Bills

South Australian Productivity Commission Bill

Final Stages

Consideration in committee of the House of Assembly's message (resumed on motion).

Amendments Nos 2, 3, 6 to 16, and 18:

The CHAIR: For the benefit of honourable members, the Treasurer has moved that the council do not insist on its amendments Nos 2, 3, 6 to16, and 18. Ahead of the luncheon break we were debating the same.

The Hon. K.J. MAHER: Can I just check with you, Mr Chairman, procedurally how will this go ahead? Is it moved en bloc that we not insist on all those amendments, or will they be taken separately? They do not all refer to exactly the same issue: will they be separated so that members can vote on whether they want a particular issue rather than its being all or none?

The CHAIR: The chair is service orientated, Leader of the Opposition. It can be moved as all of them or I can put the question as the committee chooses, so I can break it up and put the question for each amendment, if that is the will of the committee. I am happy to hear members of the committee.

The Hon. R.I. LUCAS: The government position is clear in relation to this; that is, whether they are put separately or en bloc, the government's position is that, if these amendments are insisted on in whole or in part, then the government's position is clear. So I think it is really just going to delay proceedings if we are to have separate votes. We might as well take a job lot. The motion that I have moved is that the Legislative Council do not insist on its amendments Nos 2, 3, 6 to 16, and 18.

The chairman has rightly indicated that he will either put that this council insist on its amendments Nos 2, 3, 6 to 16, and 18, or he could choose to do it one by one if he wanted to. For the sake of brevity, and the fact that we are on the last sitting day of parliament, it would seem clear what the options to the council are: rather than having 14 different votes, I would have thought that we might as well have one vote. Anyway, that is for the opposition and for the chair, ultimately, to determine, based on the wishes of the committee.

The Hon. K.J. MAHER: I suggest that this might be something that others, not just myself—some of the crossbenchers—may wish to comment on. The proposition that the Treasurer is putting to the committee is that in relation to all of the things the Legislative Council previously amended, that the lower house did not want, it is all or nothing; we cannot pick or choose the different issues. I would suggest that it might be more beneficial, as there may be crossbenchers who are in favour of the Legislative Council sticking to its guns on some, but it might also be the case that there may be crossbenchers who would prefer not to stick to their guns on some.

So if we move them all at once, it in effect does not give a choice: it is everything the council previously insisted on or none of them. If we move them individually, then crossbenchers would get to choose from the different raft of amendments, that is some of the disclosure regime, some affecting either chamber of parliament being able to refer, and also about the parliamentary committee having an opportunity to disallow members.

My suggestion, depending on what crossbenchers wish to do, is that we take them separately, so the crossbenchers at least have the benefit of deciding whether they want to support them or not, rather than it being all or nothing, which seems to be the way the government wants to deal with the whole bill.

The Hon. F. PANGALLO: I support the Leader of the Opposition: that we do them separately.

The CHAIR: Is there any other view? I am happy to put the question for each numbered amendment. The Hon. Ms Franks.

The Hon. T.A. FRANKS: The government has made it quite clear that it will be this set that is rejected, and they will not accept the amendments that we have previously put. I am happy to go through it clause by clause, but I can read that the numbers in the other place are always going to win, come the end of the day. Our choice here is not unprecedented. We have had previous governments give us similar ultimatums in recent history.

I am happy to debate each and every amendment now, but I just declare that the Greens are quite realistic here: we are either in a position where the government will go away and establish the productivity commission as it sees fit, or this council will accept a version that includes some of our amendments but not all of our amendments, and so be it. The government of the day will decide what this looks like, no matter what we do here and now, whether it is a clause by clause debate again, or if it is simply one motion. My preference is for one motion because I think that is the substance of it. I think going through it amendment by amendment has already been proven to be unproductive, to make a pun.

The Hon. J.A. DARLEY: I am quite happy to consider each one, amendment by amendment.

The CHAIR: If I put it amendment by amendment, members will have to be very aware that some of these are consequential. Is there any further debate on the motion moved by the Treasurer that the Legislative Council do not insist on its amendments Nos 2, 3, 6 to 16, and 18?

So I will put it amendment by amendment. As to amendment No. 2, I put the question that the council insist on its amendment.

The committee divided on the question:

Ayes 10

Noes 9

Majority 1

Amendment thus insisted on.

The CHAIR: I put the next question, that amendment No. 3 be insisted upon.

The Hon. K.J. MAHER: It's related. I think we said they would go down because they relied upon each other.

The Hon. T.A. FRANKS: I am taking the opportunity at this point to put our position on the record, because we simply put on the record our position on whether we went clause by clause or as a bulk lot. We were not then given an opportunity to put on the record exactly why we support what we think is something that the government took to the election. The Greens have said we will support a productivity commission, but we will not necessarily, simply because we cannot make referrals to that productivity commission, then put a spanner in the works.

