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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
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APPROPRIATION BILL 2012

Second Reading

Adjourned debate on second reading.

(Continued from 27 June 2012.)

The Hon. D.W. RIDGWAY (Leader of the Opposition) (11:38): I rise to be one of a number of speakers from the opposition to speak to this year's Appropriation Bill. I expect that we will be expressing dismay and despair at the state of the state's finances. If we turn back to the last 20 years and perhaps back to 1993 to the last time a Liberal government was elected to office and put it in some context, the state at that time had about $9 billion of debt and a $350 million deficit in the budget. Look forward 20 years to 2014 and, on the budget that has been presented, we will have a $13 billion debt and a $867 million deficit.

If you look at what has happened in that 20 years, we had a Liberal government for the best part of a decade that restored confidence in the economy and went through a range of asset sales, often with political opposition from the Labor Party and sometimes hostile approaches from the media, but by and large that sold a number of assets—electricity, maintenance of SA Water, the ports, the TAB and a number of assets. Really, the only two that were not looked at to be sold—and probably for good reason—were the forests and the Lotteries Commission. Of course, now this government is selling both of those assets.

We also need to look at that in the context of what has happened in that 20-year period. We went from particularly high interest rates in the late eighties and early nineties and low business confidence. Business confidence was restored; that was not just a function of the former Liberal government but also of the wonderful stewardship by the Liberal Party and, I suspect, some of the reforms that were made in the dying days of the Keating government to set up our economy, but its stewardship under John Howard and Peter Costello certainly gave the states an opportunity to really flourish.

In that 20-year period, especially from about 1998 to 2008, we had probably one of the best decades this state has ever seen, rivalling any of the good what they call post-war periods. Just to summarise where we are today, we have had a range of asset sales; in fact, nearly everything has been sold or is about to be sold that can be sold. We had a decade in the middle of that of probably as good economic times as we could ever wish to see, and yet in that period we have gone from a $9 billion debt and a $350 million deficit to, 21 years later, a prediction of a $13 billion debt and an $867 million deficit.

The government will argue that it has invested in some infrastructure. A large portion of that has been funded by the feds. Federal government has funded a large portion of the road projects and the rail electrification. It is only things like Adelaide Oval and the hospital that the government has not funded. To put it in context, we are in an unsustainable position. This government, I think, inherited a good set of books in 2002, and it is interesting to note that the debt continued to decline after the change of government in 2002. I know former treasurer Foley would often say that it was his good work. I suspect it was not his good work but the policies of the former Liberal government that this government had not unwound at that point, so they were still driving down the debt.

The thing that is really frightening about that is that in 2014 we are looking at a $13 billion debt and an $867 million deficit. If it takes a future Liberal government a year or two to unwind some of the crazy policies of this government, the inertia may be so great or the problems so deep that we may well see that it is hard to constrain those budget figures in the first year or two. In fact, some of the budget predictions have been made on the back of some very optimistic figures. We saw only last week South Australia's unemployment rate go over 6 per cent. If those trends continue, this state will be in a very sorry state of affairs.

We have to look at that also in context of what our constituents—the people who vote for us and for the members of the House of Assembly—are confronted with. We have the nation's highest taxes, the nation's highest capital city water charges and the nation's worst business confidence. We have the nation's worst retail sales figures in the last 12 months, the nation's worst export performance in the last 12 months, the nation's worst-performing workers compensation system, the nation's slowest growth in wages but the fastest growth in consumer prices, the world's highest electricity prices from 1 July, the worst property sales figures in 27 years and the lowest quarterly dwelling commencements in 10 years. This is what we see today: a list, not leading but trailing the nation or leading the nation with the price and height of some of the taxes and charges our community has to bear.

South Australia's economy has declined from 6.8 per cent to just 6 per cent in the last few years. If South Australia had kept pace with the national jobs growth under Labor, we would have 41,000 more jobs in South Australia than we do at present. In each of the manufacturing, farming and fishing sectors, South Australia had more jobs 27 years ago than it does now. In the South Australian manufacturing sector, there are 10,000 jobs fewer compared with when Labor was re-elected in 2010—10,000 jobs fewer in just two years.

In the South Australia mining sector, there are 10,000 jobs. This is a growth of only 1,400 jobs in the last 26 years, yet premier Rann for a decade said we would have a mining boom, there would be jobs everywhere and we would not have enough people to fill them. But there has only been a growth of 1,400 jobs in the last 26 years. There are 10,900 jobs in mining in South Australia, which compares with 64,000 Queensland mining jobs and 104,000 jobs in the Western Australian mining sector.

Access Economics forecasts that South Australia's jobs growth, economic growth, exports and population will continue to underperform the national growth over the next five years. South Australia had 7 per cent of national business investment when Labor came to office—that was to 12 March 2002—and now we only have 5.5 per cent of national business investment.

The Hon. R.L. Brokenshire: You have been busy doing all this research, Ridgy. I am impressed.

The Hon. D.W. RIDGWAY: Thank you. The Hon. Robert Brokenshire is impressed with my research. I need to compliment the wonderful staff we have who support the opposition. They have very slim resources but they are very, very good at what they do.

Let us just have a quick look at the actual fiscal position. It is interesting to see that, in the 2012-13 budget, there are budget deficits on all three measures: the net lending deficit of $1.901 billion in 2012-13, a cash deficit of $1.952 billion in 2012-13 and a net operating deficit of, as I have said before, $867,000 million in 2012-13. Year after year, the Auditor-General has warned Labor that it cannot rely on the revenues continuing to come in over budget to rescue its high spending habits. Just to quote from his 2005-06 report:

Given the forecast expectation that such revenue growth may not be sustained, control of expenses will be important.

The reason for that warning is that, in 2005-06, the budget was overspent by $370 million. In response to the warning in 2006-07, the budget was then overspent by $374 million. The Auditor-General went on to say in the 2007-08 report that:

...the State may have developed a culture of expecting growing revenues to continue to support increasing expenses.

