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Legislative Council - Fifty-First Parliament, Third Session (51-3)
2009-03-03 Daily Xml
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Question Time

ECONOMIC STIMULUS PACKAGE

The Hon. D.W. RIDGWAY (Leader of the Opposition) (14:34): I seek leave to make a brief explanation before asking the Minister for Urban Development and Planning a question about the federal government's stimulus package and, in particular, the fast-tracking of approvals.

Leave granted.

The Hon. D.W. RIDGWAY: All members are aware that the federal government has announced a $42 billion stimulus package of which South Australia is to get a significant share. The Premier announced a whole range of projects on 16 February this year but in particular (and I quote from his press release) he said, 'This is about shielding us from the full impact of that economic downturn.' He went on to say:

In South Australia, we aim to have 190 primary school building programs under construction by the end of June this year. A further 500 primary school construction projects will follow, and all of these should be underway by the end of the year. These projects include public and private schools, and all must be completed by no later than March 2011.

I think the Premier is also quoted as saying that 70 per cent of these projects must be completed by the end of next year. In addition he said, 'Beginning in March 2009 [Sunday], 1,500 new social houses will be built in South Australia, to be completed by December next year.'

On 27 February this year, the minister put out a press release entitled 'Government fast tracks nation building and jobs plan projects', in which he outlined that the government would be amending the development regulations to allow the timely delivery of such projects. I will not go into all the detail of it, but basically he appoints South Australia's Coordinator-General, Mr Rod Hook, to oversee all the projects that are due to be delivered under this time frame.

This raises a number of questions. One in particular that has been raised with me relates to the fast tracking of building approvals and concerns raised by community members about inappropriate developments and fast tracking developments, which may lead to corners being cut and safety concerns within our community.

The Hon. B.V. Finnigan interjecting:

The Hon. D.W. RIDGWAY: Mr President, the Hon. Bernard Finnigan interjects. I would like you to pay attention to those interjections, if that is possible.

Members interjecting:

The PRESIDENT: Order!

The Hon. D.W. RIDGWAY: Chuck them out! One of the biggest concerns that has been raised with me is the capacity of the South Australian building community to actually deliver these projects. The HIA, the MBA, and the Property Council, the peak industry groups, do not believe that the capacity exists to deliver these projects. Also, why on earth do we have to have the projects delivered by December next year? The cynics amongst us would say that that is when it is time for the next federal election. Surely, if we do not have the capacity, a three to five year time frame would be more appropriate.

The Hon. P. HOLLOWAY (Minister for Mineral Resources Development, Minister for Urban Development and Planning, Minister for Small Business) (14:37): What an extraordinary last question.

Members interjecting:

The PRESIDENT: Order!

The Hon. P. HOLLOWAY: I would have thought that the answer was obvious to everyone. Right now we are facing the greatest global financial crisis in 70 years, and we need the money spent now, not in three years. We need the stimulus package to work now. Why do you think the federal government rushed it through parliament? The federal government has set such tight time frames because the crisis is now and not in two or three years.

We are increasingly hearing horror stories about what is happening in the economies of Europe, the United States, and many other parts of the world. Inevitably, because we are now in a global economy, some of those difficulties will be exported here. Will we be able to sell as much of our wine in the UK market when that country is experiencing such difficulties? It will take some time for that to feed through, but that is what will happen. So, we need a stimulus package right around the world that works as quickly as possible. That is the answer to the last question, and that is why the commonwealth government has set these very tight time frames.

This government has responded to the commonwealth's package. The conditions in respect of when the money will be spent are set by the commonwealth—not us. It is not necessarily the state government's choice to spend it within that time frame, but the commonwealth government has basically said, 'Either use it or lose it.' So this government intends to use it; we will use it, not lose it.

The Leader of the Opposition also talked about inappropriate development. What we are talking about here is 1,500 houses for low income people and major school buildings. There are two lots of these. There are, I think, up to 500 Australia-wide, and we hope that our share will be somewhere around 40 to 45 special projects for major secondary schools. Primary schools have access to 800 buildings. If the honourable member reckons that it is inappropriate for primary schools in this state to have major activity in new buildings or developments, he must be the only one with that view.

The commonwealth has said that we need to stimulate our economy urgently. This money is available for only a short time because, unless that money can be spent and the stimulus go into the economy immediately, it will not have the necessary benefit. They are the rules the commonwealth has set; we have accepted that. I would be very disappointed if we were not the state quickest to use this commonwealth funding, ahead of every other government.

Last week the coordinators-general of each state met on this, and it is my understanding that they are all asking for copies of our development regulations, which went through last week. That will enable us to achieve this objective because the other states are still scratching their heads, wondering how to do it, while we are getting on with it.

In relation to the last part of the honourable member's question, he was suggesting that because we were fast tracking planning approval somehow that would lead to safety issues. We are fast tracking planning approval: we are not fast tracking building approval. Everything needs building approval. In any case, most of those buildings being constructed at schools, under the ordinary rules of the Development Act, would be assessed under section 49, which is the crown development section; so, effectively, they would have gone to DAC anyway.

Perhaps I should explain to the chamber, since the honourable member has raised it, exactly how this will work. With the tight timelines that are imposed on the funding by the commonwealth, it is imperative that we avoid any logjams that would hold up the development planning approval for this significant multibillion-dollar outlay on public infrastructure.