We would like to be able to, in this chamber, make those referrals, but we accept that the government of the day will have the numbers and have indicated that, in the other place, they will ensure that that will not be accepted. We note, though, that in discussions we do have powers of select committees and other standing committees to ensure our own work can be referred, but I also note that that is often limited by our own capacity.

We know full well, when we put up a select committee motion, that we have a lot of work ahead of us when we do it. I can understand why the government has balked at the idea that we would direct work unfettered and without some caveats to another body, this productivity commission. I am disappointed, however, that a consensus compromise position was not able to be met. I certainly think that some idea of a power of veto, a limit on the number of referrals or even a higher bar to be met than a simple majority may have been well placed in the discussion.

We are disappointed that that compromise conversation did not happen but, because we did not get everything we wanted, we will not simply stand in the way of progress on seeing something that would have been the better option in terms of the fact that this Legislative Council did some fine work, I believe, in improving the transparency and accountability of this body. Despite the fact that the government will now take this away and, regardless of the parliament, establish this body, we do hope that some of those conversations will be respected.

The Hon. F. PANGALLO: I support what the Hon. Tammy Franks has just put. In fact, I thought that there was going to be some type of flexibility and that the government might consider that there could be some veto or a decision made on perhaps the number of referrals that they would be able to accommodate. I am hoping that the Treasurer may consider that, so I support what the Hon. Tammy Franks has said in regard to that.

The Hon. R.I. LUCAS: Let me make the government's position clear. I made it clear this morning and the Hon. Mr Pangallo will know that I had a conversation with him and his colleague this morning where, after a discussion with the Premier, I made the government's position quite clear. It is completely within the purview of the committee, if it wants to reverse the position of that last vote, to reverse the position of that last vote.

The Hon. Mr Pangallo needs to be quite clear what the government's position is. I said it this morning, I said it in the conversation I had with him and the Hon. Ms Bonaros this morning, and I will state it again publicly. The government's position is that we cannot accept the series of amendments we are discussing at the moment and that we are about to conclude discussions on. The principal ones are essentially about the power of the non-government members of the Legislative Council to refer an issue to the commission. I will not go into all the details of the reason; I put that on the record yesterday and I am not going to waste time again today.

Secondly, the major point of, in essence, United States senate-style confirmation hearings of productivity commissioners—the whole notion that the Labor opposition and others could grill potential productivity commissioners in a confirmation-style hearing in the Statutory Authorities Review Committee, and have an ultimate veto right as to who goes on the productivity commission—is something that the Hon. Mr Pangallo should be quite clear the government will not be prepared to accept.

As I indicated in the conversation with the honourable members this morning, and as I said publicly in this chamber soon afterwards, the Legislative Council needs to be quite clear about the government's position. On the first vote the Legislative Council has insisted, although it is completely possible to reverse that decision because there is a range of consequential votes about to come, and we can recommit that particular vote if honourable members, on reflection, want to adopt a position somewhat closer to the position the Hon. Ms Franks just outlined.

The Greens are supportive of the position they have adopted in the Legislative Council; they believe the Legislative Council should have the right to, in essence, veto productivity commissioners. The Greens still believe that Legislative Councillors should have the right to refer inquiries to the productivity commission, but in the end what they have essentially said, what the Hon. Ms Franks has just said on behalf of the Greens, is that they accept the fact that the government went to the election on a productivity commission, they accept the fact that if this bill passes in this form the government has said it will lay the bill aside.

There is no prospect, as the honourable member has just raised, that maybe the Treasurer might like to amend this or amend that. We have made our position clear: that is, if these amendments pass this afternoon in the Legislative Council, it goes down to the House of Assembly and the bill gets laid aside in the House of Assembly. That is the end of it. It is a dead bill. It is a bit like a dead parrot; it is no more, it is finished.

The government will then establish a productivity commission potentially along similar lines to the New South Wales Productivity Commission, which it is not a statutory authority with oversight of the parliament and others. In essence, and as I explained this morning, the New South Wales one is essentially an officer within a division of the Treasury. The Productivity Commissioner, proudly announced by the New South Wales Treasurer in May, reports to a divisional head of Treasury, who then reports to the Under Treasurer, who then reports to the Treasurer.

There is an alternative model, an attached unit model, which we have in South Australia. That might have an attached unit called a productivity commissioner in Treasury or the Premier's department, and he or she would potentially report directly to the Treasurer or the Premier. They are two models that do not rely on legislation passing the parliament.

Our position is that crossbenchers adopt the position grudgingly, as the Greens have: that is, they still disagree with the government's position but in the end accept the model here as being better than the alternative model the government would institute administratively either through Treasury or the Premier's department. The issue that remains for the Hon. Mr Pangallo and the Hon. Ms Bonaros is that if they wish to move to a position similar to the Greens, there is a series of consequential amendments to the one we have just considered where they could adopt the position the government has adopted and that the Greens, for different reasons, have adopted in relation to not insisting on the amendments.

If they want to do that they could. I am not suggesting that they will, but I am saying it is an option. We could then recommit the clause we have there, and reverse that particular decision. However, the Hon. Mr Pangallo should not leave this committee thinking that there are still options in terms of further compromising on an amendment. He should be clear in his own mind—the government made it clear this morning—that the Legislative Council has some options.