Of course, the response to that warning was an overspend of some $304 million in the 2007-08 budget and, of course, the response to the next warning in 2008-09 was a budget overspend of $670 million. It gets worse, of course. The Auditor-General said in his 2008-09 report, part C, page 12, that 'the State has received large amounts of unbudgeted revenues that enabled net operating surpluses'. Of course, the 2008-09 budget was overspent by $670 million and, in a response to the next warning, the budget was overspent by some $599 million. So, you can see that, despite the windfall revenues, the government continued to overspend.

You did not have to be an Einstein or a rocket scientist to know that things never keep just expanding and booming forever but, sadly, this government expected that they would and now we are faced with the dilemma where they have sold nearly everything that the state owns. This government is about to sell the last remnants of the forests and the Lotteries Commission, and our debt, after 20-odd years of being in what some people call the State Bank era—the darkest days for our state economy—is now significantly worse.

It is interesting. The former deputy premier, Graham Ingerson, has a role with the Liberal Party and he made a comment to me the other day at a party meeting that he thought things were significantly worse in this budget and in what we are likely to face in 2014 and beyond than they faced in 1999.

It is interesting to note that there really has not been any real constraint on the taxes that have been charged. I notice land tax increased by 316 per cent under this Labor government. The costs are not only paid directly but are passed on through commercial and residential leases and goods and services, so there is a flow-on effect, as we are seeing with the carbon tax. With some of these big taxes you will see that same type of flow-on.

The increased cost of living is something I know hurts everybody in the hip pocket, and members here and in the other chamber are, more and more, having people come to our offices not being able to pay for the basics. Since 2002, if we look at where this government has taken us and where we have now ended up, CPI has gone up by some 32 per cent but housing rents have gone up 45 per cent. Property charges are up 72 per cent, gas bills are up 79 per cent, state taxes and charges are up 85 per cent, electricity is up 124 per cent—

The Hon. G.A. Kandelaars: And who privatised it?

The Hon. D.W. RIDGWAY: —and the big one of water has gone up 249 per cent.

The Hon. R.L. Brokenshire: Did anything go down?

The Hon. D.W. RIDGWAY: Only confidence and people's spirits. They are the only things that have gone down under this government. You can see there is just a continual pressure. Everything is on an upward trend and will cost more and more. I did hear an interjection about who privatised ETSA, and I will not let the Hon. Gerry Kandelaars get away with that. We had a pledge from Mike Rann. In 2002, his pledge card said, 'Elect me and I will build an interconnector to New South Wales and keep down the price of electricity.' Either he was lying to the South Australian people or he never intended to do that.

We see now that South Australia has the highest penetration of wind power in the nation and, in fact, per head of population probably one of the highest penetrations in the world, and we have the highest electricity charges in the nation. I know that the Hon. Mark Parnell, and probably all of us here, are pleased that wind power is clean, but it certainly is not cheap, and we are now paying the price of this government's fetish and Mike Rann's love affair with the wind sector.

We saw Mike Rann on his last day in office impose a ministerial DPA—a statewide one—on wind farm developments. I digress a little but I know I am given a bit of latitude when it comes to appropriation speeches. Ministerial DPAs are a mechanism by which the minister puts in a development plan amendment that stops the clock. It says nothing can happen so that nobody can take advantage of a set of circumstances that may be changed in the future. We saw the Barossa Valley and McLaren Vale DPAs put in place and there was quite an outcry because people could not build a house where they had previously been able to build a house, or build a shop in a commercial zone or rebuild a house that had been burnt down.

The nature of a ministerial DPA is to stop development so that people do not get an unfair advantage but, interestingly, the wind farm DPA relaxed all that. There were no third-party appeals, one kilometre from houses and one kilometre from towns. You would have to ask yourself: why was that so? If, in the end, it is the South Australian consumers who pay more for electricity, what a horrible and unfortunate legacy Mike Rann has left South Australia.

This government talks about its commitment to infrastructure and some of the things it has been doing. Look at the promises and then the broken promises. They are going to build a brand-new Royal Adelaide Hospital for $1.7 billion; actually, they are going to add $2.8 billion to our state debt. They will spend $450 million on Adelaide Oval and not a penny more, said treasurer Foley. Now it will be approaching $600 million for that project, and there are parts of it—Memorial Drive and the tennis facility—that were in the original proposal that have been scrapped.

Even today, the city council is not certain that the bridge is narrow enough and should be narrower. We do not see any commitment from any of the bigger players such as the SkyCity Casino or the Intercontinental on the southern side of the river, which is the area that is to be activated by the Adelaide Oval development. There is no commitment from them at all to develop anything there.

We have seen the Southern Expressway duplication promised at $370 million and it is now at $407 million, and I expect it will be more than that. The Darlington interchange at $75 million has been scrapped. The doubling of Mount Bold reservoir some years ago, which was going to cost billions of dollars, thankfully has been scrapped. The $160 million project for the Upper Spencer Gulf to be able to take desalinated water from BHP's desal plant has been scrapped. I think it was a fanciful promise in the first place because BHP, if it gives the go-ahead to the project this year, is some years away from having any access to water. The $122 million underpass along South Road between Port Road and Grange Road—

The Hon. J.M. Gazzola: Federal money.

The Hon. D.W. RIDGWAY: I do not know whether that was federal money, but we saw the $840 million given to the state government for the South Road superway. I was always sceptical of that because it was announced by the government on the first Thursday of sitting after premier Rann had that unfortunate incident at the Wine Centre, where he may have come in contact with a Winestate magazine. That announcement was purely designed to distract media attention.

