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House of Assembly - Fifty-Fifth Parliament, First Session (55-1)
2023-07-05 Daily Xml
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Estimates Vote

Department for Trade and Investment, $118,542,000

Administered Items for Department for Trade and Investment, $1,375,000


Minister:

Hon. N.D. Champion, Minister for Trade and Investment, Minister for Housing and Urban Development, Minister for Planning.


Departmental Advisers:

Mr D. Reynolds, Chief Executive, Department for Trade and Investment.

Ms J. Burgess, Chief Operating Officer, Department for Trade and Investment.

Mr C. Wood, Executive Director, Invest SA, Department for Trade and Investment.

Mr T. White, Director, Trade, Department for Trade and Investment.

Ms R. Lang, Manager, Finance, Department for Trade and Investment.


The CHAIR: Welcome to today's hearing for Estimates Committee B. I respectfully acknowledge the traditional owners of this land upon which the committee meets today and pay our respects to them and their cultures, and to the elders both past and present.

The estimates committees are a relatively informal procedure and, as such, there is no need to stand to ask or answer questions. I understand that the minister and the lead speaker for the opposition have agreed on an approximate time for the consideration of proposed payments, which will facilitate a change of departmental advisers. Can the minister and the lead speaker for the opposition confirm that the timetable for today's proceedings previously distributed is accurate?

The Hon. N.D. CHAMPION: I can.

The CHAIR: Changes to committee membership will be notified as they occur. Members should ensure the Chair is provided with a completed request to be discharged form. If the minister undertakes to supply information at a later date, it must be submitted to the Clerk Assistant via the Answers to Questions mailbox no later than Friday 8 September 2023.

I propose to allow both the minister and the lead speaker for the opposition to make opening statements of up to 10 minutes each, should they wish. There will be a flexible approach to giving the call for asking questions. A member who is not on the committee may ask a question at the discretion of the Chair.

All questions are to be directed to the minister, not the minister's advisers. The minister may refer questions to advisers for a response. Questions must be based on lines of expenditure in the budget papers and must be identifiable or referenced. Members unable to complete their questions during the proceedings may submit them as questions on notice for inclusion in the assembly Notice Paper.

I remind members that the rules of debate in the house apply in the committee. Consistent with the rules of the house, photography by members from the chamber floor is not permitted while the committee is sitting. Ministers and members may not table documents before the committee; however, documents can be supplied to the Chair for distribution.

The incorporation of material in Hansard is permitted on the same basis as applies in the house; that is, it is purely statistical and limited to one page in length. The committee's examinations will be broadcast in the same manner as sittings of the house, through the IPTV system within Parliament House and online via the parliament website.

I will now proceed to open the following lines for examination. The portfolio today is the Department for Trade and Investment. The minister appearing is the Minister for Trade and Investment. I declare the proposed payments open for examination. I invite the minister to make an opening comment, if he so wishes, and to introduce his advisers.

The Hon. N.D. CHAMPION: I will begin by introducing the department officers who are here with me today: David Reynolds, Chief Executive, Department for Trade and Investment, who of course needs no introduction really, and Timothy White, Director, Trade, Department for Trade and Investment. To my right is Christopher Wood, Executive Director, Invest SA, Department for Trade and Investment. Behind me are Rebecca Lang, Finance Manager, Department for Trade and Investment, and Julie-Anne Burgess, Chief Operating Officer, Department for Trade and Investment.

I would like to begin by thanking all of the department officials and all of the staff of the Department for Trade and Investment for their hard work over the last 12 months. Clearly, this is a tumultuous time in world relations and international trade relations. Since the last estimates, we have seen the return to normalcy post the great disruption of COVID, but we have also seen around 17 months of war in Europe, which has disrupted international trade, disrupted supply chains and, most notably, disrupted energy markets.

All of our industries have to live with both the consequences of that and the ramifications of that, both on the downside and sometimes on the upside. It has not been a normal period, I think, in global trade, and looking forward I suspect it will not get any calmer in the next 12 months. That said, we have seen our relationship with China stabilise and some improvements and openings in the barley market most notably, which assists, and we look forward to that continuing stabilisation effort between the commonwealth government and the People's Republic of China. We think that is a critical trading relationship for South Australia. Over and above that, we are diversifying our trade as best we can with the rest of the world.

In terms of the priorities for the department, they have been around a restructuring, a resumption in normal operation in our international networks and our trading relations, the fulfilment of the government's election commitments in regard to Brand SA and Invest SA, and helping to assist the other government efforts in relation to AUKUS in particular. The AUKUS announcement, which is a landmark international agreement between the UK, the USA and Australia, obviously has great importance for our state, particularly for defence supply chains and investment and trade.

Likewise, hydrogen and renewable energy: in 16 years we have gone from having 1 per cent renewables to now 70 per cent renewables in our grid, and we are ranked number one globally in annual renewable energy production, according to the IEA. So we have a tremendous head start in that area, and the department is here to see more investment in renewable energy projects to help assist other government departments with the Hydrogen Jobs Plan. That has been of great interest in our international business missions.

On our international business missions, we have seen visits to Japan and South Korea in October 2022 to attend the Australia Japan Business Co-operation Committee meeting. That was with the Premier and Minister Koutsantonis as well. It was a very important opportunity and our first business mission. Obviously, there was a key focus on hydrogen as a result of that, along with some of the other priorities.

We returned to Japan and also visited Singapore in March 2023. That was focused on hydrogen and renewables as well. We attended the Fuel Cell Expo, which is the region's largest hydrogen conference. We also appointed Mr Martin Haese as the South Australian government's Special Envoy to Singapore and South-East Asia.

In May 2023, we visited the United Kingdom, France and Italy as part of the UDIA study tour, which is more related to my planning portfolio, but I took the opportunity to attend a number of trade and investment meetings and events with key stakeholders, particularly in the United Kingdom. There was obviously a focus on the new Australia-UK Free Trade Agreement while we were there and its particular impacts on defence and food and wine.

Most recently, in June 2023, we visited the United States and attended the BIO International Convention in Boston. It is the world's largest biotech conference and had a number of participants from South Australian industry and also from the University of South Australia. We also had meetings in defence, tech, South Australian wine, and visited Washington and announced the state's sixteenth international trade and investment office. That announcement was made as part of two new international offices since estimates last met, in Frankfurt and in Washington, and both of those play pivotal roles in those priorities around hydrogen, renewable energy and, of course, defence through AUKUS.

