STATUTES AMENDMENT AND REPEAL (BUDGET 2012) (NO. 2) BILL

Second Reading

Adjourned debate on second reading.

(Continued from 14 November 2012.)

The Hon. R.I. LUCAS (15:53): I rise on behalf of Liberal members to support the second reading of the Statutes Amendment and Repeal (Budget 2012) (No. 2) Bill. This bill is essentially a reintroduction of a bill the parliament has seen previously. There are a number of important amendments; one is that the biosecurity levy is no longer in this bill. Secondly, the issue in relation to housing grants has been the subject of a separate piece of legislation. There is, however, the ongoing issue in relation to police court costs. I will not address that issue. My colleague the Hon. Mr Wade has carriage of that and will address it in his contribution and during the committee stages of the debate.

There are a number of issues that I want to raise in the second reading, and in raising questions I am quite happy that the passage of the bill is not delayed whilst a considered response is prepared. I am happy for the minister to give an undertaking to get a response from the Treasurer and officers and provide a response to me by way of a letter, sometime between now and the February session of parliament. The first issue is in relation to the changes in relation to RESI corporation which were established back in January 2000 under the Statutes Amendment (Electricity) Act 1999.

The minister's second reading contribution indicates that the litigation process which RESI had oversight of was complex and had been funded through RESI's own resources which had been originally allocated when it was established in 2000 and it had been supplemented, when required, through the budgetary process. I ask the minister if he can provide what the original funding allocation in 2000 was to RESI and what the supplementations have been for RESI since the year 2000, what particular years and what amounts have been provided to RESI as referred to in the second reading contribution.

Further on, the minister indicates that SAFA and an administrative unit of the public service that is primarily responsible for assisting the Treasurer in the performance of his ministerial functions and responsibilities are to take on the residual activities of RESI following its dissolution. Can the minister indicate what is the particular administrative unit of the public service that is going to provide that particular function as referred to in the minister's second reading contribution?

Further on in the second reading contribution there is a reference to the new public sector skills and experience retention entitlement scheme, and the minister says that public sector skills and experience retention entitlement would apply to about 26,000 public sector employees with 15 or more years of effective service. Is the minister able to provide a breakdown of the bands of service that the public sector comprises such that the minister is able to indicate that there are 26,000 with 15 or more years of effective service? I am assuming that the Commissioner for Public Employment or Treasury has compiled a classification of all public sector employees in terms of years of service.

Can the minister provide some sort of breakdown in terms of nought to five years, five to 10 years, 10 to 15 years and any breakdowns of 15 or more years of effective service. The minister also says an employee can only be entitled to one form of retention leave. Can the minister provide detail of what that actually means? What other forms of retention leave are available to public servants which, if they were entitled to them, would mean that they are not entitled to this new retention entitlement?

Also, specifically, some officers are paid what is known as a retention allowance, not retention leave. That is, they are paid an additional salary increment up to 40 or 45 per cent of their base salary as a form of retention allowance. Can the minister indicate whether this statement in his second reading contribution indirectly refers to retention allowances as opposed to the specific words that he has used in his contribution which is 'retention leave'? I seek a specific response from the minister in relation to that.

The minister also says that this leave will not apply to SAPOL employees who benefit from retaining police knowledge and experience entitlement established in the South Australian Police Enterprise Agreement 2011. Can the minister outline what are the equivalent entitlements that SAPOL officers will receive underneath that particular enterprise agreement?

I ask specifically about the position of officers, and I give one example: Mr Tony Harrison, who is a SAPOL employee but who has been appointed chief executive officer of SAFECOM, Director-General of Community Safety, but his contract indicates that he remains a SAPOL employee. In the case of persons such as Mr Harrison (I assume there are possibly others) who remain SAPOL employees but who have taken up other Public Service positions somewhere in the broader public sector, what particular retention entitlement will they be entitled to? Will it be the SAPOL entitlement or will it be this new scheme that is applied here? I would assume that it is not both.

The administrative arrangements in relation to this new entitlement scheme make it clear that, at the end of 2012-13, employees will be able to elect to convert their accrued entitlement for both 2011-12 and 2012-13 to a cash payment. I note in the budget papers that the cost for 2012-13 in the budget is estimated to be $20.3 million for 2012-13. I am assuming that is an accrual measure, that is, Treasury's estimate of all of the entitlements that public servants might have in 2012-13, even though they might not avail themselves of either the leave or cash them out. I seek confirmation of that.