It is not a question of us taking our bat and ball and going home; it is just a question of saying, 'We're going to have a productivity commission. You have two choices: it can either be one which the parliament approves, with the controls that we have talked about, or it could be one à la New South Wales, where the parliament does not control those sorts of issues. It will be done administratively by the treasurer and/or the premier in the government of the day, and it will operate in the same way as the New South Wales Productivity Commission operates.'

Those are the two choices, and they still remain options for the two honourable members from SA-Best, should they so choose. If they maintain the position of the last vote, then there is a series of consequential votes here—there are about 10 amendments that should be treated. Hopefully, we could do them quickly because they are consequential on that last vote. If the two honourable members wanted to change that position and adopt a position closer to that of the Greens, then we would need to have a fresh vote on another one, establish a new position and work our way through the committee process in that way.

The Hon. K.J. MAHER: If it is of assistance—and the Treasurer might like to look to make sure whether that is the case—I know that he would want to move every one as a block. However, as I read it, amendments Nos 3 and 8 to 16 are all consequential on amendments Nos 2 and 3 passing. So I suggest that we treat amendments Nos 3 and 8 to 16 as a block and vote on all of those together for the simplicity of moving this along in the council.

In relation to the Treasurer's comment, I reiterate what I said before: the opposition does not accept that. I would be very surprised if crossbenchers accept the proposition that you vote with exactly what the government wants—that is, the government will not enter into even the smallest bit of compromise on some of these issues—and if crossbenchers do not like it then the government will take their bat and ball and we will not have anything. I think that if we start this parliamentary term under those conditions and cede to those sorts of threats, that will continue for the rest of this parliamentary term; that is, if the government does not get exactly their way and does not even enter into discussions about a compromise—otherwise they will just can everything—then I think we are going to be in a lot of difficulty.

I know a number of other amendments relate to different matters, and I think there are matters where the Hon. Robert Lucas deliberately continues to mischaracterise them as a Senate-style confirmation hearing. That is a separate matter that we will discuss and vote on. There is the matter of the disclosure of pecuniary personal interests that we will also discuss. Finally, there is the matter of the chair appearing before the Economic and Finance Committee, which we will also discuss. I am going to suggest that we put amendments Nos 3 and 8 to 16 in a block. That, in my understanding, then closes off on the issue of either chamber of parliament being able, upon resolution, to refer something to the productivity commission. Then, there are also the other three matters that I do not anticipate will take a great deal of debate.

However, as I said before, I suggest to honourable members that, if this bill gets up with the government insisting that they will not compromise, it is really no different to doing it the way that they are suggesting. The way that they are suggesting will still have the normal oversight of any expenditure of public funds. The Auditor-General, the estimates committees, committees of parliament and FOIs will still apply to it if it is an administrative unit. There is really no difference between packing up your bat and ball, thumbing your nose at the Legislative Council and starting this as an administrative unit and it being the government's completely uncompromising bill.

We think it is a far better way to make sure that the government understands that the Legislative Council wants to improve bills, wants to make sure they are more transparent, and thinks it is only reasonable that this chamber of parliament has a say. So my suggestion is to put amendments Nos 3 and 8 to 16 as a block. That then finishes the issue that the council has just resolved in amendment No. 2, namely, to continue to insist on what the council had quite rightly said before.

The CHAIR: The Leader of the Opposition is correct. It is our understanding at the table that 3 and then 8 to 16 are consequential to amendment No. 2. So I propose, as suggested by the Leader of the Opposition, to put amendments Nos 3 and 8 to 16 unless any honourable member violently objects. I put the question that amendments Nos 3 and 8 to 16 be insisted upon.

The committee divided on the question:

Ayes 9

Noes 10

Majority 1

Amendments thus not insisted on.

The CHAIR: Honourable members, we now turn our minds to amendments Nos 6, 7 and 18. Does any honourable member wish to speak on amendment No. 6?

The Hon. R.I. LUCAS: I will speak briefly because I moved an en bloc motion earlier, and we are now doing them separately, or sort of separately. This is the second significant issue, which is, as I have used the phrase, a United States Senate-style confirmation hearing. This is, again, fundamentally opposed by the government. This, as I understand it, is a stand-alone amendment; there are no consequential amendments on this one. The whole issue is dependent on this particular amendment, and so the government's position, as I outlined earlier today, is that we call on the Legislative Council not to insist on this amendment. Again, if this amendment remains part of the bill, all of the issues that I have raised earlier, and I will not repeat again, would remain and the bill would be set aside.

The Hon. K.J. MAHER: I might just reiterate the opposition's point of view that this is an important part of the bill as it currently stands, as it was amended in this place. We would submit that the Legislative Council should stick to its guns and continue with this amendment so that the individuals who are appointed to the productivity commission have some sort of process that they go through rather than just the political whims of the government of the day.

