for Colton, may not feel consistent with advice that was provided to the Budget and Finance Committee of the other place. So I absolutely appreciate what is going on here: you are looking syllable by syllable for some inconsistency in an effort to try to draw out a political point, which so far seems to have evaded you.

So you will forgive me if I commit to this place to make sure that I provide accurate information as I can get it. You did not ask me those questions two weeks ago. I did not have the two weeks to go back and find the answers to those questions over the preceding period to right now because you have only just asked me the questions. I am happy to take it on notice. I am happy to provide accurate information, but do not accuse me of refusing to give you information or not being transparent.

Mr COWDREY: I will move on to Part C, page 379 in regard to the South Australian Government Financing Authority. In particular, I would like to ask questions in regard to the financial strategy approval that was missing for six months between June 2022 at the time of that budget, and then December 2022 when the financial strategy was approved by yourself. Can you explain to the house, firstly, how the financial strategy came to not be approved for that period of time and, secondly, how the Treasurer managed to have his trip to the US to meet with funding agencies and debt agencies, prior to him approving the financial strategy for those very things?

The Hon. S.C. MULLIGHAN: The purpose of my trip to the US was not to raise debt. The purpose of my trip to the US, as I have already fulsomely, accurately and transparently provided to the house, was to meet with credit rating agencies, was to meet with global financial and economic organisations, including the World Bank, the International Monetary Fund and our principal reinsurer Aon, as well as meeting with some select other financial organisations—I do not have the list in front of me—including the Bank of America and so on, not only to gain an understanding as to where they saw the next 12 to 18 month period in a global and an Australian economic perspective, given that at that point in time everyone was assuming the US economy was about to go into recession, and of course that would have carry-on impacts for us.

That was the purpose of that trip; it was not to raise debt. After the budget, I did travel interstate to meet with entities that do provide debt to the government, and I am also aware that SAFA on a regular basis not only travels interstate to do that, but usually to various locations, principally, but not exclusively, to South-East Asia for those purposes.

In terms of the financing strategy, the Government Financing Authority Act provides that SAFA may transact in financial markets, borrow money within or outside Australia with the approval of the Treasurer. The limit to which SAFA can borrow is set out in SAFA's policy manual, which is approved by the Treasurer on an annual basis. The limit is set based on the projected borrowing over the current and forward budget estimates as required to finance the net debt in the non-financial public sector. The policy manual previously required SAFA to seek the Treasurer's approval for its annual funding strategy separately to the existing approval for it to borrow in markets. The approval to borrow in markets is provided in the debt ceiling approved by the Treasurer as part of the annual review of the policy manual.

Due to the timing of the state budget, and the requirement for the SAFA Advisory Board to consider SAFA's funding strategy at its subsequent meeting, it was not practical, I am advised, to request the Treasurer's approval of the funding strategy prior to the start of the financial year when SAFA commences funding of the state's requirements. SAFA executes its borrowing in accordance with the borrowing limit approved in the policy manual, and the funding strategy is focused on outlining SAFA's approach to achieving this. Given that the Treasurer's approval for SAFA to borrow in financial markets is already stipulated in the policy manual, the Treasurer approved an amendment to the policy manual so that the annual funding strategy is provided for noting rather than approval, and this addresses the Auditor-General's finding.

The CHAIR: The time allocated for this portion of the examination of the Auditor-General's Report has expired. I thank the Treasurer and the member for Colton, and for the next part I invite the Minister for Child Protection and the member for Hartley and the member for Heysen. Member for Hartley, you have the call.

The Hon. V.A. TARZIA: Good afternoon, minister, and to your team. I refer to page 7, Executive Summary, Part A. Is the minister able to explain to the committee why there are no government records of the assessment processes and decisions about which individual sporting clubs and local infrastructure projects would receive grants, given that the process was undertaken by the now government whilst in opposition. This question relates to the Auditor-General's comments on page 7.

The Hon. K.A. HILDYARD: Thank you very much for the question and thank you to the team in the Office for Recreation, Sport and Racing and my office for being here. I think we might have traversed some of this exact same question during the last session in relation to the previous Auditor-General's Report. I think we have also traversed it in question time and also, perhaps, in subsequent estimates committee hearings. I guess I have to say exactly the same thing as I have said previously, and that is that, as the Premier and the Treasurer spoke to earlier and covered extensively, all of the relevant processes, codes, etc., are adhered to.

As the shadow minister would note, there have been no particular findings in the Auditor-General's Report in relation to the Office for Recreation, Sport and Racing. As the member is acutely aware, I think the matters he is referring to relate to election commitments, and again there have been questions responded to in relation to those commitments, which our government is setting about delivering upon, as we absolutely should be doing and as we will continue to do across the breadth of our broad set of policies and initiatives that we took to the election.

