Legislative Council Fifty-Second Parliament, First Session (52-1) 52 1 Parliament of South Australia Legislative Council published Question Time Liquor Licensing LIQUOR LICENSING The Hon. S.G. WADE Legislative Council LIQUOR LICENSING The Hon. S.G. WADE (14:39): I seek leave to make a brief explanation before asking the Minister for Consumer Affairs a question about annual liquor licensing fees. Leave granted. The Hon. S.G. WADE Legislative Council The Hon. S.G. WADE: The Office of the Liquor and Gambling Commissioner distributed a discussion paper yesterday called 'A Safer Night Out' which foreshadowed the government's intention to implement an annual licence fee to liquor licences to 'ensure that the liquor industry contributes more towards the cost of its regulation'. The paper makes clear that regulation in that context includes base administration costs. The minister's press release states that the government will introduce 'a scheme of annual liquor licensing fees so the industry makes a more effective contribution to the cost of compliance and enforcement'. On ABC radio yesterday afternoon the minister is reported as saying that the cost of the misuse of alcohol in South Australia is over $1 billion, so the industry should contribute to the cost of compliance. My questions to the minister are: 1.	What costs is the government proposing to recover through these fees: is it the costs of regulation, the cost of compliance, the cost of abuse, or all of the above? 2.	Is the consultation on the model for the recovery of costs only or the scope of the costs? 3.	What proportion of the costs of regulation compliance and abuse does the government aim to recover through this scheme? The Hon. G.E. GAGO Legislative Council Minister for State/Local Government Relations, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister for the City of Adelaide The Hon. G.E. GAGO (Minister for State/Local Government Relations, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister for the City of Adelaide) (14:40): I thank the honourable member for his question, and I very much appreciate the opportunity to talk about the provisions being proposed in this discussion paper and set the record straight in terms of some of the scurrilous mischief-making that has been going on, as well as some of the significant scaremongering that has occurred. As we know, two discussion papers were released yesterday. They are discussion papers out there outlining a series of proposals for the general public and key stakeholders to consider. They have a six-week period in which to forward their comments to the government and for us to consider those comments and work on what appropriate steps we should take to move forward. It is, as I said, only a discussion paper. Compliance and enforcement, which are the main focus of my attention in relation to the proposals being put forward, cost money. We know that, overall, the misuse of alcohol costs the community, as the honourable member mentioned, $15.3 billion Australia-wide, and approximately $1 billion of that is the South Australian share. We know that alcohol taxes do not go anywhere near covering those costs. The industry cries that it is already paying for the costs of alcohol, including misuse, compliance and enforcement. They say they have already paid those costs, that they are already contributing. Quite simply, they are not. When you add up all those costs, they are quite significant, and they are clearly not being covered by the current tax arrangements in place. These costs, including enforcement and compliance costs, are heavily subsidised by all taxpayers currently, and that includes ordinary mums and dads. Compliance and enforcement measures are there to ensure that certain standards apply around the sale and consumption of alcohol. Those standards are aimed at minimising harm and at keeping the community safe, so quite clearly around these elements there are benefits for the community in relation to compliance and enforcement costs. There are also clear benefits to the liquor licence holders, as a licence actually allows them a monopoly in relation to the sale of alcohol. Not every retail outlet can sell alcohol, only some, so in some respects there is a privilege associated with the holding of a licence. There are many other businesses that sell products that are licensed and have an annual fee, such as second-hand car dealers. Liquor is no different. It just so happens that here in South Australia we have not had annual licensing fees, whereas in almost all other states they do have annual licensing fees. Having a licence provides a person with a privilege or a right to sell something. However, this right also comes with a set of responsibilities, particularly when those goods being sold can be harmful. As I have already said, we know that alcohol-related harm costs the Australian community $15.3 billion a year—and they are 2005 figures, I understand, so it is probably more than that now. The fee that we are proposing for consideration is in fact a really small fee. The base rate— Members interjecting: The Hon. G.E. GAGO Legislative Council The Hon. G.E. GAGO: They snigger across from me; they snigger. For most pubs and clubs, the base fee is $1,000 a year. That is $3 a day. What is the cost of a glass of beer? About three bucks; three bucks, round about, for a glass of beer. A glass of beer a day is what the base annual fee is going to cost us, roughly—and I am being generous here—the cost of a glass of beer a day. This is going to bring the sky down on us. The whole system is going to collapse over the cost of, round about, a glass of beer a day to provide these protections to the community. We also know that, in the proposals we are looking at, many small country pubs are actually