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House of Assembly - Fifty-Second Parliament, First Session (52-1)
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HEALTH SERVICES CHARITABLE GIFTS BILL

Second Reading

Adjourned debate on second reading.

(Continued from 10 February 2011.)

Dr McFETRIDGE (Morphett) (11:02): I indicate that I am the lead speaker for the opposition on this bill and, as my colleague the member for Bragg indicated last time this bill was debated in this place, we will not be opposing this legislation. However, I do want to put on the record a number of things about medical research in South Australia and why we do need to make sure that we are funding medical research not only through charitable gifts and benevolent funds but also through the government coffers. The role of medical research cannot be underestimated in South Australia, and I will be putting some examples of that on the record today as well.

I will go back to the 2008 report by Professor John Shine and Alan Young about the importance of medical research in South Australia. The report starts by stating:

The South Australian Generational Health Review conducted in 2003 stated: Research is an integral part of the health system…It is an enabler for many aspects of health care delivery, including informing the promotion of health and wellbeing and strengthening the evidence base for decision-making…Health related research should be integrated in all aspects of health care…

We see health in all policies being put out by the government and we should remember that health-related research should be integrated into all aspects of health care across all portfolio areas. The report continues:

Health and medical research makes a major contribution at many levels:

Involvement in research is crucial in developing knowledge and linkages to improve service delivery and to structure health services.

Investment in research promotes staff development, promotes high professional standards, and fosters a culture of inquiry, excellence and evidence based practice.

It plays a significant role in attracting and retaining medical and other health professional staff.

Economically, research contributes directly to high quality jobs, earnings from the Intellectual Property (IP) developed, commercial spin-off companies, building the reputation of hospitals and universities, and attracting Australian and international students. It provides capacity to respond to new and emerging health, medical and system-level issues.

It fosters innovation and improvements in health service delivery, including primary health care and public health initiatives, leading to improved health outcomes for the community and cost savings for expenditure on health by governments.

Health research is also a key enabler of the South Australian Strategic Plan. The Access Economics report 'Exceptional returns: the value of investing in health research and development in Australia' indicates that the annual rates of return to Australian health and medical research and development have been up to $5 for every $1 spent on health research and development, and the investment in health R&D is a major contributor to rising living standards in our time.

Health and medical research and development in South Australia involve our three universities, the hospital sector, the South Australian Department of Health, the Department of Further Education, Employment, Science and Technology, research institutes of varying independence, the private sector, and the community. A significant amount of research, however, is conducted in the public health system.

Research centres in South Australia include our three universities, as I have said (the University of Adelaide, the University of South Australia and Flinders University), all of which have internationally recognised capabilities in life sciences. Major teaching hospitals are active at the forefront of clinical care. The Royal Adelaide Hospital, The Queen Elizabeth Hospital, the Repatriation General Hospital, the Women's and Children's Hospital, the Lyell McEwin hospital and Flinders Medical Centre are all active in medical research.

Three medical research institutes that are closely aligned with specific hospitals and universities include: the Institute of Medical and Veterinary Science, the Hanson Institute and the Women's & Children's Health Research Institute; and we also have cooperative research centres in South Australia. South Australia participates in 21 of the 71 Australia-wide CRCs.

We should all remember that South Australia has a long history of high performance in health and medical research funding and publications compared to its share of the national population. We really do punch above our weight in medical research. A major factor in this has been the close relationship between the universities, the teaching hospitals, the clinicians and the research scientists.

In today's Australian newspaper on page 3 I was very pleased to read about two of my favourite research scientists in South Australia, that is, Professor Tanya Monro and Professor Rob Norman, who are developing fibre optics to monitor the health of IVF embryos. The work being done by professors Norman and Monro is world class. Professor Monro was recognised as South Australian of the Year in 2010 and Professor Norman was South Australian of the Year in 2009, so we have high calibre, high quality scientists on our own doorstep—going back many years, obviously, to our Nobel award-winning scientists, the Braggs.

The other very exciting thing that is happening in South Australia, as I mentioned previously, is the value of the intellectual property coming out of research in South Australia. Not only are we seeing the terrific stuff in fibre optics and photonics that Professor Monro is involved in but also we have seen a lot of work with stem cell therapy and other cellular level biology that is being undertaken at the Institute of Medical and Veterinary Science and the Hanson Institute.