We have re-established Brand SA, which was established to raise the profile of South Australian businesses and guide consumer choices towards local products. It does not need saying that the former government had abolished funding and support for Brand SA in June 2019. We have re-created Brand SA; established a board of six members, chaired by Jane Jeffreys; begun the Spend Your Support campaign to assist River Murray businesses in need; partnered with Gluttony Food and Wine Festival, with South Australian food and top Riverland wines and spirits on centre stage; partnered with Food SA to deliver activities for the food and beverage sector, both locally and interstate; supported the Adelaide 36ers, who wore the Brand SA logo on their uniform in their historic victory against the Suns in Phoenix, Arizona, and we got great coverage out of that; relaunched the Eat Drink Local campaign in partnership with Food SA; and over the course of the next few months Brand SA will be bringing back a Buy Local statewide campaign.

In terms of Invest SA, we have facilitated a billion dollars in investment within South Australia. We have helped to assist on the government's major events strategy, which has been all about placing South Australia on an international and national stage, along with attracting visitors to our state. We are also using those opportunities—and will use those opportunities increasingly in the future—to attract investors. We know that one in three of the dollars investment are from non-traditional industries, and we want to use Invest SA to complement market diversification and economic complexity in South Australia.

In terms of trade, obviously we have had a very strong 12 months to March 2023. Merchandise exports are at $17.24 billion, an increase of 25.6 per cent. We have seen strong growth in export values continue in the United States, Malaysia and Philippines. Some of the ramifications of the war in Ukraine we saw show up in wheat sales to places like Sudan and the like, so it has been a very strong result for South Australian miners, farmers and businesses which export, and I would like to thank them for their efforts on that front.

Wine is one of our most notable exports; it is one of our most important industries. We know there have been disruptions to trade over the last two years or so, which have been very difficult to deal with, but nonetheless we have continued with the previous government's diversification efforts—we think that is worthwhile. We have established the South Australian Wine Ambassadors Club. We launched that in August 2022. We have 27 wine importers recruited, 16 brands introduced to new markets.

The Department for Trade and Investment has also assisted, through its overseas office network, by facilitating 20 wine promotional events, and assisting in 73 wine programs and campaigns. We have also provided 147 TradeStart services to 78 wine exporters in the second half of 2022. It is one feature that has become fairly regular, certainly in my overseas business missions, and hopefully in the future all government ministers will have an opportunity to do a wine promotional activity because it is very useful and very important; we think it is an all-of-government effort.

In closing, we have a very clear vision about using Invest SA and Brand SA, not just to fulfil election commitments but to fulfil objectives for the state. We want to have strategically targeted international markets and networks that fit with the state's economic priorities, and we want to make sure our global footprint works for the government and for South Australian exporters, and of course we want to make sure, as far as we possibly can, that we keep up these really good trade conditions that we have at the moment. With that, I will hand to the opposition.

The CHAIR: Thank you, minister.

The Hon. N.D. CHAMPION: Actually, I might just add one other thing for the benefit of the opposition. We have Elinor Walker here as well, who is the head of the infrastructure unit as part of Planning, but it is a direct report to Mr Reynolds, so we can have questions about the infrastructure unit in this estimate session, but I think it fits better with Planning later on in the day, so I am happy to do it in either.

The CHAIR: Does the lead speaker for the opposition have an opening statement?

Mr WHETSTONE: No, I will get on with questions. Listening to the minister, I think obviously trade has been a very important economic driver for the state and it is great to see the current government riding on some of the coat-tails of the former government. It is continuing work—no political pointscoring—but I have to agree with the minister on how important the trade opportunities are for South Australia's economy. Minister, I refer you to Budget Paper 3, page 23. Can you explain why the department has overspent its 2022-23 operating budget by $24 million?

The Hon. N.D. CHAMPION: It is not an overspend. It is additional budget adjustments, which include $7.3 million in carryovers from 2021-23 in grant payments; $3 million for a state contribution to support BioCina establish an end-to-end mRNA manufacturing facility in South Australia, which is down in the Thebarton bioprecinct; and $11 million under the Land Services SA contract in relation to additional activity, which brought in an extra $41.4 million in revenue to the state under the Real Property Act, and that revenue is reflected in the department's administered entity. So it is not so much an overspend as additions.

Mr WHETSTONE: The 2022-23 budget estimates are $169 million in operating expenses for the 2023-24 year, but this year's budget allocates $183 million. Can you explain the $14 million increase? You cannot, but someone can?

The Hon. N.D. CHAMPION: I am getting the accurate answer for you. I know this is a happy, bipartisan affair. Do you have a page reference, Tim?

Mr WHETSTONE: Page 23, Budget Paper 3.

The Hon. N.D. CHAMPION: Basically, it reflects the answer to the previous question. Essentially, there are lower grant payments and less activity under the Land Services SA contract, but I am happy to get you a more detailed answer.

Mr WHETSTONE: Moving on to ministerial office resources, I refer to Budget Paper 4, Volume 4, page 109. The 2022-23 budget for ministerial office cost of provision was $2.296 million, compared with $2.5 million in this year's budget, with an increase of just one FTE. Can you explain the $214,000 increase?

The Hon. N.D. CHAMPION: I might have to take that on notice and get back to you.

Mr WHETSTONE: Under workforce summary, the FTE difference between the 2021-22 actual and the 2022-23 estimated result increased by 18.9 FTEs, seven more FTEs than what was budgeted for. Can you give me an understanding of why that happened?

The Hon. N.D. CHAMPION: That was the result of some vacancies in the department, and they will be filled by the end of the year, so we will be at that 380 figure by the end of the year. Do you want to know why there is that seven extra?

Mr WHETSTONE: I just wanted to know the reason for the increase in the 18.9 FTEs.

The Hon. N.D. CHAMPION: Apparently, there were vacancies at the end of 2021-22 that were not filled. We expect them to be filled. One of the issues that I think the whole state is feeling, private employers as well, is that it is difficult to recruit staff at the moment.

Mr WHETSTONE: What are the roles of these additional FTEs that have come in?

