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Legislative Council - Fifty-Third Parliament, Second Session (53-2)
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Statutes Amendment (Budget 2016) Bill

Second Reading

Adjourned debate on second reading.

(Continued from 20 October 2016.)

The Hon. M.C. PARNELL (17:15): I rise to speak to some aspects of the budget bill, and my colleague the Hon. Tammy Franks will also speak to items in this bill. I will not address all of the issues raised by the Statutes Amendment (Budget 2016) Bill, but I want to touch on a couple of issues at this stage and, like all members, I reserve the right to ask more questions when we get into the detailed committee stage.

The first thing I would like to do is thank the Treasurer, and Mr Ben Tuffnell in his office, for arranging a comprehensive briefing. Because so many pieces of legislation are amended by this bill, the briefing, I think, consisted of some 10 or so government officials, and I appreciate the time they took. I also thank them for answering a number of questions on notice that I provided, and I will refer to some of the answers and ask some supplementary questions as we go along.

The bills that are amended include the Land Tax Act, and one of the things the bill does is change the taxable status of land that is owned by sporting and racing associations. A number of sporting and racing associations have already had exemption from land tax, but the proposal in this bill is for further exemptions to be granted. I asked the advisers when they came to see me about precisely which organisations will benefit from this additional land tax exemption, and I will just read a couple of sentences of the answer they provided to me subsequently. It says:

Sporting and racing associations could stand to benefit from this exemption, as long as the association is established for one of the eligible purposes, and that is sporting purposes, playing of cricket, football, tennis, golf, bowling or other athletic sports or exercises, or racing, and that includes horse racing, trotting, dog racing, motor racing or other similar contests.

It then goes on to set some other requirements. The advice to me in relation to exactly which organisations will benefit includes the following:

Based on the 2015-16 land tax holdings/liabilities, the following types of sporting and racing associations will stand to benefit from the expanded exemption. Note: associations that would stand to benefit from the exemption but that do not pay land tax on the relevant land, as the association's total landholding does not exceed the 2016-17 land tax free threshold of $332,000, have been excluded from the table below.

I will not seek to have the table below incorporated in Hansard because it is a table of one line, and basically it says that there are nine sporting associations that are expected to benefit from the additional land tax exemptions and two racing organisations.

What I would like the minister to take on further notice is which two racing organisations: which ones will benefit from additional land tax exemption? If the minister could name those organisations, then I would appreciate that. The fact that the department knows that there are two of them means that it must know who they are, and I would like to know as well.

The next issue in the bill that I would like to touch on are the amendments to the Passenger Transport Act. The thrust of these amendments is to introduce a $1 per trip levy on all metropolitan point-to-point transport journeys. The purpose of this levy, which was intended to start on 1 October this year—but clearly, we have not passed the bill yet, so it has not yet come into operation—was to compensate the taxi industry for the loss that it is deemed to have suffered as a result of the introduction of ride sharing services such as Uber.

The idea is that $1 per trip will be collected from taxi passengers, Uber passengers and licensed chauffeur passengers and that that money will go into a pool, from which taxi operators will be compensated. I have to say that I do have some concerns about the validity of a compensation regime. Members would have received correspondence from Uber, and I will just refer to a couple of sentences of that submission. It will be no surprise to members that they do not like it, and I think that their reasons are quite sound. Under the heading, 'No transparency', Uber's submission states:

The SA Government has announced a $31 million compensation package for taxi licence holders, funded by a $1 per trip levy on all transport models. The Government has provided no modelling to support its new tax. No end date has been placed on the levy and it is expected to raise far in excess of compensation requirements, generating at least $80 million over 8 years.

South Australians deserve to know how the Government will spend this levy. The taxi industry estimates that fewer than 40 South Australian taxi licence holders actually operate their taxi. Large companies, trusts and families hold a significant number as passive investments. Licences holders have already benefitted through extraordinary returns, and purchased their licences at heavily discounted prices that reflected the risk of regulatory reform.

