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House of Assembly - Fifty-First Parliament, Third Session (51-3)
2008-10-28 Daily Xml
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Auditor-General's Report

AUDITOR-GENERAL'S REPORT

The Hon. M.J. ATKINSON (Croydon—Attorney-General, Minister for Justice, Minister for Multicultural Affairs, Minister for Veterans' Affairs) (16:02): I move:

That standing orders be and remain so far suspended as to enable the report of the Auditor-General for the year ended 30 June 2008 to be referred to a committee of the whole house and for ministers to be examined on matters contained in the report in accordance with the timetable as distributed.

The SPEAKER: An absolute majority not being present, ring the bells.

An absolute majority of the whole number of members being present:

Motion carried.

In committee.

The CHAIR: The first minister under examination is the Minister for Education, Minister for Mental health and Substance Abuse, Minister for Tourism and Minister for the City of Adelaide, for 30 minutes. The normal conditions apply in relation to the house resolving itself into a committee of the whole, and questions must be referenced.

Ms CHAPMAN: My question is in relation to Volume II, page 547, capital works in progress and the $6.628 million that was spent in 2008. My question relates to the redevelopment of the Glenside Hospital site. The provisions of the Public Finance and Audit Act 1987 (in particular, section 41A) provide for circumstances where a minister refers confidential government contracts to the Auditor-General for examination.

My question specifically relates to the government's proposal to sell to the Chapley Family Group, as described in the published material, a portion of the site of Glenside Hospital. Has the minister requested that the Auditor-General examine the contract that is proposed in respect of the Chapley Family Group? This contract is confidential, as has been identified, and applications for FOI and the like have been rejected on the basis of confidentiality. In the alternative, if the minister has not requested this, has the Auditor-General requested an interview with anyone in the department or requested the inspection of any documents in relation to the proposed contract under the preferential sale arrangement and, if so, with whom, and what documents?

The CHAIR: Will you give me that reference again?

Ms CHAPMAN: Volume II. This relates to the minister's responsibility as the Minister for Mental Health. It is at page 547; it is the balance sheet.

The CHAIR: This is not a matter relating to the Auditor-General's Report.

Ms CHAPMAN: I am referring to capital works in progress; the $6.628 million spent last financial year. This is a current project of the government.

The CHAIR: Your question is: has the matter been referred to the Auditor-General?

Ms CHAPMAN: Yes; it is the question of the confidential contract. The Public Finance and Audit Act 1987 is referred to again in today's Auditor-General's Report filed by the Auditor-General and tabled by the minister in the parliament—I think the Premier tabled it today—with confirmation again of the processes that apply to section 41A in respect of confidential government contracts. This relates to the proposed portion of the redevelopment which relates to the proposed sale of property to the Chapley Family Group, as described in the redevelopment. As I have indicated, that is a confidential contract, and section 44(1)(a) of the Public Finance and Audit Act 1987 refers to that.

The CHAIR: Is there any reference to that in the body of the report?

Ms CHAPMAN: Is there any reference to the contract?

The CHAIR: Yes.

Ms CHAPMAN: No; that is why I am asking the minister—

The CHAIR: So, you are simply referring to the overall payment line?

Ms CHAPMAN: Correct. Specifically, I asked whether the minister has already referred this matter to the Auditor-General or, in the alternative, whether the Auditor-General has sought from the minister any particulars in relation to that contract; specifically, whether he has sought any documents in her department or to interview anyone in her department.

The CHAIR: Minister, it is a long bow, but I invite you to respond.

The Hon. J.D. LOMAX-SMITH: I think that the member for Bragg is referring to capital works in progress, which is about current assets, and capital works in progress I do not think would relate to the sale of land. However, I am informed that we have no contract for the sale of land, and therefore there has been no information, as far as I can tell, that has related to that that could have gone to the Auditor-General, but I am happy to check.

Ms CHAPMAN: As a supplementary question on this, then, I refer specifically also to the explanation of what obligations there are in relation to this. In today's Auditor-General's Report, which was tabled, of the Auditor-General's signing off on his own department, at page 46, he talks about reviewing summaries of confidential government contracts. I think what the minister is saying to me is that in the '08 financial year, there has not been any contract, and I am assuming from that that she is saying that therefore there has not been any referral of this issue to the Auditor-General, and so my supplementary question is: is it proposed that that will be referred to in the 2008-09 year?

The Hon. J.D. LOMAX-SMITH: As I said before, we do not have a contract at this stage but we will do whatever is required of us when one does exist.

Mr PISONI: This question refers to the Annual Report, Part C, page 8. The Auditor-General has indicated the need for caution with respect to credit and financing risks for PPPs in the current economic environment. His report states:

This may be a significant risk to the fundamental premise of whether a PPP provides a net benefit to the public compared to conventional public sector procurement.

The question is: what are the implications for the six new Education Works super schools with contractual closure for early 2009? Will all six and the closure of 18 existing schools go ahead on time, or will there be any delay?

The Hon. J.D. LOMAX-SMITH: I do not believe that the matter that the member discusses or wishes to question me about is relevant to my portfolio. The PPP procurement process is under the control of the Deputy Premier.

The CHAIR: Thank you, minister, for that advice. I was coming to the same conclusion.

Mr PISONI: This relates to a significant capital expenditure in the minister's portfolio, so I am shocked that the minister is not able to—

The CHAIR: Order!

Mr PISONI: —give me any information at all on these super schools. I think the general public would be very interested to know whether these schools will be on time and whether there will be any delay. Is the minister not prepared to answer that? Or does the minister not know the answer?

The CHAIR: Minister, do you wish to add anything?

The Hon. J.D. LOMAX-SMITH: I do not wish to take part in this kind of verballing. I have explained to the member that the PPP contractual arrangements and the philosophy behind them are to be discussed in the questions addressed to the Deputy Premier.

Mr PISONI: There are children attending dilapidated schools that are due for closure who would very much like to know—

The CHAIR: Order! Member for Unley, do you have a new question?

Mr PISONI: —whether their schools are going to be closed and they will be moving into new ones or whether they will still have to continue—

The CHAIR: Member for Unley, do you have a new question?

Mr PISONI: I do have a new question, but I have not finished on this one yet.

The CHAIR: Will you please proceed to it?

Mr PISONI: So they would like to know whether they will still be in dilapidated classrooms or whether they are moving into new classrooms. I think it is absolutely outrageous that the minister shows no interest in this.

The CHAIR: Order! Member for Unley, can you please stick to asking questions, and when the minister has indicated that another minister has responsibility for the issue, move on to a question that is within the minister's area of responsibility?

Mr PISONI: So, the minister is not responsible. I understand that.

The CHAIR: Order! This is not a time for impugning the integrity of ministers. It is a time for seeking information. Please proceed to a question.

Mr PISONI: Chair, you just said that the minister is not responsible, and I am agreeing with you. This refers to Part B, Volume II, page 315: Remuneration of Employees. The 2008 audit shows a 47 per cent increase from last year of indexed employees earning over $100,000 per annum; so, they are fat cats earning over $100,000 per annum. The actual number is an increase of 283 employees earning over $100,000 per annum since last year.

I am aware that at the POC5 level, which is $99,242, there are 83 principals; at the POC6 level of $104,408 there are 33 principals; at the POC7 level of $109,575 there are 24 principals; and at the POC8 level of $114,740 there are 19 principals—and that is for our largest schools. So there is a total of 159 principals yet, in response to a question I asked in the chamber last session, the minister said 'I for one say how pleased I am that the most experienced teachers, the best leaders of our schools…earn more than $100,000.' However, the Auditor-General's figures tell us that we now have 888 bureaucrats, or fat cats, earning over $100,000 and only 159 of them are principals. Is the minister able to tell me what positions the other 729 fat cats hold within the department?

The Hon. J.D. LOMAX-SMITH: I have to say that the member seems to be quite incapable either of reading the documents or of correctly interpreting them. He makes some point about these not being teachers, about them being fat cats; what he seems unwilling to understand is that principals are, indeed, our most experienced teachers. They are those who have been in the teaching profession the longest, and they are those who have leadership positions and are responsible for schools. If the member wants to insult them by calling them fat cats he may like to know that the people he is insulting include 378 principals, 60 assistant principals, 90 deputy principals, 18 senior teachers and 28 teachers. To claim that they are all fat cats is, I think, deeply insulting.