The Hon. N.D. CHAMPION: They are not additional roles; they are filling standard roles within the department. We will get the exact breakdown for you.

Mr WHETSTONE: Alright. The 2023-24 budget estimates 380.6 FTEs. What is the reason for a decrease? The 2022-23 estimate was 390.6; the 2023-24 budget is 380. Has the department laid off 10, or lost 10 through attrition? What was the reason for that, or have I just answered it for you?

The Hon. N.D. CHAMPION: They are the result of savings measures by the government.

Mr WHETSTONE: Do you and your department have a clear plan and time line in place for staff who are working from home? Is there a road map for your staff to be returning back to the office?

The Hon. N.D. CHAMPION: People are largely back in the office now, but there is flexibility within units and with managers for people to work from home, where that is appropriate. There is not a ministerial policy. Most people are back at work and there is flexibility for managers within their own units.

Mr WHETSTONE: So there is no plan within your office or within the department for people to achieve KPIs working from home as opposed to working in the office?

The Hon. N.D. CHAMPION: Do you mean performance management generally? It is not an issue I involve myself in, as a minister. I expect Mr Reynolds to run the department. I think that is what the chief executive officer is there to do. If I may be so bold as to say, when we have discussed those issues, Mr Reynolds believes that it is all about performance management generally. You are trying to manage a workforce in a sophisticated way. Most of the department officials work very hard and most of them do a terrific job, I am sure. If there are performance management issues, then they happen regardless of whether someone is partly working from home or working at the office.

Mr WHETSTONE: That brings me to the question: what is the current proportion of staff that are working from home currently, or have worked from home in the last 12 months?

The Hon. N.D. CHAMPION: We believe approximately 65 per cent have some access to flexible working arrangements.

Mr WHETSTONE: Sixty-five per cent?

The Hon. N.D. CHAMPION: During the last two months.

Mr WHETSTONE: Moving on to trade and investment, net cost, I refer to Budget Paper 4, Volume 4, page 110, which states that $44.586 million was budgeted towards trade and investment net costs in 2022-23. Why has this been amended to $40.754 million in this budget?

The Hon. N.D. CHAMPION: We might take that on notice and return it to you. Apparently there are a lot of different factors in those numbers between the two years.

Mr WHETSTONE: On the same reference, last year's budget 2021-22 estimated result for trade and investment net cost was $57.353 million. This budget shows the actual 2021-22 was $36.628 million. Can you give me a reconciliation of those numbers?

The Hon. N.D. CHAMPION: Some of that reflects the carryovers that we referred to in your first question, the $7.3 million worth of carryovers in 2021-22. There was a bunch of carryovers for grant payments and it just reflects that.

Mr WHETSTONE: $12 million?

The Hon. N.D. CHAMPION: It was $7 million.

Mr WHETSTONE: There is another $5 million somewhere.

The Hon. N.D. CHAMPION: We will take it on notice for the other $5 million.

Mr WHETSTONE: What measures will be put in place to meet the $46.904 million estimated in this budget?

The Hon. N.D. CHAMPION: So you are asking me a question about the future? Obviously, the departments do not set out to have underspends. We set out to achieve our objectives and that is what we will do.

Mr WHETSTONE: But you have an estimated budget. You have an estimate in the budget for expenditure: $46.904 million as opposed to a budget in 2023 of $40.7 million. Can you give me an understanding of what measures you are putting in place? Is it meeting efficiency savings or is it reducing programs?

The Hon. N.D. CHAMPION: Some of that is savings and some of it is just continuing the government's programs.

Mr WHETSTONE: Continuing? Are there any programs to be cut or removed from the budget?

The Hon. N.D. CHAMPION: No programs are being cut this year.

Mr WHETSTONE: Moving on to minor capital works, on the same reference point, page 111, can you provide a breakdown of what the minor capital works are and how much of the $1.4 million is attributed to each?

The Hon. N.D. CHAMPION: One million dollars of that is just the upgrades. There is a continuing cycle of upgrades on the PlanSA website. We are running a full electronic system that is dealing with—do not quote me on it—over 40,000 planning applications at the moment. We can probably give the exact figure later on in Planning. There are just constant upgrades of that system that went on over the period of both the previous government and this government and that will probably continue. The great bulk of it is PlanSA and then the other $300,000 is IT equipment.

Mr WHETSTONE: Under the issue of programs, what annual programs is your department committed to? I note that there are no programs listed in the budget. The question is: why are they not listed in the budget?

The Hon. N.D. CHAMPION: Are we talking about investment?

Mr WHETSTONE: Page 111.

The Hon. N.D. CHAMPION: We just have annual programs, which traditionally have not been listed. What have been listed in the past are projects, and we do not have any projects this year. We only have ongoing programs.

Mr WHETSTONE: As far as programs are concerned, has the Thomas Foods infrastructure project been finished, or has it ended?

The Hon. N.D. CHAMPION: Are you talking about the infrastructure project with the plant? It was for some infrastructure upgrades.

Mr WHETSTONE: I think it was roads, actually.

The Hon. N.D. CHAMPION: Yes. As I understand it, the majority is paid. There is a little bit remaining. We will get the exact number for you.

Mr WHETSTONE: Does that come out of your budget, or does it come out of Primary Industries? I suppose that is a tricky question.

The Hon. N.D. CHAMPION: It comes out of our budget.

Mr WHETSTONE: Is the Australian Space Park program still continuing?

The Hon. N.D. CHAMPION: The Deputy Premier has dealt with that issue at a previous estimates hearing.

Mr WHETSTONE: I do not know whether she did, but that is alright. Are you able to tell me if the Space Park has been discontinued?

The Hon. N.D. CHAMPION: The Space Park is in the Deputy Premier's portfolio, and as I understand it, she has dealt with it. As I understand it, the Deputy Premier had a number of questions on the Australian Space Park and the Common User Facility. I think she informed the parliament that ATSpace and Q-CTRL had withdrawn, Fleet and Alauda remained involved and the state government remained involved. I think the Deputy Premier dealt with this in a previous estimates hearing.

Mr WHETSTONE: Has the plant protein program been discontinued?

The Hon. N.D. CHAMPION: No, but I would say that we are still in negotiations with the commonwealth on that.