One of the very exciting products of that is a company called Mesoblast, which was established in 2004 by scientists at the IMVS and the Hanson Institute. It is now a publicly listed company and its share price was $5.17 as of a few days ago. It is a company we should be very proud of, particularly when you look at the last ASX announcement by the Chairman, Mr Brian Jamieson. At an extraordinary general meeting of Mesoblast, Mr Jamieson told shareholders and others:

Mesoblast will now have a market capitalisation of...$1.5 billion.

I will repeat that. He said:

Mesoblast will now have a market capitalisation of approximately $1.5 billion, [it will have] $280 million cash on hand, increasing numbers of new strategic domestic and international institutional investors, and a growing number of commercial opportunities.

That started in 2004 at our Hanson Institute and the Institute of Medical and Veterinary Science. That is just an indicator of what we can do if we foster research in South Australia.

We need to ensure that we are listening to our scientists, and when the Royal Institution opened here I asked the Premier at the time, 'Will you listen to the scientists?' He quipped back that of course he will because he is a scientist, he is a political scientist. I find 'political scientist' to be a bit of an oxymoron. We need to make sure that we do listen to our scientists. Where we should be putting funding for research is vital, because that money we have for research is sometimes not as adequate as it might be. That is why this bill is here with us today. We are looking at where the money is going, where it is coming from and making sure that we are getting the best bang for our buck.

I was concerned to read in the press today that the Chief Scientist for Australia, Professor Penny Sackett, resigned a little while ago. She is speaking at the Senate estimates in Canberra tomorrow, and she is very concerned that the federal government is not listening to the advice that she has been giving to it. In fact, in this newspaper report, she says that she met with the former prime minister Kevin Rudd on only one occasion. In contrast, Professor Sackett is quoted as saying:

In contrast, as of last month, every British government department, aside from Treasury, has its own science adviser, in addition to Britain's Chief Scientific Adviser, John Beddington. All contribute to policy discussions.

With respect to what I was saying before, science and health in all areas is very, very important. We need the money to do it. We need to make sure that we are getting the very best value for our dollar and building on our long and strong history of research in South Australia.

South Australia has an excellent environment for conducting clinical trials, and it has a reputation for meeting recruitment time lines and targets and in data quality. South Australian companies play a major role in the design, implementation and management of all phases of pre-clinical and clinical studies being of the highest international standards. The 2004 KPMG report, 'Competitive Alternatives', ranked Australia third for cost effectiveness for conducting clinical trials; and South Australia is again at the forefront of that.

I am just making these points to emphasise to everyone who is listening to this and who will possibly read this that we do need to make sure that we are getting the best value for our money by supporting our scientists who are here and encouraging scientists to come to South Australia. I hope that the government does listen to our scientists, not because they are political scientists—far from it. It is because we need to make sure that our chief scientists—whether they be state or federally based—are being listened to and our opportunities built on.

The latest big development in South Australia with scientific research institutions building on those we already know a lot about—the Hanson Institute, the Basil Hetzel at The Queen Elizabeth Hospital, the Women's and Children's Research Institute at Flinders and, of course, the IMVS—and the latest development for infrastructure in South Australia (as we all know; and we cannot miss the crane on North Terrace) is the South Australian Health and Medical Research Institute (SAHMRI).

This facility is fully funded by the federal government at a cost of $200 million. This will be building on South Australia's proud history of research and will be providing further infrastructure for research in South Australia.

I do have a problem with the chance that funding may go away from our other research facilities, such as the Hanson Institute and the Basil Hetzel facility and into SAHMRI, and I will be making some further points about that later in my speech with respect to some of the clauses of the bill. It is important, though, that we do have the infrastructure; it is important that we do have the research facilities—the places where scientists can gather, collaborate and build on each others knowledge. The synergy that can be developed is not to be underestimated.

The SAHMRI is going to be built down there. There is a picture in the paper this morning of the artist's interpretation of what the building is going to look like. It looks to be a very spectacular building. I just hope that the recurrent funding is going to be there for the research without bleeding other research facilities dry. That is a real concern for me. I hope that the minister can assure the house that that is not the case and that bequests, gifts and other income will be fairly spread around.

The annual report of the Commissioners for Charitable Funds is out, but, unfortunately, the latest is the 2008-09 annual report. A 2009-10 report is coming out fairly shortly, I understand. The commissioner, Judith Worrall, in her letter to the minister dated 9 March 2010—so nearly 12 months ago—was apologetic in saying that the annual report was late due to delays within the Auditor-General's office. I understand there is exactly the same issue this year. I would like to see that problem overcome, because I know that it happens with other organisations. I think the Health and Community Services Complaints Commissioner voiced the same problem with her annual report being late.