Mr PISONI: Is it correct, minister, that those positions you mentioned are all on packages of over $100,000?

The Hon. J.D. LOMAX-SMITH: I understand that technically that is salary plus super, and I have just explained that they earn more than $100,000 a year. The member opposite has called them fat cats and insulted them, and I repeat that these are our most experienced teachers.

Mr PISONI: There are 888 so you are a bit short (by my quick calculation). Can you give me details of every single one then, please?

The Hon. J.D. LOMAX-SMITH: I do not think there is the opportunity to give the member the name of every member of this category of people. There are 378 principals, 60 assistant principals, 90 deputy principals, 18 senior teachers and 28 teachers.

Mr PISONI: That is still short of 888, minister. I am not asking for names; you did not give names then. I am asking for positions.

The Hon. J.D. LOMAX-SMITH: I am very happy to give the member opposite this response. I am informed that there are 888 positions for individuals who earn more than $100,000 a year, including: Administrative Services Officer 7, comprising 13; Administrative Services Officer 8, comprising 18; Manager Administrative Services 2, comprising three; Manager Administrative Services 3, comprising six; Manager Inclusion and Wellbeing, comprising five; Manager Support and Disability, comprising nine; School Services Officer, comprising one; and Swimming Instructor, comprising one.

I understand there are 60 assistant principals; Coordinator Level 1, comprising two; Coordinator Level 2, comprising two; Coordinator Level 3, comprising 22; Deputy Principal Level 1, 14; Deputy Principal Level 2, 16; Deputy Principal Level 3, 33; Deputy Principal Level 4, 27; District Director, 23; District Improvement Coordinator, 21; Key Teacher, eight; PCO1, 7; PCO2, 19; PCO3, 78; PCO4, 108; PCO5, 77; PCO6, 34; PCO7, 32; PCO8, 23; Permanent Relieving Principal, nought; Seconded Teacher Level 1, one; Level 2, 18; Level 3, 42; Senior Teacher, 18; Superintendent, 14; and Teacher, 28. Executives: Chief Executive, one; Executive Level A, one; Executive Level B, four; Executive Level C, three; Executive Level D, one; Executive Officer Level 1, 17; and Executive Officer Level 2, four. I should point out that some of these individuals include those who have left or retired and received retirement leave payouts.

Mr PISONI: This question relates to Part B, Volume II, page 292. Will the minister describe the reporting process for maintenance and advise as to whether it is accurate? I ask that question because the Auditor-General has said that in 2007 he found that the department's reporting of maintenance backlog is inadequate to act as an effective performance indicator.

The Hon. J.D. LOMAX-SMITH: I can advise that DECS has annual reporting of backlog maintenance; it appears as is appropriate as part of the annual budget process, and there are other processes to manage the maintenance risks for DECS. In the view of DECS, the backlog maintenance is a financial indicator, rather than a mechanism to record risks and the mitigating action.

Other processes and programs, such as asset funding programs, performance assessments and general data capture, provided through the asset support centre and the SAMIS system, provide controls of managing and addressing risks. The reporting is provided through the annual capital works program briefing, and it is worth noting that SAMIS provides specific information about buildings and other physical assets to a range of users, including agency decision-makers, facility managers, business experts and school and preschool representatives that are involved in the maintenance of assets.

We believe that the auditing has been significantly improved over the past decade and that this year's audit showed the Auditor-General advising that the service provider, DTEI, should provide additional information, and we believe that this has occurred.

Mr PISONI: Is the minister saying then that her reporting is adequate and she is disagreeing with the Auditor-General?

The Hon. J.D. LOMAX-SMITH: We endeavour to make improvements as suggested by the Auditor-General. We can always improve systems.

Mr PISONI: But it is not adequate now?

The CHAIR: Order!

Mr PISONI: It is not adequate now, is that what you are saying?

The CHAIR: Order!

Mr PISONI: I am just trying to get an answer, Madam Chair.

The CHAIR: Order! I think the term is called 'verballing', and the member for Unley is being very persistent at it.

Mr PISONI: Yes; I am getting an answer, or I am trying to get an answer.

The CHAIR: The minister has answered the question. Would the honourable member like to proceed to another question?

Mr PISONI: This question refers to fee-paying overseas students, Part B, Volume II, page 290. Again, we see another flawed auditing process established or uncovered by the Auditor-General. The Auditor-General notes:

Follow-up [from the 2007 Auditor-General's report shows that]...a comprehensive costing model to measure the costs of the fee-paying overseas students program [is still not expected to be completed until 2008].

This indicates another full year without the accurate costings being available. Has the minister given any indication as to how much the difference might be between the cost of the program and tuition fees charged given this lack of regular monitoring? How much money has South Australian taxpayers had to pay out to subsidise foreign students?

The Hon. J.D. LOMAX-SMITH: Can I comment that the Auditor-General was very positive in his opinion of the department's financial statement in 2007 and 2008. He advised that, in all material aspects, the financial statement presents fairly the financial position of DECS in accordance with the Treasurer's Instructions and the Australian Accounting Standards. In his assessment of internal controls, the Auditor-General advised that, in relation to the receipt, expenditure and investment of money, the acquisition and disposal of property and the incurring of liabilities and controls exercised by DECS are sufficient to provide reasonable assurance that financial transactions are being conducted properly and in accordance with the law.

I think that the manner in which these questions have been asked has not allowed us to congratulate the department properly for the high level and quality of its accounting and its capacity to come in on budget in what is a very complex, diverse and widely disseminated system. In terms of overseas students, the 2007-08 report acknowledged that DECS was developing a comprehensive costing model to measure the cost of the fee-paying students program. I should say that DECS is on track to complete this work by December 2008. So, the assertions by the honourable member are not true.

Mr PISONI: I move now to tourism, minister. My question refers to Volume V, page 1203 and 20(a). I refer to the operating lease commitments in relation to operating leases contracted for at the reporting date but not recognised as liabilities. In 2007 the total operating lease commitments were recorded at $4.89 million, whereas just 12 months later it has increased to $13.231 million. Will the minister explain this steep increase, and in particular I draw her attention to the 'later than five years' line where there has been an increase alone of $5.321 million. Can the minister explain these increases, and in particular detail whether or not the leases are non-cancellable leases with terms of up to 11 years? Who have these arrangements been made with and can the minister detail the procurement process undertaken for these contracts?

The Hon. J.D. LOMAX-SMITH: I think that the honourable member has, perhaps, misunderstood the documentation. As he would know, the SATC moved, and, whilst the previous lease was still in existence, there was a sub-lessor's agreement that meant that only one lease was being paid at a time.

Mr PISONI: I am sorry, I did not quite understand that answer. Last year we had rental commitments of $4.89 million, and this year we have rental commitments of $13.231 million. Can you explain what the difference is; why there is a difference; and for how long those lease commitments remain?

The Hon. J.D. LOMAX-SMITH: The new lease for the premises which the SATC actually occupies represents a 10-year lease.

Mr PISONI: How much is that lease commitment?

The Hon. J.D. LOMAX-SMITH: We will have to interpret that again for you at a later point. Are you referring to the lifetime lease for these premises? There were two leases. We were only occupying one and the first lease was subleased to another tenant to cover the expiry date of the first lease, but, in fact, that was at no cost to the department.

Mr PISONI: I refer to Volume IV, page 1,200, No. 8, participation fees. Increase in other income for the year is described as consisting of an increase in participation fees which is mainly attributed to new sponsorships obtained in 2007-08. Could the minister provide details of the sponsorships?

The Hon. J.D. LOMAX-SMITH: Thank you, we will take that on notice.

Mr PISONI: Minister, could I just clarify? You took a number of questions on notice in estimates for which I am still waiting for answers. Are you able to give some indication as to when I might get answers to this question and the questions I asked in estimates?

The Hon. J.D. LOMAX-SMITH: I am not prepared to take that comment on face value, but I will find out whether there are any unanswered questions.

Mr PISONI: There are, minister. You do not need to find out, I can tell you that there are.

The Hon. J.D. LOMAX-SMITH: I am prepared to investigate that, but I will not take the member's statement on face value.