In particular, if it is an accrual measure, which I assume it is, what is Treasury's estimate of the cash cost in 2012-13 and for each of the forward estimate years of the new entitlement? I am assuming that Treasury will have estimated across the public sector what the cashing-out ratio might be, that is, what percentage of public servants who get this entitlement might seek to cash it out and therefore individual departments and agencies, in cash terms, will need to pay it out during each financial year.

Of course, if they just take a leave entitlement and, if the agency does not replace that officer during the leave entitlement, broadly, there is no additional cash cost to the agency; somebody else is doing the work of those officers who are on leave in an acting position. If, however, someone has to be appointed in an acting position, there will obviously be an additional cost during the year as well. One can see that there are three or four different potential accounting treatments, depending on the exact nature of the use of the entitlement that an individual public servant might take.

I am interested specifically in the individual cash cost estimates Treasury has made of it. I am also interested to know, if Treasury has undertaken it, what the costs might be where departments believe they may well have to employ additional staff to replace staff who have taken this particular entitlement from 2012-13 and onwards. As I said, I am looking for that for the financial year 2012-13 and also for each of the forward estimate years.

The final issue that I pick up in the second reading explanation is in relation to this provision which will vest existing roads in the Commissioner of Highways. The second reading explanation states:

Existing roads that will vest in the Commissioner are the South Eastern Freeway, and the Port River, Southern and Northern Expressways...[and] Future roads, to be identified by regulation...

What I am seeking from the minister is this—and if I could just take one example, the South Eastern Freeway, without going through all the others—I am assuming that there is an estimated valuation of the South Eastern Freeway held in the balance sheet aggregates of the state's accounts. If that is correct, what is that sum? Then, once this bill is passed into law, what, if any, are the budget impacts of the decision that has been taken in this particular bill?

That is, are there any budget impacts in terms of either balance sheet or the operating balance of the income and expenditure statements of the state that are impacted by this vesting of major infrastructure in the Commissioner of Highways? I seek a response from the minister on that. Depending on the responses received from the minister, this is potentially an issue that the Budget and Finance Committee may well pursue with the Department of Transport when it next appears before the committee, but I would like some information from the minister.

The second reading also indicates that this bill allows the commissioner to enter into commercial contracts for activities on roads such as the South Eastern Freeway. We are told that the commissioner is going to be given permission to enter into advertising contracts, for example, on major roads such as the South Eastern Freeway, the Northern Expressway or the Southern Expressway, or into service centres, and may well be entering into contracts for the inclusion of mobile phone towers or underground fibre optic services in conduits alongside the Southern Expressway or the Northern Expressway.

What estimate of potential revenue has the Commissioner for Highways or the transport department given to Treasury as to potential revenue opportunities? And, specifically, if the commissioner is to be given the power in this bill to accrue these revenue entitlements, at present, prior to the passage of the bill, who has that entitlement? Is it some other government department? Is it local councils who have the entitlement to accrue revenue for each of those examples that I have highlighted?

I specifically raise the issue of mobile phone towers, underground fibre optic services in conduits alongside the road, the issue of advertising alongside major roads and also the issue of service centres. With that, I seek a commitment from the minister to provide answers to those particular questions. As I said, I do not propose to delay the passage of the bill seeking responses to those questions unless, of course, the bill is delayed because of an inability to resolve the issue in relation to police court costs. If that is the case, I will pursue the issue if the bill is still before the parliament in February when the house resumes.

The Hon. A. BRESSINGTON (16:08): Yet again I rise to indicate that I will not be supporting the Budget bill without amendment because, yet again, the government is attempting to curtail our constituents' access to justice by imposing limits on the costs that can be awarded in the Magistrates Court. It was Professor Albert Einstein who quipped that the definition of insanity is to do the same thing over and over again and expect a different outcome.

The history of this proposal clearly demonstrates that this government is destined for padded rooms. In 2011, the government first tried to prevent costs being awarded in summary cases in all but the most exceptional circumstances. This was unsuccessful. Then, earlier this year, the government tried to entirely prevent costs being awarded in relation to indictable offences heard in the Magistrates Court. This, too, was unsuccessful. Clearly failing to learn its lesson, the government is now proposing to limit any costs ordered in the Magistrates Court to $2,000.

