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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2012-03-13 Daily Xml
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WATER INDUSTRY BILL

Committee Stage

In committee.

(Continued from 29 February 2012.)

Clause 35.

The Hon. R.L. BROKENSHIRE: I move:

Page 25, lines 26 to 38, page 26, lines 1 to 13—Delete subclauses (3) to (8) (inclusive) and substitute:

(3) In addition to the requirements of section 25(4) of the Essential Services Commission Act 2002, the Commission must adopt the terms of any price determined by the panel under section 35A.

The purpose of the amendment is, firstly, to remove the pricing order power of the Treasurer; however, the control we keep in place, as well as the postage stamp pricing principle that we and the Liberals, as I understand, are interested in continuing is in relation to our primary producer pricing panel model that will be the subject of a later amendment. In a sense, this is a test clause on that issue.

Also, I advise colleagues that if I lose the vote here on the removal of pricing orders but have sympathy on the primary producer pricing panel concept, I will move amendment No. 2 standing in my name so we can retain the pricing orders but still keep the panel. This is a quirk of how legislation interacts with the issues being raised and was the best way we could see to debate it. Honourable members should be aware that, in moving this amendment, I debate two issues, which I will explain now.

First, it gives what I call true independent pricing power to ESCOSA. At the moment, as has been debated in the media, the Treasurer's writing a letter takes away the true independent pricing power of ESCOSA. We have seen that in the past with electricity. Secondly, it creates primary producer pricing via a panel as set out in proposed clause 35A, which members can see in my amendment No. 4.

The reason for the second part I will explain in more detail later but, if we are going to be serious about giving the Essential Services Commission true independent powers to price water, we should give them true independent powers without manipulation from the Treasurer, as we have seen on several occasions already with respect to electricity.

The Hon. I.K. HUNTER: This amendment relates to Brokenshire amendment No. 4, which he indicated will be a later amendment, in relation to a proposed new clause 35A regarding a special price for water supplied for primary production. The government's understanding of the effect of these proposals is that an industry panel will be set up to fix the price that should be charged for water provided to a primary producer by any water entity.

The government does not support the proposal. It is inconsistent with the purpose of the bill, which is to establish a properly independent economic regulation regime, one that already applies in relation to electricity and gas and operates according to the well-settled requirements of the Essential Services Commission Act 2002. The panel, whose five members include three industry representatives, is obviously not independent. Moreover, the proposed arrangements would govern the activities of any water industry entity and provide less transparency and less business certainty than an economic regulation regime under the Essential Services Commission Act 2002.

In practical terms, the honourable member's proposal is likely to have the effect of discouraging competition and the development of alternative sources of supply that the bill is designed to encourage. In this respect, a potential supplier of water to the primary production sector is likely to think twice about their investment if they think a panel comprised largely of primary producers has the power to set their prices.

I contrast this to the proposals in the bill under which a new supplier of water will be subject to a light-handed price regulation, especially if they are a small entity without market power supplying to commercial customers. In addition, on the assumption that the outcome of this is a lower price for supply and usage for primary producers, this will simply mean that the cost of this subsidy will be borne by all other water users, including residential customers.

I might also respond to a question asked by the Hon. Mr Brokenshire: why would we impose this pricing order on the water industry? The pricing order provides the government with the power to manage the transition to independent economic regulation and to transparently record government policy that impacts on pricing, which may include inter-governmental agreements such as the National Water Initiative.

The bill explicitly states that the pricing order may set out any policy that ESCOSA must have regard to when making a determination and specify various parameters, principles or factors that ESCOSA must adopt or apply when making a pricing determination. This will ensure the government has adequate mechanisms available to deliver key policy objectives with respect to pricing in the water industry, for example, statewide pricing or avoidance of price shocks to consumers.

The Hon. M. PARNELL: I have a question of the mover, and this might seem a little bit pedantic. I have two amendments filed by the Hon. Rob Brokenshire, three minutes apart, affecting the same clause. Mr Chairman, you clarified that the amendment we are debating deletes subclause (3) to (8) inclusive. That is [Brokenshire-1] 1, but amendment [Brokenshire-2] 1 just deletes clause 3.

I just want to clarify exactly what it is we are debating. In moving his amendment, the honourable member talked about two issues: water for primary producers and postage stamp pricing. Whether that is the case depends on which of these amendments we are dealing with. I note that the set [Brokenshire-2] was filed three minutes after the set [Brokenshire-1].

The ACTING CHAIR (Hon. G.A. Kandelaars): I am told that if the bill is recommitted the Hon. Rob Brokenshire is proposing that second amendment.

The Hon. D.W. RIDGWAY: From my understanding, we are debating the amendment [Brokenshire-1] 1, which, as the Hon. Mark Parnell said, deletes subclauses (3) to (8) inclusive and inserts a new subclause. The opposition's understanding is that the effect of this amendment is to remove the ability of the Treasurer to issue a pricing order for ESCOSA with which ESCOSA is obliged to comply.

The opposition's view is that, notwithstanding the corporatised nature of SA Water, it is still cabinet and the government of the day which signs off on major infrastructure such as the desalination plants, new pipelines, dams, wastewater treatment plants, etc. Whether they are good or bad decisions, governments will feel the effect of those decisions at the ballot box. I suspect that, as a result of having a desalination plant twice the size of what was ever recommended by the experts to the opposition, and the government's failure to ever explain where it got its advice as to why it needed to be 100 gigalitres, that will impact water pricing.

It is the opposition's view that cabinet should maintain the ability to issue instructions to ESCOSA via a pricing order rather than make them totally independent. We believe the government should be held accountable. We understand what the Hon. Robert Brokenshire is trying to achieve, but, at the end of the day, if a government makes a decision to build, for example, a 100-gigalitre desalination plant and spend $2.4 billion on the project, it has to be funded from somewhere. Of course, if the two are disconnected there is no way that the government of the day can fund that particular project. If it is a reckless decision they should pay the price at the next election.

Amendment negatived.

The Hon. D.W. RIDGWAY: I move:

Page 26, after line 13—Insert:

(8a) In addition, in making a determination, the Commission must have regard to the principle that the prices charged to small customers for retail services should be at the same rates for all small customers regardless of their location in the State (and a pricing order must, if relevant, take this principle into account).

(8b) Subsection (8a) does not prevent the Commission setting different rates for different classes of services.

This amendment provides for the continuation of the postage stamp pricing by SA Water across South Australia. The amendment has been drawn from the Electricity Act. The reality is that, via the customer service obligation, SA Water has provided an affordable water supply to the vast majority of South Australian communities. The opposition seeks the continuation of that protection for isolated communities. We have seen the potential impact on communities in the north when the government has moved to remove electricity subsidies. If both power and water costs are not protected, towns such as Coober Pedy will soon disappear.

The Hon. I.K. HUNTER: The government opposes the Hon. Mr Ridgway's amendment No. 15. It is about statewide pricing. The opposition has made a number of statements about the need for greater independence for ESCOSA. However, the government welcomes the opposition's recognition in these amendments that there are indeed cases in which it is appropriate for ESCOSA, in the exercise of its powers, to be given authority to go beyond economic efficiency criteria in its own legislation. Statewide pricing may represent such a case; however, this amendment was seen to permanently require statewide pricing, notwithstanding any review by ESCOSA of the principles behind the pricing structures.

Under Water for Good, the government is committed to requesting ESCOSA to prepare a report on statewide pricing. This amendment constrains future governments by enshrining statewide pricing in legislation. This would unnecessarily inhibit any future consideration of more efficient or more appropriate pricing structures which may benefit consumers. Currently, the government has no intention of moving away from statewide pricing, as a policy setting it has maintained for almost 10 years. In considering such a policy change, the government would only do so on the basis of strong advice from ESCOSA and in the interests of South Australian consumers. We oppose the amendment.

The Hon. M. PARNELL: This is an interesting provision because in some ways it reflects what the government is already doing and what it has been doing for 10 years, that is, having a policy of statewide pricing. The question for us is whether it makes sense to pre-empt the findings of the ESCOSA report and forever lock into legislation this concept. I accept what the minister said, that it is not the government's intention to move away from it, but there are some circumstances in which it is possible to envisage—however much we might like the levelling out between country and city, that that makes sense—that there are circumstances where it would not make sense.

I am familiar with one property developer who attempted (I think it was on the Yorke Peninsula) to get a development up. It was not able to be connected to SA Water's infrastructure and therefore, effectively, could not go ahead. This person's solution was going to be total self-sufficiency. He was going to have massive rainwater tanks, all sorts of things, but he still could not get this development approved. You can envisage a circumstance where there might be a development that is away from a current area, where a water provider is willing to come along and provide a service to a new community and might be able to do it cheaper than putting in big rainwater tanks for everyone, and yet it might be marginally more expensive than the postage stamp pricing that would apply through SA Water supplies.

The question would be: do we say no to that development simply because the postage stamp pricing would kill it, or do we allow for some flexibility so that a development might still be able to go ahead? It seems to me that we need to keep a little bit of flexibility. If I had any inclination that the government was about to immediately move away from postage stamp pricing then it would give me some concern, but the minister has given assurances in this place that that is not the government's intention, that there is to be a review of statewide pricing. I, for one, am happy to let that process take its course and to leave this bill silent on that point for now and we can revisit it if and when ESCOSA comes back with a different model. So, for now, I think the best thing for this legislation is to not support this amendment, and the Greens will not be supporting it.