Members interjecting:

The Hon. D.W. RIDGWAY: There are interjections coming from the other side of the chamber. I know that to be almost certain, because the project manager was asleep and on holiday in Europe when it was announced. He was rung by the Road Transport Association and asked, 'Is this this project?' It took a while to wake him, and he said, 'I have no idea; I'm on holidays in Europe; I'm asleep, it's the middle of the night—I have no idea what they're announcing.' Minister Atkinson said that it had not gone through cabinet. Treasurer Foley rebutted that and said, 'Oh no, look, Mick was at the toilet when we discussed it in cabinet.' I know we talk about spending a penny, but the government spent $860 million while he was in the toilet! In the end it was announced in October and it went through cabinet sometime in early December. Again, this government has no idea about the management of money and the processes it goes through.

We saw $600 million worth of prison facilities scrapped; the $140 million Sturt Road/South Road underpass scrapped; a solution for the Britannia roundabout at $8.8 million was scrapped; and, of course, the trams to the western suburbs have been put on the scrap heap. The people in the western suburbs—the Premier's own electorate and that of the former deputy premier in Port Adelaide—are taken for granted. They promise them stuff and they never deliver.

In the public sector we saw the no forced public sector redundancies and the no public sector job cuts policies both scrapped. Up to 8,000 redundancies have been offered since 2002. The pledge to have no increase in taxes and charges and no new taxes has been scrapped: they put in the River Murray levy and put up gambling taxes and mining royalties. There were to be no increases in water rates, yet water bills have more than trebled under Labor. No privatisations! I remember the premier coming on to 891 after the 2006 election saying, 'Kevin Foley and I have just reaffirmed our decree of no more privatisations.' That morning, no toll roads were also put into that decree.

Of course we have seen the bus contracts privatised, along with forests, the Royal Adelaide Hospital, the super schools, SA Water's piping network and the Lotteries Commission—all privatised. I asked a former minister about the premier's statement about no toll roads and his decree and why, after winning a substantial victory in the 2006 election, the government would play that card. The response was, 'I don't really know; Mike said all sorts of things without talking to us.' That is one of the reasons we are in the mess we are in, because he said all sorts of things without talking to his cabinet.

There was a pledge to stop taxpayer-funded political advertising, and the government now spends $70 million a year on advertising, and some campaigns are clearly political. You can see that this government has simply had no capacity to rein in its spending, and now most of the promises they have made they have had to break.

The Hon. R.L. Brokenshire: You've just about talked me out of voting for them.

The Hon. D.W. RIDGWAY: I would hope, Robert Brokenshire, you have never voted for them or ever considered it. If you have, you should have a good, long, hard look at yourself! The other thing that is interesting to note is that one of the things—

The PRESIDENT: The Hon. Mr Ridgway should not respond to interjections.

The Hon. D.W. RIDGWAY: I know I am not supposed to respond, but I would be distressed if the Hon. Robert Brokenshire was ever considering voting for the Labor Party, given he was a minister in a Liberal government. He should go and have a very good, long, hard look at himself!

There has been some discussion about the AAA credit rating. At the end of the day, the AAA credit rating is something that the Liberal government had worked hard on. It had not quite got back to restoring it, but we achieved it as a state in the first couple of years of this Labor government. As mentioned earlier, the policies were still in force and things were still carrying on well, and so that is why the debt continued to decline in the first couple of years.

However, it will probably mean $20 million to $25 million in extra interest payments each year. That means that our borrowing becomes more difficult because, with the level of the debt, we are less attractive to investors. It will also continue to add to those negative perceptions about South Australia, reducing our attractiveness as a destination for investment, with the resultant negative impacts on our economic activity in general. Of course, the other thing it does is send a really bad message to the community that this government cannot manage its own affairs. Clearly, that is what we have seen with this particular government.

Another area, and something that has been discussed over a long period of time, is the increasing size of the public sector. In the 10 years or so of this government there have been about 6,535 what you would call front-line type people—nurses, teachers, doctors, police officers, the types of people that every modern society needs to make sure that we have adequate resources in those areas. However, we have seen an increase of about 20,000, so there are 13,000 additional public servants employed outside core government areas under this Labor government. The majority of these—and this is something I struggle with—were unbudgeted.

Ministers, the cabinet, did not exercise their control over the increases throughout the process. As Michael O'Brien, now Minister for Finance, said in October 2010, we are actually having to borrow to pay public sector wages. That is unsustainable in the long term.

It has been a long-held view of the opposition that there has simply been no control at a government level. How on earth can you set a budget, as we are passing today, the budget that was tabled some six weeks ago in the House of Assembly, with the program laid out of what you hope to do, and then exceed the number of staff you use over a decade by some 13,000? Surely somewhere along the line there would have been then treasurer Foley getting advice from his department, or other ministers from their chief executives, saying, 'Minister, Treasurer, we are actually 50 above our budget; we need to try to bring that back into line before next year.'

I think I have used this analogy before, but running a budget such as this is a bit like trying to balance a big tractor tyre—and I go back to my farming days. The hard thing to do is to lift it up; once you have it upright it is not that hard to keep it rolling and keep it balanced, but if you get out of balance and it starts to fall then it is very heavy and bloody hard work to lift it up again. That is where we are today.

The Hon. R.L. Brokenshire: Use a front-end loader.

The Hon. D.W. RIDGWAY: The Hon. Rob Brokenshire says, 'Use a front-end loader.' The trouble is that the people of South Australia are sick and tired of being the front-end loader and having to dig this lot out of a hole. So you might say that is an option, but it is not.

We now have this budget that is out of balance. The people of South Australia will, again, have to do some heavy lifting, and, when I listed those 10 or 12 items where we lead the nation—the most expensive place to do business, with water and electricity, the worst economic activity, the worst jobs growth—it is a very daunting task, indeed, for the people of South Australia.

I will just make a few comments in relation to the areas which I have some responsibility for. Planning and tourism are the two areas I would like to cover as I make my closing remarks. There have been significant cuts in planning which, of course, mean significant delays with any of the rezonings and work being done in Planning SA. I know that the Mount Barker council was promised, when that rezoning, the ministerial DPA went through, that the structure plan work would be done within six months. My understanding is that the council is still waiting for that to be done some 12 months later. At the end of the day the log jam or bottleneck is in Planning SA.

