Adelaide Oval Hotel Development

The Hon. I.K. HUNTER (17:31): I move:

1. That a select committee of the Legislative Council be established to inquire into and report on a redeveloped Adelaide Oval, with particular reference to:

(a) the economic and financial benefits of the redevelopment of Adelaide Oval, including to whom the benefits are accruing;

(b) the operations and financial management of the Adelaide Oval;

(c) the corporate governance of the Oval, including the Stadium Management Authority;

(d) the financial returns to the South Australian National Football League, the South Australian Cricket Association, and the Adelaide and Port Adelaide football clubs;

(e) the financial contributions into the Oval infrastructure and into the broader sporting community from the Oval's operations;

(f) the proposed hotel development at the Adelaide Oval, and the process by which the government considered the proposal and approved financing the proposed hotel development;

(g) the impacts on the hotel industry in Adelaide of the proposed hotel development;

(h) the legislative, regulatory and other legal frameworks governing the operations of the Adelaide Oval, and any opportunities for improvement;

(i) the impact of the Oval and its operations on the surrounding Parklands and the legislative, regulatory and other legal frameworks governing further development in the Parklands; and

(j) any other related matters.

2. That standing order 389 be so far suspended as to enable the chairperson of the committee to have a deliberative vote only.

3. That this council permits the select committee to authorise the disclosure or publication, as it sees fit, of any evidence or documents presented to the committee prior to such evidence being presented to the council.

4. That standing order 396 be suspended to enable strangers to be admitted when the select committee is examining witnesses unless the committee otherwise resolves, but they shall be excluded when the committee is deliberating.

This select committee is necessary, I believe, to investigate the operation of the Adelaide Oval, as well as the provision of a $42 million taxpayer-funded loan to the Oval's Stadium Management Authority for the construction of a hotel at the Oval.

It is clear that the redevelopment of the Oval has been a tremendous success; I do not think anyone would argue with that. Since the first test was played in late 2013 and the first game of AFL was played in March 2014 we have seen record crowds. In 2014, the first year of the redeveloped oval, the total crowd figure at the ground for Port Adelaide and Adelaide games was over one million, an average of over 46,000 people per game—a massive increase from Football Park's last year, in which attendance totalled 666,808, with an average of just over 30,000.

These crowds, to both the Adelaide Crows and Port Power home games, have significantly exceeded the financial model, I am advised, which estimated what was necessary for a redeveloped oval to be a success. Similarly, record crowds have been achieved for test cricket matches, and the huge success of the Adelaide Strikers has also meant record crowds attending to watch those cricket matches.

Concerts have pulled huge crowds, including one of your favourites, sir, AC/DC, the Rolling Stones and Adele. These are only a few of the extraordinary number of events scheduled at the Oval since 2014, although in my humble opinion none of them compare to Madonna's fantastic concert performance at the old Adelaide Oval.

It is clear that the Stadium Management Authority, created to manage the operation of the Oval, has control of not just the best oval in the country but also what clearly should be a massive money-spinner for us. As we have heard, they have also invested in the Adelaide Oval Roof Climb, the Bradman museum and the new cafe at Telstra Plaza, and this will undoubtedly be positive. Speaking of which, I am advised they have also received multimillion dollar sponsorship from Telstra of their plaza fronting the footbridge.

For its part, on top of the $535 million provided for the redevelopment, the government has regularly funded confidential inducements to attract events and concerts to the Adelaide Oval, and provided free public transport services to AFL matches, in conjunction with two AFL teams and with minor contributions, I am advised, from the SMA and the SANFL.

Despite all of this, we are now told that a new hotel must be built at the Oval to generate more revenue for the SMA to invest in oval infrastructure. The SMA is claiming they do not earn enough revenue from the current operations of the Oval. That is a surprise, to me at least, because the Oval charges about $9.50 for a beer, $6 for a soft drink and over $5 for a bottle of water. I understand, as is frequently reported in the local paper, that this compares very unfavourably to the rest of the country—in fact, we are one of the highest.

So you have to ask: where is all the money going? Who is getting the benefit of this oval? It certainly does not seem to be the two AFL clubs or even the SACA. But, most importantly, it does not seem to be the punters either. In South Australia, the Adelaide Football Club and Port Adelaide Football Club are very well supported by hundreds of thousands of fans who each pay their own hard-earned cash to become members of these clubs and support these clubs financially. Quite rightly, many of these supporters expect that the money they spend at Adelaide Oval contributes to making their club as strong as possible on and off the field and, in a bipartisan way, to making sure that the fantastic Port Power win every home game they play over the next 12 months.

The Hon. T.J. Stephens: Dream on—delirious!

The Hon. I.K. HUNTER: Thank you, Terry. You are biased on this matter. I understand and I will accept that. But where is the money going that should be supporting the infrastructure for anything that needs to be done at the Oval into the future? It is a question that needs to be explored. What about the SANFL? How much are they taking from the Oval? Are they getting their fair share? I suggest that a committee is needed to look at some of these detailed questions.

Another question that needs to be thoroughly explored is whether the Oval is being run as efficiently as possible. What are the administrative overheads? Are they reasonable? Is the government's structure or the SMA conducive to ensuring that financial returns are maximised to those that the parliament sought to assist in approving the $535 million for the redevelopment—the Crows, the Power, and SACA?