The Hon. R.L. BROKENSHIRE: Given that this is the way procedures are, I will speak specifically to the Liberal amendment but then add to that that my amendment No. 2 is identical, except that it does not apply in relation to a price determined by the panel under section 35A. If that gets up then, obviously, we would need my additional amendment. On the principle of postage stamp pricing, that is a matter we do support. I have heard in this place regularly that the government is doing a review or, trust me, they will be in government forever, and so on and so forth. We hear that regularly. I think it is time we started to protect these smaller communities and enshrine it in law. Therefore, we will be supporting the Liberal amendment.

The Hon. J.A. DARLEY: I will not be supporting the amendment.

The Hon. A. BRESSINGTON: I will be supporting it.

The Hon. K.L. VINCENT: I will not be supporting it.

The committee divided on the amendment:

AYES (9)
Bressington, A. Brokenshire, R.L. Dawkins, J.S.L.
Hood, D.G.E. Lee, J.S. Lensink, J.M.A.
Lucas, R.I. Ridgway, D.W. (teller) Wade, S.G.
NOES (10)
Darley, J.A. Finnigan, B.V. Franks, T.A.
Gago, G.E. Gazzola, J.M. Hunter, I.K. (teller)
Kandelaars, G.A. Parnell, M. Vincent, K.L.
Wortley, R.P.
PAIRS (2)
Stephens, T.J. Zollo, C.

Majority of 1 for the noes.

Amendment thus negatived.

The Hon. M. PARNELL: My amendment is the proposed insertion of three new paragraphs, namely, (8a), (8b) and (8c). Paragraphs (8a) and (8b) are effectively consequential on an issue that was dealt with previously, so I will not move those, but I will move my proposed new paragraph (8c). I move my amendment in an amended form:

Page 26, after line 13—Insert:

(8c) In addition, in making a determination, the Commission must have regard to the principle that a price in the nature of a supply charge payable for the right to the provision of a retail service should take into account whether premises are actually connected to the relevant infrastructure.

I have explained this previously. Basically, what this amendment is about is that it recognises that there are some people who, I believe, are unfairly treated by having to pay the same supply charges for water and sewerage even though they do not use those services. The way in which the system works is that, if the pipes go past your property, you have to pay those access charges, even though you do not actually use the services.

Clause 35, which we are dealing with, is about pricing, and my amendment, in a nutshell, says that ESCOSA should take into account the fact that some people are not actually using any part of the service, and therefore it leaves the door open for ESCOSA to come up with a charging regime that recognises that fact. It does not guarantee that these people will be off the hook entirely, but it leaves it open to ESCOSA to make a judgement about whether they should pay a bit less because they are not connected to the service.

The reason people are not connected to the service is very often through altruistic motives, where they have sought to take personal responsibility for their own water and waste and often have invested vast sums of their own money in, for example, rainwater tanks, dry composting toilets or greywater recycling systems. There are all manner of services where they have taken responsibility for their water and their waste, yet they are still slugged because the pipes go past their property.

I understand the rationale for that regime: it has been to share the cost of the service over everyone who is able to connect, whether they do or they do not. I think that we should provide some small incentive to people who do the right thing in terms of self-sufficiency, and this simple amendment allows the Essential Services Commission to take into account whether or not the premises are actually connected to the relevant infrastructure.

The Hon. I.K. HUNTER: This is a longstanding area of interest for the Hon. Mr Parnell and his party; I understand that. But one must realise that, on the issue of connection, it also has to be noted that even those householders or landowners who are not connected to a mains water system benefit from investments in their community's water security. In particular, landowners gain benefits in the form of water being available for firefighting purposes and increased property values from having a water or wastewater service available for connection. It is therefore reasonable, in the government's view, to expect a contribution in such circumstances.

If landowners or householders could not be charged in these circumstances, this would mean increased costs for those households that are connected. The government is happy to look at these issues of affordability and connection more closely, but it should be done in the context of the proposed review of pricing by the Independent Regulator, when proper account can be taken of a range of competing interests of equity, economic efficiencies, sustainability and water security. We oppose the amendment.

The Hon. D.W. RIDGWAY: I indicate that the opposition also will be opposing the amendment. Our understanding is that it seeks to direct ESCOSA by establishing the principle that water pricing should have regard to the provision of a basic amount of water for essential human needs. The amendment also seeks to have ESCOSA take into account that a property that is serviced by water or sewerage is either not actually connected or the service is at a very low level.

The first part of the amendment, by being prescriptive, is about a particular principle to be taken into account by ESCOSA, which would detract from ESCOSA's flexibility. It should be noted that the bill already provides for the government of the day, by a Treasurer pricing order, to set out policies, principles, factors and parameters for ESCOSA to adopt and to apply when making a pricing determination.

The second part of the amendment (and I sort of concur with some of the minister's comments) would undermine the principle that all properties with the potential to have water or sewerage connected should contribute to the cost of the service in recognition of the property's value and partly reflective of the potential to connect. I think the minister made some valuable points in relation to community services, such as firefighting and other community needs, that is, everybody in the community benefits from those. We will not be supporting the amendment.

The Hon. M. PARNELL: I can tell the will of the council even from over here on the crossbench, so I will not divide on this. However, I just make the point that I would not have expected that these people would have got away scot-free, for the reasons the minister has said: I expected that they would pay something. There is a value to having pipes in your neighbourhood for fire fighting and for other purposes.

I would still hope that, even though this amendment might not pass now, perhaps the Treasurer in a pricing order or ESCOSA of its own volition might take into account the fact that some people are doing the right thing and in fact relieving taxpayers of some of the expense, but not entirely, as the minister has said. I can tell the mood of the council and will not divide on this.

Amendment negatived.

The Hon. D.W. RIDGWAY: My amendment is consequential on the one defeated.

The Hon. R.L. BROKENSHIRE: Mine is consequential also.

Clause passed.

New clause 35A.

The Hon. R.L. BROKENSHIRE: I move:

Page 26, after line 15—Insert:

35A—Special price for water supplied for primary production

(1) For the purposes of this section, the Minister must from time to time constitute a panel constituted by the following members:

(a) a person nominated by the Minister (who will be the presiding member of the panel);

(b) a person nominated by the South Australian Farmers Federation Incorporated;

(c) a person nominated by the Local Government Association of South Australia;

(d) a person nominated by the South Australian Dairy Farmers Association Incorporated;

(e) a person nominated by the South Australian Wine Industry Association Inc.

(2) The terms and conditions of appointment of a member of the panel will be determined by the Minister.

(3) The proceedings of the panel (including as to quorum) will be prescribed by the regulations and, to the extent that the regulations do not deal with a particular matter, determined by the panel.

(4) The function of the panel is, on an annual basis, to fix the price that should be charged for water provided to a primary producer by a water industry entity for purposes associated with the business of primary production in the ensuing financial year.

(5) The price fixed under this section must be set out in a price determination issued by the panel.

(6) The panel must, in fixing a price—

(a) consult with the Commission; and

(b) consider the extent to which there can be consistency between the principles applied in relation to the pricing for the provision of water across the State (insofar as those principles may be relevant in the circumstances).

(7) For the purposes of this section, water supplied to a place used by a primary producer for purposes associated with the business of primary production and used for domestic purposes at that place will be taken to be used for purposes associated with the business of primary production.

(8) In this section—

business of primary production means the business of agriculture, pasturage, horticulture, viticulture, apiculture, poultry farming, dairy farming, forestry or any other business consisting of the cultivation of soils, the gathering in of crops or the rearing of livestock;

primary producer means a person who is wholly or substantially engaged in the business of primary production.

Family First put up this amendment after a great deal of consideration whereby we propose a special price for water supplied for primary production and that a pricing panel be established to determine what the price should be for primary producers. What we have done with this is similar to what the Greens have done with what I will call some SACOSS amendments, and we will support those SACOSS amendments for similar reasons. There are arguments that certain users of water should, in our opinion, be given an opportunity to buy that water at a fair and reasonable price.

What we have seen is a direct result of the desalinisation plant—and I will give a bit of quick history of that desalination plant. It was supposed to be a 50-gigalitre plant. In a walk in the park by then prime minister Rudd and then premier Rann, that was doubled. Whilst the commonwealth put money into it, the bottom line is that the desalination plant is an incredibly expensive piece of infrastructure, and what the government is trying to do now is rape and pillage every aspect of water purchase it can possibly get its hands on.

We have seen situations where, in the Clare valley, in the McLaren Vale wine region, in Meningie and surrounds, as examples, water for primary producers has absolutely gone through the roof, and it is now at the point where it is making those primary producers non-viable. As I always do, I declare my interest and that of my family as a dairy farmer.

I will go on to say that other dairy farming colleagues are now getting water bills in excess of $100,000 a year for water for stock and domestic use, for hosing down, cleaning up and washing milking machines, etc. The way agriculture is, there is no way known that there is a lazy $100,000 sitting around for a farmer to be able to write out a cheque to SA Water for water charges. It is just not on. In fact, it is at a point now where some of those farmers are at tipping point, which is of extreme concern.