It is my hope that this bill will also be unsuccessful. Defendants who successfully defend themselves against criminal charges deserve to have the reasonable costs of defending themselves as determined by the magistrate paid. This is the principle in the Magistrates Court and no compelling argument has been made to now undermine it. The paltry saving of some $500,000, as disclosed by the Treasurer in a meeting we had last week, certainly does not justify this.

That the $2,000 cap will still see the majority of successful defendants paid the majority, if not all, of their costs is irrelevant. Some will not, and this number will increase every year. Having already paid the emotional costs, they will be forced to pay the financial gap of being wrongfully charged. Others who are of limited means or have a particularly complex defence that will likely exceed the cap will find it increasingly difficult to secure representation.

Whilst I accept that the majority of Legal Services Commission clients currently incur costs less than the proposed $2,000 cap and, as such, the concerns expressed in relation to the earlier attempts are no longer as pertinent, I nonetheless fear this measure will still have an adverse impact on the most marginalised in our society who rely on legal aid-funded representation.

Just last week, I met with a constituent who complained that the day before his trial his legal aid lawyer informed him that the Legal Services Commission would only fund his case if he pleaded guilty. He was persuaded to do so on the commitment that a conviction would not be recorded and, as such, he would be able to return to his profession as an armed guard from which he had been suspended—hence, why he was on legal aid.

Whilst no conviction was recorded, the wording of section 23G of the Security and Investigation Agents Act 1995 meant his licence was automatically cancelled, regardless of pleading guilty to a prescribed offence. This constituent remains convinced that he would have been found not guilty if his charge had gone to trial and is understandably bitter at the position the Legal Services Commission put him in.

Whilst this obviously occurred without a gap, as proposed by the government, it does demonstrate the consequences of the Legal Services Commission's tight operating budget and tough choices that already occur. Imposing a cap would only increase the pressure on the Legal Services Commission, through legal aid-funded lawyers, to minimise costs, including by encouraging clients to plead guilty, especially in cases where the costs of proceeding to trial will be in excess of $2,000. In the words of the President of the Law Society, Mr John White, 'We can't have people who may be innocent deciding to accept a conviction because they can't afford to fight a charge.'

This council has previously made itself clear. We did not support placing limitations on the discretion of magistrates to award costs to successful defendants, and we certainly did not support doing so in a budget bill. As I stated earlier this year, it is my hope that, if this clause is again successfully deleted, the government will accept the position of this council and we will not need to have this debate again next year.

The Hon. S.G. WADE (16:13): The Treasurer introduced the Statutes Amendment and Repeal (Budget 2012) (No. 2) Bill in the House of Assembly on 1 November 2012. One aspect of the bill related to amendments to the Summary Procedure Act, which is a court procedure statute, and the government wanted to reduce police court costs. Debating this bill is a bit like Groundhog Day and, as the Hon. Ann Bressington mentioned, it has been said that the definition of insanity is doing the same thing over and over again and expecting a different outcome. Still, the government insists on persisting with amendments that this council has consistently objected to.

The bill follows the defeat of two similar proposals in the last two years. In 2011 the Legislative Council amended the Statutes Amendment (Budget 2011) Bill 2011 to remove provisions to establish a presumption that costs would not be awarded against police in a summary prosecution. Earlier this year the Legislative Council defeated provisions within the Statutes Amendment and Repeal (Budget 2012) Bill 2012, which would have provided that costs would not be awarded against any party to proceedings for an indictable offence, except in special circumstances. So, what is the justification for this new, third approach? According to a letter from the Treasurer of 2 November 2012, the idea was proposed by Family First. To quote the letter:

Family First has suggested an amendment to the Summary Procedure Act 1921 to allow capped costs to be awarded for an offence prosecuted by the police and set out criteria magistrates must consider when making a cost order. The new amendment takes into account the capacity of defendants to pay legal costs and will allow defendants to access up to $2,000 in costs indexed to CPI.

I would be interested to know Family First's thinking behind its amendment, for example, why it chose the $2,000 threshold, and I would also be interested to hear what legal stakeholders said to them when they were consulted on the proposal. I know what they are telling us. The Legal Services Commission, the Law Society, the Australian Lawyers Alliance and the Aboriginal Legal Rights Movement have all expressed opposition to the amendments in very strong terms. The Law Society said in its response that:

It is not appropriate that fundamental rights to successfully defend a prosecution are being threatened. Parliament should protect not undermine core values and principles.