The Hon. F. PANGALLO: We are probably prepared to concede this one, but we are concerned certainly in relation to the disclosure of pecuniary and personal interests. We would have thought that that was of great importance to this.

The Hon. I.K. HUNTER: I dare not usually intrude myself into these debates, but I do so today to remind honourable members who have been here before and those who are new to this chamber that, as to the arguments we have heard from the Hon. Mr Lucas, we have heard them all before. We have heard them from me and others when we were in government, taking a breakneck approach to these bills and standing up here, swearing black and blue that this is the end of it and, 'If you do not go with us the bill is dead and buried.' And what have we seen? Once the Legislative Council has stuck to its guns and insisted on its principles and it heads back to the lower house for the second time, the government crumbles, because they get 95 per cent of what they wanted.

So I would say to the legislative councillors who are considering this position: stick to your guns. If you do want to negotiate, then wait for it to go back to the House of Assembly where the government knows that they have to deal with the Legislative Council and get the negotiated outcome that they wanted in the first place.

The Hon. T.A. FRANKS: Mr President, I am just going to point out the bleeding obvious, through you. This does not have to ever come back here. The government does not need to pass a bill through the parliament to make their own productivity commission, whether they get 100 per cent of what they want rather than in fact the negotiated version that this Legislative Council was able to make amendments to.

I remember full well standing side-by-side with the Labor opposition, the then government, on the bank tax. I remember full well threats about many, many other bills. The difference here is that the government does not actually need the parliament to pass this bill. We have no card to play. So fine, stand firm. I wish you had stood firm on the bank tax. That would have been really good and appreciated—not you, Mr President, of course; through you, Mr President.

I wish Labor, now in opposition, had stood firm on the bank tax. We were more than happy to back them with that with other pieces of legislation where legislative tools are required. Of course we have that come back. Of course it has to pass both houses of parliament. But in this case we all know full well the government can just go and do this regardless of the parliament. That is the reality of the situation.

The CHAIR: Any other contributions by honourable members? So I now put the question that amendment No. 6 be insisted on.

Amendment not insisted on.

The CHAIR: We now come to amendment No. 7. Does any honourable member wish to speak on this amendment? Leader of the Opposition.

The Hon. K.J. MAHER: The opposition again submits that amendment No. 7 is a very important amendment. Again, as I outlined this morning when we started talking about these matters, the disclosure regime is in fact identical to the compromise position the government came up with for the health board's bill. The Legislative Council put in a rightly rigorous disclosure regime for the health board's bill; it went back down to the House of Assembly; the government did not like that level of transparency—the level of transparency that the Legislative Council had suggested—so the government put in an alternative model which is what has been inserted into this bill.

This is not something that is an onerous, outrageous disclosure regime; this is in fact the regime that the government insisted upon, and they were the ones who inserted it into a bill only a couple of weeks ago. There is absolutely no cogent reason why it should not apply in this bill, given it is what the government itself put into a bill we considered only a couple of weeks ago.

The Hon. T.A. FRANKS: I support the Leader of the Opposition quite wholeheartedly on that contention. It is quite extraordinary that the government is insisting that this is a deal breaker, to ensure proper accountability and transparency; it is not about the ability of the Legislative Council to affect or direct this body. This is simply about this body having the highest and most appropriate standard of accountability about their pecuniary interests. Certainly I think the government has a question to answer as to why it has decided to die in this particular ditch.

The Hon. F. PANGALLO: Yes, it is quite disappointing. I agree with the Leader of the Opposition that this is quite an important aspect of the bill. I think it needs to reflect the government's own commitment going to the election about accountability and transparency. Can I also say that credibility is quite important. If I can quote from a lecture by Professor Gary Banks. Professor Gary Banks, of course, was the first chairman of the federal Productivity Commission. In relation to institutions like the Productivity Commission he said:

Necessary design features for such institutions include independent governance, transparent processes, solid research capacity, an economy-wide frame of reference and linkages to policy-making mechanisms within government.

He goes on further to say:

Choosing the wrong person to head an inquiry, typically a confidante of a minister or someone who is known for strong opinions on a topic, can be fatal to the inquiry's public credibility and thus to its value as a vehicle of reform. The minimum requirement for such appointments could be described as confidence without conflicts.

I totally agree with that, so we will be supporting the Leader of the Opposition.

The Hon. M.C. PARNELL: I have not been engaging overly in this debate because my colleague the Hon. Tammy Franks has been eloquently putting the Greens' position on the record. I think this is an important clause in relation to disclosure of pecuniary and personal interest, because it seems to me that the issue of conflict of interest is something that has been degraded, demeaned and diminished over time. We are all familiar with people like Donald Trump and his attitude to things like that, but we only need to look across the border into Queensland where people might remember Russ Hinze who was appointed the minister for racing, and he owned 167 racehorses. It was suggested to him by a journalist that maybe he had a conflict of interest and he said, 'No, it just makes me an expert.'