We will continue to deliver on those commitments and we will continue to adhere to relevant processes, codes, etc. If I can just say much more broadly, which I think as the shadow minister has heard me speak about previously in this chamber, sport is really powerful and in communities right across our state it brings people together, it improves physical, mental and emotional health and wellbeing. It includes people as part of community families.

Hardworking volunteers in clubs right across our state do an incredible job including people, again, and helping people to do and to be their best both on their particular playing field and beyond in life as well. I commend all of those volunteers who do that, and I commend them also for always advocating for their particular clubs and the ways in which they can continue to provide that support, that sense of belonging, that enabling of improvement to physical, mental, emotional health and wellbeing to so many members of our community, as I know the shadow minister does both across the state and in his local community. I know that he always enjoys engaging with those volunteers and is a strong advocate for particular clubs and their needs, and I am sure he will continue to be so.

The Hon. V.A. TARZIA: I have a supplementary to that: what is the minister's understanding about what exactly the assessment process is and how those decisions are made about which clubs and infrastructure projects would receive those grants? What is the minister's understanding of that process?

The Hon. K.A. HILDYARD: I think I have already covered this today, and I have certainly covered it previously. As I just said, they were election commitments. Also, as the Auditor-General's Report refers to in relation to the 2022-23 financial year, for the Office for Recreation, Sport and Racing there have been no findings in terms of how particular funds, etc., were administered. Again, I commend the team for that work, and I again say that we will continue to deliver right across every portfolio on the commitments that we made at the election.

There are commitments in the women and domestic violence prevention sphere; there are commitments across human services portfolios, in consumer and business service portfolios—right across the full breadth of government. I know that my cabinet colleagues are working very hard with communities to deliver on every aspect of those election commitments, as we should be and as I am very proud that we are.

The Hon. V.A. TARZIA: Thank you very much. I will now pass on to my good friend, the member for Heysen.

The CHAIR: Do we need a change of advisers, member for Heysen?

Mr TEAGUE: Yes, I might just go to child protection. While the advisers are changing, I might just indicate that I will go straight to Agency Audit Reports in Part C. The focus of my questions in the short time available, and really following the significant events identified by the Auditor-General, will be first on budget cost on page 37 to start with; secondly, on the growth in children and young people in care, and particularly the disproportionate growth in the numbers of children in non-family-based care; and then, thirdly, I hope there might be an opportunity briefly to address the audit findings in relation to improvements in information technology general controls being required. I just indicate that to you, Chair. When the minister might be ready, I am happy to proceed.

The CHAIR: Yes, go ahead.

Mr TEAGUE: Proceeding then in order, first I direct attention to Part C, page 37 and the first dash point identified by the Auditor-General, 'Significant events and transactions.' The Auditor-General observes that child protection service costs exceeded the original 2022-23 state budget figure by $81 million (20 per cent). To put that perhaps into relevant context, we see also at page 43, at about point 9 on the page, reference to the additional $5 million that was provided to DCP as part of the Mid-Year Budget Review.

Going over to 44.1, we see further that that amount additionally comprises $42 million of further resources to fund increased costs associated with providing care services to children and young people. The third dot point at the top of page 41 is 'additional working cash', which is not further specified but provides some context.

I direct the minister's attention then to page 46 and the middle part of that, from about point 6 on that page, a series of bars in a bar chart indicating the growth in expenses both as to budget from 2019 through to 2023 but then, more particularly, to expenses in excess of budget of which, as the bar chart indicates, 2023 is a stand-out example in terms of that blowout of cost. So there is a fairly broad-ranging context.

I might put the question in terms of the way I framed it in the first estimates hearing immediately following the 2022 budget. Given the increase in the budget to the Department for Child Protection year on year, which is not itself unwelcome, the extent of the blowout for 2022-23 is a source of concern to the Auditor-General. Given that $170 million increase therefore in funds applied to the Department for Child Protection, what results have been identified in terms of how those additional funds have been applied? What is the government's plan to avoid such a cost blowout in the course of the year ahead?

The Hon. K.A. HILDYARD: Just so I can answer properly, the $170 million, I am not quite sure what you are referring to.

Mr TEAGUE: The sum of $89 million is a 13 per cent increase over the 2021-22 budget. Service costs exceeded that budget by $81 million, so 81 plus 89 is 170—partly budgeted, partly blowout of costs in excess of budget.

The Hon. K.A. HILDYARD: There is obviously a lot in that question, so I will try to—

Mr Teague: Just full context.