The Uber submission goes on to state that this $1 per trip levy will make ride sharing 8 per cent less affordable and that it will make even taxi fares 4.7 per cent more expensive. The Uber submission (I am pretty confident that this would have gone to all members of parliament) is that the levy should not be charged. The submission concludes:

Forcing emerging industries to compensate incumbent sectors will deter innovation. A levy imposed on safe, reliable and affordable transport would mean asking new entrants and new consumers to pay for the repair of bad laws—bad laws that have benefitted those demanding compensation. That is an unprincipled approach to law reform. The levy amounts to a price tag on choice, innovation and progress.

The reality of the situation, as I understand it, is that because these measures are included in a budget implementation bill, the opposition is disinclined to oppose any parts of the bill and reluctant to amend the bill, but I think that an exception could be made in this case. The clear reason that the government said it wants to raise this levy is to compensate the taxi industry.

My submission, which has been incorporated into amendments that have been filed, is to say, 'Okay, let the government have exactly what they said they wanted; that is, enough money to compensate the taxi industry.' That is not what this bill does. What this bill does is create a new open-ended tax that lasts forever. It lasts way beyond the money that is needed to compensate the taxi industry has been collected. If you think about it, what we are effectively doing, beyond the purpose for which the money is needed, is taxing those who choose not to use private vehicles.

Some people choose not to use private vehicles for a range of reasons. Sometimes they are not able to drive themselves. Other people are making a choice to use their private car less or perhaps a choice to own fewer private cars. Taxis and Uber really fall into the category of public transport, so effectively what we are doing is taxing public transport users, and not to compensate the taxi industry, because within about four years enough money will have been collected. We are just taxing those people using Uber, chauffeured vehicles and taxis. We are taxing those people forever for general revenue.

I do not think that is fair. It is not that I am against the government raising sufficient taxes for its operation. On the contrary, the Greens are always supportive of having a decent tax base, but not this one, not taxing people using this form of transport. There are plenty of other things we can tax: we could tax more pollution and there is a whole range of things that we could do. We could tax some of the speculative financial behaviour that we see, but we do not need to tax people who are using Uber or taxis.

My amendment says, 'Yes, let's have this levy but let's end it after four years.' That is what the government said they wanted the money for. It gives them enough money but then the tax comes to an end and other forms of taxation can then be considered. I think it is consistent with the position the Liberal Party has taken, which is a position, I should say, that has been honoured in the breach on previous occasions.

When it is put to me that there is a convention, and that the opposition does not oppose budget measures, well, the car park tax was a budget measure and that was opposed. It was put to me that that was a different case because they had talked about it during an election campaign. It seems to me that, using similar principles, the government has said that they want a levy to compensate the taxi industries. Let them have that but no more; in other words, finish this tax after four years. If the government wants to come back and say, 'I've got the figures wrong and it is going to take longer,' then they can try to make that case, but on the calculations provided to me, four years will be enough.

The bill also amends a number of other acts including the act that provides exemption from stamp duty for people who buy apartments off the plan. That is a policy that the Greens supported when it came in. The policy originally applied to apartments in the CBD and the Greens supported it because we know that increasing the population of the city is good at a number of levels: it is good for the vibrancy of the city, it is good for resources, it requires a less car-dependent society, and there are lots of reasons to encourage more people to live in the city. The policy was then extended to the inner suburbs and, again, the Greens supported that.

As an alternative to urban sprawl, you increase the density of people living in the city and inner suburbs so that made sense as well, but I am really scratching my head as to why the policy should now be extended to apartments or flats (using the old language) built anywhere, not just in inner suburbs or the city but anywhere—far-flung areas. The amount of subsidy, effectively, that that provides in terms of an average apartment, whether it is 400 or 500 or a fancier apartment at $600,000, we are talking about $20,000 tax forgone. My question of the minister is: what is the policy basis for extending that tax exemption to apartments bought off the plan anywhere and not confining it to areas where there is clear policy reason to do so such as the city and inner suburbs?