Mr PISONI: It is there in Hansard. Answers to questions appear in Hansard, so if you were reading Hansard you would notice whether or not they had been answered. I turn back to education and refer to Part B, Volume II, pages 295 to 296. Under 'Student Enrolments', the Auditor-General comments on the continuing shift of enrolled full-time equivalent students from the government sector to the non-government sector. While it is now around 34 per cent overall for the independent and Catholic sector, at year 12 level it is now 44 per cent for the non-government sector. Why is the trend continuing?

The Hon. J.D. LOMAX-SMITH: I think national impacts are impacting in South Australia, as well as across the rest of the country, and this is not an uncommon phenomenon in the commonwealth.

Mr PISONI: Sorry, I did not get an explanation from you; I just got a general statement.

The Hon. J.D. LOMAX-SMITH: I said that this is a national trend and is not related to anything within the Auditor-General's Report.

Mr PISONI: I am sorry, it is related to pages 295 and 296. It is quite clear that the Auditor-General has raised what appears to be concerns about the drift from government schools to non-government schools, especially the fact that last year we saw an increase of 243 in the number of executives and others earning over $100,000 a year. So, we are seeing a decrease in the number of students in the government sector, but we are seeing an increase in the number of staff.

The Hon. J.D. LOMAX-SMITH: I think that I have to explain to the member again that the increase in the number of those staff receiving more than $100,000 is because of bracket creep—I suppose I would call it—that is, the increasing number of teachers and school leaders who have fallen within that category. I know he does not believe that teachers and school leaders should be paid more than $100,000. I can only believe that is the reason he criticises this level of payment repeatedly, but I, for one, believe that our best deserve a good remuneration package, and I am very pleased that our senior teachers and principals receive this level of remuneration.

Having said that, the previous government and the actions of the previous government went a long way to demoralising and undermining public education in this state, and there was a very significant trend away from public education, which we have slowed significantly. But it is hard to reverse the impact of those tough years: despite the 52 cent increase in funding per capita per child since we have been in government; despite the massive level of investment in our infrastructure and maintenance programs; despite all these features, we, like the rest of the country, have seen an ongoing shift.

The CHAIR: I now call on the Minister for Health, Minister for the Southern Suburbs and Minister Assisting the Premier in the Arts for 30 minutes.

Ms CHAPMAN: The Department of Health is largely dealt with in Volume II, and the section commences on page 534. My first question relates to page 561 concerning a contingency provision. What was the $46 million contingency provision payment made by the Treasury department used for?

The Hon. J.D. HILL: I will have to take that item on notice, but I will get a full report for the member.

Ms CHAPMAN: I have a general question in relation to expenditure for staff. Has the resolution of the salaried medical officers' pay dispute put the department in a position where it will have to receive a bail-out from the Treasurer, come June next year, to ensure that it does not run significantly over budget; and how much do you anticipate that the new pay offer will increase the total wage cost by? Employee payments are referred to on page 549, although I do not think that will help the minister.

The Hon. J.D. HILL: The deputy leader is, in fact, not talking about the Auditor-General's report for this past year, but about what the Auditor-General might be talking about in the current financial year, so it is a little hard and it is a little hypothetical. However, I say that the enterprise bargaining arrangement with the salaried medical officers and their members will be funded through normal Treasury lines. The claim of a bail-out suggests wrongdoing, a mistake, a problem, or some overexpenditure, but, in fact, an enterprise bargaining arrangement is a planned approach to settling wages with a group of workers. You cannot predict precisely what the outcome will be, of course. If you could do that, there would not be a bargain. The way Treasury handles these matters, as I understand it, is to put certain provisions into the health department's budget and then hold central contingencies which it then applies after the arrangement has been put in place. They will go through that process in this case as well.

Ms CHAPMAN: Perhaps I did not make my position clear. It may be that the doctors' dispute resolution was effective only since 1 July 2008, and I agree that it will flow into it. But, if the minister is saying that the resolution was on the basis of no respective payment for extra funding for the doctors in 2008, I take it that there will be no adjustment for that. If there was an adjustment during that financial year, how much was it?

The Hon. J.D. HILL: That is a different matter. You asked me if there was a bailout.

Ms Chapman interjecting:

The Hon. J.D. HILL: No; a bailout is a pejorative term which implies certain relationships, and those relationships do not exist. There is an enterprise bargaining arrangement. You cannot predict the outcome of that arrangement. Therefore, provisioning is made within Treasury's central funds to cover the contingencies, and they will apply in this current financial year. I understand that any back pay that needs to be paid has been accrued by the health services, appropriately managed through Treasury arrangements. As to the exact amount of the back pay, I have to take that on notice. I do not hold those figures; it is not a secret, but it is certainly just normal provisioning.

Ms CHAPMAN: I understand and agree with the fact that there is provision. Essentially, though, in addition to your budget and the provision made by the Treasurer, which is always kept confidential for the obvious negotiating reasons—perhaps I will put it in reverse: is there any net monies anticipated to be required in addition for 2008 to cover any payment for the doctors' dispute resolution? In terms of your budget plus the allocation from the Treasurer's funds, is any shortfall anticipated and, if so, how much?

The Hon. J.D. HILL: When the deputy leader says the '08 year, I am unclear as to whether she is referring to the '08-'09 year or the '07-'08 year. As I said, and relation to 2008-09 (the current financial year) Treasury has funds available which it will transfer to health, which it will then pay to its employees. In relation to the previous year, after the year has closed Treasury's contingency lines still apply, as I understand it, and it pays the doctors whatever they are owed. There is no extra burden on the health system, if that is essentially your question. Will health have to pay something to the doctors over and above the contingencies that are held in health and within Treasury? The advice I have is: no.

Ms CHAPMAN: I will clarify and confirm this on the following basis. There is a budget allocation for salaries in your budget for 2007-08. There is a contingency provided for in the Treasurer's budget to cover the unforeseen and unconcluded negotiations. To your knowledge, in the '07-'08 year there was no shortfall above those two provisions to pay for the doctors; is that your understanding?

The Hon. J.D. HILL: We have a budget for staff. If the question the member is asking me is whether we have sufficient funding within our budget to pay for all the staff who are employed in the course of a year, putting aside the enterprise bargaining arrangements, clearly, every year that I am aware of we have employed more staff over the course of the year than we have at the beginning of the year. The number of staff we employ will depend on the demand in our hospitals, and sometimes demand out-runs our budget. Therefore, we employ more staff and some of those staff are funded, at the end of the year, by approval from Treasury. That is a different process and I am not sure whether the deputy leader is getting those two processes entangled.

In relation to the enterprise bargaining arrangement, expenses for staff are provisioned internally by Health and externally, if you like, by Treasury. Once the agreement is settled, the staff are paid their entitlements and Treasury is paid whatever the extra amount is to cover the cost of the salaries. I do not think there is anything else I can say.

Ms CHAPMAN: Of the income paid to staff and salaries to doctors (that was the subject of the doctors' dispute in the 2007-08 year), how much was paid to them in the financial year that was relevant to the negotiated new pay deal?

The Hon. J.D. HILL: The advice I have (and I am happy to get details) is that the additional amount that was accrued was in the order of about $10 million because we were covering a relatively short period—April through to June.

Ms CHAPMAN: At page 576 I am referring to full-time employees. Of the 25,871 full-time equivalents working in the health sector, how many are employed within hospitals? I refer the minister to the June 2008 State of Our Public Hospitals Report conducted by the Australian Institute of Health and Welfare, which shows there were only 18,769 full-time equivalents employed in SA public hospitals during the previous year.

When you see page 576—just so that there is no confusion here, I am referring to those employed in the 2007 year—there are 27,775 total on that page for the 2008 year. We are comparing the Australian institute 2007 figures for those who work in public hospitals and I am referring to the total of all those categories for the 2007 year which, on my calculations, is 25,871. My question is: of those, how many work in public hospitals?

The Hon. J.D. HILL: I do not have the detail of that. It is really not an audit question; it is a general question but I am happy to get it for the member. The vast majority, of course, of our employees are employed delivering health services to people. The vast majority of those who are employed delivering health services are employed in hospitals but, of course, there are other officers employed outside hospitals but, nonetheless, are still delivering health services to people. I do not have the precise figures in front of me because, as I say, it is not really part of the Auditor-General's Report.