Successive governments have supported mains water operations in the Clare valley and the McLaren Vale wine region, and with good intent those primary producers put viticulture and other forms of horticulture into production. To try to offset some of the issues with mains water, some were involved in a recycled water project in the McLaren Vale region. That was fine for some who were able to get recycled water but that recycled water only goes to a part of that region, and I have had lots of representation from growers because they are now struggling to be able to irrigate their vines.

Most members would know what has happened in the Clare valley and that it is in a desperate situation. Family First clearly acknowledges that you are not going to get this water for nothing and we do not expect that. However, when parliament was prorogued, the first point the Governor highlighted to the joint sitting of the parliament on behalf of the government was that the government was going to have a focus on the opportunities for agriculture for sustainable food production.

I give credit to the government for putting that right at the top after a lot of debate, but I put it to the chamber that, if the government wants to show more than rhetoric, here is an opportunity for it to support a panel. The minister has said that this is a primary producers panel. We will just go through who is on that panel: one is a person nominated by the minister who will actually be the presiding member of the panel and will, therefore, have a casting vote if required, depending on the circumstances; one from the South Australian Farmers Federation; one from local government; one from the South Australian Dairy Farmers Association; and one nominated by the South Australia Wine Industry.

The terms and conditions of a member of the panel will be determined by the minister. The problem we have at the moment is that there has been no panel and no consideration of the impact that this has, other than the fact that this government wants to get as many dollars as it can from wherever it can to help pay for an ill-conceived desalination plant. This desalination plant, I might remind colleagues, was opposed by the government when the Hon. Iain Evans was the leader of the opposition and went to Perth—

The Hon. I.K. HUNTER: Mr Chairman, this is not the place for a second reading speech and I ask you to direct the honourable member to speak to his amendment.

The CHAIR: The honourable member should stick to his amendment.

The Hon. R.I. Lucas: They are trying to gag you.

The Hon. R.L. BROKENSHIRE: They are trying to gag me but that is the way this government seems to be operating. I thought this was a consultation—

Members interjecting:

The CHAIR: Order!

The Hon. R.L. BROKENSHIRE: —explain and then make a decision government, but it is actually a stronger announce and defend government than the Rann government. I invite the minister to come with me in my car to see some of these farmers and he can have a firsthand look at the impact. I am arguing for this because, at the moment, the amount of money that these primary producers are being hit with is outrageous.

We are not saying that primary producers should not have to pay a fair and reasonable amount for water, but they are not mining magnates or pokie barons—as you often hear people in the government speak about hoteliers—they are actually out there trying to produce food. This needs to be done, I believe, in a fair and more equitable way. This sets up a panel that could have a look to see what is a fair and reasonable price for water and, as I said, it ties in, from a principle point of view, with some of the amendments which the Greens are moving and which we will be supporting.

The Hon. I.K. HUNTER: This amendment relates to [Brokenshire-1] regarding a special price for water supply for primary production. It is very similar to the amendment which was just defeated and which was moved by the Leader of the Opposition the Hon. Mr Ridgway. The government will not be supporting this amendment.

Essentially, it comes down to two points: first of all, the panel that is being suggested is not independent: it is comprised of three out of five primary producers. There is no way that a water company supplying water would ever see that panel being able to adopt an independent point of view when it comes to pricing for primary producers.

As I stated previously, the assumption is that the outcome of this amendment would be a lower price for supply and usage of water for primary producers. Sir, let no-one in this chamber be unaware of the fact that what that really means is the costs that you will be reducing for the primary producers will be passed on to every other customer. It will be passed on to every other residential customer, so if you think—

The Hon. R.L. Brokenshire interjecting:

The Hon. I.K. HUNTER: If you think that the outrage that you are saying—the confected outrage about the price—if you are successful with this amendment, just wait and see what the outrage will be from residential customers when they have to pick up the price for your amendment. The government opposes the amendment.

The Hon. D.W. RIDGWAY: I indicate the opposition will be opposing the amendment. We proposed a scheme earlier in the debate which would have given farmers and other users in rural communities the opportunity of purchasing water via a River Murray licence and then obliging SA Water to provide a delivery-only service, thereby offering different product which would provide some cost relief to farmers.

We saw that as a better way of dealing with this issue, but it is the view of the opposition that there are a number of users in our regional communities that might be better served by having been able to come together, or individually, and use SA Water to provide that delivery service. We also question—and I will just question the mover—I am wondering whether he has any thoughts to the ACCC, as to whether this is in contravention of any of the ACCC regulations in relation to competition.

I indicate the opposition will not be supporting this, notwithstanding that we understand the mover's intent, but we think the better way was providing a delivery service where either a group of farmers, a regional community or a group of industrial users could actually purchase water from the River Murray and have it delivered for their use.

The Hon. R.L. BROKENSHIRE: Could I just conclude, sir?

The CHAIR: Conclude?

The Hon. R.L. BROKENSHIRE: Well, I want to conclude, just to sum up. First of all, as I am seeing become more and more typical with this government, they are not even prepared to foreshadow a further amendment. If the problem with the government was that they do not like its composition, well damn well put up an amendment where you change the composition.

The Hon. I.K. Hunter interjecting:

The Hon. R.L. BROKENSHIRE: But you did not do that; you could be saving a heck of a lot of money. I want one more point placed on the public record: the Liberals did not get their amendment up, but the Liberal amendment would have cost the government of the day $15 million to $18 million; that is why the government did not support that one—it was a $15 million to $18 million cost.

This amendment is just about having some consideration and some equity into the deliberations around a fair price for them. Some of these people, by the way, cannot actually access River Murray water through a pipe, so this was an opportunity to be a bit innovative, but I hear the numbers of the two major parties, and I know what happens when they crunch together.

New clause negatived.

Clause 36 passed.

New clause 36A.

The Hon. M. PARNELL: I move:

Page 27, after line 3—Insert:

Division 4A—Customer hardship policies

36A—Customer hardship policies

(1) A water industry entity must—

(a) within 3 months of being granted a licence—

(i) develop a customer hardship policy in respect of residential customers of the entity; and

(ii) submit it for approval by the Commission; and

(b) publish the policy, as approved by the Commission, on the entity's website as soon as practicable after it has been approved;

(c) maintain and implement the policy.

(2) The policy must be consistent with any applicable code or rule under section 25(1)(a).

(3) The minimum requirements for a customer hardship policy of a water industry entity are that it must contain—

(a) processes to identify residential customers experiencing payment difficulties due to hardship, including identification by the entity and self identification by a residential customer; and

(b) processes for the early response by the entity in the case of residential customers identified as experiencing payment difficulties due to hardship; and

(c) flexible payment options for the payment of bills by hardship customers; and

(d) processes to identify appropriate government concession programs and appropriate financial counselling services and to notify hardship customers of those programs and services; and

(e) an outline of a range of programs that the entity may use to assist hardship customers; and

(f) where it appears that a customer may be using excessive amounts of water—a scheme for providing audits of equipment at the premises to check for leaks or other problems; and

(g) any other matters required by the regulations.

(4) A water industry entity may vary a customer hardship policy from time to time (taking into account the minimum requirements under subsection (3)).

(5) The Commission must, in considering whether to approve a customer hardship policy (or variation)—

(a) ensure that it complies with the minimum requirements under subsection (3); and

(b) have regard to the following principles:

(i) that the supply of water is an essential service for residential customers;

(ii) that water industry entities should assist hardship customers by means of programs and strategies that ensure the on-going provision of water for essential human needs;

(iii) that residential customers should have equitable access to hardship policies, and that those policies should be transparent and applied consistently.

(6) In this section—

hardship customer means a residential customer who is identified as a customer experiencing financial difficulties due to hardship in accordance with the water industry entity's customer hardship policy;

residential customer means a customer or consumer who is supplied with retail services for use at residential premises.

I think this amendment has general support. At one level, it might be thought of as consequential but, just to explain very briefly, if we go back to clause 25 of this bill, it requires that water industry operators have to have a licence. Part of the condition of the licence is complying with applicable codes or rules. One of the applicable codes or rules should be customer hardship policies.

We have already agreed to delete from section 25(4) the words 'if the Minister so requires', so that effectively means that we are making it obligatory for the minister to prepare a hardship policy, and what my amendment does is put some flesh on the bones. I appreciate, through discussions with the government, that it was a very prescriptive hardship policy originally, and I have made it a little bit more general but, nevertheless, I think it still captures the spirit of what is required in hardship policies.

Very quickly, I want to put on the record some information I have just received from Mark Henley, the Manager of Advocacy and Communication with UnitingCare Wesley. He has kindly forwarded to me some new ABS data, which is out today, dealing with hardship. This data updates the general social survey and includes financial stress data.

I am not in a position to table a statistical table but I will tell members the gist of this information is that the number of sole parent households who are facing financial stress as a result of utility bills has gone up considerably from 2006 to 2010. We have the situation now where 40 per cent of sole parent households have trouble paying their utility bills at some stage through the year and that most people, in fact, have multiple experiences of bill-paying stress in each year, and the mode amount is three to five problems per year.

Clearly, utility bills are starting to bite and it is very important that there should be hardship provisions in place to identify people who are potentially at risk of being cut off and assisting them with meeting their obligations. I look forward to the committee's support for this amendment.

The Hon. I.K. HUNTER: The government is happy to support this most excellent amendment.

The Hon. D.W. RIDGWAY: I am a little confused about the guidance I have received from our shadow minister, but I indicate that the opposition will not be supporting the amendment proposed by the Greens.