The Legal Services Commission, which I remind honourable members is a statutory authority of this government, said that:

The threat of adverse costs awards is designed to put a brake on unnecessary or frivolous court applications by both the prosecution and the defence. The highest onus must be on the police to ensure sufficient evidence is available to secure a conviction. It is most inappropriate to ask the public to pay for police inefficiencies this way.

The Aboriginal Legal Rights Movement also expressed its disapproval, saying:

The ALRM Is completely opposed to this back door approach to making fundamental changes to the access of justice. ALRM urges you to oppose this bill vigorously and with determination.

The Australian Lawyers Alliance said that:

Putting a cap on the amount that can be awarded is also blatantly expedient. You are rewarding the inefficiency, incompetence and making prosecutions less accountable for their actions.

The criticism of the Family First amendments is based on a number of grounds including, first, that the proposal is not a budget measure. As we argued in 2011 and earlier this year, measures such as these are primarily matters of criminal procedure that should be pursued by normal bills and not through a budget bill. The government's attempt to try to provide cover for a bad idea by sneakily slipping it into a budget bill undermines the integrity of the budget process.

Secondly, citizens defending criminal charges should be protected by cost orders. Citizens are presumed to be innocent until proven guilty; they should be able to recover the costs of defending their innocence. Even when cost orders are allowed under this bill they are capped at $2,000. Preparation of some defence cases may be complex and may well exceed the $2,000 cap. The Legal Services Commission advises that a trial in the Magistrates Court usually costs between $3,500 and $5,000.

The Legal Services Commission suggests that the meaning of 'dismissed' in the context of the amendments is not clear and may include where the trial proceeds to acquittal and the charges are therefore dismissed. In that case the allowable amount of $2,000 will be utterly insufficient to meet the costs of a full trial.

Thirdly, the exceptions in the amendments are not accessible. The bill lays down criteria which are required to be considered before a cost order is made. The Legal Services Commission advises that it would be 'virtually impossible for either the defence or the court to ascertain whether or not the prosecution had breached any of the criteria'. The Law Society considers that it 'would appear to make it difficult for a defendant to get any costs order in their favour'.

The fourth point is that the amendments encourage prosecutions with or without merit. The threat of adverse cost orders is a key driver to ensure that prosecutions are supported by the evidence and court applications are neither unnecessary nor frivolous. If the police are to be immune from a costs order, a greater number of unworthy matters may well be charged and proceeded with.

The fifth point on which these amendments could be criticised is that there are greater prospects of cost savings from efficiencies within police prosecutions. Briefings from police on the bill indicated that over the last six years the proportion of briefs attracting cost orders has increased from 0.7 per cent to 1.84 per cent, and the cost of orders has increased from $747,000 to $3.137 million, a real terms increase of 351 per cent. The Legal Services Commission asserts that cost reduction should be achieved through stricter adjudication of matters brought to trial by the police, thus avoiding cost orders, rather than transferring the cost inefficiency to other parties. The Law Society and the Australian Lawyers Alliance concur.

The sixth point on which these amendments could be criticised is that the net budget savings are overstated. The Legal Services Commission frequently benefits from the Magistrates Court's favourable cost orders. This bill would see the commission lose income in relation to in-house cases and increased expenditure in relation to private practitioner legally-aided cases. Given that the commission is publicly funded, the net savings to the budget is likely to be well under the estimated $2 million per year. I should say that that was the $2 million per year that I was advised of in my briefing, and I will come back to that point later.

The government's response in the second reading was to say that the amount that the Legal Services Commission receives from the government each year runs into millions of dollars. What they lose, it says, is a tiny fraction. That may well be the case, but my concern is that what they lose is a big fraction of what the government says it will save. Even if every commission case that currently gets a cost order continues to get a cost order under the new criteria, the cap kicks in.

In the commission's experience, we are told, a trial in the Magistrates Court usually costs between $3,500 and $5,000. Even if we use the lower figure, the Legal Services Commission could lose $1,500 income per case as the cap kicks in, or, on an annualised basis, a total of almost $72,000. That figure only relates to cost orders where in-house lawyers are involved and the payments are direct income to the commission; however, more than 60 per cent of criminal law legal aid cases are provided by private practitioners on behalf of the commission. Cost orders mean that private practitioners do not charge their costs to the commission. Assuming that cost orders are made in proportion to the caseload, unbilled legal aid cases funded by cost orders would be around $118,000. Therefore, the total loss to the commission budget could, on these assumptions, be estimated to be $190,000.