Ms CHAPMAN: Part C, page 42—the small document—states:

As at 31 March 2008, most agencies were well under their caps. Health was significantly over its cap by 925 full-time equivalents or 3.5 per cent reporting unbudgeted activity in health units as the cause.

Can the minister identify how much of this overspend was attributable to the use of agency nurses?

The Hon. J.D. HILL: The advice I have is that agency nurses are not included in the cap number. The cap number is the people who are employed by the health department. The agency nurses are, of course, services—I assume that is how it is calculated—that are funded by the department. I am happy to find the answer to the question about agency nurses for the member. The demand for them does vary from time to time depending on circumstances; obviously, during school holidays and busy flu periods and so on we end up having to employ more agency nurses. If that is the answer I am happy to get more information for the member.

Ms CHAPMAN: If it is none for agency nurses, when it refers to unbudgeted activity, what then was the activity that justified going over the cap 925 FTEs? I am assuming, from your answer, that none of this money was spent on agency nurses.

The Hon. J.D. HILL: As I have informed the house from time to time, the growth in demand in our hospitals has been extraordinary over recent years. As more people turn up so we have to provide services. We are an open-ended agency to that extent. Every person who attends a hospital has to be served so, if more people turn up than are covered in the budget papers, we have to employ people to provide services for them—and that is what we do. The growth in demand is what drives the growth in employment, particularly of nurses and doctors.

There are other factors. For example, from time to time the commonwealth gives us money to do particular things. Last year, for example, the HPV vaccine was made available and a considerable sum of money came from the commonwealth. No doubt there was employment of a certain number of people in association with that. Extra programs, from time to time, presumably drive employment growth but, generally, it is the growth in demand for services.

Ms CHAPMAN: Minister, what I am asking is: what are those services? Many of the statements you have made to the house say that the demand for services is for hospital and health care services and I have assumed that a large slice of that is for nursing. You tell us there are no agency nurses in this, so could you give us a breakdown of what the above-cap 925 full-time equivalents are doing, what services are they providing, if they are not nurses?

The Hon. J.D. HILL: I am happy to take the bulk of that question on notice, but let me just give you some information which might help you. I am referring to Workforce Numbers on page 576. At June 2007, there were 26,842 full-time equivalents employed in the SA Health portfolio, and that is about 3 per cent more than the previous year, so I agree that these are slightly different ways of looking at the figures, but it gives you a flavour of what you are asking.

Of those 775 additional full-time equivalents, over half—58 per cent to be precise or 449—were employees under the Nurses' Award, so just under 60 per cent are nurses. A further quarter—25 per cent or 195—were medical officers, and then there are about 20 per cent who are under the administrative and clerical award.

They, of course, provided administrative and clerical services but it also includes others who provide key health portfolio programs services, and they can be split into five major streams: the financial people; the legal people; the administrative people; project and policy; and consultancy and information. Project and policy, for example, would include policy officers, community and Aboriginal health workers, health research and project officers and so on. Consultancy and information would include people like HR consultants, IR officers, training and development officers, EEO officers, rehabilitation officers, ICT officers and library technicians.

If you increase the workforce that is delivering services, you need to increase the ancillary services that provide services to those workers. That is essentially the kind of proportions that occur. I am also advised that there was a rise in demands placed on hospital services in the health regional workforce with a 3.9 per cent increase in hospital inpatient activity (as measured by equiseps) together with a 6.8 per cent increase in metropolitan hospital emergency department attendances (as measured by weighted occasions of service) during the 2006-07 period, so that gives you an indication of the kind of growth. I will happily provide the detail that the member has asked for, but I just want to give a flavour of the kind of proportions that we employ.

Ms CHAPMAN: We are still on employment at page 576. What was the total cost incurred by the Department of Health for the use of agency nurses during 2007-08?

The CHAIR: The minister has indicated that agency nurses are not staff.

The Hon. J.D. HILL: They are not included in those figures.

Ms CHAPMAN: I was about to go on to say that I am happy to refer to the actual staff expenditure amount to cover your requirements.

The CHAIR: I am not sure that you have. Minister, are you able to provide any information?

The Hon. J.D. HILL: I do not want to be difficult, but the member is actually asking me questions that I think would be appropriate during estimates.

Ms CHAPMAN: You did not give me an answer during estimates, so I am asking now.

The Hon. J.D. HILL: Look, Vickie, I do not wish to be argumentative about this. I am happy to take it on notice. You can ask me all the questions you like. I will happily try to take anything on notice, but this is really just to talk about the Auditor-General's Report, and what you are asking is basic information that is not part of the Auditor-General's Report. It is really part of a proper estimates inquiry.

If you have asked me a question that I have not answered, I apologise. I am happy to try to get any information you want, essentially, but, in relation to how much is spent on staff and all the rest of it, what the Auditor really looks at is: did we spend the money we were given in an appropriate way and, if not, why not—not how much did we spend and what it was spent on. He does not get into the detail that I think you are asking about, but I am happy to try to provide the information. I am not trying to be difficult about it; I just do not have it with me.

Ms CHAPMAN: I perfectly appreciate that you may not be able to answer the question, minister, and I thank you for taking matters on notice, but let us be clear about this. The Auditor-General makes comment and provides a commentary on a report to the parliament in relation to errors or inadequacies that he may see, but he also reports as to what he finds is the total financial expenditure and income and makes comment in relation to that as well. Just because the Auditor may not have made a comment on something, it does not mean it is not in his report and, clearly, the multi-millions that are spent in the billion-dollar budget that you have covers staff.

The CHAIR: The deputy leader misunderstands the process.

Ms CHAPMAN: And the process is one where I will ask that question and I appreciate that the minister has taken it on notice. My next question is on page 572, which relates to boards and committee members. Why did the number of boards and committee members engaged by your department double last year to 262 at a time when you axed boards of governance; and why did the income paid to board members also double?

The Hon. J.D. HILL: The provision, of course, is contained in the pages the member referred to. There were, I am advised, 262 members of boards and committees in 2007-08. Of those, 199 received no remuneration whatsoever. Sixty received remuneration between $1 and $9,999 and there were three others who were paid at higher levels. The most highly paid was between $50,000 and $59,999. The more highly paid included the chair of the Clinical Network of Child Health and the chair of the South Australian Safety and Quality Council in that senior band.

The majority of members of those boards are members of the clinical networks. We established a series of clinical networks to give advice to government in relation to particular areas of clinical practice. For example, we have a clinical network which deals with cardiology issues; one deals with kidney issues; another deals with orthopaedic issues; another deals with children's health—a range of boards. This is, I think, an important reform to ensure that the voice of clinicians is heard in the development of policy.

So the members of these clinical networks are doctors, nurses, and other allied health workers from time to time, as well as patients or those who receive services or, in the case of children, relatives of those who receive services. These are important parts of the process to ensure that the voices of those who deliver services are heard.

I think one of the strongest requests I had from clinicians when I first became health minister was regarding their desire to have a stronger say in policy and the decision-making process, and we established these to do that. They are not boards in the sense of management bodies; they help create policy, which is promulgated through the normal decision-making process of the department and the government. They are not management boards in that sense.

We also established the safety and quality council as a very senior body to give advice to the health portfolio in the prosecution of maximum safety and quality standards and to ensure that we had the highest standards available. From the private sector we chose Mr Hans Ohff to be chair of that because we wanted someone from the private business sector who had very strong experience in safety and quality issues. Of course, as the former boss of the Submarine Corporation he knows a lot about those kinds of issues.

Ms CHAPMAN: I refer to page 541 on the Modbury Hospital stocktake. Minister, a couple of weeks ago you indicated that you agreed with comments that your department should have attended at the stocktake of goods held before the government took back management of the Modbury Hospital, and there are, of course, comments made by the Auditor-General regarding the lack of someone from your department being in attendance to check that what you got back was what you actually paid for—the nearly $1 million worth of property, according to his comments. Has your department done a stocktake since the goods were returned to government control and, if so, was there any discrepancy?