The Hon. K.A. HILDYARD: Yes, so I will give you full context also. I hope I am understanding the multiple questions in there, so I will try to take the themes, I guess. I think I have tried to explain this to the shadow minister before. In child protection and family support, primarily the core goal is always to do what we can to improve outcomes for children and to strengthen families where possible. Where that is not possible, it is to provide the best possible care. Where possible, that would be family-based care, either foster or kinship care. Where that is not possible, that would be residential care.

With the vision of improved outcomes for children, we are constantly balancing those various objectives. When I say 'balancing those various objectives', it is balancing, most importantly, in terms of getting the best possible outcomes for children and their families through tackling the complexity of issues that children and their families contemplate but also balancing in terms of where we direct particular investment.

If I am remembering correctly, the first point that you made was about the numbers of children in care. I wanted to give the member—

Mr Teague: I didn't mention children in care in this question.

The Hon. K.A. HILDYARD: You said the number of children. You said the growing numbers of children in care. That relates to the—

Mr Teague: I was giving an overall indication of where we are going. I will get to children in the second question. I am concerned with the blowout to budget in this question.

The Hon. K.A. HILDYARD: What you invest in children in terms of balancing the ability to give them the best opportunity for improved outcomes is also, of course, absolutely linked to where you direct particular investment. Everything is about those outcomes for children and doing what we can to improve those outcomes for children, and the investment obviously is balanced in particular ways to try to do that. We are always striving to do that, of course, as we should be.

Where I was going in terms of the numbers of children in care, which I think will be very pleasing to the member, is that over the past five years year on year, during 2018 to 2021, there was significant growth in the numbers of children in care—growth that went up to around 9 per cent year on year, sometimes 6 per cent, sometimes 7 per cent, up to 9 per cent. It is really pleasing that that number for this last financial year is in the vicinity of 2 per cent, so we are beginning to see that decrease. In regard to our investments that we are making in programs like family strengthening programs, effective intervention programs and reunification programs—and I do not want to overstate this; it is really important not to because there is still a lot of work to do—we can see a tiny shift in terms of that reduction after that blowout, using your language, over those past four years during the term of the previous government.

Having said that, when it is not possible to strengthen families, when there is no opportunity for effective intervention, family support programs, reunification or family group conferencing to work in the way that would keep a child safely at home, of course we have to take other actions. We are investing in reunification and we have put additional funds into reunification. We have put an additional $35 million into family strengthening intervention programs. We have put an additional $13 million into family group conferencing programs over here.

I will not apologise for this but, rightly, for the first time, we are beginning to invest in the way that we need to make sure that appropriate levels of support are there for children already in care. We have put significant additional investment into the care for those children and young people who are not living with their families, so that is a really important part of our investment. Again, I am not going to apologise for the fact that we are finally investing in the way that there should have always been investment for those children, particularly vulnerable children who are already in care.

There is a third area that we are significantly investing in. We recognise that we need to keep growing the numbers of family-based carers, both foster and kinship carers. We have invested with absolutely strong recognition of that in the most recent budget. We have committed more than $100 million to support initiatives including financial support for carers—I am sure the shadow minister would be really pleased to hear that—as well as a 4.8 per cent increase on carer payments. In addition to that 4.8 per cent increase, we have also provided foster and kinship carers with children 16 and under with a $50 increase to their payments. That is a really important part of responding to what carers all over the state have told us in terms of what they need to help meet those costs of caring.

Another very important thing, alongside developing a comprehensive carer attraction and retention strategy to keep building very importantly on those numbers, is we are seeing significant growth in the number of kinship carers. I take the shadow minister back to what I spoke about in terms of our $13 million investment in family group conferencing. That is very important in terms of giving the best opportunity to identify kinship carers and to identify who can be around a child in terms of that extended family network. That is an incredibly important investment to grow the number of family-based carers.

Additionally, we have invested in this budget by again recognising that we need to grow those numbers: $4 million into kinship care assessments means that we can employ additional staff members who can work much more fulsomely, efficiently and quickly to assess those identified kinship carers so we can have them in place as quickly as possible to provide family-based care to children.

Again—and I know we covered this in estimates—you always need to think about delivering those improved outcomes, and working towards delivering those improved outcomes, in a holistic sense for children and young people. You need to think about all those different mechanisms to balance appropriately the context for that child, bearing in mind the complexity of issues that a particular child and a particular family are facing: who else is around that child, whether the child should be in non-family-based care because there are no other alternatives, and really making sure that the investment is there for those non-family-based care residential settings. I am trying to answer in as fulsome a way as your fulsome question requires.

That is the balance that we continue to walk, and I am really proud that, since coming to government, we have invested an additional $370 million-odd into the broad child protection and family support system, as we should.