Mr WHETSTONE: Is the wine expansion and diversification program continuing?

The Hon. N.D. CHAMPION: Yes, but I will get the exact number of years. That was a four-year program funded from July 2021, and we have continued it. That is what the South Australian Wine Ambassadors Club and many of the promotional events through our international networks have done. You would have seen the activity through my releases as well, but basically we have done 75 campaigns delivered in 23 international markets since July 2021, and that is representing 1,600 brands and 16 wine regions.

So it is broadly continued. We have launched the South Australian Wine Ambassadors Club, which is a new element of that program. It was a four-year program put in place by the previous government, and we have kept it and kept up the activity on it as well.

Mr WHETSTONE: Just for clarification, is the wine ambassadors program a rebranded wine capital program? There was a wine ambassadors program in place. It had a different name. You have called it the ambassadors program, but is that a continuation of the Great Wine Capitals program?

The Hon. N.D. CHAMPION: No, it is new. Of course, you are welcome anytime to come to the events. We have had a couple of Riverland producers at both the last couple of events.

Mr WHETSTONE: Of course. They are finding themselves.

The Hon. N.D. CHAMPION: Indeed.

Mr WHETSTONE: Is the South Australian Landing Pad Program continuing?

The Hon. N.D. CHAMPION: Money is still being expended through the program for the next 12 months, and then we have to make a decision about whether we fund it internally and whether or not we continue with it. It continues to run for 12 months, and then we have to decide whether the department funds it internally.

Mr WHETSTONE: Are you able to tell me how it has performed, how many projects it has facilitated over the last 12 months?

The Hon. N.D. CHAMPION: In 2022-23, there were 14 companies participating in Landing Pad and 14 companies are estimated to have created 350 jobs within 12 months of establishment, and there are an estimated 1,300 jobs within three to five years of establishment.

Mr WHETSTONE: So 350 jobs were created in the last 12 months?

The Hon. N.D. CHAMPION: That is estimated.

Mr WHETSTONE: And there are an envisaged 1,300 jobs throughout the course of the program?

The Hon. N.D. CHAMPION: Within three to five years of establishment, but these are estimates.

Mr WHETSTONE: Moving on, I refer to Budget Paper 4, Volume 4, page 112, Invest SA. How much has been budgeted towards Invest SA annually?

The Hon. N.D. CHAMPION: It is $4 million over the estimates. We will get the exact breakdown year by year for you.

Mr WHETSTONE: What is the breakdown for Brand SA's expenditure since its establishment?

The Hon. N.D. CHAMPION: I can give you the year by year amounts that are spent; it will not have the elements in it. For 2022-23, the original budget was $2 million. The revised budget was $1.25 million. The budget for 2023-24 is $2,250,000; for 2024-25, $1.8 million; and for 2025-26, about $1,077,000.

Mr WHETSTONE: Being in the forward estimates, obviously there must be dedication towards branding or to projects. How many campaigns has Brand SA run since its establishment? You might have already said this.

The Hon. N.D. CHAMPION: Some of it was covered in my introduction; I am happy to run through it again. You must remember that Brand SA has only just been established and we are doing it off a cold start, but since they have been established they have provided support for the 36ers on their US tour, and partnered with Food SA to showcase South Australian produce both locally and interstate. I can get you an exact breakdown of the Food SA events.

It delivered the Spend Your Support campaign—a pre-Christmas campaign—which was all about supporting flood-affected businesses in South Australia's Murray River regions, partnered with Gluttony, a food and wine event. That was all about delivering brand awareness, supporting local products and services and the like.

We have partnered with Business SA for an AFL Gather Round official business lunch. That was all about driving the visibility of the state brand, and 700 attendees received a selection of South Australian products, along with vouchers to spend in South Australia. We are launching a new statewide Buy Local campaign, which is in development and will be in market in August 2023.

Mr WHETSTONE: Sorry to bore you with a repeat there.

The Hon. N.D. CHAMPION: That is alright.

Mr WHETSTONE: Can you elaborate on the—was it the River Murray business support program?

The Hon. N.D. CHAMPION: Spend Your Support?

Mr WHETSTONE: Spend Your Support.

The Hon. N.D. CHAMPION: Yes.

Mr WHETSTONE: Can you elaborate on that, please?

The Hon. N.D. CHAMPION: That was a campaign run as part of an overall package. It was a pre-Christmas campaign and we launched it at the Central Market. I can get you an exact list of people who were there. It was designed to help consumers support Riverland businesses. The effect of these is always cumulative but the department and I, as minister, wanted to do the things that we could do within my portfolio area to help the Riverland. In planning we have obviously done a number of things, which we can cover later on in the session, but this was Brand SA's effort to be part of that statewide flood response.

Mr WHETSTONE: Do you have an evaluation process to award money to campaigns or promotional initiatives?

The Hon. N.D. CHAMPION: That one was run within Brand SA. The review we would do is run by Brand SA, by the department. Obviously, we would look at how much economic activity it generated, but it was part of a suite of measures designed to assist flood-affected communities and, as a result, we would not be analysing it in and of itself, it would be analysed as a broader effort. As you know, there were a number of other engagements by government to help flood-affected communities because there was public sympathy for those communities and, at that time in December, they were obviously facing very tough conditions up there—which I do not need to tell you about.

Mr WHETSTONE: Thank you, any support is appreciated. Is there a planned time line for the ongoing Buy Local campaign? Do you have a road map for how that will roll out and continue to roll out?

The Hon. N.D. CHAMPION: We are going to roll it out in August 2023, and then it will be out there in the marketplace. I suppose with all of these programs, you have to meet—it is a pretty delicate balance for policymakers because you have to both make sure the programs have a long enough time in the market to demonstrate that they can be effective, and then you have to balance that up by measuring their effect. We will put it into the marketplace.

I suspect Buy Local campaigns are, by their nature, long term and by their nature they are about building some of that esprit de corps in South Australia. We already have that. Most of the business community that I talk to, and the public more generally, know that we have had a pretty good 12 months and people feel as if something has changed in South Australia, particularly off the back of the major events. This just goes to assisting that general pride in state and a desire to support particularly small and family businesses within the state, which we have a great culture of and, of course, that Food SA and others represent.