The original advice to the opposition was that the savings would be approximately $2 million, but the latest advice from Treasury is that the saving will be $455,000. The police will save $455,000 and the Legal Services Commission will conservatively lose $190,000. So we have all this pain and all this impact on people's rights for a net saving of $260,000.

To be fair, Treasurer Snelling did say in the House of Assembly on 13 November, and I quote, 'The savings that this measure will provide to the police budget will be relatively small.' But did we expect them to be so small? In my view there is a real risk that, in addressing the symptoms of rising cost orders without identifying a cause and without addressing that cause and reducing the impact of cost orders and efficiency drivers, we could well see an increase in prosecutions that would not otherwise proceed and legal aid, the Courts Administration Authority and other parts of the legal system being burdened with further costs that may well exceed the $260,000 referred to. This measure may actually cost the state money and increase court delays.

My seventh point of concern in relation to this aspect of the bill is the lack of consultation. The 2011 bill and the 2012 bills were all South Australia Police initiatives and were not subject to consultation with stakeholders. The Legal Services Commission has advised that this is the third time in 18 months that it has had to defend its entitlement to costs and that, 'at no time has the commission been consulted by Treasury on the likely impact of these amendments.'

Senior officers of the commission have also advised that they are not aware of any consultation at officer level regarding the proposed changes and the likely impact on their budget. The Treasurer advised the House of Assembly on 13 November that:

With regard to consultation, my understanding is that there has been consultation undertaken at an officer level between the police and the Legal Services Commission over the various manifestations of this savings attempt that has been brought.

Is the Treasurer being serious? Since when did the Treasury rely on an agency putting up savings to consult on and assess the countervailing impacts on other agencies' budgets? In the House of Assembly the Treasurer was not able to quantify the impact on the Legal Services Commission but he hoped it would be zero. This proposal has all the hallmarks of shoddy work not properly researched or consulted.

I ask honourable members to support me in the committee stages to delete clauses 37 and 38. I urge the government to accept the amendment, as it did in relation to the 2011 bill. If the government wants to develop a future proposal perhaps it might start by talking to people in the field. If there is a next time, let us consider the merits of non-budget issues outside the budget bill process.

The Hon. K.L. VINCENT (16:25): I wish to make a brief second reading contribution on the bill. I refer to one section of the bill that remains a significant stumbling block for the Dignity for Disability Party. This is the third time, as has already been said, that the government has tried to amend the Summary Procedure Act 1921 using what is a rather stealthy method, and I assure you that in this case third time is not a charm.

I will not detain the council for long, as my colleagues and indeed the legal community have already outlined many of the issues, but I will put on the record that, to the mind of the Dignity for Disability Party, this is not an acceptable manner for dealing with this issue and we resent the government trying to remove the rights of innocent people using this method. As the Law Society and Australian Lawyers Alliance have both detailed in correspondence with members of parliament, this is an incursion on basic rights and in stark contrast with what has been an accepted practice for many years now.

I appreciate the government has now amended the bill by placing a cap on costs that can be awarded at $2,000, but it remains an offensive attempt to limit the rights of people to costs that they duly deserve. It is not appropriate for the government to set limits or make decisions on what costs should be awarded, that is a matter for the courts to decide. The bill seems to presume that people are guilty until proven innocent, denying all principles of natural justice.

If the government is so desperate to save money in the state budget that it would suggest this measure, I suggest that instead it perhaps consider looking at the $535 million it is spending on the Adelaide Oval upgrade. In short, I do not and cannot support the second reading of this bill in its current form.

The Hon. D.G.E. HOOD (16:27): I want to speak very briefly on how this has come to be. The first thing I think that is worthy of drawing to people's attention is that this is not a Family First amendment. No-one has said it is, but it has certainly been implied, and I would like to explain how that has come about. We were approached, as were all crossbench members, I assume, by the Treasurer in recent weeks to try to negotiate an outcome to this bill. I indicated that we were prepared to enter into discussion but, as members would recall, the last time it appeared before this chamber I had voted against the bill and, in a strange situation (strange for Family First, that is), the Hon. Robert Brokenshire (my colleague) had actually supported the bill.

So, we found ourselves, as a party, not agreeing on this issue. I think that is the third time that has occurred since I have been a member of this place (approaching seven years now), so it is very infrequent, but from time to time it does happen. We were looking to resolve that, if possible, if we could get to a point where we agreed. The government presented a range of options to us. I cannot recall how many, but there were a substantial number of options.