going to be exempt from some fees. Many of those smaller pubs and clubs are going to be exempt. The fee that we are proposing will apply to almost all liquor licence holders, that is, those who sell alcohol: pubs, clubs, bottleshops and retail outlets—the suppliers of alcohol. The AHA is saying that this cost is going to be passed on to consumers of alcohol. Well, it may be, and if this is so, the $3 a day, the glass of beer a day, if that is going to be passed on, and it may well be—it probably would be offset by the cost of changing their books—let's take their word, why shouldn't the cost of alcohol reflect more closely the real cost of alcohol? What's wrong with that model anyway? Why should all taxpayers—and there are a number of honourable members here in this chamber who do not drink alcohol—why should the whole community, subsidise the cost of consuming alcohol? I think that it is reasonable to put forward for public consultation—and that is all we are doing—a model where those who consume alcohol start to pay for the real cost of alcohol. For all these reasons that I have outlined, almost all other states have put an annual licence fee in place. As I said, some are being quite scurrilous in their scaremongering, saying the sky is going to fall in. It has not fallen in in other states. They manage very well with this modest impost. The licensing fee is only one part of a suite of measures that this government has put forward for consultation to bite the bullet on some of the appalling behaviour and conduct that we see around some of our pubs and clubs, on the street and around our entertainment precincts. People are saying to me they are sick and tired of having their night out ruined by drunken, loutish, violent, offensive behaviour, and we know that this problem is on the increase. This problem has become worse, and the research shows us that one of the elements it is associated with is increased trading hours. The problems have become worse as trading hours have been extended. One of the things that we have put forward is a closing down of trading hours, a mandatory close-down across the sector, for three hours in a 24-hour cycle: from 4 to 7am, or, if they are into the breakfast trade, from 5 to 8am. That ensures a mandated two-hour close-down in entertainment areas, where they can revitalise and clean up, where entertainment crowds can be dispersed and the area revitalised ready for business the next day. One of the other proposals being put forward is the strengthening of powers of the Liquor and Gambling Commissioner to be able to take action around problem venues. This includes being able to put in place, where it is deemed necessary, for instance, extra CCTV cameras and an increase in the number of security guards. We are looking to put in place a range of measures, including the ability to mandate lockouts where it has been assessed and deemed necessary. The mandate for lockouts will apply not necessarily to just a single venue: it can apply to a number of venues, because some of the data we have received shows that lockouts can work. They can be very effective in reducing unruly, intoxicated misbehaviour on our streets. However, the data shows us that it does not work when a number of venues in an area join in to a lockout but one or two venues opt out. All that does is provide an imbalance to the trade in that area, and it disadvantages those responsible licence holders who are trying to do something about better managing alcohol misuse and putting a lockout in place. That is another initiative. We are also looking at improving regulation around party buses. We know that there have been some significant problems reported by not only police but also venue operators in entertainment areas. The Hon. J.S.L. Dawkins Legislative Council The Hon. J.S.L. Dawkins: You've been going for 12 minutes; you've only got 36 to go. The Hon. G.E. GAGO Legislative Council The Hon. G.E. GAGO: And the more interjections I receive the longer I will go on. The Hon. J.S.L. Dawkins Legislative Council The Hon. J.S.L. Dawkins: Twelve minutes. The Hon. G.E. GAGO Legislative Council The Hon. G.E. GAGO: It will be more if I keep receiving interjections. Just to finish, one of the other initiatives we are looking at is banning some of those behaviours that we believe contribute to binge drinking, such as drinking games, all-you-can-drink admission charges and things like laybacks. Mr President, I know that you probably do not know what a layback is, but that is the term used for pouring alcohol (usually spirits) directly into the mouth of a person who is sitting at a bar. That alcohol is poured from the bottle (not from a glass), so it usually administers high concentrations of alcohol in very concentrated bursts. These are some of the initiatives that we are putting in place, and we are biting the bullet. We need to clean up our streets and make our pubs, clubs and streets safe for our young people and for all the community to be able to go out at night and enjoy themselves. These are proposals for consideration, and I am very pleased to have had this opportunity to outline some of these initiatives. I think there was a question about the proportion of income involved. I have already put on the public record—and it is an estimate only—that the rough estimate of the revenue that this licence fee in the current model going out for consultation will generate is around $5 million. In terms of how that might be spent, the details of the spending would obviously need to be dealt with through a budgetary process, but I will certainly be pushing for all of that to be directed towards cost recovery, including enforcement and compliance costs. The President Legislative Council The PRESIDENT: The Hon. Mr Wade has a supplementary question.