Mr WHETSTONE: What criteria was used to appoint the members of the Brand SA Board?

The Hon. N.D. CHAMPION: The advisory board was selected for their expertise. We have Jane Jeffreys, who is a very experienced board chair; Callum Hann, who is a very prominent chef and businessperson; Rebecca Morse, a very respected journalist; Jade Torres, who is an Indigenous businesswoman; George Georgiadis, who has his own business selling gin; and Franklin dos Santos, who is the head of Foodland in South Australia. They are all people of prominence in South Australia, and we think they make a very competent, well-qualified board.

Mr WHETSTONE: Yes, I do not have any issues with that.

The Hon. N.D. CHAMPION: The government selects—

Mr WHETSTONE: The government made the call.

The Hon. N.D. CHAMPION: Yes, the government made the call. It was an action of government.

Mr WHETSTONE: Can you try to give me an understanding as to why there is no regional representation on the board?

The Hon. N.D. CHAMPION: In the first instance, we were re-establishing Brand SA after its funding had been discontinued, so we were putting it back into place. We put a board in place that we thought reflected the skill and expertise that would allow the government to fulfill its election commitment. I am certainly open to arguments about regional representation, and I have put, for instance, the first person from regional South Australia on the Renewal board, so I am certainly willing to contemplate those arguments.

Mr Reynolds reminds me that Mr Georgiadis is from McLaren Vale. I am not sure if that is as regional as perhaps the member would like, but I understand the point you are making. I think we have a very well-qualified board and I think they are going to do a great job for regional South Australia as well.

Mr WHETSTONE: I guess the point I am trying to make is that it is always good to see a balance and some regional representation can always put some level of diversity on any board.

The Hon. N.D. CHAMPION: I welcome the suggestion.

The CHAIR: It is a very good suggestion.

The Hon. N.D. CHAMPION: It is a very good suggestion and the Chair thinks so as well. I should know, having grown up in country South Australia, that it should always be at the forefront of my mind.

Mr WHETSTONE: Thank you for your protection, Chair. What export assistance and programs are the department utilising to facilitate trade outcomes?

The Hon. N.D. CHAMPION: At the moment, we have the Global Expansion Program, which provides up to $50,000 per company, supporting high-growth, export-ready businesses, and the Landing Pad Program, as well as providing TradeStart advisers.

Mr WHETSTONE: Under targets, one of the targets was to facilitate $750 million of foreign investment into South Australia. I am interested to know why the budget removed the word 'foreign'.

The Hon. N.D. CHAMPION: Investment is good for jobs, it does not matter if it is foreign or domestic. As long as it is coming to South Australia and creating jobs and economic activity, we think that is enough. Foreign investment is important and we welcome it, but the nature of business now is that investment generally is the name of the game.

Mr WHETSTONE: Do you think it is potentially trying to alleviate any political headwind when it comes to bringing investment into South Australia? That conversation is reasonably robust with foreign investment. Would it be fair to say that that just alleviates any headwind within conversation with—

The Hon. N.D. CHAMPION: If you are talking about generally in the community, I do not think the community are looking at the budget papers as forensically as perhaps the honourable member is.

Mr WHETSTONE: You would be surprised.

The Hon. N.D. CHAMPION: Maybe. I am very keen on not just investment coming in; there are a number of South Australian companies who are the foreign investors in other countries. As you know, there are a number of South Australian businesses now investing in foreign markets. They have factories in foreign markets, have plant and businesses in foreign markets. That is good for South Australia. When South Australian businesses grow and invest elsewhere, that is good for us as well.

Is that domestic investment? Is it foreign investment? That is why it is better to have I think a generic investment term. Obviously, the public know when it is a foreign investor or when it is not. I guess the honourable member's suggestion was not a consideration in terms of the budget paper. We just wanted to have a general investment category.

Mr WHETSTONE: Sure. Can you tell me how much of the $975 million investment facilitated is foreign?

The Hon. N.D. CHAMPION: There is $750 million that is foreign and $290 million that is national.

Mr WHETSTONE: With the breakdown of that, is Australian investment overseas considered in your numbers?

The Hon. N.D. CHAMPION: No, although it would not be a bad figure to have when we are looking at all of these figures, because if a South Australian business invests in another country and then repatriates profits from there, that is a good thing for South Australia. On my overseas trade missions I have actually been surprised about how many South Australian businesses are now present in foreign markets and making a real go of it.

Mr WHETSTONE: Generally, the reason I ask that is that we consider anything that is exported out of this country as a number, as a part of our economy, so the reason for that question is: if we are putting the price of wine that is exported out of this country, are we not putting the monetary value of business that is set up in another country? That was the reason for the question.

The Hon. N.D. CHAMPION: I think there is probably a broader conversation about the nature of trade and investment. We are very focused on product export. I think that is because it is a core part of our economy. Perhaps we need a set of measurements about investments going out, services in particular and the importance of all of that in our trade performance.

Mr WHETSTONE: The $975 million target is $225 million more than expected. The department's export assistance program also facilitated $10 million more than expected, so why have the targets for this year remained the same despite exceeding expectation?

The Hon. N.D. CHAMPION: The answer for that is there is an attempt to have long-term targets, because the variations of international trade are frankly beyond state governments. We have just had an absolutely rip-roaring year in terms of international trade. It is very rare that you have good prices—

Mr WHETSTONE: Do not tell the wine industry that.

The Hon. N.D. CHAMPION: No, that is right, but even in the wine industry there has been a lot of diversification, and it is notable. It varies from region to region, and from variety to variety, but we have had a very good trade year, but next year there might be an entirely different set of circumstances. If there was any cessation of the conflict in Ukraine and the ports opened there, that would obviously have a big effect on our grain industry, so you have to pick long-term goals, so that you can account for the gyrations of the world.

Mr WHETSTONE: Yes, I understand. I refer to Budget Paper 4, Volume 4, page 113. The explanation of significant movements states that a decrease in income is primarily due to lower commonwealth funding for TradeStart. Can you expand on that, please?

The Hon. N.D. CHAMPION: There have been complicated negotiations with the commonwealth. Apparently, they have just finalised, so we now have another contract for 12 months with TradeStart, but it had not been finalised until after the publication of the papers. We can get you an accurate update on that. I just want to clarify on that foreign investment stuff: it was $710.4 million in foreign investment and $290 million in local. I think I said a slightly different figure, not by much, though.