The main sticking point for me, and one that I struggled to accept, was the issue of not being able to award costs to a particular person who may well be found to be not guilty. It is true that we do not allow that in the District and Supreme courts at the moment, and we have not for some time, as I understand it. Nonetheless, I felt that as we had allowed that in the Magistrates Court that we should maintain that position, and that is why I voted against the bill last time.

The government then proposed a $2,000 cap to be applicable, which is as the bill appears before us today, and I find that acceptable. There are many reasons that I do, and I think we have heard from the Hon. Mr Wade and the Hon. Ms Bressington, who have outlined the case against quite succinctly and well, and I do not dispute the points they raise. I think that they are valid points that are worthy of the chamber's consideration.

However, I would just like to go through some of the specific detail in this that I think for me was persuasive in allowing $2,000 to be a reasonable limit that costs could be claimed—that is, this proposed measure does not take away the right of the courts to award costs, of course. That was the original proposal, but it is not the proposal that is currently before us, so it is important to acknowledge that the magistrate will still have that discretion under this bill.

I think, very importantly, unrepresented defendants—usually the people who are the most vulnerable in these types of situations—in almost all cases, as I understand it, in South Australian legal history (there have been some exceptions) the overwhelming majority of these people run up costs of less than $1,000. It is very unusual to have costs exceed that amount if they are unrepresented, so in virtually all these cases no-one in that situation would be out of pocket.

Furthermore, I understand that between 2010 and 2012 the median costs awarded by the Magistrates Court in South Australia were in the order of $1,650—that is the median figure. Again, that falls beneath the $2,000 cap which the government is proposing and, for that reason, I also find it acceptable from that point of view.

I also believe that the impact on the Legal Services Commission will be very small. In fact, I understand that the government has written a letter to all crossbench members, and perhaps to the opposition as well (I am not sure), that states that the impact on the Legal Services Commission, which received $43 million in revenue last year, will be something in the order of $169,000. So, again, I find that to be an acceptable amount. It is not ideal—clearly, it is not ideal from that perspective, but I think it is a very small amount when compared with the $43 million that it received in other funding.

Another important point that argues in favour of a cap being in place is that it does encourage the defence, if you like, to get on with it—to put it simply. It does not encourage them in any way to prolong proceedings. The truth—and this may not be palatable for some people to hear—is that there is an incentive at the moment for defence lawyers to prolong these things because it increases their fees. I do not know if that happens, but it has been suggested to me that it may and, if that is the case, then I think a cap would certainly help in that situation.

I think another issue that is relevant here is that Queensland, I understand, has very similar legislation in place to what is being proposed here. This may all be academic anyway because Family First will support the bill as it stands now. However, I understand that there are no other changes in position and, for that reason, the bill will fail and so be it. That is the will of the chamber and we accept that, but I just wanted to place on the record the reason for the change in my position.

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (16:33): I understand there are no further second reading contributions to this bill. By way of concluding remarks, the Statutes Amendment and Repeal (Budget 2012) (No. 2) Bill brings into effect important legislative changes around the 2012-13 state budget, including cost of living measures, to ensure tenants receive the water security rebate, the off-the-plan stamp duty concessions for apartments in the Adelaide CBD and the Riverbank Precinct, and the public sector skills and experience retention bonus.

Since the bill was last before this house, three changes have been made; the first is the amendment to the Livestock Act 1997 to establish a fund for the animal health programs has been deleted. Secondly, the amendments to the First Home Owner Grant 2000 have been removed. This matter has been superseded by and incorporated in the First Home Owner Grant (Housing Grant Reforms) Amendment Bill 2012. Thirdly, Family First has suggested an amendment to the Summary Procedure Act 1921 to allow capped costs to be awarded for an offence prosecuted by the police and to set out criteria magistrates must consider when making a cost order. The new amendment takes into account the capacity of defendants to pay legal costs and will allow defendants to access up to $2,000 in costs indexed to CPI.

It is clear that the chief area of concern relates to the proposal to amend the cost provision of the summary procedure act. It is important to note that the process measure does not take away the rights of the courts to award costs. The bill simply asks magistrates to consider all relevant criteria before awarding costs. The discretion of whether or not to award costs still lies with the magistrate under the proposed amendments.

