Bills

Liquor Licensing (Liquor Production and Sales Licence) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 16 June 2020.)

The Hon. K.J. MAHER (Leader of the Opposition) (15:39): I rise to speak on this bill. The government has urgently moved this bill in the Legislative Council in the same week that it passed the House of Assembly. It was not in the weekly correspondence from the Leader of the Government to the opposition and the crossbench that normally guides our proceedings.

Whilst moving so quickly on a bill would usually represent an egregious breach of the conventions which help this chamber run smoothly, the opposition understands there are special circumstances. We are advised by the government that all non-government members in this chamber have indicated unanimous support for the progression of this bill this week, and that provides some comfort in stepping outside the standard practices of this council.

Despite the very short time frame, the opposition has received advice from some stakeholders, including the Australian Hotels Association (SA) and the Wine Industry Association, supporting the government's proposal. As has been set out, this bill is deemed urgent because there are reportedly numerous liquor licence applications from a supermarket that have caused concern. These apparently seek to exploit a loophole in a specific licence that is intended for use by genuine producers.

This bill seeks to close this loophole by amending the liquor production and sales licence category in section 39 of the act. It seeks to prevent the sale of alcohol from supermarkets, convenience stores and delis, or at least those ordinarily known and advertised as such. It seeks to limit direct sales, including online and mail orders. In this area, the bill will limit sales to the licensee's product only, except in the case of a wholesale transaction where the volume of liquor sold is 4.5 litres or more.

The bill also makes changes to section 22 that deal with the applications of the commissioner, specifically by amending section 22(1)(c) of the act. It will allow any party to make an application to the court, where the court allows it. This expanded capacity will apply in all circumstances, except those handled under section 22(1)(a) and section 22(1)(b). These sections deal with applications where the commissioner held a hearing in relation to an application and decisions relating to designated applications such as those for pubs and hotels.

It is not immediately clear whether this additional change about the expanded court access is as critical as the change to the specific licence provision, but I trust the government will go into further detail during the second reading sum-up or the committee stage.

Whilst I indicate the opposition is supportive of this bill, there are a couple of questions that we will seek answers to and an assurance given during the second reading summary or during the committee stage. Specifically, how can we be certain that no genuine producers will be made ineligible for this licence as a result of the change? Have any other applications from supermarkets or similar retailers been received or dealt with prior to those that have caused the government to seek this urgent change in the law? Having said that and with those couple of questions being answered, we will be supporting the swift passage of this legislation.

The Hon. C. BONAROS (15:43): I rise to speak in support of the Liquor Licensing (Liquor Production and Sales Licence) Amendment Bill 2020. The bill, as we know, seeks to amend limited provisions of the Liquor Licensing Act 1997. I have made it clear from the outset what our long-held position has been on the sale of alcohol in supermarkets and the concerns around opening the floodgates for the sale of alcohol at the expense of boutique wineries, cellar doors and, of course, independent bottle shops.

Restrictions on the physical availability of alcohol and reduced outlet density are also a proven way to reduce consumption and alcohol-related harm. These are very important factors, but this is a debate for another day. The bill addresses a very specific liquor licensing issue, and we have been asked to deal with it as a matter of urgency. It closes a loophole that would otherwise create a very uneven playing field for one supermarket giant over others.

As I understand it, there are currently outstanding matters before the Licensing Court in relation to applications by Aldi for producers' licences for six of its stores. It is worth noting that the applications were made under the old licensing scheme, and a decision is expected imminently. I understand Aldi has purchased its own wineries and has no plans to sell other wine labels in its stores.

The government has made it very clear that it is anxious to make these legislative amendments before any decision is handed down by the Licensing Court. Of course, the amendments are retrospective and are intended to capture that outstanding matter.

As I said, the licence applications were made under the old scheme. The new licence category commenced on 18 November last year, and I think it is correct to say that had the Aldi applications been made today they would have been subject to the new community impact test that imposes a significantly higher threshold on any applicant—and rightly so. It replaces the needs test, as recommended by an independent review of South Australian liquor licensing laws conducted by former Supreme Court Justice Anderson in 2016.

The Commissioner for Consumer and Business Services has issued community impact assessment guidelines pursuant to section 53B of the Liquor Licensing Act. The guidelines outline the considerations given in granting applications for a packaged liquor sales licence and other high-risk licence applications.

They include potential harm to the community as well as social, cultural, employment and tourism impacts in a similar vein to those that relate to poker machines. The onus is on the applicant to satisfy the commissioner in the absence of a waiver, and we welcome the high threshold. High-risk licences are just that; they have the potential to create greater harm to the community.

In relation to this particular bill, the government informs me that it has sought to consult with a number of key stakeholders, including the SA Wine Industry Association, the Department for Trade and Investment, various peak wine bodies and, I believe, our long-time adversary the Australian Hotels Association. All appear to have remained silent on this issue, but I think it is safe to assume that none would oppose the move by the government to tighten this loophole.

It goes without saying that the AHA will back any move to zealously protect its market share, and I suspect this bill falls fairly and squarely within that category. As all in this chamber already know, it is extremely rare—if ever—that SA-Best aligns with the AHA on any view, but I think it is fair to say that in this instance there are obviously very vested interests on the part of the AHA for doing so.

