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House of Assembly - Fifty-First Parliament, Third Session (51-3)
2008-09-10 Daily Xml
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SHARED SERVICES

Mr GRIFFITHS (Goyder) (15:39): My question is to the Treasurer. What is the extent of the cost blow-outs on time delays associated with the government's shared services project? On 27 June 2008 the then minister for finance raised doubts about the program when he told Estimates Committee A:

The targeted savings will emerge over a longer time frame than originally estimated. We do not have any new estimates. The reason is because we are doing detailed discovery, and as a consequence of that detailed discovery we learn things all the time. As we go through each tranche we will learn more.

The opposition and the Public Service union have expressed grave concerns about the credibility of the shared services program.

The Hon. K.O. FOLEY (Port Adelaide—Deputy Premier, Treasurer, Minister for Industry and Trade, Minister for Federal/State Relations) (15:40): The Liberals and the PSA (the Public Service union) together—lock step, arm in arm, what an unholy alliance! Anything this government does that is remotely reformist, remotely efficiency driven and in the public interest to keep finances spent where finances are needed to be spent, this lot over here has a whinge about. They are big spending, big taxing, sloppy financial managers. That is not this government. This government is recognised from Wall Street to Pitt Street as a very good manager of this state's finances—from Wall Street to Pitt Street.

An honourable member interjecting:

The Hon. K.O. FOLEY: We have. We have restored the state's AAA credit rating. Members opposite were incapable. Even after selling ETSA, it still could not get there. I mean, strike me pink! Now, shared services—

The Hon. I.F. Evans interjecting:

The Hon. K.O. FOLEY: Sorry?

The Hon. I.F. Evans: The only reason you got there was because of the ETSA sale.

The Hon. K.O. FOLEY: Now, the member for Davenport, what is Jamie Briggs going to say about you in the next week? Is he going to dump on you?

The Hon. I.F. Evans: Probably.

The Hon. K.O. FOLEY: Really?

An honourable member interjecting:

The Hon. K.O. FOLEY: Of course he's not; he just said 'probably'. Well, I'm on your side, Iain. With respect to shared services, I am quite relaxed—

An honourable member interjecting:

The Hon. K.O. FOLEY: No, I did not hear the full content of what was said—and I am not going to react to interjections all day long. I will keep you here till 5 o'clock. The Leader of the House will find some way to shut me up pretty shortly. I am glad you picked on me today, because I was not feeling that well and it is good to have the old brain and mouth working one in one for a change. Shared services is going well. I have said publicly and before parliamentary committees that—

Ms Chapman interjecting:

The Hon. K.O. FOLEY: Quite easily, because it is. It is an ambitious target. The critical issue for me and for the government is that we get the end point, that is, that we get the savings. As the former minister for finance and I have said, there is likely to be some slippage in the time it takes to achieve that bottom-line saving we are looking for—perhaps a year or two. I am still confident that we will get there. In fact, we have already locked in for 2008-09 $28.5 million of annual savings already achieved through shared services. The next $30 million, or so, is getting towards the harder end of the exercise.

Mr Griffiths interjecting:

The Hon. K.O. FOLEY: Well, 2008-09 has not finished yet.

Mr Griffiths interjecting:

The Hon. K.O. FOLEY: It is in the budget; it is locked in.

Members interjecting:

The Hon. K.O. FOLEY: I have no reason to doubt that it will be achieved at the end of the financial year. Shared services is an efficiency that every major corporation globally is undertaking. Under the government of members opposite, BHP attracted to Adelaide BHP's Minerals Division, I think (its shared services back-office operation), here into South Australia. Tens of millions of dollars of taxpayers' money was spent getting BHP corporation's back-office function into Adelaide? Why? Because John Olsen saw it as the right sort of business model to have in this state.

We are doing that. We are putting in place a shared service entity for most of the state government structure. It is a sensible business reform to the operation of business. Most, if not all, major companies are either doing it, looking at it or wishing they could do it. Get into the real world. And do you know what else? I want to let the house into a little secret. What was the member for Goyder's previous occupation? A chief executive officer—

The SPEAKER: Order! The Deputy Premier will take his seat.

Ms CHAPMAN: I rise on a point of order. That is clearly not anywhere near the subject of the question that has been asked. We ask the questions.

Members interjecting:

The SPEAKER: Order! There is no point of order. The Deputy Premier.

The Hon. K.O. FOLEY: The member for Goyder was the CEO of a large regional council and by all accounts did a pretty good job. Do you know what I was informed a year or two ago? Do you know what the Local Government Association has had in place for some years now? Shared services operations. So I would say—

Mr Griffiths: Some councils.

The Hon. K.O. FOLEY: Some councils. Did yours?

Mr Griffiths interjecting:

The Hon. K.O. FOLEY: It didn't? Are you telling the truth?

Mr Griffiths interjecting:

The Hon. K.O. FOLEY: The understanding is that his council did not go into the LGA shared services model. I will endeavour over the next 24 hours to get some information to see whether the district council of Goyder did, in fact, participate in the shared services—

The Hon. P.F. Conlon: It is not called Goyder.

The Hon. K.O. FOLEY: What is it called?

An honourable member: It is the Yorke Peninsula.

The Hon. K.O. FOLEY: Yorke Peninsula. We will find it and we will see whether or not the former CEO embraced that initiative and we will see, because local government got ahead of the game with the state government . That is a bit embarrassing, I have to tell you, but we are catching up. It is a good initiative; and do you know what? I know—

Mr Griffiths interjecting:

The Hon. K.O. FOLEY: I put my hand on my heart. Member for Goyder, if you won office at the next election, would you scrap the shared services? If you were finance minister would you scrap shared services?

Mr Hamilton-Smith: We ask the questions.

The Hon. K.O. FOLEY: They ask the questions. I tell you what, this is as good a lot of fun as I have had in this parliament for a long time. I thought I was going to be under the pump today because they had some sort of financial scandal. What they have done is allow me to highlight this government's superiority when it comes to financial management and the fact that this Treasurer and this ministry and this government are right across it when it comes to our state's finances. We are managing it well. Shared services are but a part of it, and I look forward to continuing the job with my colleagues of ensuring that we get every spare dollar we can from efficiency savings and put it into schools, hospitals, police stations, roads and any other decent community service.

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