It seems to me that it is nothing more than a taxpayer subsidy to the apartment building industry and I cannot see that it makes a lot of sense. It does not provide that preferential treatment that city and suburban apartments, I think, deserve. I would ask the minister if he could address that in summing up or at the committee stage. There are other issues which I will raise when we get into the committee stage.

The bill raises a number of issues where I have concerns but they go beyond the scope of the bill so it might be difficult to deal with those, but for now the Greens will certainly be supporting the second reading of the budget bill. We look forward, when we get into committee, to the Legislative Council supporting the amendment to limit the taxi tax or the Uber tax to four years so that it does just what was promised it would do and that is compensate the taxi industry and no more.

The Hon. K.L. VINCENT (17:29): Dignity for Disability would also like to start by thanking the Treasurer and his staff, namely Mr Ben Tuffnell, for arranging and providing not less than 10 public servants, by my last count, across half a dozen departments, to brief my staff on the details of this omnibus bill, as the budget often is an omnibus bill.

We also appreciate the figures, information and answers which have been provided to me subsequently, and this has clarified some matters for us. I will not mention those, but, given that the Hon. Mr Lucas and others have already spoken at some length on this bill, I do not intend to hold up progress by rehashing the intent and consequences across a number of areas that this bill covers. I am very pleased that some of those questions have been answered. However, we would like to make a few points and ask a couple of additional questions.

The Hon. Mr Parnell has just asked some questions in relation to the removal of land tax and I will not repeat those, but I certainly echo those concerns and Dignity for Disability would like answers to those questions as well.

Firstly, in relation to the introduction of a wagering tax, the query I have is: is this going to make the government further dependent upon gambling revenue to run services? How is it not further ensuring the government's own addiction to gambling revenue?

Secondly, the amendments to the Education Act, introducing school fees for 457 visa holders. From the information that the department has provided, the biggest impact will be on 457 visa holders here in South Australia who are from India, the United Kingdom and China. Does the cost of implementing this scheme outweigh the benefits? Do we know how many 457 visa holders have children of school age and whether they attend public or private schools in South Australia?

Finally, the amendments to the Passenger Transport Act, we broadly support the changes. I think the Hon. Mr Parnell has made some valid points on behalf of Uber about the $1 levy. Aside from this, there is one feature of the reform that we would like clarified on behalf of many of the constituents we represent. There is, of course, to be a lifting fee of $10 introduced by access cabs to support the extra time at either end of the journey—that is the one that brings up the hydraulic ramp and straps people down in a wheelchair.

There has yet to be an announcement as to when this will be implemented, but given the multitude of issues that many people with disabilities have trying to access transport, we would certainly appreciate some clarity on that. I know both the taxi industry, and particularly the access taxi drivers, and people with disabilities, are certainly looking for some clarity on that. We are pleased that this has led to a lifting fee, but would like some clarification as to when it is going to begin and exactly how it is going to be implemented.

With those few additional questions, and in addition to those we have already asked and had answers to from the Treasurer, we are happy to support the bill.

The Hon. T.A. FRANKS (17:32): I rise to respond to some aspects of the Statutes Amendment (Budget 2016) Bill. I note that the leader of the Greens in this place, the Hon. Mark Parnell, has addressed the bulk of the issues, but I rise also to address this bill before us.

The Greens do welcome some aspects of this state budget, however once again, as we have come to expect from this particular Weatherill Labor government, it is also a budget littered with missed opportunities.

To commence, I do want to acknowledge one of the positive aspects of this budget: the new measures to crack down on the gambling industry. The Greens welcome the introduction of a wagering tax for online gambling, based on the place of consumption, where that place of consumption is here in our state of South Australia. Given the enormous human costs of gambling, the gambling industry should be making a much bigger contribution back to society. The contribution that they would make through this is a welcome start.