There are also some concerns at the local government level in relation to the 30-year plan. In areas like Playford and Salisbury and some of the more broadacre-type councils, vast areas of land are earmarked for either residential or commercial development in the 30-year plan but the state government expects the local councils to provide all the planning support in areas where councils had not expected them to be brought on so quickly.

I think the Playford council initially had quite a significant rate increase and its justification was, 'Well, we have all these extra planning staff that we need to employ to do the work the state government is forcing upon us.' So there is a bit of a flow-on effect: if you do not have adequate staff in Planning SA here in the city, you pass the buck to local government and in the end local government has to increase its rates so there is another whack for the poor old consumers in the area of local government.

Tourism is something I would like to touch on. I know the minister opposite—

The Hon. R.L. Brokenshire: It's booming, I heard the other day.

The Hon. D.W. RIDGWAY: Booming, yes. There is nothing much booming in tourism at the moment. If we look at what has happened in tourism, we have had cuts right across the tourism industry for a number of years: all the regional offices are gone; I think there was a commitment to budget saving of some $4.5 million and an understanding that any other savings that could be made could be kept for marketing, but the next year Treasury came back and said, 'Sorry, we need another $4.5 million,' so they took $4.5 million dollars again.

This is one industry, Mr President, that provides investment and income right across our state, from little places like Beachport—your new home town—right through to suburbs in Adelaide. Tourism manages to spread a little bit of money right around this great state. Mr President, we know it will be many years before you are fully retired, and I am sure you will take an active interest in what happens in here, but rumour has it that you will be leaving your current role in October. It is people like you, who have worked hard and are able to provide themselves with a cash flow, who are the sorts of tourists we need in order to make sure that we spread out across the state and try to capitalise on.

We have neglected our regions, we have neglected marketing, and we have virtually no new events. The only two events that are still successful in South Australia are the Tour Down Under and the Clipsal 500—two events that were started under a Liberal government. The World Tennis Challenge has gone and Tasting Australia, sadly, looks like it has gone now. There were also a number of smaller events—we saw what happened on Kangaroo Island, and the Guitar Festival being questionable.

We have no new events. Everybody loves Mad March, but that was primarily the Festival, the Fringe, WOMADelaide, Clipsal and Tour Down Under beforehand, and they were all events that had been around for a very long time. The lack of vision from this government and the lack of understanding of how important the tourism industry is have certainly driven the morale of a lot of the operators and people in the tourism industry to a new low. I think that is exemplified by the very messy way the government has handled the visitor information centre—a budget cut when they needed it.

I am told it cost $1.4 million to run the visitor information centre on its old site in King William Street. We know all the details of the arrangement that was made to shift it to the underground basement site on Grenfell Street. I suspect that if it had been a site that gave better activity, more public access and a better promotion of our state, people may have lived with it, but it was not: it was a disaster. Of course, the private operator eventually could not make ends meet because either the figures he was given were wrong or the location was so poor that nobody went there.

However, again, it was all due to the actual lack of leadership and understanding from the minister, minister Rau. People have said to me that he was too busy—well, that is no excuse. He made a decision and he supported the decision to shift it from a main street, ground level site to a side street, basement site. When the lease ran out and interim arrangements ran out with Holidays of Australia, we had to scramble to find a new site. I am advised that the Tourism Commission was negotiating with the Rundle Mall authority and the little—I want to say 'caboose', but it is not that: what is it called?

An honourable member: Booth.

The Hon. D.W. RIDGWAY: Booth—a little booth that they used. I knew it had a B in there somewhere, but I had a mental blank for a minute. They had a little booth, but of course that cannot display everything. At the end of the day, they had gone through a range of negotiations before it dawned on the Tourism Commission that, 'Actually, they are going to redevelop Rundle Mall; that's going to be bulldozed later in the year and we'd have to shift again.'

The decision was made with only a matter of days' notice to go to the EDS building and into Service SA. I have to say, after I went down there for a press conference, that I thought it was going into the vacant office of Thinkers in Residence, which has a glass front; it is out of the way and it is not an ideal location, but it would have given it some presence. But no: this mob has stuck it inside Service SA. You have to go in, turn the corner and there is the counter with two staff.

We had 23 staff over here in King William Street; we now have five—4.8 FTEs. It is all about a public display of our great state. Victoria has its visitor information in the middle of Federation Square in Melbourne. Every other state has it in a prominent location, with some satellite operations around the city. I had an opportunity to do some talkback radio about the location, and the switchboard lit up with the number of people who had a view on it. This is something that clearly the community is interested in, and clearly the community is very disappointed with the appalling way that this government has handled tourism and the lack of investment in it.

Finally, as we move into the technological age, as members would be aware, I have been disappointed with the way that the applications on iPads and iPhones have been used by Tourism SA and the disdain with which it has treated tourists by not updating them; they are out of date and I think still do not work properly. It really is a disgrace and it just exemplifies how dysfunctional tourism is under this government, with the lack of investment, and under the lack of leadership from this minister. With those few comments, I support the passage of the bill.

The Hon. CARMEL ZOLLO (12:12): I rise to speak on the Appropriation Bill before the chamber. This bill is designed to provide a strong platform for South Australia which will allow the state to take full advantage of future economic opportunities. There is no doubt that we operate in a difficult economic environment. The 2012-13 budget handed down by Treasurer Snelling certainly reflects this. The Treasurer, as he stated in his budget address, has been faced with the biggest writedown of government revenue in the state's history. This is something, one has to observe, that those opposite conveniently overlook when they go on and on about debt and deficit.

As the Treasurer showed on budget day, this government has not shirked from making the tough decisions. This includes the cutting of a further 1,000 public servant positions, the suspension of electrification of the Gawler and Outer Harbor lines, and the postponement of the stage 3A upgrade of The Queen Elizabeth Hospital until 2015-16, when the budget is projected to return to surplus.

