LIQUOR LICENSING

The Hon. J.S. LEE (14:47): I seek leave to make a brief explanation before asking the Leader of the Government a question about new liquor licensing fees.

Leave granted.

The Hon. J.S. LEE: On 15 June 2011, on ABC radio, the President of the Australian Hotels Association, Ian Horne, raised the issue of the state government introducing a new licensing fee in addition to the existing tax structures for every venue in South Australia. Country hotels will be paying a new liquor licensing fee. The media reported that small venues are going to be paying up to $500 a year and larger venues will have to pay up to $4,000 a year. In the City Messenger dated 16 June, Clubs SA General Manager, Helen Martin, said:

Licensed clubs are struggling enough as it is. The fee could contribute to the demise of some clubs.

A number of traders' groups and associations have also raised concerns with me about how businesses will cover these extra taxes implemented by the government. They believe that businesses will have no choice but to pass expenses on to their customers. My questions to the Leader of the Government are:

1. The media has reported that the government will introduce a range of fees for restaurants, sporting clubs and smaller country pubs, and there will be some exemptions. Can the minister explain what the exemptions are and also the basis for these exemptions?

2. Has the government taken into consideration the impact on small businesses, especially country pubs and clubs operating in the regional areas?

3. As businesses may have no choice but to pass expenses on to the consumer, how much will an average drink go up by and has the government taken into consideration the impact on consumer spending?

4. The media reported that the fee likely to be charged from early 2012 will provide the government with an extra $3.6 million a year. How does the state government intend to use the revenue to support pubs, hotels, clubs and the hospitality sector across South Australia? Will country pubs, hotels and restaurants see any additional policemen, better roads and infrastructure? What options and benefits can the government offer to justify introducing a new fee?

The Hon. G.E. GAGO (Minister for Regional Development, Minister for Public Sector Management, Minister for the Status of Women, Minister for Consumer Affairs, Minister for Government Enterprises, Minister for Gambling) (14:49): I thank the honourable member for her question. Indeed, the introduction of an annual licensing fee for liquor licensees has been discussed by this government for some time. In fact, it was included in a discussion paper that I put out close to 12 months ago. So, it is not a new or novel idea.

Currently, in South Australia, there is not an annual liquor licensing fee in place. The licensed premises pays at the outset, when they first take their licence out, and they are only required to pay again if their business or licence changes in some sort of significant way. So, for many licensed premises, they pay a once-off fee, and that might be one fee in 50, 60, 70 or even 80 years, unlike most other jurisdictions where an annual liquor licensing fee is, in fact, in place.

At present, Treasury has been in negotiations with the AHA and, I think, some other key stakeholders. The details of the breakdown of the different classes of licence, I have been advised, have not been finalised as yet—that detail is still being worked through—but an annual fee will be introduced for holders of liquor licences to help cover the ongoing costs of regulatory compliance. So, if you like, it is a fee that is a cost recovery type of arrangement to cover the costs of compliance.

At this point, I am advised that it is intended that there will be two base fees, which will reflect the level of compliance effort and the type of business conducted under the licence. Fees will be adjusted between categories for venues that are high or low risk. An additional fee will also apply to licensees permitted to trade after 2am, and a further fee for trading after 4am, if that is permitted.

Clubs holding a limited licence will be exempt from the annual fee, and the fee amounts date for payment and the basis for the calculation of the fee will be set by regulation, and obviously there will be consultation with industry stakeholders. The fees will be set to achieve cost recovery for liquor regulation and will be indexed annually as a part of the fees and charges process, which requires the periodic review of cost recovery levels to be conducted.

The Liquor and Gambling Commissioner will have the discretion to grant, on application of the licensee, either a reduction in that annual fee or, I understand, an exemption under hardship provisions, if they can be established. As I said, the annual liquor licensing fee applies in many other jurisdictions, including Victoria, Queensland, Western Australia and Tasmania, and it is the budget bill that we will be looking to to establish the mechanism to establish that fee.