While this is certainly a move in the right direction, I do think that there are still some questions to be clarified around its implementation. For instance, it is not clear from this bill how the government will ensure that online gambling is captured by these provisions. While the government says it will cover bets placed over the phone, internet or other electronic means provided by the licence holder who has substantial business assets and infrastructure here in the state of South Australia, surely there are many players in the industry who could have their business arrangements set up in such a way that they would be able to circumvent these provisions. If the government could provide a response as to how they would manage that, the Greens and, I am sure, the South Australian public would appreciate those answers.

As I say, we welcome the intention, but it falls short on the kind of reform that is really needed to address problem gambling. We need bet limits of no more than a dollar on poker machines. We need to remove the coin-dispensing machines and the EFTPOS facilities from gaming areas. Problem gambling is a major issue for our state, and it is something that causes distress and misery for many South Australians. It literally destroys lives, it literally takes lives, and the ripples of that are felt across our community. The economic impact is profound.

It is morally wrong, in my view, that the state government continues to rely on revenue from problem gamblers. In effect, the government is generating money by taxing the most vulnerable members of our community. That is an approach that has been taken by successive Labor and Liberal governments, and it needs to stop. As noted by SACOSS in their report 'Losing the Jackpot', these taxes account for 1.15 per cent of household expenditure for the lowest income quintile, almost double the average for all households of 0.66 per cent. For people earning in the lowest two income quintiles, gambling taxes represent a greater household cost than vehicle registration, insurance duties or the emergency services levy. So, it really is a tax on the most vulnerable.

While the industry will now be making a greater contribution to the Gamblers Rehabilitation Fund, this does fall short of the kind of structural reform that is so desperately needed. We need to end the reliance of state governments on pokies and on gambling. We need to break the reliance on that to fund social services on the backs of the most vulnerable in our community. Indeed, SACOSS highlights the potential for broader structural reform in their report. They suggest that gambling taxes be directed into a sovereign wealth fund, where only the earnings of that fund go to consolidated revenue and current expenditure. This would limit the reliance of state budgets on gambling. It is the kind of measure that I hope the government will consider, as it is clear that we need major reforms in this area.

Additionally, the Greens will continue to advocate for gaming area prohibitions and barring orders as per the private member's bill we saw fail in this place in the last sitting week. Indeed, we have worked closely with all members of the crossbench on these issues because we know that this is an issue that is profoundly affecting the most vulnerable in our communities. We also know that both of the old parties, Labor and Liberal, continue to oppose efforts to curb the gambling industry, but also continue to take money for elections from the gambling industry. That has to stop as well.

I note that, in these past few days, the government has been condemned for its move to withdraw support for the Statewide Gambling Therapy Service as it is currently run. The AMA (Australian Medical Association) of South Australia, no less, has spoken out against the plans to stop the funding of the Statewide Gambling Therapy Service. That service has offered ongoing outstanding results, and it now faces closure after a tender decision looks set to direct the funding to a private sector psychology provider. The Greens share the AMA SA's serious concerns that the state government proposal to effectively privatise state gambling therapy services is a retrograde step. Why would you make an ongoing public health service that has been delivering outstanding results subject to short-term tender? This is a point the AMA SA has made, and it is also a point that the Greens support.

In terms of other budget measures in this bill, I share the concerns expressed by the Hon. Kelly Vincent, and I also ask for some further clarification on how the amendments to the Education Act—which will introduce new fees for people in South Australia who are here working under 457 visas (Temporary Work (Skilled) visas), where those who are parents with school-aged children will now pay $5,100 for each primary school student and $6,100 for each high school student to attend local schools—will be implemented, what the estimated impact is, and whether it will have a knock-on effect on the ability of ensuring those workers take on roles in our state.