If we were to get that sort of attitude on this productivity commission, where someone who was a director of a company or owned in their own personal capacity a lot of shares in an industry that was being looked at, especially if it was being looked at with a view to it getting public subsidy or support, then that would be outrageous, and so these disclosures absolutely do need to be made and so I support my colleague the Hon. Tammy Franks. If this particular clause is a deal breaker then that says much more about the government than it does about the Legislative Council. This is a good amendment and it should stay in.

The Hon. R.I. LUCAS: For the benefit of the Hon. Mr Parnell, I point out that there is in the government bill a provision in relation to conflict of interest, which mirrors exactly the provision that is in the Essential Services Commissioner's legislation. As the government argued when we debated this yesterday or the day before, the closest thing that we can see to the productivity commissioner is the Essential Services Commissioner.

However, the Essential Services Commissioner has more power than the productivity commissioner. The Essential Services Commissioner actually makes final decisions in relation to pricing issues. Water pricing, port charges and those sorts of things are decisions that they make, whereas the productivity commission is actually just an advisory body. It just advises governments under the government bill about policy direction.

As we have seen with the federal Productivity Commission, it is an advisory body, and on the horizontal fiscal equalisation the federal government has said, 'We hear what you say. We understand what you say, but we are disagreeing with everything that you say and we are not going to implement your recommendations.' The Essential Services Commissioners actually have more power, separate from politicians, parliament and everyone. We have set them up as an independent regulatory authority and they make final decisions in relation to issues. The productivity commission will be just a recommending body.

The government's bill with conflict of interest provisions in it is actually the same as the Essential Services Commission. It is not as if there is no conflict of interest provisions there. The conflict of interest provision in the bill says the chair must inform the minister in writing of any direct or indirect interest that the person has or requires in any business or in any body corporate carrying on business in Australia or elsewhere, or any other direct or indirect interest the person has or acquires that conflicts or may conflict with the person's functions.

It is not as if there are no conflict of interest provisions. There are explicit conflict of interest provisions in there. It then says under subclause (2):

The Chairperson, Acting Chairperson, Commissioner or delegate must take steps to resolve a conflict or possible conflict between a direct or indirect interest and the person's functions in relation to a particular matter, and, unless the conflict is resolved to the Minister's satisfaction, the person is disqualified from acting in relation to the matter.

So there is a process that the commissioner or the chair must inform the minister in writing of any direct or indirect interest that might conflict with the work. They then have to try to resolve the issue to the minister's satisfaction, and if that is not possible, then the commissioner is disqualified from acting in relation to that particular matter.

As I said, whilst I understand the position being put, that the non-government members in the chamber who have spoken have indicated that they believe the alternative disclosure provision, which they have pointed out was included in the health governance bodies, is the appropriate one, the government has chosen the Essential Services Commissioner model. Again, I make the point that in relation to the governing councils in the health area, as I understand it, they will actually have a budget. They will make final decisions in relation to delivery of services within some sort of contractual agreement, I understand, with SA Health.

There will be a CEO, there will be a board, and they will actually make decisions, sometimes—often—independently of a decision of the minister, that is, the board will be taking decisions as to how the tens or hundreds of millions of dollars might be spent within that particular area health network. Again, I contrast this with the productivity commission, which will not actually make any decisions, other than recommend on important issues to government a policy direction, which the government of the day can accept or reject in terms of where you head.

So there are, clearly, differing roles and functions, both of the Essential Services Commission, upon which we have modelled this conflict of interest provision, or the alternative model, which the non-government members have chosen—the health governing councils—and said, 'Well, hey, you put it in that; why wouldn't you put it in this?' The difference is that one body actually makes final decisions, independent of government to a certain level—there will obviously be an agreement, and within that agreement that board or authority will make its decisions—whereas the productivity commission at no level can make independent decisions; it will just recommend to the government of the day.

We therefore do see a difference and there are therefore, in terms of managing a health budget in a particular area, some explicit provisions in relation to how you would manage it because there are quite clear potential conflicts, because they are making decisions and there might be conflicts between business interests or personal interests of members.

The productivity commission will be recommending to a government, and in terms of conflicts there is a process there that they have to resolve. In the end, even if, contrary to the bill that is proposed, they did not disclose a particular interest, or whatever it was, then ultimately the government of the day can accept or reject the recommendations of the commissioners in that respect. That is the background to the reason for the difference.

I will be frank and say that the government's major issues and problems related to the first two issues about which we have determined views in the council, which was the United States Senate-style confirmation hearings and the power of the council to refer to the commission. In order of magnitude, the government's position is those two; conflict of interest we still disagree with, but it is not of the same order of magnitude as those first two issues.

The Hon. K.J. MAHER: I thank the Treasurer for his contribution. The Treasurer is saying that different regimes apply: the regime that eventually was settled on for the health boards bill, which has a higher standard of disclosure of pecuniary or personal interest, or there is a lesser one that deals with conflict that is in the ESCOSA bill, to which he would prefer us to be more akin.