We need to look at the audits of these reports. I am sure it is not as onerous as auditing a department like the health department. So, whether it be outsourced or whether the Auditor-General could make sure that it is given the due attention that it requires in the appropriate time, it would be nice to have up-to-date financial reports, particularly when you are debating legislation like this, and it would be of assistance to all of us.

I wish the commissioner well in achieving that, and those on this side of the house and, I assume, the government, will be doing all that they can to assist the commissioner in doing what the commission wants to do. I will read a little from the 2008-09 report. I do not know whether much will have changed; we will find out when the 2009-10 report comes out.

I will give a bit of background about what the Commissioners of Charitable Funds' job really is and what the commission does so that we can make sure that people then understand that the money that is being cared for and used and invested by the commission is being used for the best outcomes for research in South Australia.

The Commissioners of Charitable Funds was proclaimed under the Public Charities Funds Act 1935. The bill we are dealing with today will be updating that act because there is a lot of outdated wording and the context has changed, although there is a case to hang on to some of our long history of the way we express and conduct ourselves. Certainly, we see that in the protocols within this place and the respect that we pay to you, Madam Speaker, and your position in this place and the long traditions of the Westminster Parliament.

Throwing out the language may not always be the best thing but in this particular case, while I know that some of my colleagues have some issues with the changes in the language, I am a veterinarian not a lawyer and so I am prepared to be guided by parliamentary counsel with the new wording. So, what I am really saying there is that we are moving on from the 1935 wording.

The Commissioners of Charitable Funds is a body politic and corporate created in October 1875 for the purpose of administering gifts made for the maintenance and support of Public Charitable Institutions in South Australia.

The responsibilities of the Commissioners can be summarised as follows:

to receive assets gifted to public charitable institutions;

to administer the assets vested in the Commissioners of Charitable Funds and to ensure that the security and integrity of the vested assets are maintained;

to ensure that the assets are used appropriately for the benefit of the public charitable institution;

to ensure that as a prudent manager, the investments are made in order to optimise the return in accordance with the provisions of the PCF Act.

Funds vested in the Commissioners are only used for the benefit of the particular institution for which the assets are held. These funds and other assets have been given to proclaimed institutions and vest in the Commissioners by way of:

bequests;

donations and gifts...

the proceeds from other corporate, community and institutional fundraising programs.

I am not sure what the current balance is but during 2008-09 the net assets actually declined. I think that was probably part of the global financial crisis (GFC) effect. It was $75.7 million in total; it went down by $4.2 million. I understand that it is back up to around $77.5 million now held in trust.

Payments to Charitable Institutions for fellowships, education, research, patient assistance and equipment were $7.6 million [in 2008-09] compared to $5.8 million in the prior year.

I am looking forward to seeing that increasing again in the report that we are about to receive. It continues:

Funds received were comprised of contributions from estates and different units of the Royal Adelaide Hospital and other institutions that have discrete fundraising programs.

There are 11 of them listed in the report here, but I will not read them all out. The point there about hospitals and proclaimed institutions is one we should note. The proclaimed institutions in South Australia under the PCF Act are the Royal Adelaide Hospital, including Glenside Campus, The Queen Elizabeth Hospital, Modbury Hospital, Mount Gambier Hospital, Port Augusta Hospital, Port Lincoln, Port Pirie, Wallaroo and Whyalla hospitals, Strathmont Centre and the South Australian Dental Health Service. 'The existence or not of a board of commissioners in the institutions is not relevant to the commissioners' responsibilities under the PCF Act,' it states in the annual report.

There is a need to make sure that the money that is given or invested to the commission is given to the right institutions and that those institutions are appropriately managed. However, 'the existence or not of a board of management in the institutions is not relevant to the Commissioners' responsibilities...' it states here. So, we do need to just make sure that we have a commission that has been in the past and still is one that is cognisant of that and is going to make sure that the funds, if they are given to an institution, are used for the main purpose that they were intended for when initially donated.

If for some reason the funds cannot be used for the initial intent, then I think the classical case there is the Mount Gambier Hospital hydrotherapy pool. If that is the case, then the commission, I think, under this bill—and the minister might be able to enlighten me—will then be able to divest those funds to another institution or purpose that is similar to the one that was initially intended if the initial donors cannot be found or they do not want their money returned.