While other jurisdictions have gone down this path, South Australia at this time needs more migration into our state. We need more workers in this state. We need to ensure that we are not removing a market advantage here that perhaps could attract those people to our state. I also think it is a broader question about whether it is fair to charge people such a significant amount of money when they are paying taxes during their time in Australia. Surely, there is some expectation that when you pay your taxes, it goes towards accessing that public education system in the place where you reside. Thousands of dollars per child is a small contribution in this budget for the state, but it may have an unexpected and profound impact, so we certainly seek clarification, as did the Hon. Kelly Vincent.

As I said, this is a budget best defined not by what is in it but by what is missing. Indeed, it says very much about the priorities of this Labor government. This is a government that has been in power for 14 years, Mr President, as you well know, during a time of significant economic transition for our state. So, where is the plan to transition our state to a clean economy? Where is the plan to create new jobs? Where is the plan to arrest the so-called brain drain and stop talented young people from moving interstate?

We welcome the establishment of Green Industries SA as a new statutory authority. We need bold big picture ideas to transform our economy and cement South Australia as a global leader. Where is the plan for advanced manufacturing? Our state has enormous skills and expertise in manufacturing. We should be harnessing these for the future, rather than rolling out the red carpet for the likes of BP in the Great Australian Bight or the nuclear lobby in the regions which is hitching its wagon to the nuclear royal commission which is currently being rolled out at great cost, not just financially but at great opportunity cost, while we do not pursue a future of investing in renewables in this state.

We are also calling on this government to truly focus its attention on creating green jobs—those jobs in advanced manufacturing, jobs in local sustainable industries. We should be the state that makes things, rather than the state with those submarines that blow things up. We have a highly skilled automotive industry in this state. Indeed, Mitsubishi and Holden have been employing South Australians for generations. Let us look at how we can use that expertise to create the cars of the future.

Electric cars are a multibillion dollar business. Imagine what could be achieved if South Australia got a piece of that action. The Greens vision is for every electric car that comes off the conveyor belt anywhere in the world to have a component made right here in South Australia. By making cars here, by making car components here, we can create the new jobs we so desperately need. The state government should be looking at how it can drive that kind of innovation in our state, not flights of fancy about storing high-level nuclear waste on the never-never into our future.

While we are on the topic of driving cars, where is the support for public transport infrastructure in this bill? The government has a plan to expand the trams network in this state. Well, let's bring it forward, let's get it happening and let's create the jobs that have been promised for tomorrow, not tomorrow but today. It is not good enough to keep talking about implementing these ideas on the never-never. We want those transformations and we need those transformations now.

Through these kinds of manufacturing projects, we can also provide a boost for our steel industry. It is not enough to talk about building South Australia if you are building it with imported steel. The Greens want to see the local industry actively supported by state government policy and that policy to be in black and white. Before the Labor and Liberal parties say that it cannot be done, we would rip up the TPP. This dud deal sells out our national interest. So, then we should and could do it. We would rip up that TPP so that we can have local procurement policies that protect South Australian jobs.

I note my colleague the Hon. Mark Parnell has a bill that we will put to a vote in this place tomorrow that will test your resolve on supporting our local steel industry. Where in this bill is the support we need for creative industries, the community arts sector? Former premier Don Dunstan put our state on the map by supporting a thriving local arts scene. Indeed, we called ourselves the Festival State. This Labor government is certainly not one in the Dunstan tradition, and within so many areas there is a huge chasm between the rhetoric and the action when it comes to this state government. They make a lot of a so-called 'vibrancy agenda', but when it comes to actually supporting vibrancy and diversity in the arts community by adequately resourcing such things as community arts and supporting local artists they are missing in action.

Of course, I should point out that in addition to appropriately funding community arts, the Greens want to see vibrancy extending beyond the CBD. That is one of the reasons I seek, in my private members' bill, to let those small bars roam free across the state and not be kept within the confines of the city square. There is no question that South Australia faces some serious and profound challenges, but with those challenges come opportunities. Sadly, this budget is missing out on those opportunities.

Debate adjourned on motion of Hon. T.J. Stephens.

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