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Legislative Council - Fifty-Third Parliament, Second Session (53-2)
2015-06-16 Daily Xml
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Bills

Supply Bill 2015

Second Reading

Adjourned debate on second reading.

(Continued from 4 June 2015.)

The Hon. A.L. McLACHLAN (15:29): In accordance with convention, I express my support for the Supply Bill for the appropriation of $3.29 billion from the Consolidated Account. This will provide sufficient appropriation to meet government expenditure from 1 July 2015 to ensure government services continue to be provided until assent is given to the Appropriation Bill following the bringing down of the budget in the other place.

The Liberal philosophy is that a strong economy provides meaningful opportunities for employment for those who seek it, which in turn ensures a greater quality of life for all our citizens. The Liberal Party also believes that a strong economy is also equally important to safeguard the most vulnerable in our community. Abundant employment opportunities are the best way to keep families out of poverty and allow them to avoid welfare dependence. The approach of this government is to believe that the more it taxes and spends will somehow lead to a magical recovery. The policy settings of this government are essentially driven by socialist sentiments and, in my view, will lead to an inevitable economic stall.

Governments must focus on providing the environment for economic activity. Governments and their bureaucracies do not have the skills to conduct economic activity in their own right—that is the role of the free individual and their enterprises in a dynamic marketplace. The only justification for government intervention is when there is market failure or to assist sections of our community to transition and adapt to new market conditions. The only recent policy initiative from this government that I can observe is privatising assets and begging the federal government for more money, even to the point of advertising their complaints. This is a poor substitute for what should be done—that is, encouraging innovation in our economy.

For success, we have to take responsibility for ourselves and not leave our future up for grabs. We must seek to shape our future and not let it rest in the hands of others who reside outside this state. I encourage the government to genuinely seek to reform our economy, rather than continually lay the blame on everyone but themselves. They have held the reins of power for too long to enjoy that luxury.

South Australia is currently in an unsustainable fiscal position, assuming no dramatic changes by the government of its extant policy settings. The government's attitude reminds me of Narcissus, a handsome Greek youth who rejected the desperate advances of the nymph Echo. These advances eventually led Narcissus to fall in love with his own reflection in a pool of water. Unable to consummate his love, Narcissus lay gazing, enraptured, into a pool hour after hour, unable to do anything else. All we hear from the government is that it is creating a vibrant city but we hear nothing about a vibrant state and its regions, while the deficit grows and the underlying structural drivers of the deficit's growth are ignored and remain untended. Our community withers as we gaze into the murky and diseased pool that is the Torrens.

It is no secret to informed opinion that we can expect that our state will continue to be challenged by expenditure growth, largely driven in the health, education and welfare sectors. At the same time, revenue growth is more tied to market conditions, as it is collected through taxes on goods, services and payroll. To restore fiscal sustainability, our revenue system needs to be aligned to match expenditure; one or other or both have to be adjusted. In some of the projections I have seen, they meaningfully suggest that expenditure growth is expected to be greater than revenue growth well into the future and gather pace, trending out dramatically beyond the forward estimates.

It is simply unacceptable to continue to run deficits. It is also not a long-term solution simply to sell off assets, for which this government has developed a hearty appetite. This is a government of privatisation, selling off the prized state assets to compensate for their failure to lead and facilitate economic recovery. The government's hunger will only be satiated when there is nothing left to sell. In all likelihood, we will see a deteriorating net operating balance going forward.

The sale of assets, such as the Motor Accident Commission, is not a fix for an unsustainable fiscal position: it only delays the inevitable. I remind the government that the need for the privatisation of state assets came to South Australia not because of any inherent desire of the Liberal Party but out of necessity because of the collapse of the State Bank and the need to ameliorate the desperate financial circumstances created by the previous Labor government. The Liberal government was given no choice, unlike the choice the Labor government has in respect of the Motor Accident Commission.

I pause to acknowledge the great contribution to restoring the fiscal health of the state at that time of my colleague the Hon. Rob Lucas. During the early nineties, the collapse of the State Bank doubled South Australia's debt, leaving it more than $8 billion in the red. If only we had $8 billion in debt today to repay we would not be so concerned. Non-financial public sector debt is expected to hit $10.84 billion in 2014-15 and forecast to reach $13.2 billion in 2016-17—even higher than the debt incurred when dealing with the State Bank collapse. The net operating deficit for the general government sector alone is expected to reach $185 million in 2015, and this will only be achieved after stripping $459 million in profits out of the Motor Accident Commission, revenue which will not exist in the future because the government are privatising the prized asset.

I cannot help thinking of the novel Heart of Darkness. You can trace many of the difficulties our state is now experiencing back to the Labor Bannon government, but our Labor friends do not want us to journey up the river to reveal the true horror of the misguided administration of our state. They seek to deflect blame onto everybody else for their failed oversight of the economy. They wear their time in government as a badge of honour, yet they refuse to shoulder responsibility for their failure.

