Parliamentary Committees

NATURAL RESOURCES COMMITTEE: LEVY PROPOSALS 2011-12

The Hon. R.P. WORTLEY (16:16): I move:

That the 50^th to 56^th reports of the committee relating to the Natural Resources Management Board levy proposals 2011-12 for Kangaroo Island, South-East, Eyre Peninsula, Northern and Yorke, Arid Lands, Murray-Darling Basin, and Adelaide and Mount Lofty Ranges, be noted.

One of the Natural Resources Committee’s statutory obligations is to consider and make recommendations on any levy proposed by the Natural Resources Management Boards where the increases exceed the annual CPI rise. Of the seven proposed increases in the division 1 land based levies for 2011-12, all were higher than the CPI rate, which for the current financial year is 2.6 per cent. All bar one of the division 2 water levy proposals were also higher than CPI.

Considering these levies presented a challenge for the committee, while members were sympathetic to the desire of NRM boards to increase their funding bases, members believe that in principle above CPI increases should be the exception, rather than the norm. In this instance, the committee has determined not to object to the levies, while also suggesting that arrangements around the setting and collection of levies should be reviewed as part of the boards’ budget planning processes for 2012-13.

I will go through some reflections on the individual board proposals. Adelaide and Mount Lofty Ranges NRM region continued its equalisation process begun in 2009-2010 to bring all division 1 levies to parity by 2012-13. Prior to 2009-10, levies ranged from about $17 to $47, dependent on local government area. The committee supports the equalisation concept. Once the equalisation process is completed, the committee will expect future increases to be limited to CPI.

The committee accepted the South-East NRM Board's argument that it needed to increase its division 2 levy to offset reductions in water allocations which are under review. In the case of the Arid Lands NRM region, the Natural Resources Committee objected to a proposed 900 per cent increase in its division 2 levy back in 2009, suggesting a more moderate increase and also an increased division 1 levy in order to spread the impact. The levy proposal was consistent with those suggestions.

In the case of the Murray-Darling region, the NRM board receives considerable funding from the Australian government for water projects. The board is concerned that this funding may decline or cease once the new Murray-Darling Basin Plan has been adopted. Consequently, it has sought to increase its levies to offset the risk.

A number of other factors were raised by boards in their appearances before the committee as part of their justifications for above CPI increases. Firstly, staff wages will increase by 2.5 per cent under enterprise bargaining arrangements in the coming year. Maintaining wages, salaries and staffing is important, and these are a significant proportion of boards’ budgets.

Secondly, commonwealth funding is uncertain beyond 2013. The Caring for Our Country program provides 23 per cent of the total funding for all of South Australia's boards. It is the second biggest source after the regional NRM levy, which contributes 40 per cent on average. Thirdly, the NRM boards have differing chances of attracting additional funding. Some boards—for example, the Arid Lands Board—have been successful in negotiating generous grants from mining and pastoral companies, while other boards only have very limited opportunities to target private sector funds due to size or location.

On another matter, members heard recently from the Presiding Member of the Northern and Yorke NRM Board, the Hon. Ms Caroline Schaefer, who is also a former member of this committee and this place. Members heard that the requirement for the boards to review their business plans and levies annually is onerous and resource intensive. The quote I am about to give you is a bit long, but members of the committee believe it to be an accurate reflection of the experiences of the majority of the NRM boards. I will now quote from Mrs Schaefer's evidence to the committee:

I spent some six years on your committee, and one of the issues that always bemused us was the amount of time that it seemed to take for an NRM board to achieve anything. Now that I am wearing a different hat, I thought that it may be opportune for me to explain some of the frustrations that I, my board, and, I suspect, the public servants feel in terms of the maze of checks and balances that are in place, I think, to the exclusion of efficiency.

As an example today, I will simply run through the process that is required by legislation for us to bring this business plan to you. The business plan is a revolving plan over three years, but it is reviewed annually, as is the requirement. In order to review it annually, the board meets a minimum of two, probably three times, when they discuss what its priorities will be. So, we will start looking at our plan for 2012-13 in about July-August of this year. We will then have about two or three board meetings. We will set priorities. We will send that draft to DENR. DENR will then see that our priorities are not at odds with the priorities of the government of the day, and they will send it back to us.

We will then be obliged to hold a minimum of three public consultations, but they have to be advertised first. By this stage, you are getting to around about Christmas. Blind Freddy knows that in the country people are reaping, then they go to the beach. So, you have to get that advertising in prior to that, because you must have your public consultations before the end of February.

We send a request that we can advertise in these publications for this amount of time. DENR, in fact, chooses what size advertisements will be put in. This year we are treated to about a quarter page in the local press and a thumping big one in Saturday's Advertiser, which we as a board paid for, when, frankly, a notice in the public notices in the local press would have covered the same people.

The advertising is done. We then have three public consultations. This time they were in Clare, Maitland and Orroroo. We then have to disseminate what we learnt at those public consultations, plus take written submissions from anyone who chooses. We have a cut-out date, sometime in February. There are almost always, I am assured, a couple of late submissions, notoriously from government departments, but that's beside the point.