The Hon. R.L. BROKENSHIRE: Based on the principles that I argued before and the fact there needs to be flexibility in hardship areas, including primary production and general hardship, and knowing that SACOSS has been pushing this, we would support this amendment of the Greens.

New clause inserted.

Clauses 37 to 57 passed.

Clause 58.

The Hon. D.W. RIDGWAY: The opposition opposes clause 58 and its powers, which are available elsewhere to the minister. The bill obliges the minister to undertake water supply planning. It also empowers the minister to collect fees to pay for planning and associated work. Therefore, it should fall to the minister to be responsible for making decisions about restrictions or discontinuance of supply. This clause divorces the minister from the responsibility, so we would like to oppose the clause.

The Hon. I.K. HUNTER: Clause 58 provides powers for water industry entities to respond to a set of circumstances that may impact their ability to provide a reliable or safe service. Under this clause an entity may restrict or discontinue supply in accordance with any requirement stipulated in the regulations, for example, if the quantity is insufficient to meet demand, if the quantity or quality is below standard or the capacity of the water infrastructure is insufficient to cope with demand.

This should not be confused with the water conservation provisions in clause 90, which prohibit certain types of water use. Powers similar to those in clause 58 have been afforded to SA Water in the past under section 33 of the Waterworks Act and will now be available to other water industry entities under this clause.

There are a number of examples where the powers in clause 58 would be used by SA Water or by other entities. For example, the powers in clause 58 would be used in situations where there is a lack of supply. A number of SA Water's rural systems have been developed to provide water for domestic and stock watering purposes. Without the ability to restrict supply, experience has shown that some customers have taken much higher volumes of water, for instance, to store water by filling large dams. This interferes with the system's ability to provide water to downstream customers and has the potential to exhaust water allocations, potentially making SA Water non-compliant with its licence requirements.

The powers in clause 58 would also be used in situations of poor water quality. Drought conditions typically lead to deterioration in water quality such as high salinities and the potential for toxic algal blooms. Whilst this has been managed in the past, issues with salinity or nutrient levels could lead to the need to discontinue supplies should the water become unsafe to drink.

Finally, the powers in clause 58 could also be used in situations where there are short term system failures. Circumstances arise from time to time that require the water supply system to be shut down. For example, in 2005, SA Water lost pipelines on Eyre Peninsula due to bushfires, and supplies were severely interrupted for two weeks, with water supplies subsequently restricted.

The absence of these powers, such as in clause 58, would mean that each water industry entity would need to either provide sufficient infrastructure to guarantee continuous supply under all situations regardless of cost or allow systems to run dry when available water was exhausted. The inability to lessen water supply or manage its use in unavoidable circumstances may have a negative impact on these services or create a reluctance to enter into this area of service provision. Consequently, the government asks the committee to support the clause.

The Hon. A. BRESSINGTON: I will be supporting the clause.

The Hon. M. PARNELL: The Greens will be supporting the clause.

The Hon. R.L. BROKENSHIRE: We will be supporting the clause, based on what I have just heard.

Clause passed.

Clauses 59 to 79 passed.

Clause 80.

The Hon. D.W. RIDGWAY: I move:

Page 59, line 21—Delete 'Subject to subsection (2), a' and substitute:

A natural

This is in relation to self-incrimination. Subclause (2) provides:

If a person is required to give information or produce a document under this Part in circumstances prescribed by the regulations and the information or document would tend to incriminate the person of an offence, the person must nevertheless give the information or produce the document, but—

It has been the longstanding position of the Liberal Party that a natural person should not be required to give information that may incriminate them. I think members would be well aware of our longstanding principle, so I urge members to support the amendment.

The Hon. I.K. HUNTER: The government's position is that the amendment is not required. Clause 80, as proposed in the bill, already includes appropriate protections and balances these against other policy outcomes. For example, if a natural person is required to provide evidence that is incriminating, then that evidence cannot be used against them in court. However, the information obtained could still lead investigators to other evidence that could be used to prosecute a person.

Clause 80 also provides protection in the instance where a company is required to produce evidence that is incriminating. Again, that evidence cannot be used against them in court, but that information obtained could lead investigators to other evidence that could be used to prosecute a company director.

The effect of the opposition's amendment would be to remove this clause in relation to companies. If evidence or information cannot be obtained in this way, it may not be possible to prevent continuing harm or to manage risk of harm to persons, the environment or the public.

Interestingly, in April this year the opposition supported self-incrimination provisions in the Safe Drinking Water Bill that were similar to the provisions in clause 80 of the Water Industry Bill. In fact, the provisions offered less protection for a person who has to produce documents or provide information. The government, therefore, cannot support the opposition amendment in this case.

The Hon. S.G. WADE: The minister rightly pointed out that the opposition has, if you like, eased the privilege of self-incrimination where there is a threat to water. If the government already has the power to override self-incrimination where there is a threat to the environment or public health, as this parliament provided for earlier this year, why do we need to honour reticulation issues?

The Hon. I.K. HUNTER: My advice is that we are still dealing with water issues in this bill so we need consistent legislation. I should correct myself, I said, interestingly, in April of this year. I meant, of course, April of last year.

The Hon. S.G. WADE: I would make the point to the committee that we should be very reluctant to wind back the privilege of self-incrimination. If there is a threat to water in relation to the environment or health, we have already given the authorities the power to act, we should not give them the power to override self-incrimination when they are actually water pumping.

The Hon. R.L. BROKENSHIRE: I rise to advise the committee that Family First will be supporting the opposition. The situation is, for a start, that I do not trust the wording of this. It states that the person must, nevertheless, give information or produce the document. It goes on—which this government is famous for in drafting—to state that things will be established in regulation. I remind my honourable colleagues of what we are seeing with NRM and the way those officers go about intimidating (and so on and so forth) property owners when they try to get evidence. It is actually more than intimidating, it is sometimes interrogating. This is a basic principle of right that has been in the parliament for a very long time. I think it is a big error of the government to even push this as an amendment.

The Hon. I.K. HUNTER: I remind honourable members that the effect of the opposition's amendment would be to remove this clause in relation to companies. That evidence that we seek would not be used against them in court but could lead to other information that could lead investigators to other evidence that could be used to prosecute a company director. If you support the opposition's amendment in this regard you are deleting the action of this clause from acting on companies.

The Hon. A. BRESSINGTON: It is my understanding that, under Australian law, it is already established that bodies corporate do not have the right to be protected from self-incrimination. So, I will be supporting the amendment.

The Hon. M. PARNELL: The Greens will not be supporting the amendment. The starting point for us is to look at the subject matter and the likely range of issues that are going to be dealt with, and they are issues that are beyond an individual's relationship with the state. Often, when we think about self-incrimination, it is just that person and the state. What we are talking about here is the stuff of life. We are talking about infrastructure to deliver clean water and take away dirty water. When things go wrong, when people do not comply with their obligations, things can go terribly wrong.

I cannot see that there is a logical distinction to be made between individuals who are involved with the water industry and companies involved in the water industry. It makes no sense to have different standards applying to both. Having said that, we need to hang onto legal principles, such as the right to not self-incriminate, but that right is subject to the greater good, and the government has put some safeguards in here. As I understand the minister's comment before, and as I understand the Liberal amendment, we are dealing with amendment No. 18 now, but when we deal with amendment No. 19, that deletes the whole of subsection (2), including the reference to corporations. I am assuming that is what the minister was getting at. I do not think that this amendment, or the following one, are worthy of support.

The Hon. K.L. VINCENT: I am certainly opposing this amendment.

The committee divided on the amendment:

AYES (10)
Bressington, A. Brokenshire, R.L. Darley, J.A.
Dawkins, J.S.L. Hood, D.G.E. Lee, J.S.
Lensink, J.M.A. Ridgway, D.W. (teller) Stephens, T.J.
Wade, S.G.
NOES (9)
Finnigan, B.V. Franks, T.A. Gago, G.E.
Gazzola, J.M. Hunter, I.K. (teller) Kandelaars, G.A.
Parnell, M. Vincent, K.L. Wortley, R.P.
PAIRS (2)
Lucas, R.I. Zollo, C.

Majority of 1 for the ayes.

Amendment thus carried.

The Hon. D.W. RIDGWAY: I move:

Page 59, lines 24 to 42—Delete subclause (2)

This is to delete subclause (2) of clause 80. I will not prolong the debate. As I think we are all well aware, the opposition's position is that natural persons should not be forced to display evidence which will incriminate themselves—a fundamental tenet of our law. I thank members for their support on the previous amendment and I look forward to their support for this next amendment.

The Hon. I.K. HUNTER: For similar reasons to the last amendment, the government opposes this one.

The Hon. R.L. BROKENSHIRE: It is no surprise to you, Mr President, I am sure, but Family First will be supporting the opposition on this, and I want to say why. Under this further amendment, the opposition's position is that a natural person should not be forced to supply evidence which will incriminate themselves as a fundamental tenet of our law. Frankly, we believe that the argument that the evidence cannot be used in court against the natural person is inconsequential because, once the person has evidence of incrimination, the investigator simply assembles a body of evidence excluding that piece of information. The law is being used, and at times abused, not for the protection of society but for the attainment of convictions.

I also want to say that we understand, like the Hon. Ann Bressington, that, with regard to the bodies corporate, it has already been established in Australian law that bodies corporate do not have the right to be protected from self-incrimination. But, certainly, when it comes to the individual, we believe that they should have that right, and we will be supporting the opposition.