However, whilst the current uncertain economic environment has significantly reduced projected revenues, the government, to its credit, has remained committed to building a better South Australia. There is no doubt that the momentary adulation that comes from delivering a surplus can be so alluring to some governments that they will sacrifice just about anything in order to achieve it. This is not what this government is about.

To cut services and major infrastructure projects, as the Treasurer stated in his budget address, would be damaging in the short term, with a loss of jobs, as well as in the long term, as opportunities to transform the state's economy into a truly modern, innovative and diverse economy would be put in jeopardy. This government, unlike those opposite, sees the bigger picture: that as leaders of our state we must make decisions not only for the now but also for the future, so that the prosperity of our state is secure. On that note, I would like to take the opportunity to highlight some of the key elements of the budget.

In relation to infrastructure, in my contribution to the debate last year I made mention of the many infrastructure projects being undertaken by the government that were just getting underway. Today it is almost impossible to look across Adelaide and not notice the multitude of machinery, as well as construction workers busily working away on either the South Road superway (which is well under construction), the new Royal Adelaide Hospital and medical research institute in the city or the Southern Expressway. It shows that this government is truly one of action and not just words.

This is a Labor government that is committed to building up the infrastructure in South Australia to a truly international standard. This year's budget also saw the announcement of a number of community infrastructure projects, and most notable is the redevelopment of The Parks Community Centre. The state government, in partnership with the Port Adelaide Enfield council, will invest some $28.7 million in the facility, which will see the replacement of the existing indoor pool, the refurbishment of the existing general purpose buildings, car parks and theatre areas. The upgrade will also see the development of two new outdoor soccer pitches, change rooms and recreational areas. The investment being made in The Parks Community Centre ensures that those living in the inner western suburbs will continue to have access to high-quality community facilities for many years to come.

In relation to disability funding, I have to say that one aspect of this budget that I am truly proud of is the government's continuing investment in disability services. Whilst these measures may not get the headlines that the new RAH gets and whilst there are always more and more needs, I am certain that those South Australians living with a disability welcome this commitment. As the Treasurer stated on budget day, the government will, on top of last year's funding commitments, provide a further $106 million over the next five years for extra accommodation support and respite, $61 million for new community-based supported accommodation and $21 million to move the remaining residents of the Strathmont Centre into high-quality community supported accommodation facilities.

As Treasurer Snelling mentioned in his budget address, the state government will also commit $20 million to assist with the South Australian launch of one of the most fundamental reforms ever to occur to disability service provisions in South Australia, that being the introduction of the National Disability Insurance Scheme (NDIS). These commitments show that Labor will always stay true to its values and stand up for those who have a limited voice within our community to ensure that they receive the quality care they deserve, and that they are afforded every chance to actively fully participate in society. I am pleased that minister Hunter has placed on the record our state's commitment to the NDIS.

I would also like to quickly note the government's continuing commitment to the health and wellbeing of rural and regional South Australians. As minister Hill has previously announced, some $728 million will be spent on country health, which is almost double the amount spent on country health when those opposite were running the state.

Concerning law and order, as a former minister for corrections I am pleased to see that the government will invest in this budget some $37.3 million over the next four years in our state's prison system. This money will go towards the construction of a high dependency unit at Yatala, providing 26 extra beds for elderly prisoners and inmates with serious health conditions, as well as the construction of a new 112-bed cell block for the Mount Gambier Prison and the addition of 86 new beds at Port Augusta.

In relation to the environment, there is little doubt that the future of the River Murray and the ecosystems that rely on the river are at a crossroads. As a result of decades of misuse from upstream irrigators in Victoria, New South Wales and Queensland, the health of the river is in severe decline. To help secure the long-term future of the River Murray in South Australia, the government has contributed some $49.1 million to the Riverine Recovery Project, which will assist to rejuvenate wetlands, improve water quality, provide for increased environmental flows and give a much-needed boost to the ecosystems that rely on a healthy river.

However, this good work may be put at risk by the Murray-Darling Basin plan, which, as of the revised draft released in May this year, does not allocate the required flows necessary to maintain a healthy river. That is why the government announced it would allocate $2 million to evaluate and respond to the draft plan to help achieve an improved outcome for the River Murray and for South Australia. Just last week, minister Caica announced that the government had formally responded to the draft plan, stating that 'independent scientific analysis has confirmed that the 2,750 billion litres the plan proposes to return to the river will not be enough'. There is no doubt that this will be a tough fight, but it is one that this government will not shy away from.

Concerning regional South Australia, we all recognise the important social and economic contribution that rural and regional South Australia makes to our state. The government understands the need to invest in rural communities to ensure they continue to play an important role in our state's future. To assist with the development of regional infrastructure, the budget will see the creation of a new $3 million Regional Development Fund. Grants of between $50 to $200,000 will be able to be assessed by Regional Development Australia committees, local councils, businesses and community groups to assist with local projects.

In relation to government support for rural communities, we have before us the character preservation legislation. The legislation introduces measures to help protect some of the state's key agricultural and tourism assets, being the Barossa Valley and McLaren Vale regions. The protection zone legislation, introduced by the Minister for Planning in the other place, seeks to ensure that these green belts are kept primarily for agricultural production and that any development will be in keeping with the character of the regions in question. This will guarantee that the valuable agribusiness and tourism revenue they generate will be protected, along with local jobs.

During the recent estimates, the Minister for Agriculture, Food and Fisheries advised the committee of our food priority, known as Premium Food and Wine from our Clean Environment. The overall vision for our food policy is to achieve a South Australian premium brand for food, wine and tourism that underpins high quality food and wine that is sustainably produced and processed to the highest standard. The bills before us, which we are debating at the moment, are all about guaranteeing that prime agricultural land continues to be available for the pursuit of premium food and wine. As to be expected, horticulture is an important sector in South Australia and contributes approximately $2.64 billion to South Australia's gross food revenue.