In regard to the complexity that children and families are facing, I have spoken about the investment across the child protection and family support system. We know that to effectively deal with the complexity that children and families face we also need to make investments elsewhere. For instance, in the education setting—and I am sure the Minister for Education will be able to speak about this particular investment—there has been an investment in terms of mental health professionals in schools. That is, when you think about the system in its broadest possible sense, there are also investments, importantly, that we are making through other departments to make sure that we are responding to that complexity of issues that families face.

Similarly, there are investments in health settings and in many other departments as well. If we are all—and when I say 'we' I mean everyone in this parliament, everyone in our community, everyone across government, everyone in the sector—to live up to that mantra that so many of us speak to, that child protection and family support is everyone's responsibility, then we need to think about it in a holistic way right across government, and think about how those other investments and strategies also interact with us trying to improve outcomes with and for children and young people and their families.

I will flag—and I think this will absolutely demand, rightly, further discussion at other points—that I think there is absolutely much that we will be able to advance to help improve outcomes for children and young people through the investment following the royal commission into the early years. I think that there is an excellent opportunity to also connect work right across our community and right across government to advance outcomes for children and young people. That will be a really important investment in that regard, as will our investment into the new Women's and Children's Hospital and many other areas also.

Mr TEAGUE: I direct the committee now to page 45, perhaps in light of the emphasis in the minister's answer on the need to invest in improvement of availability of family based care, kinship care and so on. Going to page 45 at about point 2 on the page, we see the Auditor-General addressing just that, and indicating there that 'Family based care at 30 June 2021 increased by 1 per cent or 41 children,' so it goes to the 2 per cent that the Auditor-General identifies at page 37. That might be regarded as an encouraging number.

However, the Auditor-General indicates, and I ask the minister to direct attention there, to the concerning growth—12 per cent growth, 83 children—in non-family based care, the very thing that the minister has just directed attention to. That is a 12 per cent increase over the course of the year that, if we go back to the question I asked about money, was a year in which there is $170 million of additional resources applied.

The chart that the Auditor-General sets out provides what might be described as a startling indication, by the darker section at the top of the 2023 bar, that the number in non-family based care is constituting a startlingly increased proportion of the overall. The Auditor-General makes the observation, in the following paragraph below that table, that non-family based care is significantly more costly to provide than family based care and is the main driver of the significant growth in child protection services costs.

So you have a blowout to budget that the minister has described as resulting from investments towards promoting family based and kinship care. The Auditor-General is belling the cat on that, though, by indicating that we have had this 12 per cent increase in the very thing that these funds have been directed to. As if to illustrate the concern, the Auditor-General points to the commonwealth Productivity Commission's Report on Government Services—the RoGS 2023—reporting that:

…in jurisdictions where data was available, annual costs per child were considerably higher for residential care (ranging between $487,000 and $956,000 in 2022) compared to non-residential care…

I hear and absorb and listen carefully to the minister's answer in relation to investments towards increasing family based and kinship care, but the Auditor-General is indicating that such endeavours have, in the circumstances of the report, been an abject failure.

One further observation is that the chart that the Auditor-General then refers to is the situation in South Australia relative to the rest of the country, and so we see South Australia has a lower proportion of children and young people in family based care than the Australian average across the board.

The Hon. K.A. HILDYARD: First of all, if I can just correct you: I knew that you were giving the parliament an incorrect figure before when you spoke about the $170 million. You have actually doubled up your figures. What you refer to in terms of the $89 million is the appropriation which funded the investment into the costs of caring. I just want that noted, that that figure is utterly incorrect, hence why it does not appear there in the Auditor-General's Report.

Mr Teague interjecting:

The Hon. K.A. HILDYARD: If you understand—

Mr Teague interjecting:

The Hon. K.A. HILDYARD: One figure speaks to the investment in the costs of caring, so it is not an addition; one is funding the other. I just wanted to put that on record because that was completely incorrect. The other thing that you have missed in your soliloquy is that the figure you are also not accounting for is the investment in intervention, which has meant that particular children's families are strengthened and they have been able to stay safely at home.

The other thing that I would say is, in terms of your quote of the $487,000 and $956,000, if you read that line that actually refers to all jurisdictions, so it is not particularly a South Australian jurisdiction. Again, I just wanted to make it clear that that was not correct. Nevertheless, what I will explain again is that we, in this most recent budget, have made significant investment to grow the number of family-based carers. That investment—

Mr Teague interjecting:

The Hon. K.A. HILDYARD: Yes. This is about the previous financial year, so we have made that investment to address that issue. I am hoping that makes sense to you. That is why we have made that investment, but I am happy to talk through it again in the remaining time that we have. We are providing additional funds to carers to fund the cost of caring, and we are investing in family group conferencing and in kinship care assessments to grow that pool of family-based carers.

The CHAIR: The time allocated for the examination of this portion of the Auditor-General's Report has expired.

Progress reported; committee to sit again.