The Hon. A. BRESSINGTON: I will be supporting the amendment as well.

Amendment carried; clause as amended passed.

Clauses 81 to 85 passed.

New clause 85A.

The Hon. M. PARNELL: I move:

Page 65, after line 1—Insert:

85A—Consumer advocacy and research fund

(1) The Consumer Advocacy and Research Fund is established.

(2) The Fund must be kept as directed by the Treasurer.

(3) The Fund consists of—

(a) the amount of $250,000 (indexed) paid into the fund on an annual basis (at a time determined by the Treasurer) from the total amount of annual licence fees payable under section 24 attributable to designated prescribed costs in any particular financial year; and

(b) any money provided by Parliament for the purposes of the Fund; and

(c) any income arising from investment of the Fund under subsection (4); and

(d) any additional money that is paid into the Fund under a determination of the Treasurer; and

(e) any other money that is required or authorised by another law to be paid into the Fund.

(4) The Fund may be invested as approved by the Treasurer.

(5) The Minister may apply the Fund—

(a) to support research or advocacy that promotes the interests of consumers with a disability, low income consumers, or consumers who are located within a regional area of the State; or

(b) to support projects that advance the interests of consumers from an advocacy perspective; or

(c) in making any other payment required by another law to be made from the Fund; or

(d) in payment of the expenses of administering the Fund.

(6) The administrative unit of the Public Service that is, under the Minister, responsible for the administration of this Act must, on or before 30 September in each year, present a report to that Minister on the operation of the Fund during the previous financial year.

(7) A report under subsection (6) may be incorporated into the annual report of the relevant administrative unit.

(8) The Minister must cause a copy of the report to be laid before both Houses of Parliament within 12 sitting days after the report is received by that Minister.

(9) The amount of $250,000 (indexed) referred to in subsection (3)(a) is to be adjusted on 1 July of each year (commencing on 1 July 2013) by multiplying that amount by a proportion obtained by dividing the Consumer Price Index for the immediately preceding March quarter by the Consumer Price Index for the March quarter, 2011.

(10) In this section—

Consumer Price Index means the Consumer Price Index (All groups index for Adelaide) published by the Australian Bureau of Statistics.

This amendment inserts a community advocacy and research fund. This amendment has had a number of different iterations, and I think that I have settled on a version that I hope will meet with the committee's satisfaction.

Basically, what I think all members would know is that, when it comes to the engagement of stakeholders in a process, it is important that those stakeholders be empowered to engage at a level that is commensurate with the subject matter and, when it comes to utilities, whether it is service contracts for electricity or, in this case, in relation to water, the interests of consumers are best met through empowered advocacy on the part of those groups.

This is an amendment that certainly SACOSS was supporting, but a range of other community groups are supporting it as well. Basically, what this amendment does is it creates a community advocacy and research fund which can be used by the minister to support research or advocacy which promotes the interests of consumers with a disability, low-income consumers or consumers who are located within a regional area of the state. So, they are the three main criteria: disability, low income and, as the Hon. Rob Brokenshire has mentioned many times today, people in regional areas of the state.

The different iterations of this amendment are that the first version I put forward had the primary sum being a percentage of the licence fees. A number of members found that was a bit too uncertain. We then put in the amount of $500,000, and that was a little bit much. So, now we are down to $250,000 which, on my calculations, is probably about 10 per cent of the relevant licence fees. It is not a huge sum of money, given that we are talking about a product and services that affect the entire population.

Those figures I gave members earlier—that 40 per cent of families comprised of a sole parent with children are under stress when it comes to paying utility bills. So, having a well-informed, well-resourced advocate in various forums to do with the setting of standards and prices, I think, is absolutely critical.

I see this as complementary, if you like, to some of the other amendments we have passed today. The hardship provisions have had the support of the committee. I think this advocacy fund does as well. It would be too difficult, whether it is welfare, disability or regional groups, to participate meaningfully if that participation is not resourced. I urge all members to support this amendment.

The Hon. I.K. HUNTER: The government supports the amendment in the interests of supporting advocacy and research that assists vulnerable consumers, and provided the fund is limited to $250,000.

The Hon. D.W. RIDGWAY: The opposition was not going to support the amendment as we believe the bill already provides in section 14 for consumer advisory committees to enable the consumers to provide advice to ESCOSA on any matter relating to the water industry. In fact the same committees may also be established under the Electricity Act, so it is our view that a provision is there already for consumer advocacy and we think this is another duplication, but at the end of the day if the government is supporting it and there is sufficient support for the Greens amendment, we will not be dividing.

The Hon. R.L. BROKENSHIRE: It is our intention to support this. I had a meeting with the CEO of SACOSS and there are a range of issues that we would have introduced also. Suffice to say that an effort has been made by crossbench members to try to get up some amendments to assist people, and this one will assist people I believe and we will support it.

The Hon. K.L. VINCENT: I am very happy to support this amendment. To put it simply, there are many people within the disability sector on low incomes who do need assistance and advocacy when it comes to essential services like these. It is particularly relevant, given that this government is now attempting to move the disability sector in particular to a human rights framework, and I think that will require a lot more advocacy than we have available currently and I think this is a good place to start, so I fully support the amendment.

New clause inserted.

Clause 86 passed.

Clause 87.

The Hon. D.W. RIDGWAY: I move:

Page 65, lines 15 and 16—Delete subclause (2)

This clause relates to delegation by minister and states:

(2) a function or power delegated under this section may, if the instrument of delegation so provides, be further delegated.

I moved my amendment No. 4 in relation to a similar power earlier in the bill. It was not supported, so I will not argue for too long and too vigorously. It is a technical amendment so that you keep track of the powers that have been delegated. I hope members have a different view this time, but I am not holding my breath.

The Hon. I.K. HUNTER: As the honourable member said, this removes the ability to subdelegate functions. This amendment has a similar effect to amendment No.4 in the name of the Hon. Mr Ridgway, which this chamber defeated last sitting week. Numerous acts I am told have clauses like this. It is not an uncommon feature and the government does not support the amendment.

The Hon. M. PARNELL: The Greens will not support the amendment.

Amendment negatived; clause passed.

Clauses 88 to 90 passed.

Clause 91.

The Hon. R.L. BROKENSHIRE: We oppose this clause. We have seen a series of new levies, charges and taxes coming into this state over the last 10 years. In the community now there is hardly anybody that I meet who is not telling me they are doing it tough. The save the River Murray levy did not save the River Murray: a flood actually saved the River Murray. We have moved on since then also because the Murray-Darling Basin Authority and the commonwealth powers are such that they have the general control of the River Murray.

There is a large amount of money available that the states are siphoning from the commonwealth for projects. I believe that, based on what has happened historically since they set up this River Murray levy and the fact that it failed to deliver, there is a lot of money each year left unspent. The ministers always say, 'We'll find a purpose for that,' or 'We're doing some more assessments before we spend it.' The bottom line is that the money is not being spent; people are hurting; this bill is here now and this is an opportunity for us to give some relief to the South Australian community, so I commend the amendment to the committee.

The ACTING CHAIR (Hon. J.S.L. Dawkins): Before the minister responds to the Hon. Mr Brokenshire I need to advise the committee that we need to deal with amendment [Ridgway-1] 21, clause 91, page 69 after line 22 before we deal with the Hon. Mr Brokenshire's amendment. We do have you on the record, the Hon. Mr Brokenshire, but we will go back and deal with the Hon. Mr Ridgway's amendment.

The Hon. D.W. RIDGWAY: I move:

Page 69, after line 22—Insert:

(11a) This section does not apply in relation to land—

(a) if the land is not supplied with water by a retail service provider; or

(b) if water supplied to the land by a retail service provider is supplied as part of water supply system that is not in any way connected to a water resource that is sourced (directly or indirectly and wholly or in part) from the River Murray.

This is consistent with a longstanding Liberal Party policy where we seek to relieve SA Water customers whose water supply has no connection with the River Murray from paying the River Murray Levy. For example, people living on Kangaroo Island, who have no impact on the River Murray through their water usage, consequently can in no way change any impacts on the River Murray by modifying their water use. In addition, there are people saddled with other living expenses not shared by other South Australians.

Similarly, South Australians in the Far North and the South-East, where they have no connection to the River Murray, are currently obliged to pay the levy. The opposition thinks that it is, in a sense, a levy on River Murray users. While at the time we thought it was an interesting measure, it is established now, and I think it recovers something in the order of $20 million a year and so we are not necessarily of a mind to oppose it and to do away with the River Murray levy.

However, we urge members, especially in this amendment, to support the opposition's view about people who are not connected to it—as I said, Kangaroo Island, the Far North, the South-East—it is about halfway between Keith and Bordertown that the pipeline runs out from the River Murray water and from there on for the rest of the South-East water is from the underground aquifer. It does not make any sense to the opposition to apply the River Murray levy to people who do not use any of the water from the River Murray.

I know that the Hon. Mr Brokenshire would like to remove the River Murray levy in its entirety but, given that we are debating this amendment first, I would urge members to support this as a sensible and reasonable measure. It goes halfway, if you like, to what Mr Brokenshire is trying to do, but it does take the levy away from those people who do not use any of the water at all from the River Murray.