Mr WHETSTONE: Are you able to give me a better understanding of how that $710.4 million was represented?

The Hon. N.D. CHAMPION: We could probably give you segments, categories, of where it came from, but I will take that on notice.

Mr WHETSTONE: Was any of that $710.4 million directly through your attraction program?

The Hon. N.D. CHAMPION: Invest SA's job is to facilitate and engage with all of the investors coming in and case manage, so it is not as a result of a program; it is a result of Invest SA's mission, if you like, because their mission is to facilitate investment as it comes in. The whole idea of it is that we give investors a highly case-managed service.

Mr WHETSTONE: Would it be fair to assume that a majority of that investment has not just happened over the last 12 months? That is something that has been building, and then has been finalised in the last 12 months?

The Hon. N.D. CHAMPION: I think the answer to that is that there are a range of investments. Some of them have been very long term, some of them have been medium term, and some of them have been short term and transactional.

Mr WHETSTONE: The good work of this guy here, the former minister.

The Hon. N.D. CHAMPION: I have praised both of you—

Mr WHETSTONE: I am being kind to everyone here.

The Hon. N.D. CHAMPION: —on occasion. Some of them date back beyond even the previous government. Trade is, by its nature, a long-term game, and we try to make it as much of a bipartisan effort as we can because we are all team South Australia.

Mr WHETSTONE: Hear, hear! Minister, performance indicators: how much of the once-off energy and mining sector peak contributed to the $975 million?

The Hon. N.D. CHAMPION: Energy and minerals was 46 per cent of it, and I will find out exactly how much of it is minerals.

Mr WHETSTONE: I think that was in that timely news piece this morning in the paper, was it not? It did not mention you once.

The Hon. N.D. CHAMPION: Mate, I am a team player.

Mr WHETSTONE: Take it for the team.

The Hon. N.D. CHAMPION: Sorry, I should not call you 'mate' in the chamber.

Mr WHETSTONE: Do not do that, for goodness sake, gee whiz!

The Hon. N.D. CHAMPION: The Chair should protect you from that. I am a team player—team South Australia.

Mr WHETSTONE: Again. I am hoping this will not be a scenario. Can you provide a breakdown of the 4,000 new jobs that will be secured through Invest SA's initiative. Can you give me an understanding of the breakdown of those jobs, full-time and contract jobs?

The Hon. N.D. CHAMPION: Just erring on the side of caution, some of those are going to be the subject of commercial-in-confidence, so we will take it on notice and endeavour to give you an appropriate answer that is careful of the range of factors concerned. But the department, by its nature, always runs a very hard ruler over these numbers. They are not guesstimates.

Mr WHETSTONE: The numbers in the budget—there has been an upgrade, as I said, in today's media piece. Today, it was 4,300 jobs expected, with $1 billion of investment into South Australia. It was a thousand of high tech, 300 in creative. There are 3,000 new jobs. Are they new or is there an existing component with that headline?

The Hon. N.D. CHAMPION: They are all new jobs as a result of deals over the last 12 months.

Mr WHETSTONE: You said that 46 per cent came through energy and mining, 20 per cent came through defence. Are you able to give me a breakdown of the remainder, the 34 or 35 per cent?

The Hon. N.D. CHAMPION: Subject to the commercial-in-confidence issues, we are happy to take it on notice and—

Mr WHETSTONE: I am not looking for individual cases. If we break it down to food and beverage, space and high tech, there must be a component there where we can see an emerging—

The Hon. N.D. CHAMPION: Yes, sure. Like I said, I am happy to provide the answer on notice.

Mr WHETSTONE: The question I have to ask: is your chief executive for Invest SA, Chris Wood, essentially doing your job?

The Hon. N.D. CHAMPION: I do not—

Mr WHETSTONE: I know you are a team player for SA.

The Hon. N.D. CHAMPION: I do not know what budget line you are talking about.

Mr WHETSTONE: I am looking at the $1 billion invested, the good work of Chris. No disrespect to you—

The Hon. N.D. CHAMPION: It sounds disrespectful.

Mr WHETSTONE: No, come on.

The Hon. N.D. CHAMPION: I would hate to see if you were really giving me a hard time.

Ms Hutchesson interjecting:

Mr WHETSTONE: You have to watch out for the member for Waite. She attacked me yesterday.

Ms HUTCHESSON: I take offence to that.

The CHAIR: Let's not go there.

The Hon. N.D. CHAMPION: There is no budget line for that question. Go on, let's have this debate. I saw your grievance speech.

Mr WHETSTONE: I congratulate Mr Wood on the great work that he is doing on the back of the former government.

The Hon. N.D. CHAMPION: He is a fine public servant—

Mr WHETSTONE: He is.

The Hon. N.D. CHAMPION: —and an excellent bit of recruitment by Mr Reynolds.

Mr WHETSTONE: I was just going to say, Mr Reynolds seems to be missing out there, so I am glad you have mentioned his name as well.

The Hon. N.D. CHAMPION: I praise them all. They are all very hardworking.

Mr WHETSTONE: Moving on to page 114, the value of export deals mentions a one-off large-scale trade outcome in the creative industries sector. What is that referring to?

The Hon. N.D. CHAMPION: That is a commercial-in-confidence deal at the moment. I will take it on notice and get the most cautious and careful answer for you.

Mr WHETSTONE: The member for Unley would be very disappointed that you did not mention what it was. What I would say is that the 2023-24 target is only $50 million. Will the government pursue more ambitious projects in the creative industries, or are you pursuing more ambitious projects?

The Hon. N.D. CHAMPION: We have just extended the games rebate. I was down at Keywords Studios the other day, seeing some of the work they are doing and the expansion of their workforce. I think it was going from 20 to about 35. We have extended the games rebate, we are the first state to have it, and that will provide a program for growth in that sector. But the nature of that sector is that it is inherently lumpy in its outcome. As I said before, you set a goal and you try to meet it each and every year, but it does not necessarily build up over time.

We have all the policy settings in place. We are very supportive of the industry and we think it is a good industry. It is expanding in its employment and providing graduates—I met a young woman in the graduate program who is very excited about her future. I think it is an area that we are very interested in and supportive of, but we are keeping the targets the same because that makes sense at the moment.