One area I am particularly concerned about is the lack of consideration that this government and indeed the SMA, on the face of it at least, seem to have for our other restaurants, hotels and CBD venues. You see, what the hotel is asking us as a parliament and as a government to do is, I suggest, a potential risk, because it could be moving visitors out of the CBD into an isolated pocket where visitors will not engage with the businesses already established throughout the city in Grote Street and Gouger Street, and with the bars in streets through which people would normally walk to get to the Oval and back to their accommodation. They will not need to do any of that if they are closeted down at the Adelaide Oval. They can stay there and they will not need to move to the restaurants in North Adelaide, or walk up Peel Street to have a drink at one of our bars or to go to a fantastic Gouger Street restaurant.

I am not sure if we have actually thought this through. When a group comes over from Melbourne to watch the footy and stay in the CBD, they do not just pay for their hotel and a beer at the footy which is, as we have heard, one of the highest in the country. They might go out and enjoy what other venues in the city have to offer, spend a few dollars in a local venue and help employ South Australians in those venues. And, if they are supporting a Victorian team against the Power, then they will be also be spending a lot of money drinking their sorrows away.

This means more tourists, more income and more revenue, which fundamentally means more jobs for South Australia in a vibrant CBD. What does building a hotel down at the Oval do to that? I am very concerned about that. It is not something that has been canvassed and I think it is something that this committee, if it is supported by the council, should have a close look at.

The Premier, I understand, has claimed that in granting this $42 million loan to the Stadium Management Authority we are essentially levelling the playing field. I just cannot comprehend how he could run that argument. He is giving, in essence, a loan to an organisation to set up a competitor to the rest of the businesses in Adelaide. He is giving favoured position to a hotel to be established on the site which will fundamentally compete with other businesses that have to go out to the banks and ask for a loan to increase and improve the operations of their business. How is that levelling the playing field? I just do not understand.

Hoteliers, businesses, restaurants and cafe owners have invested their own capital in constructing and improving hotels and their venues, with a view to attracting interstate and overseas to attend matches at the Oval and enjoy the local hospitality. How will a state-owned, effectively, hotel down at the Oval affect the prosperity and viability of those ongoing businesses and the jobs they provide for South Australians?

I do not think much reflection has happened about that fundamental question. If it has, I would like to be told about it. Did this hotel get the exclusive stewardship and access to profit-making enterprises that the Stadium Management Authority did when they got the keys to a brand-new $535 million best-in-the-nation stadium? Is that an inducement that is being offered?

Members interjecting:

The PRESIDENT: Can honourable members cease having a conversation? I would like to listen to the Hon. Mr Hunter.

The Hon. I.K. HUNTER: Why did the Stadium Management Authority need a $42 million loan from the Liberal government for the construction of this hotel? Did they not ask their bank for a commercial loan first? If they did, were they knocked back? If so, why were they knocked back? Can a bank not look at the financials of the SMA and their operations and see that it is profitable enough for them to be able to make the necessary loan and for the SMA to make the loan repayments?

If a bank cannot see that the SMA can make the loan repayments, then how can the taxpayers expect that? It is a question, I think, that bears a little more examination. How can taxpayers be expected to fund a loan to an organisation that cannot get a commercial loan on the basis of its ongoing business? That is a question that needs an answer.

Parliament also needs to understand how this loan was arranged. Who asked for it? Who exactly approached the government and asked for this loan? Were correct probity procedures put in place to ensure actual or perceived conflicts—

Members interjecting:

The PRESIDENT: The Hon. Mr Hunter, just hold it there for a moment. Can the minister and the Hon. Mr Wortley cease engaging in repartee? It is not witty, and I would like to listen to the Hon. Mr Hunter give his important speech seeking an examination into a potential state asset. The Hon. Mr Hunter, please continue.

The Hon. I.K. HUNTER: Thank you, Mr President, for your protection. Were correct probity procedures put in place to ensure actual or perceived conflicts were handled appropriately and dealt with adequately? Why was this all hush-hush until it was leaked on Saturday night to Channel 7?

Another aspect which I think is worthy of exploring is the impact of the Oval and its operations on the surrounding Parklands. There is not another city in Australia, and very few in the world, that can boast this green ring of parklands and trees around their CBD, a ring that is open to all South Australians for recreation, for a picnic, for a jog in the morning or to walk their dog.

Any development in the Parklands must be carefully considered. I am not saying that there are not appropriate developments in the Parklands, but we cannot just hack away at sections of the Parklands for the enjoyment of a few wealthy citizens. We need to consider how those developments in the Parklands will benefit everybody, if they do. If they do not, we should seriously consider whether they should go forward.

I am not educated in the law as you are, sir, but I think there are significant legal questions regarding this proposed hotel. Is it actually legal? Will there need to be changes to the legislation to allow it to go forward? Does existing legislation prevent it from being built now? I think it may well do, but we need further advice about that.

The Hon. D.W. Ridgway: Thank god you're not a lawyer.

The Hon. I.K. HUNTER: Indeed, thank god I am not a lawyer. I was just a humble cancer researcher a long time ago, who came into this place and now relies on other people with legal background to give me that advice, but we do not have it. We do not have it and I am asking this council to allow a select committee to find out.

It is vitally important that the legislative and regulatory framework governing the operations of Adelaide Oval are fit for purpose. This select committee will allow us to explore whether any updates are needed and whether they are in the state's best interest. After the first five years of the redeveloped Adelaide Oval, I think it is an appropriate time for us to set up a select committee to inquire into these matters. I look forward to the support of honourable members for the establishment of this important select committee and the important work that it will do in the future.

Debate adjourned on motion of Hon. T.J. Stephens.