The Hon. I.K. HUNTER: The River Murray is an iconic part of the social, economic and environmental fabric of South Australia, of the whole state. Its value goes well beyond its function as a water supply for large parts of South Australia. It has intrinsic value quite apart from its function as a water supply. The government does not believe that it is unreasonable to ask South Australians to contribute to the preservation of one of our greatest state assets.

This amendment would negatively impact on the revenue available to save the River Murray. In addition to this, given that we are currently developing our response to the draft basin plan, if we were to reduce our financial commitment to saving the River Murray this would send a very poor and, might I say, a very dangerous message to South Australians and the rest of the nation. We must maintain our commitment to restoring the river to health and restoring the health of the basin.

The Hon. M. PARNELL: I think the minister summed it up very well in his contribution. The River Murray is certainly much more important to our state than simply a source of water coming out of a tap. The opposition's amendment seeks to effectively limit those who are to pay the levy to those who get, at some stage or another, River Murray water out of their tap, but it does not impact on people who—and I will use the people of Kangaroo Island as an example—might not get that water out of their tap, but they might enjoy the biodiversity; they might go boating, canoeing, or waterskiing—you name it.

There is always a difficulty with hypothecated levies, where you actually take something outside the general taxation regime and you apply a special or separate single-purpose levy for it. It is appropriate to limit some of those to a small number of people who might benefit from it, but there are others where it is more appropriate for it to go broader. All of us can think of examples of services that are provided that we are never going to use, and yet we are happy to pay for them because it is part of being in a society. I doubt I will ever be admitted to the Women's and Children's Hospital, being in neither of the eligible groups, yet I am more than happy that my taxes are paying for it.

We could have a debate about whether we should have a River Murray levy at all, but the minister's point that he made was that if, as a state, we are about to take on this massive national debate about whether or not we are going to get a core amount of water as an environmental flow across the border into South Australia, it actually does send a very bad signal—it sends the wrong signal interstate—in relation to this fairly modest amount of $20 million that we are going to either, in the opposition's case, shrink that amount, or in the Hon. Rob Brokenshire's case, abolish it completely. I just think that we would have trouble in that national forum saying, 'We're not happy with how you are mismanaging the River Murray and, by the way, we've decided to not spend this $20 million.'

I just remind members that the levy goes into the fund, and the fund is spent on programs and measures to improve and promote the environmental health of the River Murray, as well as ensuring the adequacy, security and quality of the state's water supply from the River Murray. So, there is a range of purposes. We could have a debate about whether the money is being well spent, poorly spent, or not spent—that is what the Hon. Rob Brokenshire was raising—but I think that the concept of the River Murray levy is generally supported.

People will always grizzle about taxes, the emergency services levy, etc., but I think it is generally supported. The number of emails or letters I have had in my office over the last six years telling me that this is an outrageous impost on the citizens of South Australia and must be abolished—I do not know if I have received any. So I think that we can keep these arrangements going, and I think that we should spread the cost of this levy over the broader base of the community than that proposed by the Hon. David Ridgway's amendment, so we will not be supporting the amendment. Similarly, we will not be supporting the Hon. Rob Brokenshire's proposition to delete this provision in its entirety.

The Hon. A. BRESSINGTON: I will be supporting this amendment, and also supporting the Hon. Robert Brokenshire. I do not know how that is going to work, because this one comes first, and that one—

Members interjecting:

The Hon. A. BRESSINGTON: You know what? The Hon. Mark Parnell says that everybody uses the River Murray at some stage, or gains some benefit, goes boating, etc. What are we going to tax next? Surfing at Glenelg or Henley Beach? They are iconic areas as well for people who love the sun, surf and sand. The fact is: Mother Nature saved the River Murray, and Mother Nature will continue to save the River Murray, just as she has done for the last 150 years.

What happened with the River Murray during the one in 100 year drought has happened time and time again. It was not a one-off situation, it will happen again in the future. People are paying $20 million out of taxpayer funds and getting absolutely nothing in return for that money. As far as sending a bad message at this point in time during negotiations over the Murray-Darling Basin agreement, let the federal government sort that one out.

We have heard all the way through, and the Greens say how tough people are doing it, and the Hon. Robert Brokenshire has talked about producers and whatever, yet it is still okay to siphon out $20 million of taxpayer money for something that we see nothing happening from. I say: get rid of it. I know plenty of people who say: get rid of it; it is a scam; it is an extra levy that we don't need. Those people would not write to the Hon. Mark Parnell about this because he is a member of the Greens and we all know that the environment comes first and people come second.

The ACTING CHAIR (Hon. J.S.L. Dawkins): I advise the Hon. Ann Bressington that she can vote to amend the clause initially and subsequently vote to oppose the clause. You can do both.

The Hon. A. BRESSINGTON: Okay; thank you.

The ACTING CHAIR (Hon. J.S.L. Dawkins): I call the Hon. Mr Brokenshire.

The Hon. R.L. BROKENSHIRE: I thank you for your advice there, Mr Acting Chairman. Obviously, this one goes up. I will still be opposing the clause. If this gets up but the clause is opposed, there would have to be a change to delete the whole of the levy. I just want to say a couple of things and then put a question to the minister.

When it comes to other states, to my best knowledge, no other state has a save the River Murray levy. Notwithstanding that, all other states that have the Murray-Darling Basin in them, other than South Australia, have actually done a lot better from the commonwealth share of the $13 billion. I do not buy the argument that we would be looked down upon if we were to remove the levy.

I also say that the levy has not delivered. If you go along the River Murray, and I have been along there quite a bit in the last several months, most of the projects there have a commonwealth badge on them as well as a state badge, and a lot are local projects, too. In one sense, $20 million is a lot of money, but it is not a lot of money to the government compared to the impact that $20 million has on all South Australians who are currently paying this levy when they do not even have River Murray Water connected.

Given that water bills are going up over 50 per cent now, and then they are going up more and more, that $20 million might help them to provide a bit of water for a garden and their family to have a decent shower and cook a bit of tea. I think it is about time we got back to reality. This was set up as a tax grab and it has not delivered. Those people who have not had any opportunity—like those in the South-East, parts of Eyre Peninsula and other parts of the state—certainly should not be paying it. We would like to see the levy totally removed. It was a levy that came out of the blue. There was no mandate for this levy.

Also, I want to finish with this before asking the minister a question. I believe most South Australians did not think that this levy would go on forever. What we are now seeing is that this levy has become another tax. I want to finish with one key point. We have seen a doubling of the taxation base from $7 billion to nearly $15 billion. People are already paying tax to save the Murray. If this government started to manage, they would not have to hit people in the backside with an additional levy.

So, use the $15 billion part of that to help save the Murray. I have a question to the minister. Can the minister advise the house what percentage of the save the Murray levy actually goes into the department for administration, and other add-on costs to the department specifically: and what percentage of the money actually goes into delivering projects on the ground?

The Hon. I.K. HUNTER: The Hon. Mr Brokenshire raises a comment—a debating comment, really—about no other state having a save the River Murray levy. In fact, that is pretty meaningless. Other states have different ways and different mechanisms of raising money. For example, if the Hon. Mr Brokenshire did not know this, Victoria has a tax on water retailers called the environment contribution tax. Other states have different ways of raising the money. Our way of raising money to save the River Murray is the River Murray levy. On the particular question he asked, I will have to take that on notice.

The Hon. D.W. RIDGWAY: The Hon. Mark Parnell made a comment about the fact that we pay a number of different levies, the emergency services levy being one. I am sure the people in the South-East, who do not get River Murray water but pay the levy, will never get River Murray water. I am sure they would not want to be in a situation where they needed the services of the emergency services, but they pay the levy knowing that if they have a fire, a road accident, or whatever, those services will be there for them. There is a benefit there for them as individuals.

The question the Hon. Mark Parnell raised is important. He is saying that we have to pay this tax. This is one that was designed and put in place by this government and then premier Rann. Premier Weatherill was part of the cabinet. I am not sure if he was environment minister at the time but he may well have been. It was designed to be a levy on users of River Murray water. Suddenly, we discover that those in places like Kangaroo Island, the South-East (Bordertown) and the Far North are paying that levy, yet will not ever have the opportunity to enjoy any of the benefits of the River Murray water being reticulated for their property.

Unlike the emergency services levy, where everybody not wanting to avail themselves of those services still pays a levy—and in the back of their mind they know that in their hour of need they will be able to access an emergency service—this is different again. I certainly urge all members to support this amendment that relieves those who do not get any water from the River Murray of the burden of the levy.

The Hon. I.K. HUNTER: I just took on notice a question from the Hon. Mr Brokenshire. My advice is that the question is answered in a report tabled in parliament. It is an annual report on the Save the River Murray Levy Fund. That provides that money raised through the levy must be spent in accordance with the purposes of the act.

The Hon. R.L. BROKENSHIRE: Given that amendments have already been passed that are now going to go to another place, can the minister table a full breakdown of that before we see any further deliberation from what happens in the other house, including what has been syphoned off for administration costs and the like?

The Hon. I.K. HUNTER: I am advised that I can, but I would point out that the annual report tabled in this place is a public report. You could do the homework yourself.