The Treasurer is basically saying, 'Look, we think the productivity commission is more akin to ESCOSA, so we should have the lesser regime apply, not the greater regime.' I thank the Treasurer for his suggestions, and I think we will closely consider an amendment to the ESCOSA bill to include this as well. I do not think we should—

The Hon. R.I. Lucas: You're not in government.

The Hon. K.J. MAHER: I do not think we should look—a private members' bill can make any changes to a bill. I do not think we should be fooled by the Treasurer with his argument that there is a lesser regime, so that is the only one we can choose. Let's lift the tide on all of them.

We can have an amendment to the ESCOSA bill so that all these schemes operate under a higher level of disclosure and pecuniary interest. I might ask some guidance from the Chair. I think the advice on Tuesday, or when we last considered this, was that because this is a new bill it is capable of amending any other bill. So could we today amend the ESCOSA bill to include this regime, in line with the advice given yesterday?

The CHAIR: No, it is not relevant.

The Hon. K.J. MAHER: May I ask the Chair: what is the distinction between amending the government enterprises bill—

The CHAIR: Because it goes outside the scope of this bill.

The Hon. R.I. Lucas: Do you want to see this finished today or not?

The Hon. K.J. MAHER: It may well come back as a private members' bill then to amend the ESCOSA bill to have the greater level of disclosure.

The Hon. C. BONAROS: I appreciate that my colleague predominantly has been dealing with this bill, but I have to agree with the comments of my colleague the Hon. Frank Pangallo, the Hon. Mark Parnell, the Hon. Tammy Franks and the Leader of the Opposition. I think the Treasurer's remarks just now have reinforced that position, if nothing else. He has said the decisions of the productivity commission are such that they recommend policy direction to government, and if there are interests there and there are people with those interests making those policy direction recommendations then I think that is something we ought to know about. If anything, I think the comments have further reinforced our support for this amendment, and we will be sticking to that.

The Hon. J.A. DARLEY: I thank the Treasurer for the further explanation and, as such, I will not be insisting on the amendment.

The Hon. F. PANGALLO: I am not sure about the Treasurer's threat that if we do not accept this they are just going to go and set up their own because all that just flies in the face of what credible experts around the country are saying when you set up institutions like this, which is that they need to be independent and that it will affect and impact on their credibility. If the government is going to decide, 'Well, we are going to go away and set up our own. We will appoint our own commissioners. We will tell them what to do,' it really does detract from the productivity commission bill that they put up themselves.

I just cannot understand the government's stance in saying one thing about what it wants, and then it will go away and virtually present something that is going to lack credibility and perhaps not even win the trust of the public. Again, we will stay with the Leader of the Opposition and dig our heels in.

The CHAIR: Does any other honourable member have a contribution? I put the question that amendment No. 7 be insisted upon.

The committee divided on the question:

Ayes 11

Noes 8

Majority 3

Amendment thus insisted on.

The CHAIR: We have now arrived at amendment No. 18.

The Hon. K.J. MAHER: I rise to speak on and commend to the Legislative Council that we insist upon amendment No. 18. We think it is entirely reasonable that the chair of the productivity commission is responsible, in the conduct of what they do in terms of the productivity commission, to appear at least once a year, as the clause states, before the Economic and Finance Committee. This is not a particularly onerous level of accountability for this commission which, under the Treasurer's statements that we heard earlier today, is an incredibly powerful position that will be recommending policy to government.

The Hon. T.A. FRANKS: Again, I am not sure why the government, to reiterate, is willing to die in a ditch on this one. To compel appearance before a parliamentary committee once a year is hardly an onerous request. It is something that potentially committees of this parliament can and will do anyway, so it is extraordinary that this one is being insisted on.

The Hon. R.I. LUCAS: In the spirit of conviviality and camaraderie that has imbued this chamber in the committee debate, let me add to that by indicating that—I only speak as an individual—I do not know that the government will die in a ditch over this particular issue. The two fundamental issues to the government, as long as they are sustained by one further vote on recommittal, are the United States Senate-style hearings and the power of referral.

The Legislative Council has expressed its view in relation to the conflict of interest provisions and, in light of that, I would be happy to have a discussion with the Premier between the houses in relation to the government's position should that be the package that goes. If tacked on to the end of that was an annual appearance at the Economic and Finance Committee—I cannot put words into the Premier's mouth, but certainly from my viewpoint—I am not sure that would be a die in a ditch type of issue for the government or the Premier. I do not profess to speak on behalf of the Premier, but I indicate that I would be happy to have a discussion on it.

From my discussions with colleagues in this chamber, my understanding is that the numbers are there to insist on this amendment, so I will not choose to divide on this issue.

The Hon. F. PANGALLO: We will be supporting the Leader of the Opposition on that. I really do not think it is an onerous ask to have them appear before a parliamentary committee.

The Hon. J.A. DARLEY: I will be supporting the opposition on this one.

The CHAIR: I put the question that amendment No. 18 be insisted upon.

Amendment insisted on.