The Hon. J.D. HILL: There has been regular stocktaking since the transfer. The issue the Auditor-General raised was that there should have been someone from the Central Northern Adelaide Health Service (CNAHS) there, and there was not—and I have commented on that in the past. However, even if someone had been there we are not sure it would have actually helped. because it was difficult for CNAHS to assess the condition of the equipment as the condition of the equipment transferred in 1995 (when your party was in government) was not recorded. So there was no basic information to rely on to determine whether or not what we received back was in any decent condition. It is a bit like the pot calling the kettle black to have a go at the government for somehow failing in this regard.

It would have been a better process for someone from CNAHS to have been in attendance—that has been acknowledged—but the advice I have is that even had someone been there it would not have helped to any degree because there really was no basis on which to compare what was coming back with what was transferred in the first place. Given the lack of records available and the early termination of the agreements, it was assessed that no further action could be taken.

Ms CHAPMAN: I am astounded by that answer. Your department paid nearly $1 million for these assets, yet you say that there would have been no benefit in having someone there to check, first, that you got what they said they were selling back to you and, secondly, whether it was in any reasonable condition. You say that you were not so sure of the condition it was in when it was transferred back in 1995; surely that would be all the more reason to make sure someone would be there to do that.

That having not happened, how long after you got all this stuff back from the Modbury proprietors—that is, Healthscope—did your department do a stocktake of the goods that you purport to have got back, in good condition or otherwise? Was a stocktake ever done? If so, when and by whom?

The Hon. J.D. HILL: I think the deputy leader is getting somewhat confused about these matters. I refer her to page 541 of the Auditor-General's Report, Volume II, Part B, which refers to stock on hand. It states:

As at 30 June 2007 a stocktake of inventory was performed by Healthscope to determine the value of inventory for transfer to the state for payment reimbursement to Healthscope. The inventory value was determined at $926,808 and is one of the items described…The exercise of appropriate due diligence should have resulted in the attendance of representative(s)…

At that point that did not occur. It went on:

Also audit review of the stock sheets indicated limitations in the stocktake processes and records.

The stock on hand, the inventory, was not the fixed assets to which I was referring earlier; as I understand it this is the consumables. The department ought to have been on hand when that material was transferred, but there has subsequently been a stocktake and the department is satisfied that it got its money's worth in terms of that $900,000-odd. The point I made before (and perhaps I was confusing the committee) was that, in relation to the fixed assets, there were no records as to their condition, so when they came back to government we could not tell whether or not they were in the condition they ought to have been in; there was no record of their condition when they were transferred to Modbury.

So there are two issues there. Regarding the stock in hand, the inventory, we are satisfied that that has been properly transferred, despite the lack of a supervisor there when that occurred. In relation to the fixed assets, they have been transferred back but we cannot comment on their condition because there was no original record to be found.

The CHAIR: That concludes the examination—

Ms CHAPMAN: Can I just have it clarified whether the minister will get me the date of when that stocktake occurred?

The CHAIR: Order! The member can talk to the minister outside. The examination has concluded. I now call the Minister for Families and Communities, Minister for the Northern Suburbs, Minister for Housing, Minister for Ageing and Minister for Disability.

Ms CHAPMAN: I have a couple of questions for the minister in respect of her area of responsibility of housing. I refer to Volume II, page 578, which is the commencement of the chapter on HomeStart Finance. I refer to page 586 which has an income statement for this entity which provides finance for housing. The minister would be familiar with the entity, of course. The net profit which was paid to the South Australian government in the 2007 year was $8.316 million. Last financial year I see that it reduced to $4.751 million.

In each of those it also paid directly to the government the government guarantee fee, which in 2007 was $7.007 million and in this last financial year $6.640 million. So, very substantial amounts of money are paid to the Treasurer out of this entity. My first question is: in relation to the government guarantee fee, has any money been refunded back from Treasury pursuant to the obligations of that guarantee fee?

The Hon. J.M. RANKINE: I am advised that it is a payment made back to the government relating to the risk that the government takes in relation to the moneys provided to HomeStart, and no moneys are returned.

Ms CHAPMAN: I understand what it is for, and I do not know that I have ever known any money to come back. So, it is a direct fund to the state government, and the Treasurer keeps that as the profit, as also identified there. In the last financial year a total of some $13 million was taken out of this entity and paid to the state government. My question is: now that you are the new minister, are you proposing any change of policy in the 2008-09 year, given that we have 22,000 people waiting on the public housing list, that this money be applied to public housing and not just put back into general revenue?

The CHAIR: Order! This is not about government policy. Minister, do you wish to make any comments at all? The question does not relate to the Auditor-General's Report.

The Hon. J.M. RANKINE: For this coming year, no.

Ms CHAPMAN: Page 1067, unspent grant revenue: $23.7 million of the grant revenue was unspent. I note that $8 million of that was for disability support accommodation and $6.8 million for Foyer and Common Ground projects. My question is: why was that money not spent and when will it be spent by?

The Hon. J.M. RANKINE: We received those funds late in the year and we are ready to spend that money in the very near future.

Mrs REDMOND: I have some questions on the area of disability, referring in particular in the first instance to Volume II at page 440, which deals with the restructure. The minister will no doubt recall that, under the stewardship of the previous minister, the restructure involved the removal of the various boards for Intellectual Disability Services, the Independent Living Centre, Julia Farr Services and so on, and page 440 seems to be the most relevant. My first question is really one of a generic nature, because I know that, when the minister announced all of that restructure, in his media release in May 2006 he stated:

Cutting overheads and bureaucracy will leave more money for services and ultimately for the people who use them. There will be no extra expense to the taxpayer from the outset, and the more coordinated approach will mean more efficient use of this money in the long term.

I do not know whether the minister or, indeed, her advisers can answer this, but the fundamental question that I want to get at is this: is there any way, through the Auditor-General's assessment, to actually determine whether the money is now being spent more efficiently? That would seem to me to be the fundamental question that the Auditor-General should be able to answer: has this actually panned out to be better, or at least as efficient, as the system that we had when we had the Intellectual Disability Services Council, the Independent Living Centre, Julia Farr Services, Metropolitan Domiciliary Care—all the things that were reorganised and restructured?

I cannot find in these documents anything to tell me whether it is more efficient. So, my first question, as I said, is generic and it may be one to which no-one can give me answer, but is there a way to tell whether what we have now is, as promised, a more efficient use of resources?

The Hon. J.M. RANKINE: The first part of the honourable member's question about whether the Auditor-General should be looking into those things is something she should perhaps put to the Auditor-General. I am sure that if he found there was wastage within the department and inappropriate processes he would be highlighting them in the coming year's Auditor-General's Report. What I can tell the honourable member is that we have abolished a number of boards and streamlined the processes, and just one example would be the provision of equipment. Since 30 June I understand that we have been able to provide equipment to the value of in excess of a million dollars.

We have provided one contact point, streamlined the assessment processes and streamlined the purchasing processes to deliver more equipment for less money. Whilst I am happy to take that question, I could get more detail for the honourable member, because I know that she is genuinely concerned about these things. As she said, it is not part of the Auditor-General's Report, and I understand that we are here to examine that. I am happy to get more information for the honourable member about how we have streamlined those services. Obviously, as minister, I will be keeping a very close eye on what occurs, because what we want is a better outcome for people we are servicing.

Mrs REDMOND: As the minister would appreciate, I am no longer the shadow minister for disability services, but it would seem to me to be fundamental to ascertain whether in fact the proposal has worked. I appreciate what the minister says about the Auditor-General's Report identifying wastage within the current system, but the necessary step it seems to me is to compare the current system with the previous system and identify whether there are benefits or losses. However, I will move on to the more specific questions.

On the same page and still on this issue of the Disability SA restructure, the first set of figures on page 440 shows that $13.017 million worth of liabilities was transferred from Julia Farr Services. What was the nature of those liabilities?

The Hon. J.M. RANKINE: I am advised that essentially they are employee entitlements and creditors' liabilities. A range of things are highlighted in this report in relation to the impact of Julia Farr Services coming into Disability SA, and I do not know whether the honourable member would like me to outline some of those for her.

Mrs REDMOND: I have some more specific questions on that. If the minister says they were largely employee liabilities, how much of that $13.017 million was funded by the allocation to disability announced in the 2007-08 budget?