As I said, we approved last week—and they were part of the regulations I tabled in this place a few minutes ago—to bypass local planning authorities and centralise the approval process with a specially appointed Office of the Coordinator-General. The appointment of Mr Rod Hook, the Deputy CEO of the Department for Transport, Energy and Infrastructure, as Coordinator-General was also gazetted in last Thursday's Gazette.

These amendments to development regulations are necessary to ensure the delivery of projects across the state within the timeframes that have been established by the commonwealth, and failure to meet these timeframes would result in a loss of commonwealth funding, and that would mean South Australians would be needlessly exposed to the economic fallout of the global financial crisis.

The development approval process previously requiring the input of either several government or local government agencies will be removed for projects funded by the Nation Building and Jobs Plan and will be managed through the Office of the Coordinator-General. Projects approved by the Coordinator-General for funding through the Nation Building and Jobs Plan will be exempt from planning consent.

Where there are planning issues associated with projects, the Coordinator-General will liaise with the department of planning and local government to ensure an appropriate assessment of applications against the relevant planning requirements. Prequalified contractors will be required to submit all projects relating to the Nation Building and Jobs Plan to the Office of the Coordinator-General. As I said, building rules consent will still be required, so it is nonsensical even to imply that safety regulations and requirements are being compromised by the government's decision to fast track planning approval. The same safety requirements imposed on all building works in this state will be met; no corners whatsoever will be cut in that regard. Safe building practices will not be jettisoned, and to suggest otherwise is quite outrageous.

In fact, the Coordinator-General has assured me that, in relation to safety, he will be insisting that only certifiers that also hold engineering qualifications will be accepted for engagement to undertake building rules assessment of these projects. These changes simply allow planning approvals to be centrally coordinated and avoid bottlenecks as the planning authorities are inundated with development applications. For the fiscal stimulus package to have maximum impact on the local economy, projects need to be approved and construction work has to begin as quickly as possible. I think only an economic illiterate would think that it was sensible policy to delay a stimulus package until after the global financial crisis has hit our economy. I notice that the leader put out a press release the other day, calling this 'A dash for cash'. However, rather than a 'dash for cash', this is the sort of package that will not only cushion the South Australian economy but provide a legacy for decades to come by providing much needed public infrastructure for our schools and communities.

Members interjecting:

The Hon. P. HOLLOWAY: A legacy of debt! The honourable member should really think about what would happen if there was not a stimulus package and we had the sort of economic decline they have had in Europe. The debt would be far greater. Yes, a stimulus package will add to debt but, if it is successful, it will avoid an even bigger debt if the economy crashes like it has in some other parts of the world. You have only to look at Spain, which I think has over 20 per cent unemployment. What do you think unemployment at the sort of level they have in parts of Europe at the moment would do for debt? Yes, a stimulus package will add to debt, but it will be a lot less debt than otherwise would be the case.

We know where the Liberal Party stands on taking a proactive approach to protecting Australians from the worst economic consequences of the global economic downturn, given the Liberal Party's outright rejection of the stimulus package in the federal parliament. The Liberal Party would rather let South Australians bear the full brunt of the economic tsunami heading our way than take decisive action to limit its damage.

The timing of this nation building exercise is part of the policy prescription. Allowing projects to be delayed simply because local planning authorities cannot cope with the sudden surge in applications is just bad economics, and it would unnecessarily disadvantage this state. Only projects approved by the South Australian Coordinator-General, Rod Hook, for funding through the Nation Building and Jobs Plan will be exempt from planning rules consent. I think it is important that we understand that only public schools and some private schools are eligible for this package, although most of them will be at government schools.

The Coordinator-General will also work closely with the Local Government Association to ensure that community projects put forward by local councils can benefit from the fast tracked approval process. All the councils have been consulted—and I have spoken to the Local Government Association in recent weeks—and they are very keen to ensure that they are also able to spend as quickly as possible the money that will be provided to them through this package, because they do not want to lose that money, either. Exceptional circumstances do require exceptional measures, which is why this fast tracked approval process will be used only for national building projects while we face this unprecedented economic challenge.

The Coordinator-General is required to liaise with South Australia's Department of Planning and Local Government should planning issues associated with the project arise so as to ensure the appropriate assessment of applications. Pre-qualified contractors will be required to submit all projects relating to the Nation Building and Jobs Plan to the Office of Coordinator-General.

As there will be some heritage issues in relation to some schools, I also indicate that state heritage protections will remain in force. Finally, I say that—

An honourable member interjecting:

The Hon. P. HOLLOWAY: Well, you asked the question; you wanted the details. I think it is important to note that, sensibly, these exceptions to the state's planning regulations will expire in December 2012. So, a sunset clause does apply when they are no longer required to implement the projects funded under the National Building and Jobs Plan. As I indicated—

An honourable member interjecting:

The Hon. P. HOLLOWAY: That is the time frame requirement for these projects to be completed. So, there is a sunset clause for these rules. As I said earlier—

Members interjecting:

The PRESIDENT: Order!

The Hon. P. HOLLOWAY: —it is probably true that many states in the commonwealth will struggle to meet the incredibly tight time frame. However, this government is determined that, given this money is available on the conditions that have been applied by the commonwealth government, we will do our best to ensure that our entitlement is spent within this state to assist the economy of South Australia.

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