Amendment No. 5:

The Hon. R.I. LUCAS: I move:

That the council do not insist on its amendment No. 5 and agrees to amendments Nos 1 to 3 made by the House of Assembly in lieu thereof.

This was the end result of a package of amendments. Contrary, I think, to the unfair characterisation of the government that it said it was all or nothing, we did compromise on a number of amendments the Hon. Mr Darley moved in relation to two amendments and that the Hon. Mr Pangallo moved in relation to one amendment.

For the third amendment the government came up with an alternative proposition in relation to the competitive neutrality regime. That has been further discussed with the Hon. Mr Darley, because it was his original amendment. He can speak for himself, but I am hopeful that there might have been some agreement in relation to the amendment we put in the Legislative Council that the Hon. Mr Darley was still unhappy with.

To refresh honourable members' memories, competitive neutrality can be investigated under an existing act, and the government's position was that if there were a complaint about competitive neutrality it could go to the minister, who could get the productivity commission to go off and do the work under the current structure of the Government Business Enterprises (Competition) Act because there is a structure there as to what has to happen for competitive neutrality investigations.

The Hon. Mr Darley's position, as I understand it, is that he would still like a complainant to be able to go to the productivity commission as well as to the minister. The compromise amendment allows for both; that is, if it goes to the productivity commission and they decide they want to do a competitive neutrality investigation they will do so. They will take themselves off and do that investigation under the auspices of the Government Business Enterprises (Competition) Act. They will use that structure, but the trigger point that the Hon. Mr Darley was concerned about was that it should not just be a complainant being able to go to a minister, he or she should be able to go to the minister or to the productivity commission directly.

I guess that caters to the situation where a minister unreasonably rejects a competitive neutrality complaint and does not refer it to the productivity commission. In those circumstances the complainant could go directly to the productivity commission and the productivity commission could institute a competitive neutrality complaint under the current legislative framework. My understanding is that possibly the Hon. Mr Darley is comfortable with that. We are certainly moving this compromise amendment in the anticipation that there is now a compromise position on that, and if that is the case we urge honourable members to accept this compromise.

The CHAIR: The first question is that the council insist on its amendment No. 5. If you support the Treasurer's position you vote no.

Amendment not insisted on.

The CHAIR: I put the further question that the council agrees to amendments Nos 1 to 3 made by the House of Assembly in lieu thereof.

Alternative amendments carried.

The PRESIDENT: Honourable members, I report that the committee has considered the message from the House of Assembly and has resolved to insist on its amendments Nos 2, 7 and 18; to not insist on its amendments Nos 3, 6 and 8 to 16; to not insist on amendment No. 5; and has agreed to amendments Nos 1 to 3 made by the House of Assembly in lieu thereof.

The Hon. R.I. LUCAS: I ask that message No. 42 from the House of Assembly, relating to the South Australian Productivity Commission Bill, be recommitted in respect to amendment No. 2 of the Legislative Council, to which the House of Assembly has disagreed.

The PRESIDENT: Before we get to that, we need a motion that the report be adopted.

The Hon. K.J. MAHER: May I speak to the question?

The PRESIDENT: You may.

The Hon. K.J. MAHER: I will speak briefly to say that the opposition will be opposing the recommittal. I will flag that this is the issue that we that we have agitated about, namely, either house of parliament, by a majority motion of that house of parliament, being able to refer a matter to the productivity commission. I flag that, if the recommittal fails—that is, if the will of the Legislative Council goes back to the idea that a house of parliament should be able to put something to the productivity commission—the opposition will then be recommitting amendments Nos 3 and 8 to 16 to reinsert the consequential amendments.

So the opposition will not be supporting this recommittal. We will be voting against this recommittal. If that is successful, the opposition will be putting that amendments Nos 3 and 8 to 16 be recommitted to allow those consequential amendments to allow a chamber of parliament to refer something to the productivity commission. We do so because we think this is critically important.

The Parliamentary Budget Advisory Service has been stopped by this current government. There is now no other way for a crossbench member or other members of parliament to seek advice on the economic impact or the financial impact of policies that it might propose. This would be the only way, to use the productivity commission. We have seen the Treasurer say that he is happy to have discussions between the chambers in relation to other parts of this. As the Hon. Ian Hunter said, governments regularly jump up and down and say, 'This is it. It's all or nothing. If you don't take this, there will be nothing at all,' then, regularly, governments pretty quickly compromise.

If we recommit this and vote it down, that is it: there is no more negotiation. The government gets 100 per cent of what they want in relation to this. If we vote against a recommittal and then recommit the other clauses, it keeps it alive so that there is the possibility of further negotiation. As the Treasurer has admitted in relation to other matters, he is happy to have discussions between the chambers. Recommitting this and voting it down means that it is over and there is not even a possibility of negotiation on this matter. So the opposition will be voting against the recommittal. If the opposition is successful in that vote, we will be recommitting amendments Nos 3 and 8 to 16.