Some of the investments that the commission made in trying to build up the pool of funds are listed in the annual report. It is interesting to see—and I did not know this until I did some research on this bill—that the property assets of the commission are mainly in six properties. They are at Greenhill Road, Wayville; Torrens Road, Croydon Park; Waymouth Street, Adelaide; Archer Place, Clare; Halifax Street, Adelaide; and the big one is the Town Acre 86. Town Acre 86 is down the eastern end of Rundle Mall. The buildings on that Town Acre were recently revalued at $18 million, and the income from the rentals, the leasing arrangements, for that property is a significant piece of income for the commission.

That Town Acre 86 originally started out as the Thomas Martin Estate. As I said, the location is at the eastern end of Rundle Mall by Pulteney Street where the Citi Centre Building is. The Citi Centre building was completed in August 1988. The head lease for that is currently owned by the Minister for Infrastructure.

The other thing we should note about Town Acre 86 is that the income pays for many important programs at the Royal Adelaide Hospital. That is something that we will probably have some questions about in committee—where that income is going to be directed in the future.

The other significant estates that provide income for the commission are the Nimmo Estate. The late Rowland Harrold Nimmo, who died in 1956, conducted a hotel business at Mile End. When he died the estate was valued at $4.7 million and the bequest finances a visiting professor's position at the Royal Adelaide Hospital. Again, the Royal Adelaide Hospital is one of the main recipients of bequests and income from the commissioners' funds.

The Overton estate is another significant bequest. Ida Mary Overton, who died in 2002, was a generous donor to the arts and medical research. Mrs Overton bequeathed a half share of the residue of the estate to the Royal Adelaide Hospital Research Fund and the Flinders Medical Centre Foundation. This was valued at $4.2 million as of 30 June 2009.

One that is interesting is the Helpmann Family Foundation. While the Public Charities Funds Act 1935 does not allow the commissioners to fulfil the testamentary requirements of the late Sheila Helpmann by performing the role of trustee for the purposes of administering the Helpmann Family Foundation, the commissioners continue to play an active part in monitoring the Helpmann Family Foundation investment portfolio. There are clauses in this bill which will clarify the arrangements between the Helpmann Family Foundation and the Commissioners of Charitable Funds, because there are some legal technicalities that complicate the way the Helpmann Family Foundation is being administered and its relationship with the Commissioners of Charitable Funds.

The income from the Helpmann Family Foundation is significant, and investments were for the benefit of the Royal Adelaide Hospital's cardiovascular investigation unit. Since these gifts were made by the late Sheila and Maxwell Helpmann, in excess of $1.9 million has accumulated from the foundation, so we are really talking about very significant amounts being donated. As I said, I think the total amount held in trust at the moment is $77.5 million, which is by no means a small amount of money to be responsible for.

The way that money is invested is interesting. In the past there have been some investments in shares and share portfolios, but there were some questions about the way that money could be invested which would have affected its ability to have fully franked dividends on investments. Now, I do not claim to be an economist or a stockbroker, or to have any deep understanding of the accounting procedures or tax requirements involved here, but I do know that the Australian Taxation Office has determined that the Commissioners of Charitable Funds is not a government body carrying out the functions of government, and is thus considered to be a charitable institution.

This status is important, since income received by the commissioners in the form of fully franked dividends from Australian-listed companies is tax exempt. This means that the Commissioners of Charitable Funds is able to claim the full value of franked dividends when companies pay these dividends. If the Commissioners of Charitable Funds were not a charitable institution, the imputation credit would be forgone. The commissioners claimed $480,000 in imputation credits and dividends from the ATO during 2008-09; it will be interesting to see what they could claim in 2009-10. So, it is a significant amount, there is a significant benefit in being declared a charitable institution. That is something we do not want to interfere with, and I think this bill will strengthen that position for the commission.

I will not go through the comprehensive income statements for 2008-09 because they are clearly outdated, and we look forward to seeing the latest report on income and expenditure. However, I will mention just quickly that income from trust funds in 2008-09, gifts to public institutions vested in the commission, were $4.3 million. So they are coming in, and they are coming in strongly; South Australians are supportive and are making sure that we get a good financial base for our institutions through donations and bequests to our various hospitals and research facilities around the place. We need to make sure that that is in no way weakened, and that no government—whether Liberal or Labor—can divert funds off to what might be pet projects.