The Hon. J.M. RANKINE: The honourable member has assumed the liabilities of Julia Farr, but that has not increased our expenses per se. We have not used our disability funding for that.

Mrs REDMOND: On the line above that figure, the Disability SA restructure shows $5.963 million of assets transferred from Julia Farr Services. What were the assets transferred?

The Hon. J.M. RANKINE: The $5.963 million, I am told, is essentially cash and equipment. The Highgate property, which is obviously worth a lot more than that, is an administered item.

Mrs REDMOND: Indeed, my next question leads me onto that property. Madam Chair, I ask your indulgence. I am strictly sticking to the Auditor-General's Report, in particular page 412, which deals with the Home for Incurables' Trust, and pages 450 and 451, which also refer to the Home for Incurables' Trust, but in order to get to the question I need to give a bit of background. In the debate on the bill about the Julia Farr Services' Trust (which was in June last year), the Hon. Paul Holloway summarised the government's deal with the former Julia Farr Services Board as follows:

For the benefit of members, this agreement was entered into and finalised in June 2006. Let me make it clear to members what that agreement entailed. The Julia Farr Association has received and will receive the following: $2.4 million in cash, which was transferred in 2005-06, to enable work on community houses transfer to be finalised (this money is sourced from the proceeds of the sale of the Fisher building); $4.45 million in completed community housing; an $8 million one-off non-recourse grant; and a commitment to transfer $21 million worth of community housing stock to the JFA over three years. The Julia Farr Association will also receive three trusts totalling $1.367 million.

The minister did not mention that the $21 million of housing stock would be transferred with the debenture and the unencumbered assets are worth $14.85 million: the total assets are $35.85 million. In a letter to the then minister in June 2007, the chair of the board wrote:

Julia Farr Housing Association welcomes the opportunity to receive $21 million worth of housing, though the offer does come with government insistence of debenture under the SACHA Act [South Australian Community Housing Authority Act]. We asked for these debentures to be removed but this was denied. If it is possible for the debentures to be removed now we would welcome it. It would increase the capacity to make strategic choice in serving the South Australian disability community.

It is my assertion that the only clear value transferred is $14.85 million, whereas the real value of the assets is $26.55 million. The chair of the Julia Farr Association also stated:

The board adopted the view that it held assets with a book value of $33.4 million. The board adopted the view, albeit reluctantly, that under the circumstances it had reached the best possible agreement with the formal transfer of $6.85 million of community housing that was at the time being operated by the Julia Farr Housing Association, the commitment of a further $21 million in housing and a non-recalls grant of $8 million to the new Julia Farr Association, all in addition to securing the trust property at Highgate Park for people with a disability.

The book value of $33.4 million less the $6.86 million value of the community housing retained by Julia Farr is $26.55 million.

At page 451, the Auditor-General's Report shows the following Home for Incurables assets: property, $27.067 million; investment properties, $1.139 million; and current assets, $7.110 million. In addition, the report also notes Julia Farr Services—that is, the incorporated entity that held the trust—also had the following assets—and they are the two to which I have already referred—of $5.963 million and liabilities of $13.017 million. The question is: where did the $6.658 million held in deposit with SAFA for the Home for Incurables Trust come from? If any, how much of this money is the proceeds of the sale of any property where the sale of the property was concluded before the transfer of the Home for Incurables Trust to the minister in July 2007?

The Hon. J.M. RANKINE: I am told the $6.658 million is the cash proceeds from the sale of two properties—Ringwood and another property—and those deposits are still with SAFA, and the interest is used in the provision of services at Highgate.

Mrs REDMOND: Has any of the property held by the trust been sold within the past 12 months?

The Hon. J.M. RANKINE: No.

Mrs REDMOND: Do the debentures held over the Julia Farr Association community housing appear in the financial statements for the department and, if so, where do they appear?

The Hon. J.M. RANKINE: I am assuming that they are in the Housing Trust accounts, as it has assumed responsibility for SACHA.

Mrs REDMOND: How much of the $21 million of housing stock to be transferred to the Julia Farr Association as part of that transfer arrangement of the Home for Incurables has been transferred?

The Hon. J.M. RANKINE: We will take that on notice and get back to the member.

Mrs REDMOND: I refer to page 440. What is the nature of the investment properties listed under the non-current assets of the Home for Incurables?

The Hon. J.M. RANKINE: It is student housing, which is the former nurses' home on site.

Mrs REDMOND: Sorry, can you explain, minister, where that is?

The Hon. J.M. RANKINE: Where it is physically? At Highgate; at the old Julia Farr.

Mrs REDMOND: I refer to page 412 and again on the Home for Incurables information. Will the minister outline what steps have been taken to develop supporting documentation, operating rules and financial reporting, as advised was necessary by the Auditor-General in his report?

The Hon. J.M. RANKINE: I will get the detail of that for the member, but I am advised that the department consulted closely with the Auditor-General and all that work has been completed.

Mrs REDMOND: At the bottom of page 413 is the heading 'Expenses' and below that 'Income'. In the last paragraph under 'Expenses', it states that the net expense from the restructure was $4 million. I ask the minister: if that was the net expense incurred in the transfer of—according to this—the various assets and liabilities from those various organisations, including the transfer of staff, how does that reflect an improvement in the ability of the department to provide the services, if there is a $4 million backlog, as it were, in the provision of services because of a net expense in that transfer taking place in the first place?

The Hon. J.M. RANKINE: This is not about incurring an expense, it is the book difference between the assets and liabilities, and those balances existed before the transfer occurred.

Mrs REDMOND: I will not even try to understand that response. It is probably me, not the minister. Someone said this week that the columnists were only invented to make meteorologists look good and I suspect that is correct.

Under the heading 'Revaluation of Non-Current Assets' at the top of page 425 is a paragraph about land and buildings at fair value. I have a couple of questions, which I will try to combine into one question. The paragraph starts by noting that the department's land and buildings were due to be revalued at 30 June 2009, but then it was decided that, because there had been an increase—the values had materially appreciated—it would be better to revalue them now. The first part of the question is: was that a mistake in hindsight and, in fact, have they now come back down again? I suspect that they have.

The second part of the question is: who chooses the professional valuer to do what is called a desktop valuation? Is there some sort of tendering process, or is there some sort of panel to choose the person who is going to do this magical exercise of saying, 'Well, yesterday they were worth X. Now they are worth X plus 20 per cent'? In fact, now they are probably worth X minus 40 per cent. I am curious how one goes about that process and why it was brought forward. I know what it says there about it being an increase in value, but why bother to bring it forward because, as events have panned out, it probably would have been more sensible to leave the revaluation until the date that it was scheduled to take place, in June next year?

The Hon. J.M. RANKINE: First, there is a tendering process in the selection of a valuer to undertake this work and it was decided to do a desktop valuation, as opposed to a complete valuation, because more assets came into the department and, as the member recognised, there was a substantial increase in property values.

The Hon. I.F. EVANS: Page 432 of Volume II states:

Net Gain from Disposal of Assets

Land and Buildings:

Process from disposal—

shown as zero–

Less: Net book value of assets disposed—

shown as $749,000. Can the minister explain what asset was disposed of that the government received nothing for that was worth $749,000?

The Hon. J.M. RANKINE: I am told it was a retired asset that was obsolete and had no book value, but if the member is keen to know exactly what that is, I will take that on notice and get it for him.

The Hon. I.F. EVANS: If the minister would do that that would be good, and would the minister explain to me, if it has no book value, why it is in the books at $749,000? She can give me that answer in her reply as well. The minister might want to take the next two questions on notice too, given the time. At page 411 in Volume II under 'Expenditure' it talks about:

The need to implement a check to ensure that all payments processed through the manual payment voucher system are authorised in accordance with DFC's approved delegations.

Will the minister advise why the Special Investigations Unit investigators of the Tom Easling case sought payments from the department? The voucher reads, 'For reasons that cannot be disclosed due to the sensitivity of the investigations.' Further, will the minister advise: does this fit with all the Treasury guidelines and is it in line with all Treasury guidelines and the approvals of the department to have a voucher read in that way?

The Hon. J.M. RANKINE: I am happy to have that checked to ensure that it met with all those guidelines and advise the member.