Mr WHETSTONE: In regard to international network expansion, I would like to understand where we currently sit with our export initiatives. Are you able to give me a breakdown on the costs of each component of the international network expansion initiative?

The Hon. N.D. CHAMPION: In terms of the two offices, Frankfurt and Washington?

Mr WHETSTONE: It is more than that. If I take a step back, how many trade offices does South Australia currently have active?

The Hon. N.D. CHAMPION: I will list them all off, although there has been no great change since the previous government: Shanghai, Guangzhou, Hong Kong, New Delhi, Tokyo, Kuala Lumpur, Singapore, Seoul, Dubai, San Francisco, Houston, New York City, Washington and Frankfurt. The only thing I will point out is that our employee in San Francisco left because he was, as I understand it, recruited by the government of Victoria, so we are currently looking at who will fulfil that role in the future.

Mr WHETSTONE: Can I have a little bit more clarification on those trade offices? Are they all staffed by a person appointed by you, or are they staffed by an Austrade employee who wears various hats?

The Hon. N.D. CHAMPION: There are two standalone offices as well, in Jinan and the Office of the Agent General in London. The standalone offices are administered by us and then the list that I gave you before is embedded with Austrade.

Mr WHETSTONE: These offices are administered by the South Australian government?

The Hon. N.D. CHAMPION: They are our employees. We have a contract with Austrade. We recruit them, but technically they are employees of Austrade.

Mr WHETSTONE: Are they employed on a full-time basis under the South Australian banner or do they wear various hats?

The Hon. N.D. CHAMPION: They are full time for us.

Mr WHETSTONE: Full time.

The Hon. N.D. CHAMPION: That has not changed since I became minister. They are exactly the same arrangements that were in place with previous ministers.

Mr WHETSTONE: Yes, I understand. As a former government, we came in and we had the trade offices there, but they were not staffed. I am just trying to get an understanding that every trade office has a staff member there for active service.

The Hon. N.D. CHAMPION: With the exception of San Francisco, the trade network has not changed in its structure.

Mr WHETSTONE: How many trade offices in the US? Four?

The Hon. N.D. CHAMPION: We have San Francisco, which is currently vacant; Houston, which remains the same; New York City; and Washington, which we are just about to embark on.

Mr WHETSTONE: Can you give me a better understanding of how the Washington office will work?

The Hon. N.D. CHAMPION: The primary reason for Washington is AUKUS. This is a very significant agreement for South Australia. We already have offices in London, which are well established, but we did not have one in Washington, and there will be a number of matters relating to AUKUS that will require us to have a presence in Washington. Secondary, but no less important, is that there are a lot of developments from the Inflation Reduction Act as it relates to hydrogen. We need to be aware of those and aware of the detail, not just how the United States Congress might interpret the act but also the administration as well.

Mr WHETSTONE: The Special Envoy to Singapore and to South-East Asia, are they working in a standalone office or are they working as a moving operator? I do not know if I made myself very clear there.

The Hon. N.D. CHAMPION: We have a contract with Mr Haese. He is our special representative, obviously, so we do not have him based in an office like the Austrade offices or the standalone offices. This is a new arrangement that we have and we have done it specifically because Singapore is a critical hub for investment.

Mr WHETSTONE: Does he work from home?

The Hon. N.D. CHAMPION: I am sorry?

Mr WHETSTONE: Does he work from home?

The Hon. N.D. CHAMPION: Mr Haese works very hard, I can tell you. He has already had a substantial number of meetings. I have been impressed not just by his work ethic but also by some of the meetings that he has been able to secure, and that has been a very important aspect of what we are trying to do in Singapore. We obviously have an office there and that is important, but we want to make a special effort with Singapore and South-East Asia.

Singapore is the home of, I think, 300 family offices, a huge amount of investment capital, and that represents a real opportunity on a whole range of areas for investment in South Australia. It does need additional effort, and not just by the minister and not just by Mr Wood, as investors come in. We need to reach out to investors as well, and Mr Haese is uniquely positioned as a former Lord Mayor and a former head of Business SA to do that for us.

Mr WHETSTONE: Sure. I acknowledge his good work. Does Mr Haese report directly to you or to Mr Wood? How is the arrangement set up?

The Hon. N.D. CHAMPION: His contract is with the department. He reports directly to Mr Reynolds, but he has also been very keen to keep me in the loop. Mr Haese is an enthusiastic South Australian. I think he is trying to do a great job for South Australia in Singapore and in those other markets. He has been very keen to keep me aware of what the opportunities might be.

Mr WHETSTONE: Is he living in Singapore?

The Hon. N.D. CHAMPION: He lives in South Australia. He is commuting to Singapore regularly for his own business purposes. He is working on contract for us, but it is not a full-time contract. Essentially, this has been a new initiative by the government. We think it is a worthwhile initiative. Obviously, Mr Haese is uniquely suited to this role in Singapore. As I said before, there is an additional effort we want to make there. If this works, we would consider it for other places that need additional effort over and above a trade office. Trade offices do great work, but there is room for additional initiative in some places because they are particularly important to the investment task.

Mr WHETSTONE: With all trade offices, are there levels of key performance indicators that are guidelines or are given to them to achieve? Are there meeting numbers? What is the benchmark?

The Hon. N.D. CHAMPION: There is a broad set of KPIs for the trade offices, which is done in aggregate. The reporting mechanisms are exactly the same as in the previous government. They report through to the same public servant, Mr Tali Reaburn. That arrangement is exactly the same as in previous budgets and previous governments.

I have the aggregate outcomes for you, if you want to know the aggregate outcomes for 2023. There were 52 trade outcomes with export value of $A19.8 million. That is basically trade programs, bespoke business-to-business facilitation. They facilitated four investment projects with an investment value of $10.8 million, had strong results in defence, energy, minerals and food and wine and contributed to the business development opportunity pipeline through the creation of 113 active trade opportunities and 74 potential investment opportunities.

Mr WHETSTONE: Just for clarification, I read a press release from you in March, and it was stated that Mr Haese would report directly to you.

The Hon. N.D. CHAMPION: He does, but his contract is with the department and Mr Reynolds, so he reports to both of us.