In the minister's second reading speech he talked about some of the background, history and language that is being used, and about some of the changes that will be put in place with this bill. One of the dot points the minister made on the first page was, 'Maintains the independent decision-making powers of the commission.' That has to be paramount, that the commissioner or other commissioners have to be able to make those decisions completely independently of any political or other outside pressure, so that the original intent of the donors can be achieved to the very best of their ability.

I believe that there are circumstances where that original intent cannot be achieved, through various circumstances, or where you can actually improve the benefit for the recipients with, say, small amounts of money. Rather than investing just the interest on a small amount of money, you could use the capital in some better way to maximise the benefit, which was the original intent. Had the donor received some other advice (possibly better advice, in some people's opinion), then that money may have been used in a different way in the first place.

The bottom line is that we would need to make sure that the commissioners are kept independent and able to make those decisions without any political influence for the benefit of the research committee in South Australia and fulfil the wishes of those who are putting up the money in the first place.

The Health Services Charitable Gifts Board will be established under this bill, and we will talk a bit more about that in committee. There are some concerns in the bill itself, though, as you read through the various clauses, and we will go through some of those concerns in committee, but one I will mention now is the establishment of the advisory committees, in particular the Investment Advisory Committee. On reading this bill, my understanding is that Treasury officials will be on this committee.

My concern (and it may be undue) is that in the past Treasury has tried to get its hands on this money, and I just see this as a possible backdoor way of doing that. I would like some assurances from the minister that this is not going to happen because, as I have been saying and will continue to say, it is very important that the money is used for its intended purposes via this independent commission.

It is interesting to note that our health advisory councils, which were established under the 2008 legislation, will not be proclaimed as public health entities, and that is because they do not want to be. Most of them are receiving small amounts of money (and sometimes larger amounts of money) which they want to be able to use in their own ways. They can actually ask to be proclaimed, but in most cases they do not want to be proclaimed, so we will watch where that goes. We do not want the central government, the central decision-makers, to be taking any more power from our country hospitals and our country communities than has already been the case.

The legislation has some other concerns, which we will go through in committee. With the regulations, once again the devil is in the detail. I have not seen draft regulations, and it would have been nice to have seen them before the bill was debated in this place, but the bottom line is that we have not seen them yet.

I spoke before about the South Australian Health and Medical Research Institute. The existence of that organisation will come up in committee because there are real concerns—whether they be justifiable in reality, I do not know, but I expect the minister should be able to answer the questions—and certainly perceptions out there that this bill is nothing more than a money grab to take money away from the other institutions, particularly the Royal Adelaide Hospital, and divert it across to the South Australian Health and Medical Research Institute (SAHMRI). In his second reading explanation, the minister said:

The current act converts the specific purposes of a gift held on trust by the commissioners given for a particular hospital to a more general one of being applied for the benefit of that hospital. The bill maintains this power of the current act and, in addition, enables the board to apply a gift to a different hospital or a prescribed research body.

I do not have any problem with that on face value, but what I do have a problem with is the fact that we have a Treasury official involved in the investment committee. I have some real concerns that pressure will be put on the commission to move funds across and that the fears of this being a cloak-and-dagger piece of legislation to move funds across to SAHMRI from other research institutions will come to fruition. I hope that is not the case, and I expect the minister to give assurances not only to me but also to those people who have contacted me from the various research institutes and the medical professions.

During the consultation process on this bill, I spoke to the AMA about some of its concerns, and the AMA's concerns basically boiled down to concerns about what I have just spoken about—not a cash grab from the SAHMRI so much as money being moved around to recipients who may not have been those intended by the donors.

The AMA said it had concerns about the transparency of the bill and the fact that there is no immediate public transparency on decisions. The AMA has concerns with the fact that funds that were originally donated to a dedicated recipient could be utilised for purposes other than that for which they were originally intended; so it is important to have public transparency whilst the decision is being made rather than information being provided after the fact through an annual report. The AMA also expressed some concerns about what sort of advice would be given on how funds were going to be invested in the sharemarket.

In the bill the definition of 'prescribed research body' has changed a little and now means 'a person or organisation that is involved in health or medical research and is prescribed by regulation for the purposes of this definition'. As I have said before, the health advisory councils (HACs) are prescribed health entities and certainly not prescribed research bodies.