I would like to applaud the work of minister Rau and his office for the extensive consultation process they undertook to ensure the character legislation meets the needs of these two regions. This was evidenced by the minister taking on board some of the suggestions made by the Hon. David Ridgway with regard to the proposed boundaries for the DPA. The South Australian government, I believe, has delivered a prudent budget that recognises the difficult economic times which have buffeted the state's economy. We should also mention that it is following a 10-year drought as well. However, the government has kept its focus on transforming South Australia into a truly modern economy, allowing South Australians to take full advantage of the expected mining boom.

As I have previously mentioned, projects such as the Royal Adelaide Hospital, the South Road superway and the Southern Expressway are now well underway, with the redevelopment of The Parks Community Centre to follow shortly. These are projects which provide thousands of jobs to local workers. The government has also invested substantial amounts into disability services to help ensure that those living with a disability have access to the quality of service they require. This is in addition to the government's continuing commitment to improve rural and regional health services.

As this budget shows, the government is about achieving real results which improve the lot of each and every South Australian, ensuring that they are afforded every opportunity to grow and prosper. I add my support to the Appropriation Bill.

The Hon. J.S.L. DAWKINS (12:25): In supporting the passage of this bill I recognise its importance in providing finance to the various programs incorporated in the 2012-13 budget of the government. It is my intention to focus on one particular area that has come to my attention as it relates to the priorities of the government and the manner in which public servants carry out those wishes. The particular area is something that I touched on in my Supply Bill speech earlier this year, which is the process of amalgamations of primary and junior primary schools in South Australia, and particularly that process at the Para Hills schools, which are quite unique due to the topography of that site and which is quite different from many of the other schools that have been amalgamated.

The community of the Para Hills primary and junior primary schools and the combined governing council have worked very hard over a long period of time to try to get across to the bureaucrats and officers within the Department for Education and Child Development and to the minister the particular significance of having the two schools rather than amalgamating on that site. I wish to take some time to document the work that this community has done to put their case.

Firstly, on 11 November 2010, a petition from the community with over 800 signatures was collected and presented to this parliament opposing the amalgamation of those two schools. As part of the government's process, an amalgamation review committee was formed around that time. The community requested that two parent representatives, one from each school—not one, as the minister had allowed for—be part of that committee. Lisa Manning and Kerry Faggotter were appointed by the governing council to represent the two schools. They put in over 12 weeks of work and read over 200 submissions from the community and reported back on them to the committee. The review committee was unanimous in its decision that the schools should not amalgamate. The committee therefore wrote a recommendation to the minister to not amalgamate the schools.

On 11 August 2011, a letter was written to the Hon. Jack Snelling MP, the local member for Playford, asking him to support the community in its wishes not to amalgamate the schools, and no reply was ever received. On 12 August 2011, a letter was written to Mr Tony Zappia MP, the federal MP for Makin, requesting his support to stop the amalgamation. Kerry Faggotter, the chair of the governing council, received a phone call from his personal assistant asking her to keep them informed, that Mr Zappia was too busy to attend the information meetings and that, as a federal member, he could not intervene in a state matter.

On 23 August 2011, a letter was sent to parents asking them to write a submission to the panel to express their concerns, opinions and views on the proposed amalgamation. On 1 September 2011, 12 corflute signs were designed, printed and put up on main roads and outside the school for public awareness. On 13 September 2011, a letter was sent to the then education minister Weatherill, with an invitation to attend the schools to see the complexity of the site of the two schools. Unfortunately, the then minister (now Premier) never replied or acted upon this request.

On 13 September 2011, a survey was sent out to all parents and collated for the review committee's information. On 27 September 2011, a letter was sent to the Chief Executive of the DECD requesting that he attend the site. Unfortunately, no reply was ever received. On 14 October 2011, a delegation from the Para Hills schools and the community attended the Save our Schools Alliance protest rally at Elder Park in the city and cooked a fundraising sausage sizzle for people who had come from other schools.

On 7 November 2011, a letter was sent to the new education minister, the Hon. Grace Portolesi, requesting that she attend the schools before making her decision. No reply was received. On 10 November 2011, a delegation of 21 of the schools' community, staff and parents attended the office of the local member (the Hon. Jack Snelling) to ask him to support the retention of the junior primary school. There has been no response to the attendance on that day.

On 16 March, the Hon. Grace Portolesi, in her role as the minister, attended the school. As I have highlighted in this place before, she attended at 8.30 on a Friday morning, having notified the school community a couple of minutes before 4 o'clock the previous day, giving no time for parents to be notified or staff to be able to organise a time to chat with the minister.

On 4 April, a letter was sent to minister Portolesi after she attended the schools, confirming the topography and site issues to be faced if the amalgamation of the schools went through and requesting her to seriously consider the implications for the community and the children should she go ahead. Unfortunately, again, there was no reply.

On 2 May 2012, the principals of the two Para Hills schools each received an email informing them of the minister's decision to amalgamate the schools. On that day, Kerry Faggotter, as chair of the governing council, received phone calls from the media in the morning in relation to this announcement. It is interesting that the calls from the media came before the emailed letters actually reached the principals. So, the media were obviously notified before the principals of the schools.

I believe that the time taken until the decision was made was some six months, but the school communities were then given three months to organise everything to make the transition process smooth, particularly for the children and also the staff. On 5 May 2012, the school communities informed the minister in writing of a resolution that was passed through the governing council as follows:

Para Hills Schools Governing Council has continually asserted that our schools are NOT co-located and that this was a unanimous decision within the Review Committee report. Therefore we request that the Minister upholds the decision of the Review Committee to refrain from amalgamating our schools.

On this occasion, an acknowledgement was given with the promise of a reply but, once again, no reply has been received.

On 11 May 2012, a delegation of 28 staff, parents and students attended the SOS Black Friday protest at the DECD head office. On 30 May, a letter was written to the DECD complaints unit regarding the rushed process and the pressure on the governing council and parents of the community in relation to organising the amalgamation transition by term 4 of 2012. A reply was received from the manager of the complaints unit, which said:

I am writing to inform you that the Parent Complaint Unit is not able to take any action on your complaint as the decision of your schools amalgamation was taken by the Minister for Education and Child Development and as such complaints involving this decision do not sit under the auspices of the Department for Education and Child Development Parent Complaint Policy.