Unrepresented defendants who successfully challenge a prosecution will more than likely receive their out of pocket expenses, as they do now. It is extremely rare for any unrepresented defendant to seek and be awarded more than $1,000 under the current legislation, so the proposed ceiling of $2,000 will not affect these people.

In 2010-11 the median cost awarded was $1,639 and in 2011-12 the median was $1,650, both well below the government's $2,000 proposed cap. I thank honourable members for their second reading contributions and look forward to this being dealt with expeditiously through the committee stage.

Bill read a second time.

Committee Stage

In committee.

Clauses 1 to 43 and title passed.

Bill reported without amendment.

The Hon. S.G. WADE: I move:

That the bill be recommitted in respect of clauses 37 and 38.

The committee divided on the motion:

Majority of 6 for the ayes.

Motion thus carried; bill recommitted.

Clause 37.

The Hon. S.G. WADE: For the reasons that I outlined in my second reading contribution, I would urge the council to oppose clauses 37 and 38 so, when the motion is put, I urge the council to oppose it. These are the clauses that would introduce the police court costs provisions.

The Hon. G.E. GAGO: Obviously the government supports these clauses. We believe that this issue around police costs is an important element to the bill. As I said, we have moved to cap the costs to be awarded for an offence prosecuted, and a letter has gone out outlining a range of different impacts that this will have. I will not go through all of it but, in terms of impact on defendants, it is quite obvious that this provision does not take away the rights of courts to award costs. It simply asks magistrates to consider relevant criteria before awarding costs.

The discretion of whether or not to award costs still lies with the magistrate under our proposal, and I have already outlined in my second reading summary that the median costs are well below that of the $2,000 cap. The bill does not prohibit costs to defendants. In relation to the Legal Services Commission, there were issues raised in concern about that. I am advised that the government's proposed measure will have no impact on the budget of the Legal Services Commission or the ability of the commission to provide representation.

In 2011-12, the Legal Services Commission received $43 million in revenue while the costs recovered from the police in the Magistrates Court were a minor $169,000. There were 127 files on which costs were recovered in 2011 and 2012 with an average cost of $1,330 per file while, again, the government's proposed cap is $2,000. I am advised that the majority of matters where the Legal Services Commission provides representation are serious criminal cases where there is a likelihood of imprisonment. The majority of these matters are dealt with in the District and Supreme Courts with, again, very little impact.

In relation to court efficiency and the justice system, capping costs will not place a greater burden on the court system and may, we believe, have the opposite effect. Under the proposed changes there will no longer be an incentive for the defendant to drag out criminal matters by regularly adjourning them, knowing that they will be fully compensated by SAPOL by way of costs. Further capping costs will further prevent the practice of jurisdiction shopping in order to have the case heard before the court that awards costs. Currently, the majority of briefs are heard in the Magistrates Court as opposed to superior courts, so we believe that our proposal offers a more efficient system.

In relation to budgeting impacts, the latest amendment to the police costs measure now allows defendants to access up to $2,000, indexed each year to CPI, allowing costs of up to $2,000 to have a small positive impact on the budget of around $0.5 million. Capping costs will still allow those most in need to access costs while preventing those with the capacity to engage top lawyers from claiming excessive costs in the order of $75,000 against the state.

I draw to members' attention the average costs awarded against SAPOL in the Magistrates Court in the past few years. In 2010-11, there were 1,346 files and over $3.08 million awarded in costs, the average costs being $2,200. In 2011-12, there were fewer files, that is, 1,322, with higher costs awarded at $3.137 million, and that averaged at $2,300. So members can see there are, indeed, efficiencies occurring there. With those words, I urge members to support this clause.

The Hon. S.G. WADE: I do not intend to speak at length but just make these points in response to the minister's points. She claims there will be no impact on the Legal Services Commission: that is not the view of the Legal Services Commission. She claims there will be no impact on the justice system: that is not the view of the Law Society, the Australian Lawyers Alliance and the ALRM.

I thank the Hon. Dennis Hood for his contribution during the second reading stage in clarifying the origin of this amendment. I was simply relying on a letter from the Treasurer suggesting that it was Family First's suggestion. In his comments, the Hon. Dennis Hood mentioned that the government had a range of options that it discussed with Family First. I would urge the government to take those options to the legal community and consult.

The fact that the Attorney-General can go on radio and say that this is a police savings measure, and the fact that we have been advised that it was not the subject of consultation with key players such as the Legal Services Commission, in spite of statements to the contrary by the government, is a cause of great concern. We would urge the government to accept the deletion of these clauses if it is the will of the committee to do so and that we not delay the progress of this bill any further.