The amendments we have to this bill, which have been placed on file, are pretty straightforward in most cases, apart from amendment No. 3, which we will talk about at the committee stage, and that relates to payment of remuneration and expenses to the commissioners in the execution of their duties. Clause 15—Certain gifts vest in board as part of charitable assets provides:

...the property must be transferred to the board by the executor, trustee or other person

I assume that is talking just about the exclusion in the section of such things as when someone donates a TV or couch, or something like that, they will not be grabbed by the commission.

The concern I think most people have relates to the application of funds for various purposes. However, I will go back to schedule 2—Investment advisory committee, which is one area of concern for me. I will be asking questions in relation to that during the committee stage, and I know that some of my colleagues will certainly be asking questions about the involvement of Treasury in relation to this so that we can make sure that the commission will not be lent on by people with particular agendas—I am not saying that would be the case, but you never know what might happen in the future.

Schedule 3, clause 4 provides:

The committee must, on or before 30 September in each year, deliver to the board a report on the performance of the board's investments...

That is something that will be interesting to watch, that is, how those investments work. We hope to see the annual reports coming out in a timely fashion so that, if the investments are not available at the time of their being put through, at least the information will be available as early as possible and we will not have to wait, as is the case in this instance, well over six months to see what is happening.

That is probably all I need to say at this stage. We will be going into committee on this bill, and I certainly have some questions and I know the member for Bragg has a number of questions. The member for Bragg has an extensive history of involvement with many of these organisations. I am sure the minister will be able to put all of our concerns to rest to make sure that the fine, long history of medical research in South Australia can continue and that people such as Professor Monro and Professor Norman, and the many others, continue their work.

These people are out there every day trying to build on that reputation and also improve the life not only of South Australians but everybody in the world, and that is not being too enthusiastic; that is an actual fact. When you see that Mesoblast now has a market capitalisation of $1.5 billion in research projects, it is something that we should be very, very proud of.

This bill will bring the 1935 act into current terminology. It will expand some of the things it is able to do. It will tidy up some of the things that it was doing in the past (and perhaps were questionable from a technical/legal sense) but I do not think that we should in any way doubt the fact that in the past we have had very fine commissioners for charitable gifts, and we have a long history of giving to our institutions in South Australia, so anything that will throw any shadow of doubt on that whatsoever must be avoided. With that, I commend the bill to the house.

Mr VAN HOLST PELLEKAAN (Stuart) (11:40): I appreciate the opportunity to talk about the Health Services Charitable Gifts Bill. Our shadow health minister (the member for Morphett) has gone into a lot of detail, and there is obviously still more to come in the committee stage. We will be supporting this bill, as he said. I support anything that ensures and improves the way that donations from the public get spent exactly where they are intended to be spent, regardless of who is in government; that is an extremely important principle. I would like to speak on this from a country and rural perspective for a few minutes.

There is a tremendous history of donating and giving for health projects, hospitals and research in South Australia, as the member for Morphett just said, and that is no better shown than in country South Australia. There have been enormous concerns about the operation of the health system in the country. As the minister knows, many people have come to me over the past few years, as a candidate and now as a member of parliament. I will not be dwelling on those at the moment but, certainly with regard to donations, people in relatively senior positions in the community have come to me with their very genuine and serious concerns that donations to hospitals in country areas have been slowing and drying up over the past year or so.

Much of that has to do with the change from hospital boards to health advisory committees (HACs), and people are telling me that, totally separate from all the other issues that exist around that change, donations are getting harder and harder to get. In the rural environment at the moment, where things are going pretty well—and we would all understand that donations wax and wane with people's ability and concerns or optimism about the economy and their own personal circumstances—certainly we are entering into a pretty good time as far as the economy goes in country areas from most primary producers' perspective—certainly not all of them, but most of them—yet donations to hospitals are drying up.

The reason for that, I am told, is that people are really concerned that their money will not be spent where they want it to be spent. I certainly support the minister if this change in legislation is going to improve that situation, because it is a very genuine concern in the country at the moment, as I have been told by many people who are involved with community health in their areas.

Another specific example of where people in rural areas (and certainly in Stuart) are very concerned about their donations going exactly where they want has to do with the transfer of St John Ambulance into the SA Ambulance Service. Very recently, ambulance officers have been telling me that they are concerned about recent changes and particularly the fact that they have been told of a change to the local ambulance brigade choosing which community events to attend (so, nothing to do with attendance at accidents or emergencies) and, in return for their voluntary attendance, as is the custom for donations (and I have been on the other side of this where I have been running community events that required an ambulance to be in attendance), receiving a donation out of the fundraising proceeds from that event specially back to that ambulance group.