The committee divided on the amendment:

AYES (10)
Bressington, A. Brokenshire, R.L. Darley, J.A.
Dawkins, J.S.L. Hood, D.G.E. Lee, J.S.
Lensink, J.M.A. Lucas, R.I. Ridgway, D.W. (teller)
Stephens, T.J.
NOES (9)
Finnigan, B.V. Franks, T.A. Gago, G.E.
Gazzola, J.M. Hunter, I.K. (teller) Kandelaars, G.A.
Parnell, M. Vincent, K.L. Wortley, R.P.
PAIRS (2)
Wade, S.G. Zollo, C.

Majority of 1 for the ayes.

Amendment thus carried; clause as amended passed.

Clauses 92 to 96 passed.

New clause 96A.

The Hon. R.L. BROKENSHIRE: I move:

Page 71, after line 23—Insert:

96A—Scheme to install separate meters on all properties

(1) The Commission must prepare and publish a report on the implementation of a scheme that is designed to ensure, so far as is reasonably practicable, that all land—

(a) that is owned by the South Australian Housing Trust or another agency or instrumentality of the Crown; and

(b) that is used for residential purposes; and

(c) that is subject to a separate occupation; and

(d) that is supplied with water by a water industry entity as part of a reticulated water system,

will have a meter that records the amount of water supplied to that piece of land.

(2) The scheme must address—

(a) the fitting of meters to premises existing at the time of the publication of the report (insofar as meters are not fitted); and

(b) the fitting of meters to premises constructed after the publication of the report.

(3) The report must be published by 30 June 2013.

(4) In connection with subsection (2), the scheme must set out a program under which all existing premises supplied with water by SA Water as part of a reticulated water system (and falling within the ambit of subsection (1)) will be fitted with a meter as envisaged by subsection (2) by 31 December 2016.

(5) This section does not apply to premises where it is not reasonably practicable to fit a separate meter.

(6) Without limiting the extent to which the Commission may consult for the purposes of this section, the Commission must specifically consult with SA Water about the program that must be established under subsection (4).

This is a scheme to install separate meters on all South Australian Housing Trust properties. The minister with the carriage of this bill also has responsibility for the South Australian Housing Trust (or Housing SA). We have talked about the importance of equity, fairness and hardship. We have supported the Greens with some of those amendments of SACOSS, and I would seek support for this amendment.

I remind colleagues that when the now Premier, the Hon. Jay Weatherill, was the minister responsible for Housing SA he made a commitment to fix this problem. That was several years ago, and here today we still have a situation where there are lots of people unfairly paying for water because this government has not put a proper plan or process into its verbal commitment to deliver separate water meters on all properties.

We have considered this carefully. I think we have been fair in what we have said to the government. I will go through a couple of the points. The commission must prepare and publish a report on the implementation of a scheme that is designed to ensure as far as reasonably practicable—so, if there are situations where you cannot, we wear that. However, all land owned by the South Australian Housing Trust or another agency, etc. has a separate water meter.

We are saying that the report must be published by 30 June 2013, so we are giving the government about 17 months or something to do that, and then we are saying in connection the scheme must set out a program under which all existing premises supplied by SA Water as part of a reticulated water system will be fitted with a meter. We have given a date of 31 December 2016.

We think that is a fair and reasonable time but unfortunately—and I have said this a couple of times in this debate and I stand by it—we just cannot take any longer the government saying they will fix it, set up a review and that they will implement a process, set up a panel or whatever because they do not stick to their word. You might as well use their press releases to wrap up your rubbish because it does not always come to bear what they say in the release.

We have an opportunity, as members of parliament, to bring in amendments like this. It is not often that we get a chance, but this is really about hardship. I am sure all members in this house have had a lot of constituents talk to them about the problems, but there has to be some fairness there. This is real hardship for people. It is not equitable. I commend the amendment to the house.

The Hon. I.K. HUNTER: The government opposes this amendment, although the proposed amendment raises some significant policy questions and deserves respectful consideration. We acknowledge that meters can offer better feedback to customers about water use than quarterly billing and could better support a shift to scarcity pricing and more efficient water use.

We must consider that there is also the cost of installation. At present, it is government policy that there will be no mandatory introduction of metering unless the benefits clearly exceed the costs, otherwise installation and metering will just mean more costs for consumers. Before any decision is made to require metering for water services, there would need to be a public consultation and an assessment of the costs and benefits of the relevant options. The government opposes this amendment.

The Hon. D.W. RIDGWAY: I indicate that the opposition will be supporting the very sensible amendment by the Hon. Robert Brokenshire. We note that in the first line of his proposed new clause is that the commission may prepare and publish a report on the implementation of a scheme designed to ensure as is reasonably practicable regarding land owned by the Housing Trust and other agencies under the crown.

The minister says that where there is a benefit and there is a cost to do so, they will only do it where there is a benefit. As the price of water goes up, it allows individuals who are often in Housing Trust situations (low income earners and people who do not have a high level of disposable income) a chance to accurately monitor exactly how much water they are using. The opposition thinks this is a sensible amendment and we are very happy to support it.

The Hon. A. BRESSINGTON: I indicate that I will be supporting this amendment. With the minister saying that there has to be a cost benefit analysis basically done on this, that the cost of fitting meters has to be taken into consideration, we just finished debating a $20 million levy that people do not get any benefit from and need to pay. Some of the people who are affected by not having an individual meter are aged pensioners.

I have heard representation from a number of aged pensioners who are living off the same meter as a family with two or three children. There is no way of knowing how much water they are using as a couple and how much they are paying for the water being used by those families with two or three children. I think that is outrageous, given that last year this government saw the opportunity to claw back a pension increase by the federal government, which it promised it would not do, to aged pensioners. Now, the government is saying that we have to consider the cost of installing these meters so that they can measure and monitor their own water use.

Finally, let me say that it never ceases to amaze me in this place that, on one side of the coin, an argument can be used for the need to consider the cost and then, on the other side of the coin, used against such a proposition. What about the cost to the taxpayer? What about the cost to the aged people? What about the taxes and levies they are paying for these services? What do they get back in return?

I know that there is difficulty with some of these blocks of units in having individual meters installed. I have heard it discussed before, that is, that it is a very expensive exercise; but I have also heard that there is a solution to that with a different kind of metering, something this government has refused to look at and consider. So, now, on notice, do your job. Give the people the services they pay for and allow them the freedom to know how much water they are using and how much water they are paying for.

The Hon. I.K. HUNTER: If the Hon. Ann Bressington was doing her job, she would acknowledge that, in the situation she is referring to, where there are group homes that share a housing trust meter, Housing SA pays 30 per cent of that water bill to take into consideration the differential water uses in different households.

The Hon. A. Bressington interjecting:

The Hon. I.K. HUNTER: The Hon. Ann Bressington says that it is not enough. She might come back here at a later stage and find that, when those places have been individually metered, people are actually paying more than they are now with the 30 per cent discount.

The Hon. A. Bressington: So, be it.

The Hon. I.K. HUNTER: Oh, great! The Hon. Ms Bressington says, 'So be it.' So, through her actions in this place, she is going to make people pay more for their water bills than they do now. She is saying that she is going to pass this amendment to make people pay more for their individual water bills than they might already do now because they have 30 per cent taken off the price of their water bills. Go for it, Ms Bressington, do your job.

The Hon. A. Bressington: No worries, minister.

The CHAIR: The minister should not debate.

The Hon. A. BRESSINGTON: Let me tell you: that is just sheer speculation and guesswork on your part.

The CHAIR: Order!

The Hon. A. BRESSINGTON: You have no way of substantiating that cynical little argument. If people are using water, they pay for it like everybody else. But I guarantee you that these two old pensioners, who are living in a set of flats and paying water and having to sit by and watch families with two or three children consume water—

The CHAIR: Order! That's enough of a debate.

The Hon. A. BRESSINGTON: —at three times the rate, will not be paying more for their water.

The CHAIR: Sit down, order! The Hon. Mr Darley.

The Hon. J.A. DARLEY: I will not be supporting this amendment.

The Hon. M. PARNELL: I understand the government's argument that very often the cost of installing a meter is not warranted by the amount of water that is used. Using round figures if, for example, it costs, say, $200 to install a meter but it is a multilevel flat with one person living in it and they might not use $20 worth of water a year, basically, it would take you 10 years of water use to pay back the cost of the meter. So, I can understand that it is a difficulty from the government's perspective.

I was at a housing trust block of units over this last summer, and one of the tenants told me how, in an attempt to beautify, if you like, what was a fairly barren garden—a bit of a wasteland—he tried to water the lawn, and he was yelled at by his neighbours. The response was, 'Don't you know we're all paying for that?' It was a difficult situation. He really wanted to live in a nice environment. The lawn was dying and it could have used a bit of water but, because of the way of the metering, everyone had to pay for it.

I will refer to a case with which I am familiar—and I am not going to suggest that this a very common case. Members have referred to the fact that household sizes are different and, clearly, household water consumption patterns are different as well. One case I am aware of that went to the Residential Tenancies Tribunal was a person who suffered from a mental illness—obsessive compulsive disorder—and they washed and they washed and they washed. Basically the water was running pretty much around the clock, and the neighbours in this block of units were saying, 'This is really unfair; we all have to pay because there's no separate meter.'

Having said all that, there is one problem I can see with the Hon. Rob Brokenshire's amendment. He has a list of the criteria that have to be met when the commission is publishing a report: No. 1—is it Housing Trust—tick; No. 2—is it residential—yes; No. 3—is it separately occupied; No. 4—is it supplied by water; and, No. 5 should be—is the cost of that water shared? That is the bit that is missing.