We then have to have another couple of board meetings to assess what those submissions have said to prioritise them, to draw up a final draft, which then goes to Adelaide, through DENR. If they believe it is compliant, it then comes back to us, then it comes to you and, at the same time, it comes to the minister. The minister, if you have no objections, usually approves our draft plan and it becomes our business plan.

So, our business plan, which, in fact, is really only about the levy, which is very little changed from previous years, has taken from August to May to become a working document for us to use. I do not necessarily have any answers to that, but, as I see it, if that were any other sort of business there would have to be two or three layers of that process cut out to make it efficient. It ties up a huge amount of resources within the board, which, in spite of public perception of NRM boards, is neither overstaffed nor over-financed. It takes a huge amount of time of board members, and I don't believe it could possibly be the most efficient process.

The committee concurs with Hon. Caroline Schaefer that, based on her description, the process of annual review of the levies appears to be onerous and inefficient. In the interests of addressing some of these points, we have sought a meeting with the minister to discuss the process to see if it can be in any way improved.

I commend the members of the committee: the Presiding Member, the Hon. Steph Key, Mr Geoff Brock MP, Mrs Robyn Geraghty MP, Mr Lee Odenwalder MP, Mr Don Pegler MP, Mr Dan van Holst Pellekaan MP, the Hon. Robert Brokenshire MLC and the Hon. John Dawkins MLC. Finally, I thank the committee staff for their assistance. I commend these reports to the council.

The Hon. J.S.L. DAWKINS (16:23): I rise to support the remarks of the Hon. Mr Wortley in noting the 50^thto 56^threports of the committee. Certainly they cover the levy proposals for those boards as listed by the honourable gentlemen. I will not speak at length but, considering that these levies presented a challenge for the committee, I think it is important that we are sympathetic to the work that the boards are doing, as the honourable member said. We understand that there is a flavour out in communities that would suggest that they are over-financed and underperforming, and I think the committee would not support that view.

However, we also support very strongly the fact that we would like to do everything we can to assist the boards to perform in the best possible manner and, for that reason, as the Hon. Mr Wortley indicated, we have sought a meeting with the minister to see whether the processes that are involved in the boards presenting their business case to both the committee and the minister can be streamlined.

We determined not to object to the levies on this occasion but I think in every case we put in a proviso that each of the boards needs to look at limiting itself to CPI on the next occasion they come to us. We have also, as I said, sought that meeting with the minister to try to pick up a number of the points, made very well by my former colleague in this place, the Hon. Caroline Schaefer, as outlined very well by the Hon. Mr Wortley.

I am glad the Hon. Mr Wortley quoted the Hon. Caroline Schaefer to the extent he did because she outlines very well the situation that she has seen on both sides of the fence. As she said, she was a member of the Natural Resources Committee for six years—in fact, I think, probably from its creation until her retirement. She now sits as the chair of an NRM board. Remarkably, I think, she has only been in that position for about 12 months, yet she is the longest serving presiding member of an NRM board in this state.

We have seen so much change in the personnel—presiding members, board members and, indeed, regional managers, as they are now called—because of the cooperation—the shadow minister might help me with the word—the transition of NRM boards into—

The Hon. J.M.A. Lensink: Integration.

The Hon. J.S.L. DAWKINS: —integration, thank you, of the boards into the Department of Environment and Natural Resources. In that case the Hon. Caroline Schaefer's words have been taken very seriously by the committee and we will pass them on to the minister. I think it is easy for the committee to say, 'Why haven't these boards got their proposals into us earlier,' because our time lines make it difficult for us as a committee to look at the proposals with the necessary time that we feel we should give to them before the effluxion of the time set by the act.

One would hope that we can suggest changes to the minister that can improve this process and particularly pick up the points made by the Hon. Mrs Schaefer about the fact that, in many cases, the boards would like to advertise their consultation process only in local media. They do not see a need to have to pay for a very large advertisement in the Saturday Advertiser. In fact, I think in the board region that the Hon. Caroline Schaefer chairs there are at least seven weekly newspapers.

She was of the view that an advertisement in each of those newspapers would be sufficient. Indeed, she also suggested to the committee that the opportunity ought to be there for local boards in the regions to use regional TV and radio for advertisements, because they are obviously a lot less expensive than advertising on metropolitan TV and it is a way to get right into every corner of the areas they work in. So, I would ask that the minister take on those suggestions as well.

I do thank my colleagues on the committee for the manner in which they have examined these reports. I think that has been assisted by the excellent chairmanship of the Hon. Steph Key, who is passionate about natural resources and her leadership of this committee, and I thank her very much for that. I also thank my other colleagues on the committee, including, of course, the Hon. Mr Wortley and the Hon. Mr Brokenshire in this place. I pay tribute to the work of Mr Patrick Dupont and David Trebilcock, who are the staff of the committee.

Motion carried.