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Legislative Council - Fifty-Second Parliament, First Session (52-1)
2011-03-24 Daily Xml
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BOSTON CONSULTING GROUP

The Hon. T.A. FRANKS (14:54): I seek leave to make a brief explanation before asking the Minister for Industrial Relations, representing the Premier, a question about the Boston Consulting Group Consultancy commissioned by the Department of the Premier and Cabinet.

Leave granted.

The Hon. T.A. FRANKS: The Boston Consulting Group is a privately-owned global management consulting firm and adviser on business strategy. In 2009, the Department of the Premier and Cabinet engaged the Boston Group to provide services designed to, as they said, enhance strategy and policy development across the Public Service. This finished on 10 May last year.

I understand that the total cost of this one-year contract was close to $1 million—$497,750—and has been described as a project to improve the Public Service's understanding of the most important long-term global trends affecting the state. Ten months after the consultancy we have yet to hear exactly what the Boston group has been working on, apart from value responses offered by the Premier's departmental heads in the recent Budget and Finance Committee, and that the work in fact, we have been told, involves advice on megatrends in some five or so portfolios.

However, what we do know is that in New South Wales in the past week press reports claim that the Boston Consulting Group have provided that Keneally Labor government a similarly secret paper which recommended cuts to the education budget in that state in the order of the closure of 100 public schools and the loss of 7,500 teachers across that state. I understand from the media coverage that the report was critical of the trend to decrease class sizes. Perhaps the megatrend they liked was to downsize those classes rather than upsize them.

Given the edicts to find and execute $750 million in extra Public Service savings in the budget announced by the Rann government after its re-election, and its warnings to the public sector to limit their wage claims to 2.5 per cent—

The PRESIDENT: The Hon. Ms Franks should get to the question.

The Hon. T.A. FRANKS: I am almost there, sir; there is one more line—or face further cuts to the 1,600 cuts to jobs over the next three years announced, my questions are:

1. Will the minister confirm that this half a million consultancy work was not simply a previous iteration of the razor gang work done for last year's financial budget?

2. If it was not, can the minister now confirm that it was also not an exercise in navel-gazing on the part of the Premier while this government has then gone on to execute $750 million of cuts across the Public Service, which have seen the loss of 450 jobs already, including family day-care workers, police, ambulance, fire and emergency services workers?

3. In order to assure the South Australian public that the consultancy was neither a razor gang nor a naval-gazing exercise, when will the full report be released?

The Hon. B.V. FINNIGAN (Minister for Industrial Relations, Minister for State/Local Government Relations, Minister for Gambling) (14:57): I will refer those questions to the Premier in another place and bring back a response, but can there be a clearer demonstration of the Liberal/Greens alliance we see in this place daily? The Hon. Tammy Franks now seems to be getting her questions from the Hon. Mr Lucas and his committee.

I do not know the details of the Boston group or what role they may have played as a consultancy, but I certainly know that the Hon. Mr Lucas has spent a lot of time in the Budget and Finance Committee talking about every single consultancy that he ever came across, and I am sure he has been into excruciating detail with the one which the Hon. Ms Franks refers to in her question.

If having senior public servants from the Department of the Premier and Cabinet in front of the committee was not enough, one wonders why members of this place bother to support that committee and continue to establish it if they believe the committee serves no purpose and they still have to come in here and ask the questions they have already asked in the committee. What is the point of having the committee? If it is not there to answer questions, it is clearly there to provide fodder for them to develop more questions for question time. They cannot get all their questions from The Advertiser, the ABC or from country papers, so now they have to start trawling through Budget and Finance Committee transcripts as well.

I do not know exactly the role this group played, but what I can say, of course, is that we know the budget is under strain. South Australia, like other jurisdictions around the country, is facing a significant strain on revenue because of economic conditions, and in the wake of the global financial crisis our projected GST revenue flowing from the commonwealth has fallen. It is very clear that the government has faced a tough budget environment, as indeed have other states. The government has responded to that responsibly by putting in place the mechanism, with the Sustainable Budget Commission, to examine thoroughly items of government expenditure and to come up with a budget accordingly which will set the state on a sustainable footing into the future.

There are lots of different things that make up the budget items of expenditure. It is certainly the oldest parlour game in the world to pick out certain things and say, 'Well, if you drop this, you could pay for that,' and move the budget around as if it is some sort of jigsaw puzzle. However, in reality, we know that the government needs to make decisions about priorities and what it is we are able to fund. Every day, we have honourable members of this place coming in here and complaining about some expenditure or another being cut from some particular service, or you have complaints.

Here we have, in the very same question, where the honourable member is raising Public Service numbers—even though she mischaracterises completely the increases this government has made with our investment in police and other essential services—at the same time, the member is bemoaning the fact that expenditure has occurred on this particular consultancy, as this week she was lamenting about expenditure on a drug treatment facility.

Honourable members come in here every day and complain about what the government is spending its money on and then complain when the government says that we are going to make some savings. So, on the one hand, they are saying, 'What are you spending all this money for?' and then, when we say that we are going to make savings, they say, 'How outrageous that you're going to cut the budget.' Well, which is it, Mr President? Do they want to blow the budget and to run a billion dollar deficit and plunge the state into financial crises and lose the AAA rating? Is that what they want, or do they want the government to institute a massive razor gang and cut government expenditure to ribbons?

Which is it? They cannot do both at the same time. Let's hear from honourable members opposite exactly what items of government expenditure they think need to be cut. If they believe that the government is making the wrong decisions about the budget, let's hear what they have to say; let's hear what their plan is. It is like so many issues they talk about in here, such as the forests, where they have continually talked about what the government has said in relation to investigating the forward sale of forests, but at no time have they put up an alternative as to how they see a sustainable future for that industry.

I will refer those questions to the Premier in relation to this particular consultancy, but this government is committed to a sustainable budget. We want a strong state economy, a strong fiscal position, including the AAA rating, and that will be the focus of our budget and the priorities we make.

The PRESIDENT: The Hon. Ms Franks has a supplementary deriving from the answer.

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