Motions

Retirement Villages

The Hon. R.I. LUCAS (Treasurer) (15:48): I move:

1. That, in the opinion of this council, a joint committee be appointed to inquire into and report on—

(a) valuation policies of the Valuer-General and their impact on some residents of retirement villages; and

(b) options available to both state and local government to alleviate any impact on SA Water and local government charges of these policies.

2. That, in the event of a joint committee being appointed, the Legislative Council be represented thereon by three members, of whom two shall form a quorum of council members necessary to be present at all sittings of the committee.

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

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

5. That a message be sent to the House of Assembly transmitting the foregoing resolution and requesting its concurrence thereto.

In speaking to the motion to establish a joint standing committee, for the benefit of members who are new to the chamber and perhaps have not had the benefit of what was an ongoing debate over a period of time prior to the 2018 election, and to provide a bit of context and background, I will read a good part of an article from Miles Kemp in the Sunday Mail under the heading 'Retirees face astronomical water charge'. The article goes as follows:

Retirement village residents fear a 700 per cent water bill increase is hanging over their heads because the State Government has not brought an SA Water cash grab under control.

SA Water, which already makes hundreds of millions of dollars in profit each year, wants to take advantage of a system in which the Valuer-General is valuing each retirement dwelling in a village as a separate entity.

This means that despite only one water meter going to each village, dozens of dwellings could be charged by SA Water as separate entities.

The system, which would cost retirees millions each year, was put on hold in 2015 following alarm about the first two retirement homes recording a 700 per cent increase, netting SA Water another $24,000 in revenue.

But Retirement Villages Residents Association president Bob Ainsworth said the problem had not been resolved almost three years later.

And the deal to stop SA Water acting through compensation was due to expire in 2025. 'This problem goes back to 2015 when the State Valuation Office made a decision to issue separate assessments to each retirement dwelling, rather than retain single assessments which are issued to all other multiple occupancy complexes such as shopping centres, office developments and blocks of flats,' Mr Ainsworth said.

'SA Water opportunistically wants to charge 8500 dwellings for a metered service despite there being only one meter to the complex they were in, and also to change the way the sewer charge was calculated to make even more money.'

But an SA Water spokesman defended the system of compensation from the State Government, because it avoided payment by those living in retirement villages.

I will not go on with the rest of that particular article. Suffice to say it highlights the particular issue, but from the viewpoint of those who oppose the current arrangements. I hasten to say that if the parliament chooses to establish this joint committee, they will receive strong evidence from a number of other stakeholders who trenchantly disagree with the assessment that Mr Ainsworth has outlined in that article.

SA Water has disagreed with that view. Certainly, the former valuer-general has now retired, but the state valuation office has expressed a different view in relation to some of the claims that have been made by Mr Ainsworth. I am not sure whether the committee would call former Labor ministers who had responsibility for this particular area at the time of 2015 or not, but that is entirely a decision for the joint select committee, should it be established. Nevertheless, a range of stakeholders have put a point of view disagreeing with the claims that are being made about the 700 per cent water bill increase or about the potential unfairness of the valuation system.

So there are trenchantly different views in relation to this vexed issue. The former government did, in essence, put it to bed in a political sense by signing this MOU in 2015, which goes through to 2025. As Mr Ainsworth concedes, this issue will only really become an issue upon the expiration of this particular arrangement in 2025. Nevertheless, as the residents association has highlighted, it is a matter of concern to them and they want to see the issue resolved.

I, as shadow treasurer, had a series of discussions about this particular issue. I know our colleague the Hon. Mr Darley has pursued this issue through various parliamentary committees already—the Budget and Finance Committee and possibly other committees; I cannot recall. In terms of questioning the former valuer-general, I know the Hon. Mr Darley has had meetings with the former valuer-general, etc., in terms of trying to seek a resolution to it.

The Hon. Mr Darley has a view that a particular legislative solution is a simple solution to it. Concerns have been raised about what the potential ramifications of that simple legislative change might mean, and it is for all those reasons that ultimately, in the discussions that I had with Mr Ainsworth, having put a number of proposed policy solutions to him and his association, he said, 'All we are asking is for an opportunity to have the parliament establish a committee so that we can argue our case before a parliamentary committee.' It is for those reasons that on 5 March, about two weeks prior to the 17 March state election, I issued, on behalf of my party, the then opposition, a press release policy commitment, which said:

Liberals agree to inquiry into Valuer-General policy

Shadow Treasurer Rob Lucas said today that a Marshall Liberal government would establish a Parliamentary Select Committee to investigate valuation policies of the Valuer-General and their impact on some retirement village residents.

This decision has been taken in response to lobbying from the SA Retirement Villages Residents Association (SARVRA) which has called on both the Labor Party and the Liberal Party to establish a Parliamentary Select Committee on this issue.

I will not repeat the rest of the press release. I am not aware that the Labor Party responded either privately or publicly to the lobbying from the Retirement Villages Residents Association. It may well be when a spokesperson from the Labor opposition speaks to this motion they might be able to indicate that they did correspond with Mr Ainsworth committing to an inquiry or they might have issued a public statement, but I obviously have no record of whether or not the Labor Party prior to the election responded to the request from the residents' association for an inquiry.

In technical terms, there is some information I can place on the record. The Valuer-General's approach to retirement villages has been to value each independent living unit as a separate assessment rather than a grouped assessment. The Valuer-General has argued that this approach was first introduced in 1993. The Valuer-General has argued that there are 500 registered retirement villages across the state, incorporating 17,500 independent living units, of which around two-thirds are currently separately assessed and the remaining third are assessed as a grouped amalgamated unit.

Again, the committee will be able to interrogate that evidence, but that information has been provided to my office, which indicates there are 17,500 independent living units. The separate assessment process was first commenced in 1993. Two-thirds of those 17,500 units have been separately assessed and it is the remaining one-third that have been assessed as a grouped amalgamated unit. One of the challenges in this, of course, is that under the current policy rollout one particular model is that the remaining one-third will be separately assessed.

The issue is that we currently have a situation where some are already separately assessed and therefore are either currently paying or will be paying rates, taxes and charges in relation to being a separate assessment. You have others that have not been separately assessed and that are paying the same sorts of rates, taxes and charges, but paying them at a different rate because they are part of a group assessment.

So there is an argument about an inherent inequity within the system as it exists at the moment. The committee may well look at one option, which is to separately assess all of them, and the other one is to reverse what we are told is the policy back to 1993 and I guess give an advantage to people who have been paying their taxes and charges on the basis of a separate assessment perhaps back to 1993. They are the sorts of issues this committee is going to need to have a look at.

I am advised there have been subsequent reviews since 1993. The valuations approach was subject to a select committee, I am advised, in 2013, established in the House of Assembly. As I referred to earlier, I know the Hon. Mr Darley pursued some issues in 2015 and subsequent years through some questions in the Budget and Finance Committee. The MOU that I referred to earlier that was established on 1 July is actually between, I am advised, the Valuer-General, SA Water, RevenueSA and what was then the department for communities and social inclusion. That is the one that is meant to expire on 1 July 2025.

In brief, that is the background to this motion to establish a joint committee. I think, on behalf of the residents who have relentlessly pursued this particular issue for some time, there is a significant issue that needs to be resolved. This was an election commitment that the former Liberal Party and now Liberal government made prior to the election. This is our following through on that particular election commitment and it will, of course, be subject to whether or not there is a favourable decision to support it in this chamber and in the House of Assembly to establish a joint committee.

Debate adjourned on motion of Hon. I.K. Hunter.