Mr President, I noted your interest in this particular issue. I can say that I have previously worked on an application concerning a transfer of licence where I also appeared before the court on the same side as hoteliers because they objected to an application—again, not because they agreed with us that we did not need more poker machines in that instance, but because they just did not want more competition. When it suits the AHA we know they will come to the party and back proposals that back their membership. That is factual.

We continue to take issue with the AHA's significant lobbying power in relation to poker machines in this state and, indeed, its stranglehold over both the Liberal government and the Labor opposition, driven of course by its extremely generous donations to both. However, that is an argument for another day.

In contemplating the bill at hand we have regard for its very limited focus. The power of Aldi, and indeed all the supermarket giants, needs to be kept in check. Allowing the exploitation of an unintentional loophole would have dire consequences for competition in South Australia. It would be detrimental to allow Aldi's presumably cheap, home brand wines to fly off their shelves. That is not what we, the community, needs right now—or, in my view, at any point in time.

For those reasons, SA-Best supports this bill and the amendments proposed by the government. However, I make it clear, again, that this is a very limited debate that relates specifically to that case. Had it been any broader we would have insisted that we have more time to debate it.

The Hon. F. PANGALLO (15:49): While my colleague has indicated our support, I must view this step with some cynicism. This government, as have Labor, have made their intentions clear about the sale of alcohol in supermarkets, and it would not surprise me if there has been intense lobbying on this from their generous election benefactors, the Australian Hotels Association and of course other elements in the liquor and hospitality industry dependent on door sales.

This bill does close a loophole that the clever legal eagles at Aldi supermarkets sought to exploit. We are being asked to push it through with retrospectivity, no doubt before a decision on Aldi's application is handed down by the Licensing Court. It is rhetoric promoting shopping hours deregulation. The Treasurer often points to the eastern seaboard supermarkets to amplify his argument, even though various reports would suggest it could result in an increase in prices and a negligible rise in jobs, but that is debatable, too.

If I am to gaze into my crystal ball of cynicism, I see the Treasurer bringing back his trading hours bill soon. If he were to be consistent in his comparisons with the Eastern States, he would entertain what they also do in supermarkets, and that is that they sell alcohol on their shelves. The world has not caved in on bottle shops, liquor retailers or winery cellar doors in those states. If anything, it provides a competitive market for the sale of liquor and opportunities for small boutique wineries and distillers to get much-needed exposure for their products.

South Australia is one of Australia's leading wine regions. It has many world-class brands and produces world-class wines and spirits, and we also have several acclaimed small wine producers and breweries. They all have a right to get their products widely exposed and promoted without having to pay exorbitant fees to the big retailers, some of whom have already cornered the liquor retail sector with their own outlets and hotels, many with electronic gaming machines.

Smaller supermarket operators have indicated to me that the ability to sell liquor could help alleviate any financial losses incurred, should trading hours ever be deregulated. As my colleague has indicated, this issue will probably be for another occasion. I would hope that the passage of this bill does not eventually signal that any hope that liquor would one day be sold in our supermarkets is extinguished. With that, as indicated by my colleague the Hon. Connie Bonaros, we support this bill.

The Hon. T.A. FRANKS (15:53): For the sake of the record, the Greens do support this bill. We simply put that on the record, noting that this is an unusual process but that we appreciate the various time pressures upon us today due to the court proceedings.

The Hon. R.I. LUCAS (Treasurer) (15:53): I thank all honourable members for their contributions to the second reading, and I reiterate, as I have done to all members privately, that if any member of this chamber, Labor or crossbench, had said to me, as Leader of the Government, that they were unwilling or unprepared to proceed with this debate this week, I would not have persisted and the government would not have persisted.

I gave that undertaking privately and I put it on the public record that we would proceed only if everyone agreed to proceed and to support. So I thank the honourable members for that. As each of the three members—the Hon. Ms Bonaros, the Hon. Mr Pangallo and the Hon. Ms Franks—have briefly indicated, the reason for this is that there is a current case. There may well be others, but there is certainly one at the moment and this matter is to resolve that particular issue.

The Attorney-General issued a statement on behalf of the government on 13 May, 'Liquor licensing loopholes to be shut.' I will not read all that because the Hon. Ms Bonaros in her contribution more than adequately placed on the public record the position of which the government, through the Attorney-General and her advisers, had advised SA-Best.

I repeat that the advice that SA-Best and other members were provided by the Attorney and/or her officers is a fair reflection of the government's position and a fair reflection of the reasons the government has asked members to consider debating and passing this bill today.

I know this was an issue the honourable Leader of the Opposition raised with me, so I place on the record that the advice that has now been placed on the record by the Hon. Ms Bonaros and the Hon. Mr Pangallo is a fair reflection of the advice and views of the government, the Attorney-General and her officers in relation to the need for the legislation before us today.

With that, I thank honourable members. I know there have been veiled references about other issues, which I will leave for another occasion, other bills and other debates. We will leave this one to this particular issue. I will not take up the invitation to explore other very interesting avenues of debate and discussion.

Bill read a second time.

Committee Stage

Bill taken through committee without amendment.

Third Reading

The Hon. R.I. LUCAS (Treasurer) (15:57): I move:

That this bill be now read a third time.

Bill read a third time and passed.