I think that probably summarises some of the overall frustration the community has felt. They as volunteers have acted in a very consistent sense. They have been frustrated by running up against a brick wall, but particularly they are frustrated by the fact that so many of their pieces of correspondence have not been responded to by the department or, in fact, the minister or the local member of parliament, the Hon. Mr Snelling.

To further sum up the situation, I would like to read from a letter that was sent by the Para Hills schools governing council to the Hon. Mr Snelling on 27 June this year. The letter states:

Dear Mr Snelling,

Para Hills Schools Governing Council held a community meeting on Tuesday 26th June as a requisite of a letter that our Principals received from a Mr Ross Treadwell from DECD, asking us to propose a new school name for the forced amalgamation that your Government is forging ahead with in 2013, against our community's will.

Due to the forced closure of our CPC, Kid Zone and Junior Primary Schools the registration of a new name has had to be rushed to meet time frame requirements of your Government amalgamating us onto the primary school campus.

During this meeting there were very angry and concerned parents of your electorate and our schools with many questions as to the impact this closure will have on their children's education at the Para Hills Schools in the future.

Parents have requested that governing council write to you demanding answers to the questions stated below:

1. What actions did you take to support the community's campaign to keep their Junior Primary School?

2. Asset Services have told us that the Junior Primary School buildings will be mothballed. Will you fight to have our school compensated by your State Government for the BER money that is now being wasted on the open space unit totalling $800,000? Will you guarantee that we will receive an additional $800,000 to restore the money lost from the federal government?

3. It is unlikely that the $1.25mill allocated to us will be sufficient to redevelop the Primary classroom block to accommodate all of the Junior Primary Classes, the expanded Resource Centre and the refurbishment of the Administration Building. Will you fight for our children to receive additional funds so that the promised work can be done without more loss?

4. What will you do to ensure that the money spent on emergency maintenance over the inadequate allowance will be fully refunded, not at the suggested DECD arrangement of 71¢ in the dollar?

5. Will you support the community in ensuring that the school is fully compensated for the increase in utility costs to prevent more cuts to learning programs over the cuts already being contemplated because of your Government's closure of our Junior Primary School?

Awaiting your reply,

Yours faithfully,

Kerry Faggotter

Chairperson, Para Hills Schools Governing Council

I understand that, as of today's date, that letter has received an acknowledgement only.

As I said, I think this whole process that many of the schools have gone through has been a disappointing one, particularly in relation to Para Hills. As I said in the previous speech on the Supply Bill, the topography of the area—the fact that there is a deep gully in the area between the schools—makes it totally impractical for these schools to be run as one entity.

I made mention earlier of the need for a new name for the amalgamated school to be dealt with in a speedy fashion. The governing council was asked to indicate to DECD what its preference was for a new name. I understand that there were some suggested names put forward by DECD. However, the preference of some 70 per cent of the people of the governing council and the schools community was for the name to be the Para Hills P-7 Schools. I think to highlight the ridiculous way this whole process has been handled by the department and also minister Portolesi is that DECD will not accept this but they will accept Para Hills School (singular not plural) P-7. This is nonsense and it sums up what has been a disappointing process for a group of people who believe passionately about the identity of their schools and their community.

I think it is a significant indictment on the local member. I was at a public meeting last year that was held about the time that the review process started and, while the Hon. Mr Snelling was there, he did not stand up for the community then and he appears not to have stood up for that community at all in this whole process.

Having noted the disappointing way in which this whole amalgamation process has impacted on the Para Hills community, I think it is also important to note that there are many good people who work within DECD who have had to implement the priority of the government. The government has its right to do that. This bill supports the government in seeking its priorities but I think it is unfortunate the way in which officers of DECD have been forced to deal with some of the passionate and dedicated volunteers in this school community, of which they are very proud. With those words, I support the passage of this Appropriation Bill.

The Hon. G.A. KANDELAARS (12:44): I rise to make a second reading contribution to the Appropriation Bill for the 2012-13 fiscal year. There are a number of areas that I wish to concentrate my remarks on today: firstly, the current economic environment we find ourselves in; secondly, the Weatherill government's commitment to the future of our state through its record of ongoing investment in infrastructure; and thirdly, the ongoing commitment of the Weatherill government to provide good quality health and disability services.

As the budget papers point out, this year's budget has presented the government with significant challenges, in particular in respect of taxation and GST revenue writedowns over the forward estimates in the amount of $2.8 billion. I draw on my experience as a former director of a super fund to highlight the nature of the current economic cycle. In the past decade, we have seen one of the most volatile financial markets in world history. If you look at the typical balanced fund investment returns, in four of the last 10 years, we have seen negative returns. This year it is likely to see many funds barely showing positive returns.

This is unheralded and shows the level of turmoil in financial markets around the globe. This in turn has seen Australians move from being net debtors to net savers with a consequential and profound effect on GST receipts. In itself, Australia becoming a nation of net savers is not a bad thing at all, but the consequence of this has seen a substantial decline in the flow of money within the economy. The result is a decline in GST revenues for all states, including South Australia.

There is no doubt that South Australians are worried by world economic events such as are occurring in the eurozone—in particular, the Greek debt crisis—as well as the British and United States' economies which are still struggling with their recoveries post the global financial crisis. These events are certainly providing a dampener for our economy. However, the fundamentals of the South Australian economy remain very sound indeed.