Ambulance officers are telling me that they are very concerned that the money is now not going to go back to the specific ambulance group but will go into the central pool. In fact, one ambulance officer said to me that he believed that, instead of that traditional situation where volunteers turn up and then the event (whether it happens to be a gymkhana, a rodeo, a football grand final or whatever) giving a donation back, it is very likely that the South Australian Ambulance Service will actually be asking for a fee for attendance and the money would go back into the central pool. That is something that requires further investigation, but I can assure everybody present that that information has come to me first-hand. This is another example where people are concerned that money that is donated may not be used exactly where they intended it to be used.

I was also told very recently of a person who is a very generous donator. Instead of donating cash to a hospital, for fear that the money might end up somewhere else, this person asked the director of nursing and the hospital directly, 'What would you like your money to actually be spent on, and I will buy that. I would rather purchase whatever it is that you request for your hospital and give you that rather than the money, because I am concerned about where it might end up.'

I certainly welcome anything that will improve this area and that will give people more comfort, because it is the comfort of the donators that is extremely important in this issue. Regardless of what legislation is in place, regardless of what systems are in place and regardless of what assurance they receive from the government, the hospital or the people, if they remain uncomfortable then that will have a negative impact on donations. I certainly welcome anything that will improve that.

People in the country understand that their donations to their hospital go a lot more broadly and have a far more wide-ranging positive impact than just specifically the health service, because people understand that, if they lose their hospital in their country town, then they lose so much more. They lose the opportunity for older people to stay in the town and for young families to want to come to the town. They lose all of the business that the hospital creates in the town, too; whether it is the local pharmacy, the butcher or the grocer, and those things are in fact under attack at the moment with regard to centralised purchasing. However, people really do understand that their donations to their hospital in a country town are far more beneficial than they are just to the specific health service and that they do support the town in general.

I, together with all members of this house, I am sure, am extremely grateful for people all over the state who donate to our health system. I am particularly grateful for the people throughout Stuart who donate to the hospitals in Stuart. There are nine hospitals in the electorate of Stuart and every single one of them is extremely important. I certainly welcome any improvement to legislation that gives donators greater comfort that the money that they would give to the health system will be spent exactly where they would like it to be spent.

Mr PEDERICK (Hammond) (11:48): I rise to speak to the Health Services Charitable Gifts Bill. I note that on 24 November last year the minister introduced and moved the Health Services Charitable Gifts Bill to provide for the administration of gifts to public health entities and to repeal the Public Charities Funds Act 1935.

The Commissioners of Charitable Funds through the Public Charities Funds Act 1935 administers gifts for the maintenance and support of public charitable institutions in South Australia. Funds (this includes bequests, donations and gifts from corporate and community groups and individuals, and proceeds from institutional fundraising programs) vested in the commissioners are only used for the benefit of the particular institutions for which the assets are held.

Proclaimed institutions under the Public Charities Funds Act 1935 include the Royal Adelaide Hospital (Glenside campus), The Queen Elizabeth Hospital, Modbury Hospital, Mount Gambier Hospital, Port Augusta Hospital, Port Lincoln Hospital, Port Pirie Hospital, Wallaroo Hospital, Whyalla Hospital, Strathmont Centre and the South Australian Dental Health Service.

There was a delay by the Commissioners of Charitable Funds in lodging the 2008-09 annual report and financial statements as there had been a number of matters concerning difficulties with the administration of the Public Charities Funds Act 1935. Many of the matters that arose were in relation to the administration of gifts relating to the Hanson Centre for Cancer Research and their impact on the presentation of financial statements. This resulted in a qualified auditor's opinion from the Auditor-General, Simon O'Neill, on 18 February 2010.

The Auditor-General outlined that the gifts received on behalf of these institutions, including the Institute of Medical and Veterinary Science and the Hanson Centre for Cancer Research, do not vest with the commissioners. They were therefore incorrectly recognised as revenue, assets and trust funds (equity) within the statements and were overstated. There were a number of matters relating to this that the commissioners need to address and resolve. The commissioners, under advice from the Crown Solicitor's Office, continue to hold these donations as a 'constructive trust' until they can be properly dealt with.