Indeed, while some on the other side of this chamber decry the loss of the automotive industry and seek to blame the federal government, they have had plenty of time to understand the nature of global markets and the need for transformation and transition strategies to assist our people. They have been asleep behind the wheel of the figurative steamer as it plies its way in our federated and global economy.

Industry adjustment takes time and needs the whole of community support, not petty partisan jibes based on falsehoods and the revision of history. One only needs to look at the United States and those cities which have successfully revived their fortunes. It was not only a whole-of-government approach but a whole-of-community approach. There are no easy answers. Unless the state dramatically increases its revenue or seeks to review its expenditure, we will continue to be on this disappointing projection. I fear that many of the cuts that will inevitably come from Labor's policy settings will target the most vulnerable in our community.

I do accept that there needs to be a recast of federal and state fiscal relations. It has been advanced by some that one of the best ways of ameliorating the vertical fiscal imbalance is to consider giving the states a share of income tax or giving the states an agreed share of total federal revenues or even leaving the states to increase their own taxes.

I am not advocating a particular position, for each policy setting will require a number of trade-offs. What is important to acknowledge is that the revenue base of the state is very narrow. The implications of increasing stamp duties is that it is potentially economically distorting. Increasing payroll tax maybe efficient as a tax but it also attacks unemployment, which all governments, whatever colour, do not wish to encourage.

Increasing gaming taxes may also be efficient, but the tax base is being eroded and it relies on an industry which many believe is socially destructive. Introducing a land tax places an unfair burden on South Australian families unless there are other tax offsets and reductions. I am not opposed to recasting our tax system, but South Australian families should not be made to bear the burden of poorly considered spending decisions by the government and a lack of discipline in managing its overall expenditure.

The South Australian economy is already suffering under the yoke of continued increases in state taxes and charges. The people of South Australia need to have a government that places them at the centre of its growth strategy. Our people should not be seen just as taxpayers, as this government is wont to do, whose sole purpose is to provide funds to underwrite the imaginings of a tired government. Innovation cannot be directed by the commissariat: it must be nurtured and rewarded. Our people must be set free to flourish and grow.

A strong public service is fundamental to good government. An independent, professional and highly qualified public sector is critical to a better South Australia. We have one of the highest number of public servants per population amongst our sister states. This huge investment in our people also needs the leadership to ensure that it makes a meaningful contribution to creating an environment for our long-term prosperity.

Given the size of our public service, we must do all that we can to encourage innovation in the public sector. It is essential to ensure our future wellbeing, for as the pressure on our state finances grows, we will continue to need to provide reasonable public services with fewer and fewer resources. Put simply, we have to find new ways of doing business in this state.

I am confident that with the right leadership our public servants can assist us to find new ways to ensure our future prosperity. I know that there are thousands of public sector employees who are passionate about the outcomes for the people they serve. The public wants to see the government live within its means. The public also wants the government and the public sector that serves it to facilitate change and encourage enterprise in the community. The cost of inertia and inaction will mean that those generations that follow us will bear the double burden of a large debt and an ageing population. We need to accept responsibility for the future of our state now, as did those who came before us. I commend the bill to the council.

The Hon. R.I. LUCAS (15:40): I rise to support the second reading of the Supply Bill. Put simply, the Supply Bill provides an appropriation of $3.3 billion, approximately, to allow the continued provision of public services in South Australia until such time as the Appropriation Bill, or the budget bills, pass the state parliament. Given the budget is not to be introduced until later this week and the passage of the budget bills may take some weeks, or indeed in some cases, months, there is an essential requirement for public services to continue during that particular period, which obviously takes part of the new financial year, and the Supply Bill is the mechanism which the parliament uses to allow that to continue until new appropriations are approved by the state parliament.

As we look at this Supply Bill in the context of a budget bill being brought down later this week, the budget, as my colleague the Hon. Mr McLachlan has indicated, is in a mess. We have seen a continuing series of budget deficits. Six out of the last seven budgets have produced, or are estimated to produce, budget deficits. We have the situation where, as the Leader of the Opposition often quotes, if one looks at what the budgeted expenditure at the start of each year of this government was meant to be and then compares it with what the actual expenditure is at the end, the total, to use the phrase 'unbudgeted expenditure' as defined by those parameters, is nearing $4 billion during the term of this Labor government. So there is an average of more than $300 million a year in unbudgeted expenditure.

As we look at that, one accepts that in some cases there are decisions taken through a financial year which are not included in the original budget for that particular financial year, but we see, by and large, too many examples of massive government waste by this government. As we enter the 14th year of this government, it is a bit hard for the government to argue that it is on its trainer wheels or that it has learned the lessons, or that these were the errors of the past.