The Hon. I.F. EVANS: My last question to the minister concerns page 432 of Volume II, and a series of bad and doubtful debts. Will the minister advise if any of the debt relating to an alleged victim in the Easling investigation was forgiven or capped while the investigation was being undertaken? If so, what was the value of the debt forgiven and capped, and why was it forgiven or capped? Will the minister advise what role the Special Investigations Unit investigators played in having the debt forgiven or capped? Did the investigators request or suggest that the debt be forgiven and capped, and, if so, why?

The Hon. J.M. RANKINE: I am advised that it is unlikely that there is any connection between that and the Easling case. I do not know, from my reading of the Auditor-General's Report, that there was actually any mention of the Easling investigation. There are a number of issues that the member has raised before, including the issue of the diary entry, which I think was probably misrepresented in this house. It was made to sound as if someone had a notation in a personal diary, when, in fact, it was the investigations diary. People do not generally notate leaks. The member raises some serious issues which he should do with great caution in relation to this case.

The CHAIR: The time for the examination of the Minister for Families and Communities having expired, I now call the Minister for Police, Minister for Emergency Services, and Minister for Recreation, Sport and Racing to the table.


[Sitting extended beyond 18:00 on motion of Hon. M.J. Wright]


Mrs REDMOND: I will deal with police first. I refer to Volume III, page 870: Firearms Licences. The Auditor-General states that an instrument of delegation for firearm licence approvals needs to be developed and that there is scope to improve the follow-up system for expired licences and firearms purchases for which a licence application has not been made. Does the purchase of a firearm for which a licence application has not been made refer to the illegal purchase of a firearm?

The Hon. M.J. WRIGHT: My advice is that the audit identified a need to develop an instrument of delegation for firearm licence approvals. Further, there was scope to improve the follow-up of expired firearms licences and firearms purchased for which there was no licence application.

Mrs REDMOND: With respect, minister, that is exactly the point I was asking about. I read that myself in the report; that is what it states at the bottom of page 870. The question is: when you talk about the purchase of a firearm for which a licence application has not been made, is that per se the purchase of an illegal firearm? We have records about firearms for which people have an application, and my understanding—and the minister can correct me if I am wrong— is that if you want to purchase a firearm in this state lawfully you have to get a licence. Where the report of the Auditor-General states, 'firearms purchased for which there was no licence application', does that per se mean that unlawful purchases—illegal firearms—are circulating?

The Hon. M.J. WRIGHT: I understand the point you are making. I will take that on notice and come back to the member.

Mrs REDMOND: On the same topic, The Advertiser on Saturday referred to a commonwealth document entitled, 'Criminal use of handguns in Australia'. It reported that 41,519 handguns were registered in South Australia. That is the article the minister no doubt saw as well as the rest of us. Does an instrument of delegation for licence approvals refer to the officers who are authorised to grant approvals? If so, given the non-existence of this instrument of delegation, as referred to in the Auditor-General's Report, who approved the licences held by the owners of the state's 41,519 handguns?

The Hon. M.J. WRIGHT: I do know the article that the member is talking about and can inform the house that incorrect information was supplied. The member is right: it was reported at 41,000 whereas, in effect, in South Australia it is 14,000 plus something (I am not sure of the precise number). It is my understanding that incorrect information was supplied and, obviously, that is a bad mistake to occur and it is regrettable. The member asked a detailed question about licensing and, once again, I will obtain that information for her.

Mrs REDMOND: The minister is one step ahead of me because I was going to ask him about the fact that there seems to have been a little transposing of a one and a four. There is a significant difference, of course, between 14,000 handguns and 41,000 handguns. Is it now the minister's statement that, in fact, there are 14,000 (and some) handguns in the state? What basis does the minister rely on in giving me that figure, as opposed to the figure that was supplied to the commonwealth in a formal sense?

The Hon. M.J. WRIGHT: I take the point that the member makes. I think we were all a wee bit surprised at that figure of 41,000, particularly when looking at other jurisdictions and comparing it with bigger states, where we had the higher figure. The information that has been provided to me only today (it may have been yesterday; I cannot be 100 per cent sure) was that the figure is 14,000 and something. That information comes from the commissioner.

As I said, obviously, it is regrettable that a mistake was made—and a mistake of that size. Yes; I can confirm with the member that the true figure for South Australia is 14,000 and something—I am not sure of the last couple of digits.

Mrs REDMOND: I have a fascination with handguns today, Madam Chair.

The CHAIR: That is unusual.

Mrs REDMOND: Yes. Members will be pleased to know that when I did the exercise Executive Stretch with the Defence Reserves, I managed to get 10 bullseyes with the standard assault rifle, and my secretary has been decidedly well behaved ever since that day.

The Hon. M.J. Wright: From what distance?

Mrs REDMOND: Whatever the standard distance was. Still on this issue of handguns, on 13 October The Advertiser reported that a document prepared by the police showed that 1,498 gun-related incidents occurred in Adelaide over the five years leading up to 30 June this year. During last year's Auditor-General's questioning (responding to questions over similar concerns raised by the Auditor-General) the then police minister stated:

One of the things future budgets will need to look at is improving the computer systems to maintain better licensing.

Given the documented evidence that gun crime appears to be extremely rife in South Australia, why is there no current budget measure to improve that accountability on firearms licences?

The CHAIR: I think that is an estimates question. Minister, can you supply any information?

The Hon. M.J. WRIGHT: No, it is an estimates question; there is no doubt about that. I cannot be sure of the answer; that pre-dated me as police minister. Largely, what was sought by the commissioner, generally speaking, was received in their budget.

Mrs REDMOND: I think this is strictly an auditor's question, because I am referring to what the Auditor-General's Report stated last year. The Auditor-General stated this time last year that a benchmark had been set for reduction of outstanding expired licences by 25 per cent to 536 for the financial year just finished. Was that target achieved?

The CHAIR: I point out to the member for Heysen that we are examining the report of the Auditor-General for the year ended 30 June 2008. Matters relating to the report for 2007 are not under consideration. However, I invite the minister to provide any information he can.

The Hon. M.J. WRIGHT: Yes; I can provide some information which I hope will help the member. The number of expired firearms licences has been continually reduced and a benchmark (1 per cent of all firearm licences) has been set. The last four monthly audits reveal that the benchmark has been exceeded, so they are pretty good results.

Mrs REDMOND: I appreciate the tolerance of the chair. My difficulty is that I want to know what has happened, given the Auditor-General's comments and the reports last year, and how that compares with this year. One of the things raised was that discussions needed to take place between police ministers (and the new police minister may not have been in the job long enough) about registers of licences going national. Has that been progressed at all?

The Hon. M.J. WRIGHT: I am not sure of the answer; I will have to obtain that. As the member said, it would have pre-dated me. There is a police ministers' conference coming up in about two to three weeks but I will have to check whether or not that is on the agenda.

Mrs REDMOND: I have only one more question on guns.

The CHAIR: I am relieved.

Mrs REDMOND: I have some others on SAPOL. Michael O'Connell, the Victims of Crime Commissioner, recently said, 'The figures show the fight against guns is failing.' Minister, you recently called for a gun amnesty to be set up. However, it is my understanding that, when we had the last amnesty (in 2006), where people could hand in their guns without penalty, that yielded a goodly sum of 1,490 firearms. However, the briefing paper shows that between 2003 and 2008 overall gun crime dropped by only 1.5 per cent, from 315 incidents in a year to 310 incidents. That seems a very nominal reduction. The suggestion to me from the figures (and maybe I am wrong) is that, in fact, honest people hand in guns during an amnesty and it has very little effect on the fight against illegal gun crime.

The CHAIR: Again, it is beyond the scope of the report but do you have anything to contribute, minister? No?

Mrs REDMOND: I will move on, Madam Chair.

The CHAIR: I think that is wise.

Mrs REDMOND: I refer to page 888 (an auspicious number if ever there was one). On that page, it is listed that there has been an increase of 498 employees within SAPOL earning above the famous $100,000 per annum mark. During question time, the Treasurer stated that senior sergeants commonly have remuneration packages of $100,000 and went on to say that by questioning that increase of 498 employees, the opposition was attacking senior sergeants. My question to the minister is: how many of those 498 people are senior sergeants; how many are sworn operational officers; and how many are bureaucrats?