The Hon. M. PARNELL: I rise to put the Greens' position on the record. As other members have, so, too, have we received a great deal of correspondence from various stakeholders on this issue. They include the Law Society and the Australian Lawyers Alliance; but also, I should say, given that I have been known to hang out in legal circles at different times, I have had a number of lawyers ring me personally, and some quite senior practitioners, to urge us to oppose these two clauses in the budget bill. That is what the Greens will be doing. We will be supporting the deletion of these clauses.

I note that in the Law Society's most recent correspondence to us of a week or so ago they point out that the restrictions on the orders of costs will increase the risk of people pleading guilty when they should not. As the Law Society says, this is an issue of justice and access to justice and it is not just a financial measure.

As other members have pointed out, the Law Society has recommended that the government go back to the drawing board on this and undertake detailed consultation with stakeholders, and we would echo that call. The Law Society urges the government to explore other options to reduce costs in the criminal jurisdiction, rather than pass a measure that imposes the costs of unsuccessful prosecutions on to innocent persons. So the Greens will be supporting the deletion of these clauses.

The CHAIR: Before I call the Hon. Ann Bressington, there is no motion before me to delete it from the bill. Just so that you are clear how you actually deal with it.

The Hon. M. PARNELL: Mr Chairman, with leave I would say if there is no motion to delete the clauses, the Greens will be opposing that the clauses stand as read, if that is the motion that is put.

The Hon. A. BRESSINGTON: I am rising to indicate my support if that motion is put to oppose clauses 37 and 38. I made it very clear in my second reading speech this afternoon that I would not be supporting the court costs measures or the cap. I have heard that little that would change my mind.

The Hon. G.E. GAGO: Just to set the record straight in relation to a number of issues in relation to the Hon. Stephen Wade saying that the Legal Services Commission was not consulted, that is not so. I am advised that they were consulted by both Treasury and also the police minister's adviser. In fact, the Legal Services Commission was asked to estimate the degree to which the budget measure may have an impact on them, and they were unable to do that.

They were clear that they did not support the measure but could not quantify the likely effect. When asked to elaborate, I am advised that the response was that they would require a manual audit of internal case files to be able to provide an estimate. So, they were in fact consulted. Treasury did some modelling, and their modelling suggested that in 2011-12 the Legal Services Commission received $43 million in revenue, while the costs recovered from police in the magistrate's court were a minor $169,000.

There were 127 files on which costs were recovered in 2011-12, and the average cost of $1,330 per file was obviously well below the proposed $2,000 cap, so most of those people will in fact not be impacted on. In terms of this assertion that more people will plead guilty, our system is already extremely efficient in terms of looking at the figures from 2005-06 through to 2012-13. The percentage of guilty findings is between 80 to 88 per cent, so it is already a really highly efficient system, and there is no reason to believe that that would not continue.

The Hon. S.G. WADE: The minister, in commenting on the consideration of this clause, said that Treasury had consulted the Legal Services Commission. I am not going to take that further other than to say that at the highest levels of the Legal Services Commission, as recently as today, they were not aware of having been consulted. I wonder if the consultation occurred at appropriate levels. I am not wanting to go into 'he said, she said', but let's go to the question. The minister asserted that the estimated savings in relation to the $169,000 relate to the income that the Legal Services Commission receives as a result of payments from police in relation to cases run by in-house lawyers.

Can the minister advise what the impact is on the other portion of the work, which is that which is briefed to outside lawyers? My understanding of the Legal Services Commission and the report is that 62 per cent of criminal law matters are actually handled by outside lawyers. The greater impact will not be from income lost to the Legal Services Commission but, rather, certificates that otherwise would be handed in which will now be used. So, if the minister could give us an estimate of the total cost, not just a portion of it.

The Hon. G.E. GAGO: I am advised that the Legal Services Commission does not collect that information, so therefore that information is not available.

The committee divided on the clause:

Majority of 3 for the noes.

Clause thus negatived.

Clause 38.

The Hon. S.G. WADE: I would urge that when the motion is put that this clause stand as printed, we do not support it because, consistent with our decision on clause 37, it is part of the police court costs decision.

The Hon. G.E. GAGO: It is consequential.

Clause negatived.

Bill reported with amendment.

Third Reading

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (17:06): I move:

That this bill be now read a third time.

Bill read a third time and passed.