The Hon. R.I. LUCAS: I think the choices for members are clear in relation to this. We now have two conflicting sets of amendments in the bill. That is what the recommittal is about: to confirm the position. That is, there is a package of about 10 amendments, which was the second vote we had, which confirmed the position that the Legislative Council would not be able to refer matters to the productivity commission. That was the final vote that was taken.

There was a package of about 10 amendments, amendments Nos 3 and 6 to 16, whatever that motion was, and that particular position was the final position adopted by the committee. There was an earlier vote in the committee which went the other way, so the two positions are inconsistent. What this recommittal is about is simply to have a consistent set of amendments which leaves the Legislative Council, in relation to this issue, with the power to refer issues to the productivity commission.

Contrary to what the Leader of the Opposition has just said, let me make the point very clearly that there are two issues about which we have spoken at great length where the government has said they will just not move in relation to these particular issues. If the bill goes back, along the lines the Leader of the Opposition wants, then the bill will be laid aside and we will proceed with the productivity commission in the alternative, as I have explained.

The only other point I would make is that it is a little bit disingenuous of the Leader of the Opposition, and he knows it to be the case, when he says the new government abolished the parliamentary advisory service. The former government established the parliamentary advisory service on a time-limited period through to 30 June. Former deputy under treasurer John Hill was appointed on a fixed-term contract which expired on 30 June. All of the staff were appointed on fixed-term contracts.

The former treasurer made it quite clear that the former government's intention was that its work would finish straight after the election on 30 June. The claim from the Leader of the Opposition, which he knows to be wrong, that the new government has abolished the parliamentary advisory service as an independent form of advice to members of parliament, is untrue. It does him no good to make that claim on the record in the Legislative Council. Put that to the side; that was a red herring.

It is clear that the last substantive vote in the Legislative Council committee stage was to confirm the position. This recommittal just tidies it up because an earlier vote was inconsistent with it. We ask members to support this—and it might be a division—for a recommittal.

The Hon. K.J. Maher interjecting:

The PRESIDENT: The debate has been summed up; you do not have a right to be heard. I put the question that—

Members interjecting:

The PRESIDENT: Order! I am putting the question that message No. 42 be recommitted in respect of amendment No. 2.

Ayes 9

Noes 10

Majority 1

Question thus negatived.

The Hon. R.I. LUCAS: I will move that the report be adopted.

The Hon. K.J. MAHER: Mr President, I foreshadowed I was moving a recommittal of amendments Nos 3 and 8 to 16.

The PRESIDENT: No, you did so in the event that the other was recommitted. They were your words.

The Hon. K.J. MAHER: Are you not allowing me to move a recommittal of those amendments?

The PRESIDENT: I will give you a moment to reconsider it, but they were your own words—your own words. You have to be very careful what you say, Leader of the Opposition, in divisions like this. Are you making the application to me?

The Hon. K.J. MAHER: I am making the application to you to recommit amendments Nos 3, and 8 to 16.

The PRESIDENT: I will put the question. Do you wish to have debate? Treasurer.

The Hon. R.I. LUCAS: Only very briefly. We will be opposing this and we will divide on it. One never knows what the results of these divisions will be, so I await with anxious anticipation.

The Hon. M.C. PARNELL: I do not think I am Robinson Crusoe here in being slightly confused. My understanding is that the Legislative Council has now passed a bill that has some mutually inconsistent provisions in it. The question is: which way are we going to lean? The inconsistency has to be removed some way. My understanding is it is via recommittal. If we do not recommit, the inconsistency stands. I am not sure what latitude parliamentary counsel have. In a previous bill we talked about them being able to fix things up where there were some consequential administrative fix-ups, but I am not sure that this is within their remit. I would be happy if people needed to take advice, because otherwise we are just going to keep dividing and going backwards and forwards and not actually getting anywhere.

The PRESIDENT: Does any other honourable member wish to contribute to this debate? I will put the question that message No. 42 be recommitted in respect of amendments Nos 3 and 8 to 16.

The council divided on the question:

Ayes 10

Noes 9

Majority 1

Amendments Nos 3 and 8 to 16 reconsidered.

The CHAIR: Leader of the Opposition, you are now to move, if you so choose, that amendments Nos 3 and 8 to 16 be insisted upon.

The Hon. K.J. MAHER: I move:

That amendments No. 3 and 8 to 16 be insisted upon.

The CHAIR: Does any honourable member wish to make any contribution? Treasurer.

The Hon. R.I. LUCAS: The government opposes it and will call a division because one never knows what the result might be.

The CHAIR: Does any other honourable member wish to make a contribution? I put the question that amendments Nos 3 and 8 to 16 be insisted upon.

The committee divided on the question:

Ayes 10

Noes 9

Majority 1

The PRESIDENT: I have to report that the committee has further considered message No. 42 from the House of Assembly and resolved to insist on its amendments Nos 2, 3, 7, 8 to 16, and 18, to not insist on its amendment No. 6, to not insist on its amendment No. 5, and has agreed to amendments Nos 1 to 3 made by the House of Assembly in lieu thereof.