State economic growth is predicted to be about 2.75 per cent for 2012-13 and there remain $109 billion worth of both government and private projects underway or in the pipeline. Examples of these major infrastructure projects are numerous. The amounts I list reflect the total capital cost of each project:

upgrading the metropolitan rail network—Belair and Noarlunga line, $143 million; Gawler, $128 million; the remaining network, $48 million; the construction of electrified line from Noarlunga to Seaford, $316 million;

duplication of the Southern Expressway, $407 million;

South Road superway, $842 million;

developing and upgrading major metropolitan and regional hospitals—Berri Hospital, $36 million; Flinders Medical Centre redevelopment, $162 million; Lyell McEwin stage C, $201 million; Modbury Hospital, $46 million; Queen Elizabeth stage 2, $127 million; Repatriation General Hospital, $33 million; Whyalla Hospital redevelopment, $69 million; Women's and Children's Hospital upgrade, $64 million;

Sustainable Industries Education Centre at Tonsley Park, $130 million;

Adelaide Convention Centre expansion and redevelopment to improve the Riverbank promenade and surrounding precincts to Morphett Street, $354 million;

new Royal Adelaide Hospital, $1.8 billion, which is associated with the design and construction currently being undertaken by SA Health Partnership; and

Adelaide Oval redevelopment, $535 million, which includes operating expenditure.

The budget delivers many new infrastructure investments this year including:

$28.7 million over four years to redevelop The Parks Community Centre;

$13.7 million to provide critical traffic-related infrastructure supporting the residential land release at Evanston;

$2 million to expand the Techport Common User Facility to support the air warfare destroyer project;

$11.7 million building the Adelaide Entertainment Centre park-and-ride facility, increasing the parking capacity by 602 spaces;

$443 million in partnership with the commonwealth to upgrade the Torrens and Goodwood rail junctions;

$75 million over four years to construct new community-based accommodation for the disabled;

beginning in 2011-12, $38.3 million over three years to build a new state-of-the-art mining, engineering, defence and transport training centre at Regency TAFE;

$11.3 million over four years to improve facilities at Salisbury East High School and Windsor Gardens Vocational College;

$7.7 million over three years for critical work on Her Majesty's Theatre and the Adelaide Festival Centre;

beginning in 2011-12, $4.7 million over two years to replace the Glen Osmond Fire Station; and

$4 million over two years to strengthen the Saltfleet Street bridge at Port Noarlunga.

The government has introduced a fiscal strategy to limit the government's net debt to 50 per cent of general government revenue. The planned and current spend in infrastructure in this state is an investment in this state's future and has also the added benefit of providing employment, particularly in the civil and building and construction sectors of our economy.

The Weatherill government has shown a continual and ongoing commitment to improving public health services in South Australia. This year's budget allocates $489 million to building new health facilities in the 2012-13 year. This is an increase, compared with the 2005-06 budget, of $353.5 million or 260 per cent. In terms of the South Australian country health system, $728.5 million has been allocated in 2012-13. This is an extra $348.2 million or 91.5 per cent compared to what was spent on public health in the country in 2001-02.

When Labor came to government in 2002, South Australia had the oldest health infrastructure in mainland Australia. The government has made a commitment to record infrastructure spend, upgrading all of the state's major metropolitan and country hospitals. The jewel in the crown will be the new Royal Adelaide Hospital where work has just commenced on the foundations. The new hospital will be a world-class facility which our state can be rightly proud of.

My wife until recently was a nurse in the public health system and I can assure you that she and many of her former colleagues believe that the new RAH will lead to better health outcomes for patients who will be treated there. One of the key reasons for this is that there will be 100 per cent single inpatient rooms. This will greatly assist in infection control which is increasingly difficult in multibed wards, particularly with the spread of superbugs such as MRSA and VRE.

Whilst on the issue of hospital beds, South Australia has the highest ratio of public hospital beds per head of population in Australia with three beds per 1,000, which is 15.4 per cent above the national average figure of 2.6 beds per 1,000. Across metropolitan acute hospitals, there was an average of 2,866 overnight beds in June 2011. This is over 300 more beds than in 2001-02.

Currently, there are capital works programs to extend the number of public hospital beds with work at Lyell McEwin, approximately 100 beds; the Modbury Hospital, approximately 30 beds; the Women's and Children's Hospital, approximately 10 cots; and the new RAH, approximately 120 beds. This will provide more than 250 additional beds by 2016 compared with the stock position at 2008-09.

The Weatherill government is also showing its ongoing commitment to assist those with a disability, and in 2012-13 the state budget allocated an extra $212.5 million in funding for those in the community who suffer from a disability. The allocation of this $212.5 million over five years represents an increase in disability funding of more than 15 per cent, and there will be a 33 per cent increase in disability expenditure across the forward estimates.

Assisting people with disabilities is a major priority of the Weatherill government. The Premier has been a passionate advocate throughout his career for people living with disabilities, and this is not only limited to his time as minister for disabilities from 2004 to 2008. Since coming to office, the Labor government has more than doubled its spending on disability, from $135.4 million in 2002-03 to $345.9 million in 2012-13.

The government is proud of its record of supporting people with disabilities but acknowledges that more needs to be done in this area. This is why this new money will assist in major reforms across the disability sector, including changes in preparation for the NDIS, moving to individualised and self-managed funding, getting a new disability act underway, working on a disability justice plan and expanding community visitor schemes. I know that minister Hunter is doing all he can to ensure that those living with a disability in this state are given the same opportunities to genuinely participate and contribute in our society as every other South Australian.

In conclusion, this budget reflects a time of global economic uncertainty, although a time when the fundamentals of this South Australian economy are sound. The international uncertainty has fed back into the Australian economy. Consumers have been reluctant to spend, which has seen a significant decline in GST and stamp duty receipts, which has led, as I said earlier, to a writedown of forward estimates of $2.8 billion.

The Treasurer has framed a budget that looks to South Australia's future with a significant ongoing infrastructure investment as well as looking to assist those in our community who need it most. The budget provides a strong foundation for a strong future for South Australia. I commend the 2012 Appropriation Bill to the house.

Debate adjourned on motion of Hon. J.A. Darley.


[Sitting suspended from 12:59 to 14:17]


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