The Hon. M.J. WRIGHT: What I can tell the member is that the majority of them are operational police. We can get some greater detail for the member in regard to the breakdown, but the advice that I have received is that the SAPOL increase is for non-executives and is mainly as a result of last year's enterprise bargaining agreement which comprises an average wage increase of 16 per cent during the three-year life of the agreement.

I am also advised that there has been a decrease of executives. For example, SAPOL senior sergeants and above commonly have total remuneration packages above $100,000 as the member has already referred to. If I could also just add on another topic, I have been advised that the previous issue that was raised by the member is on the police ministers' meeting agenda coming up in a couple of weeks' time.

Mrs REDMOND: Can I just confirm the minister's response then. Is he saying that none of the 498 people referred to on page 888 were executives who have moved into that hundred thousand dollar plus bracket and that in fact there has been a decrease in the executives within the department?

The Hon. M.J. WRIGHT: What I said in my previous answer was that they were predominantly operational police. In 2007, there were 13 executives, and there were 13 executives in 2008. The non-executives were 427 in 2007 and 925 in 2008.

Mrs REDMOND: I have two questions on page 827, dealing with SAPOL employee benefit expenses. There was an increase of $44 million in SAPOL employee benefit expenses and I am just trying to find that.

The CHAIR: That is Premier and Cabinet.

Mrs REDMOND: I will check that. The minister may be able to answer the question without the specific page reference anyway. The question is: of the total $44 million increase in SAPOL employee benefit expenses, how much of that money is accounted for by the recruitment of operational police officers in the financial period just finished?

The Hon. M.J. WRIGHT: I will have to get that sort of detail for the member.

Mrs REDMOND: I have one other question while I am on page 827.

The CHAIR: Could it be page 872? Could there have been a transposition?

Mrs REDMOND: It could be. It is a thing with this department; we like transposing figures. But while we were on page 827, I was puzzled and would love an explanation—

The CHAIR: Excuse me, member for Heysen, I have seen what you are referring to, and it is page 872.

Mrs REDMOND: The minister has already indicated, though, that he will get me an answer on that. I do have a question, though, on page 827, and it is fundamental human curiosity that sparks this question. Halfway down the page, there is net loss or gain from disposal of assets.

The CHAIR: But 827 is Premier and Cabinet.

Mrs REDMOND: I was wondering why the police had works of art.

The Hon. M.J. WRIGHT: We don't!

Mrs REDMOND: Exactly how many more sworn police officers working on the beat need to be achieved by 2010 in order to fulfil the government's commitment to 4,400 such officers?

The Hon. M.J. WRIGHT: From memory, I think it is like this: as of 30 June, we had 4,144. To get to 4,400 requires another 256, so it is in that vicinity. I do not want to be held to that precise number, but I would say that is around about the figure and the advice that I am getting is that there will be another hundred this year and another hundred next year. It might be a bit more than that, as I said, from my calculations.

I know that in the short time that I have been police minister, I have been fortunate enough to have been invited to at least two graduations, and there is another one coming up in the next week or two. It is fantastic to be present at these graduations, and I know the opposition has also been represented. We will continue to work hard to get to that number of 4,400. We remain very confident that we will do so. What also strikes me, as we see the graduates coming through, is the diversity of backgrounds and experiences that these new officers have and I am sure they will do us and the police force proud into the future.

Mrs REDMOND: I have only a couple more questions on SAPOL. These relate to page 870 and, in particular, to the area under the heading 'Workers Compensation'. I know it is not up to me to comment, but some bright spark must have spent hours coming up with the acronym IDEAS; I assume it is the name of some sort of computer system. The commentary under the heading 'Workers Compensation' states that the documented records of workers compensation payments made to SAPOL staff did not reconcile with those approved by the Commissioner and, further, that no controls exist to make sure that payments are checked and input into records. Finally, amongst other reconciliation issues, a number of related invoices were paid without evidence of appropriate approval.

SAPOL has stated that it has amended payments and authorisations for consistency. In amending these payments so that they reconcile with authorisations, has any money been written off as a cost to the department? If so, how much?

The Hon. M.J. WRIGHT: The advice I have is that we have not written off any money. Further to the member's question regarding financial delegations in the integrated desktop environment for applications and services (IDEAS) not being consistent with the delegations approved by the Commissioner, there is a disparity between the SIMS level of authority and SAPOL requirements. This is because the SAPOL levels of authority are at a lower level than the SIMS requirements. The delegations within the workplace instructions are in place to ensure compliance with SAPOL requirements. The authority for approval was vested in the manager prior to final processing by the relevant administration staff. The injury management work instructions contain financial authorisations that were lower than those authorised by the Commissioner.

Regarding invoices paid without evidence of appropriate level, the injury management work instructions have been changed to ensure that accounts are paid only once invoices have been approved by the position with approval authority. The relevant manager is required to approve expenditures. Systems have been reviewed to ensure that there is evidence of appropriate expenditure approvals.

In terms of no overall control to ensure all workers compensation payments are checked and put into IDEAS, the Auditor-General's Report referred to the previous IDEAS system. With the implementation of the new SIMS system all invoices are to be entered onto SIMS before payments can be processed. This audit finding has been resolved by the implementation of the new system.

Mrs REDMOND: With respect, minister, I know that you were just reading what was put in front of you, but that was as clear as mud, and I would like to clarify it. Is it the case that the new system is something called SIMS (and that is a computer system); that the old system is something called IDEAS; and that there has been a discrepancy between the authority level for each officer? So, under one system an officer at the level of, say, senior sergeant was authorised to approve payments and under the other system someone more senior had to do it. If that is the case, could you explain it in plain English so that I can get into my head what, in fact, that response meant. I think I get the gist of it, but I do not precisely understand what was the problem.

The Hon. M.J. WRIGHT: The member is correct with regard to the SIMS system being the new system and IDEAS being the old system. With the old IDEAS system clerical people had a lower level of delegation than financial delegations, but that has been rectified with the new SIMS system with the delegations for IDEAS.

Mrs REDMOND: The underlying question I want to get at is, given all that (and I accept it is basically a hiccup of changing from one system to another), has there been any cost to the department? Have there been write-offs, for instance, for the department in reconciling the problem identified by the Auditor-General in his report?

The Hon. M.J. WRIGHT: The advice I have received is that there have been no write-offs, and the only costs that would have occurred would have been in transitioning from the old to the new.

Mrs REDMOND: Madam Chair, I would like to move on to emergency services for the few minutes left to me. I refer to Part B, Volume IV, page 960, and the issue of SAFECOM consultants. SAFECOM consultants increased from four consultants engaged last year to 15 this year, and the cost of these consultants totalled $232,000 compared with $31,000. So, we went from four with $31,000 to 15 with $232,000. What did these consultancies relate to?

The Hon. M.J. WRIGHT: I thank the member for her question. Regarding what consultancies there were, I can quickly go through those. I will give you the amount in dollars as well. Aquarius Learning, $450; John Bridgeland, $1,040; Ranlee, $2,450; Anita Lebed, $3,150; Mercer, $4,400; Workplace Resolutions, $4,427; Governance Matters, $5,000; Deloitte, $5,850; PKF, $6,045; Anita Lebed (another one for them), $6,400; Stillwell Management Consultants, $20,000; Protegic, $27,800; Deloitte, $29,200; GHD, $41,545; and John Murray Consultants, $78,409.

Mrs REDMOND: Minister, I know you may not have the detail of all of those, and particularly some of those smaller ones like Aquarius Learning that you started out with, but some of those bigger ones: what were the consultants being engaged to do for SAFECOM and what was it about the work that could not be done in-house by SAFECOM?

The Hon. M.J. WRIGHT: Perhaps if I tackle three or four of the bigger ones, as a starting point anyway. Protegic, that was a communications strategy external to SAFECOM. Deloitte, tax consultant services, that was to look at its FBT. GHD, building replacement review, that was looking at the efficiency of building processes. John Murray Consultants, as the member would probably be aware, that was a review of the Fire and Emergency Services Act, which obviously needed to be independent of SAFECOM.

The CHAIR: The agreed time having expired, I thank the minister, his advisers and members.

Progress reported; committee to sit again.

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