Mr WHETSTONE: Mr Reynolds answers his phone.

The Hon. N.D. CHAMPION: What are you suggesting?

Mr WHETSTONE: You are a busy man.

The Hon. N.D. CHAMPION: Are you suggesting I have no phone calls from Mr Haese? Is that what you are suggesting?

Mr WHETSTONE: No, I am not suggesting that.

The Hon. N.D. CHAMPION: You would be wrong—very wrong.

Mr WHETSTONE: I am not suggesting that. That was all a bit lighthearted.

The Hon. N.D. CHAMPION: Okay. I will take it in the manner it is intended.

Mr WHETSTONE: Did the department meet its savings targets in the last financial year?

The Hon. N.D. CHAMPION: Yes.

Mr WHETSTONE: It did?

The Hon. N.D. CHAMPION: Yes.

Mr WHETSTONE: Congratulations. Are you still committed to saving your $4.7 million this financial year?

The Hon. N.D. CHAMPION: Yes.

Mr WHETSTONE: Can you explain what your operating efficiencies are and what will be implemented to achieve them?

The Hon. N.D. CHAMPION: Last year, we put in place a restructure and that restructure is of a nature that will deliver not just our savings target last year but this year as well.

Mr WHETSTONE: I want to touch back on export services. What programs are the agency providing to support startup exporters?

The Hon. N.D. CHAMPION: TradeStart advisers and global expansion.

Mr WHETSTONE: Are there any internal programs in South Australia to support startup exporters or existing exporters exporting new products, new services?

The Hon. N.D. CHAMPION: Just those two programs.

Mr WHETSTONE: Just the two, okay. There are 400 South Australian businesses that are currently exporting, as I understand. How many of those have received government support?

The Hon. N.D. CHAMPION: Of that 400, all of them have received some sort of advice or facilitation through the department.

Mr WHETSTONE: Are you able to give me some clarity on what sort of support from a certain level to an extended level of support?

The Hon. N.D. CHAMPION: The answer is that it varies from business to business, depending on what they are attempting to do through their business plan. We try to tailor our support to what they are trying to do.

Mr WHETSTONE: Just to touch on the establishment of the trade office in Frankfurt: how will the office in Frankfurt differ from other offices in that close vicinity? We have an Agent General in the United Kingdom. We will have an office in Frankfurt. What other trade offices will South Australia have in Europe or supporting offices for setting up an office in Frankfurt?

The Hon. N.D. CHAMPION: This will be our first European office, and we think Frankfurt is the right location for that. Germany is the hub of renewable energy in particular and advanced manufacturing. We think that is a right place to have a European trade office. The London office will obviously continue to service many European countries. Our Agent General there fulfills his role as well, and the last time I was there the trade office was talking about a trip to Norway and some of the Baltic states around defence. Europe is a large place. We have been doing all that work out of the London office until now and Frankfurt will be part of an additional part of the network.

Mr WHETSTONE: On the back of that, can you give me an understanding as to why the trade office in Paris has been scrapped?

The Hon. N.D. CHAMPION: Because Paris was the wrong place to put it, and Frankfurt is the right place to put it. On any objective measure, the government is confident that that is the right decision for South Australia, for our industries and for our network.

Mr WHETSTONE: As important a trade office as it will be, can you give me an understanding of staffing numbers, FTEs and resources?

The Hon. N.D. CHAMPION: It will be an office embedded in Austrade along the same lines as those others that I read out before.

Mr WHETSTONE: So there will be one staff?

The Hon. N.D. CHAMPION: One staff, yes.

Mr WHETSTONE: One FTE.

The Hon. N.D. CHAMPION: Yes, FTE.

Mr WHETSTONE: With all of the trade offices, do you independently audit those offices for their net worth?

The Hon. N.D. CHAMPION: Mr Reaburn, who has looked after the international network for the Department for Trade and Investment—and from my observation has done a very diligent job for governments of both political persuasions—is continuing in the work that he has done over the two governments. There have been no changes there; we have not changed that arrangement at all. Mr Reaburn reports to Mr Reynolds. From what I have seen, all of our trade offices do an exceptional job, but their management is a matter for Mr Reaburn and Mr Reynolds.

Mr WHETSTONE: On reflection, part of the reason behind that question was that previously there were a number of trade offices, under your former government, that were not adhering to the guidelines that were put in place and hence their jobs were terminated, hence there was no presence in those trade offices. I am trying to better understand if there is some level of that KPI where, if an office is not performing or an individual is not performing in a key global trade office, what will be the—what is the right word? There has to be some level of KPI or a performance indicator for an office to continue under its working conditions.

The Hon. N.D. CHAMPION: Essentially, the management of the trade office is exactly the same as the management of any departmental employee. It is Mr Reynolds and their direct supervisor who monitor all of that. I have not sought to intervene in any way, and I would not. That is just a normal matter for the department to manage.

Mr WHETSTONE: I apologise to the former trade minister. He does have one question he would like to ask.

Mr PATTERSON: I am really interested in getting a further update on the plant protein MMI initiative. You said you were waiting on the federal government to confirm. In terms of the parties that were involved, you had Thomas Foods, a local company, and Australian Plant Proteins—the only plant protein manufacturing company in Australia—and then AGT Food. What is the status of those three companies in terms of their interest and involvement?

The Hon. N.D. CHAMPION: They are all still interested and still involved. We are just in negotiations with the commonwealth about the nature of the funding contract.

Mr PATTERSON: I know the federal government is going through a review process at the moment, but have they committed their funding for this initiative?

The Hon. N.D. CHAMPION: Yes, the review finished some time ago, and they remain committed to this program. It is just a matter of negotiation between the commonwealth and the state bureaucracies and the parties about the contract. The funding is still in place and the program is still in place.

Mr PATTERSON: So when are we likely to see some construction start on this project, if the funding is there?

The Hon. N.D. CHAMPION: The contracts have to be signed before there can be any movement on that front.

The CHAIR: The time allotted having expired, I declare the examination of the portfolio of the Department for Trade and Investment completed. I thank all the advisers and the department for all the work you do through the year, and for all the work you have to do in the lead-up to estimates. I thank the opposition for their contribution to the process, and the minister.

Sitting suspended from 10:30 to 10:45.


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