This has created divisions within the research committee as the Hanson Institute received over $21 million in research grants in 2009 and works closely in collaboration with the Royal Adelaide Hospital and the University of Adelaide. Concerns about how these funds will be used in the future, through changes introduced in this bill, will be discussed. The minister has argued that the act needs to be updated with current terminology as the act has remained virtually unchanged since its introduction in 1875.

Consultation: the establishment of advisory committees and investment advisory committees and the requirement for commissioners to seek advice has been a concern. There are concerns that the bill specifically precludes health advisory councils from being proclaimed a public health entity and the property they hold on trust from being vested with the Health Services Charitable Gifts Board that is proposed to be established by the bill. The changes the government has made to country hospitals, and the introduction of health advisory committees to replace country hospital boards, places questions over whether country hospitals and health services will be able to receive donations and bequests or property unless the minister provides an exemption.

This bill will allow for the South Australian Health and Medical Research Institute to access funds, although originally the funds were donated specifically for the use of a dedicated recipient. This bill also allows commissioners to invest in the share market where previously they were not able to do so.

Some concerns have been raised by the AMA about the transparency of the bill and the fact that there is no immediate public transparency on donations. The AMA has had concerns that funds that were originally donated to a dedicated recipient could be utilised for purposes other than for what they were originally intended. So, it is important to have full transparency whilst the decision is being made rather than information being provided after the fact about where a donation has ended up, and this would only happen through an annual report.

I certainly support the comments by the member for Stuart in regard to country hospitals and the way people have donated funds or specific gifts to hospitals in rural regions. Country health, certainly on this side of the house, is taken very seriously. Hospitals can be hundreds of kilometres apart. Hospitals in my electorate include, in the Mallee, Pinnaroo and Lameroo, both 100 kilometres or so from other major hospitals in the Riverland. Then I have Karoonda, Tailem Bend, and obviously, a larger central hospital in Murray Bridge. Servicing the edges of my electorate is the Mannum hospital, the Strathalbyn hospital, Victor Harbor and Meningie.

We certainly must make sure that we support all of these hospitals in the regions because the interesting thing is that they do not just support country people. You get the view sometimes from the other side of this place that city hospitals are the only hospitals that need investment. Certainly we have seen funding cut back by the Labor government in regard to hospitals like the Keith hospital and those at Moonta and Ardrossan. I have a very real fear in regard to the Keith hospital, in that if it shuts I hope that does not have any ramifications, especially for people travelling on the Dukes Highway or for locals down around the Bordertown, Keith, Tintinara area who need health care. They have the right to health care just as anyone does in urban areas—they absolutely do.

In our country electorates, we need our health services, and we need people, and I am sure the minister will tell us either in his closing remarks or in committee how gifts will be handled in country hospitals. People have raised money in various ways; it can be by something as small as cake stalls and trading tables, or by people who want to give significant amounts in their will to their local country health centre. It is a great way for people to put back into the community, and a lot of people want to do this because they have the capacity and, perhaps, in the last years of their lives acknowledge the support they have had from the local health services.

One thing that is certain about health services right across the board in my electorate of Hammond is that they are now also a vital part of the aged-care network. The link is right there. The aged-care sections of hospitals work with the emergency sections, and it is a very good way to get services into the community, so there is that direct link that makes things work. I know that they are both state-funded and federally-funded—I acknowledge that here today—but it is absolutely vital in the first instance that these hospitals do not turn into just aged-care facilities, because they need the health and the accident emergency sections of these hospitals as well.

I think that, if you looked at it in a business sense, it is very much common sense that these two areas of health work together, and I hope that they work together for a long time yet in this state because it seems to be operating very well in the bush. It irks me at times that, over the last 20-odd years, we have had to stand up and fight for our rural hospitals, and I think we will probably have to keep doing it in the future.

All we are asking for in the bush is a fair go for services because they are needed not just for people who live in the regions but also for people who travel through them. I can tell you that they are more than happy when they get health services if something happens—especially if they are travelling through and a car accident or something similar occurs—and they can get localised services and be linked into road ambulance services or picked up by air evacuation, whether that be by helicopter or fixed-wing aircraft.

I seek some clarification from the minister to make sure that, when people working in their local communities donate money, the money will go to the right place and stay locally so that our hospitals can remain viable. I seek that assurance from the minister because it is absolutely vital in our rural areas of South Australia.

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