I am happy for the government to take away this problem and fix it up between the houses, because there is a problem of equity here where people are obliged to pay for things they do not use, and it is a fairer system and I want the government to take this amendment between the houses and look at how it can be improved, because injustice is occurring out there and I do not think the government has done enough to address it to date. We will support the amendment.

New clause inserted.

Clauses 97 to 110 passed.

New clause 110A.

The Hon. M. PARNELL: I move:

Page 77, after line 5—Insert:

110A—Protection of tenants and lessees of residential premises

(1) This section applies in relation to a tenant or lessee occupying residential premises.

(2) A water industry entity must not, in relation to a tenant or lessee who is a consumer—

(a) take action to recover from the tenant or lessee any amount for which the landlord or lessor is legally liable; or

(b) take action to recover from a tenant or lessee any amount on account of any default on the part of the landlord or the lessor; or

(c) take other action against the tenant or lessee on account of any default on the part of the landlord or lessor unless such action is reasonably justified in the circumstances and is in accordance with any relevant provision prescribed by the regulations or contained in a code or set of rules published by the Commission for the purposes of this section.

I spoke about this new clause in my second reading contribution and I will summarise it now. I think it has general support. It basically recognises that from the water company's point of view they have a customer, yet often the actual consumer is a different entity altogether, and that is a typical situation with a rental property. The difficulty is that, if there is a residential tenancy agreement where the tenant is obliged to pay for the water used and the tenant does the right thing and hands over that money to the landlord who then fails to pay the water bill—spends it on the pokies, drinks it at the pub or whatever—all of a sudden you have the tenant, the consumer of water, potentially facing disconnection or some other adverse consequence that is not their own fault.

This amendment says, basically, that a water industry entity should not be taking action against a tenant if the tenant has done the right thing and the fault lies with the landlord. The only time it would be appropriate is if the tenant is also at fault or to blame. This is again one of SACOSS's suggested amendments. It makes sense and it makes sure that innocent parties are not unreasonably disadvantaged when it is not their fault that a water bill might not have been paid.

The Hon. I.K. HUNTER: This amendment aims to protect tenants of residential properties. Under the proposed legislation water industry entities would not be entitled to recover landlord debts from tenants, as tenants are not customers. Disconnections will be governed by ESCOSA's water retail code, which will specify minimum requirements on this, amongst other issues. With these facts in mind the government is prepared to support this very sensible amendment.

The Hon. D.W. RIDGWAY: The opposition is happy to support the amendment.

The Hon. R.L. BROKENSHIRE: We will support the amendment. It was SACOSS' recommendation No. 5 and we are very pleased to support the amendment.

The Hon. A. BRESSINGTON: I also support the amendment.

The Hon. K.L. VINCENT: Supporting.

The Hon. J.A. DARLEY: I will support the amendment.

New clause inserted.

Clause 111 passed.

New clause 112.

The Hon. J.A. DARLEY: I move my amendment in an amended form:

Page 78, after line 17—Insert:

112—Review of Act

(1) The Minister must cause a review of the operation of this Act to be conducted as soon as practicable after the expiry of five years from its commencement.

(2) The results of the review must be embodied in a written report.

(3) The Minister must, within 6 sitting days after receiving the report under subsection (2), cause a copy of the report to be laid before both Houses of Parliament.

I have moved this amendment in an amended form; namely, by replacing 'three years' with 'five years' in subclause (1). The amendment in its amended form seeks to require a review of the operation of the act to be conducted as soon as practicable after five years from its commencement. As is normally the case with these sorts of provisions, the results of that review are to be embodied in a written report which the minister must table in parliament within six sitting days after receiving that report.

The objects of the bill are, among other things, to promote planning associated with the availability of water within the state in order to respond to demand within the community; to promote efficiency, competition and innovation in the water industry; to provide mechanisms for the transparent setting of prices; to provide for and enforce proper standards of reliability and quality in connection with the water industry; to protect the interests of consumers; and perhaps most importantly, to promote better water management in South Australia.

The bill proposes a number of substantial changes in order to ensure that these objectives are met. It is a significant reform for South Australia, particularly given that it seeks to establish a new framework relating to the assessment of one of our state's most precious resources—namely, water—including current and future demands on that resource. As such it is also imperative that the operation of the bill be subject to rigorous review and scrutiny.

As already alluded to, a key element of the bill is the introduction of independent regulation of the water industry by the Essential Services Commission of South Australia. I agree that there is a real need to ensure both a transparent means of setting service standards and prices and increased protection for consumers. I also agree that ESCOSA should undertake this role. However, I am concerned about the way that this has been addressed in the bill, especially given that ESCOSA will be required to comply with the requirements of any pricing order issued by the Treasurer when making a determination.

The pricing order can specify any policies or other matters the commission must have regard to when making a determination, various parameters, principles or factors that the commission must adopt in making a determination, as well as any other matter the Treasurer considers appropriate. It is these provisions of the bill that cause me the greatest concern and reinforce the need for a review. I think it is fair to say that the need for a review was generally agreed to during my briefing with the minister's office and departmental officials, subject of course to the issue of the time frame of that review.

If my memory serves me correctly, at that meeting it was suggested that a review would be better placed to take place after some eight or nine years from the commencement of the bill. That time frame is, in my opinion, certainly too long. I initially thought three years would provide ample opportunity in terms of assessing whether or not and, indeed, how effectively the objectives of the bill are being implemented.

Having said that, and in the spirit of cooperation, I understand the government is prepared to accept a review after five years, particularly in view of the fact that ESCOSA's first price determination is expected to be for a period from 1 July 2013 until 2016. I commend this amendment to the house.

The Hon. I.K. HUNTER: The Hon. Mr Darley has said it all really, so the government supports the amendment.

The Hon. D.W. RIDGWAY: I indicate the opposition is supporting the amendment.

New clause inserted.

Schedule 1 passed.

Schedule 2.

The Hon. I.K. HUNTER: I move:

Page 79, after line 12—Insert:

(2) Section 33(1)(d)(vii)—Delete 'The South Australian Water Corporation' and substitute:

a water industry entity under the Water Industry 2012 identified under the regulations.

The government has identified an additional consequential amendment required for the development act. This is technical in nature, and requires the South Australian Water Corporation to be replaced by 'water industry entity' in section 33(1)(d)(vii), identical to the amendment already proposed for section 33(1)(d)(iv).

The Hon. D.W. RIDGWAY: This is supported.

Amendment carried.

The Hon. D.W. RIDGWAY: I move:

Page 80, after line 11—Insert:

4A—Amendment of section 222—Permits for business purposes

Section 222—after subsection (5) insert:

(6) This section does not apply to any water/sewerage infrastructure established or used (or to be established or used) by or on behalf of a water industry entity under the Water Industry Act 2011.

(7) In this section—

water/sewerage infrastructure has the same meaning as in the Water Industry Act 2011.

I will use Salisbury council as an example: where you have a water entity that is providing customers with water and reticulated systems, it means that SA Water is exempt from paying rates and charges, so my understanding is that the government is likely to support this amendment. The minister is in two minds, but he has often been in two minds—and I am not sure whose mind he is in today—but I do hope he supports it. It is just, I think—

The Hon. S.G. Wade: It's common sense.

The Hon. D.W. RIDGWAY: It is a commonsense amendment that was perhaps overlooked in the original drafting, so I commend the amendment to the chamber.

The Hon. I.K. HUNTER: It is the government's understanding that, under section 222 of the Local Government Act, a public road can be used for business purposes only if authorised by a permit. The scope of section 222 is understood to relate to the likes of pie carts, cafes and kiosks, not the installation of essential infrastructure.

This follows on from the purpose of the section, as well as from the fact that the Local Government Act deals separately with authorisations for the installation of pipes and other objects under section 221, though in such a case any requirement to seek authorisation under section 221 would be overridden by clause 44 of the Water Industry Bill. Nevertheless, in the interest of business certainty, to the extent there is any ambiguity about section 222, the government is prepared to put the issue beyond doubt and therefore supports the amendment.

The Hon. M. PARNELL: The Greens will be supporting the amendment, but we are not sure we support the honourable minister's assertion that pie carts are not essential public infrastructure.

Honourable members: Hear, hear!

Amendment carried; schedule as amended passed.

Title passed.

Bill reported with amendment.

Bill recommitted.

Clause 4—reconsidered.

The Hon. D.W. RIDGWAY: I move:

Page 9, after line 25—Insert:

River Murray has the same meaning as in the River Murray Act 2003;

I have been made aware that my amendment to clause 4, which was my first amendment, was initially proposed in relation to supplying the River Murray water access through the pipes. Of course, that was defeated because it was not supported. Now, with the River Murray levy being taken off customers that are not connected to the River Murray, parliamentary counsel advises me that we need to support this amendment. It is, if you like, consequential.

The Hon. I.K. HUNTER: The government supports this.

Amendment carried; clause as amended passed.

Bill reported with amendment.

Third Reading

The Hon. I.K. HUNTER (Minister for Communities and Social Inclusion, Minister for Social Housing, Minister for Disabilities, Minister for Youth, Minister for Volunteers) (17:55): I move:

That this bill be now read a third time.

Bill read a third time and passed.


[Sitting suspended from 17:57 to 19:46]


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