We have continued to see over recent months continuing examples of massive government waste, which is what so infuriates people, but which, of course, is a prime cause of the budget problems that we are confronting in South Australia. The biggest infrastructure project that the government is involved with is the new Royal Adelaide Hospital. One remembers the debate of 2010, when the government attacked the Liberal Party proposition for a cheaper alternative: an almost complete rebuild on the existing site, on the basis that it could not be achieved for the cost that the Liberal Party indicated and by the same token indicated that it had locked-in rolled gold guarantees, that their new hospital could be built for $1.7 billion. As we now know, even as they were mouthing those words, they had already received advice at cabinet from Treasury that it had already blown out to $1.8 billion. There had been a $100 million blowout even as they uttered those words to the people of South Australia in 2010.

Sadly, without tracing the long, sordid history of the continued blowouts, the total cost is now in and around $2.3 billion for the new Royal Adelaide Hospital, compared to the $1.7 billion. That is a $600 million blowout in costs; that is approximately the sum of money that has been spent on the Adelaide Oval. When one looks at the cost of the Adelaide Oval redevelopment, that is just the cost or the size of the blowout on the new Royal Adelaide Hospital.

Of course, that is not the final number because it has only been in recent months that a further $170 million blowout in the new Royal Adelaide Hospital was publicly revealed when the government finally conceded that it actually had not costed transferring people from one site to the other, and it had to also include the costs of running two sites at the one time for a period of time; something they had long denied. Many stakeholders had highlighted that it was going to be impossible to meet the time line they were promising but, nevertheless, finally they have been forced to concede a further $170 million or so in terms of additional cost. That will not be the end of it. The $2.3 billion figure will not be the final figure for the final cost of the new Royal Adelaide Hospital.

There are so many examples in the IT area. I will not go through all the examples, other than to briefly list them. EPAS in Health is a fiscal disaster and scandal combined. RISTEC in the Treasurer's own department is a project which has blown out by some $25 million to $30 million—an IT project in the Treasurer's own department. The only way it has been kept to that level of blowout (believe it or not) is by significantly reducing the scope of the project so that it is now going to deliver a much smaller level of service, or more restricted level of service than was originally promised in the original budget.

There are the examples in the hundreds and the tens of millions of dollars, and there are many others but I will not go through all of them today. Perhaps the appropriation bill debate will be a time for greater detail over a wider range of areas. However, just look at some of what might be the smaller areas in dollar terms where the government wastes money: the recent announcement of a former Labor Party staffer to be the chief executive of the Department of the Premier and Cabinet with a $125,000 pay rise. This man is paid more than three hardworking members of the Legislative Council—other than the Hon. Gerry Kandelaars, of course, who is the original $200,000 man.

For the base salary of $150,000 or so, the CEO of DPC is being paid $550,000, and I suspect there is more to come out about the Hon. Mr Winter-Dewhirst's package in due course. That is the publicly-proclaimed position: as I said, a pay rise almost equivalent to what is paid to a back bench member of parliament—a $125,000 pay increase. How on earth the Premier justifies that I do not know.

The Department of Premier and Cabinet in a series of moves—which I am sympathetic towards, I must admit—is actually jettisoning many of the additional elements that have been added to it over the years and becoming a true Department of Premier and Cabinet, with some exceptions. It clearly has the very significant Services SA section, but areas like arts and Aboriginal affairs and multicultural affairs and SafeWork SA and other areas have now been attached to other departments and agencies. So, the job Mr Winter-Dewhirst has got, with a $125,000 pay rise, is a significantly reduced one in terms of the numbers of staff and the numbers of functions for which he is responsible.

Of course, we then move down from his position, and one of his very first moves, I am told, in some cases without even meeting, interviewing or knowing anything about some executives in his department, was to organise the ritual beheading, in a corporate sense, of up to 11 executives on one fateful morning in January of this year. Some of those executives had never even met the chief executive.

In one case an executive was about to go in with his staff to celebrate his birthday with a birthday cake. He was asked to hold the birthday cake and candles for a moment because the chief executive wanted to see him. He went in and, as I said, was ritually beheaded in a corporate sense by the representatives of the chief executive.

It is interesting to put on the record the way some of these were treated. A representative of the chief executive read a series of paragraphs, which had been drafted for the executive, which said, essentially, 'We don't want you any more.' Someone from human resources was sitting next to them with a yellow envelope, and the representative of the chief executive said, 'HR has an envelope for you which has all your entitlements in it; you can take that away.'

They did not even get a chance to read the contents of the orange envelope. They were then told that the representative from HR would escort them down to their desk, where they could collect their personal belongs before being escorted off the premises. In the case of the fellow with the birthday cake awaiting, he never got back to see his staff and celebrate his birthday on that particular occasion.

These were not people who were under suspicion of corporate wrongdoing, impropriety or lack of performance in any way. They were people about whom the new chief executive, the former Labor Party staffer, had made a decision, based on some advice, because, as I said, he had not met some of them, that they were not suitable and were for the corporate high jump.

Where this comes in, in terms of waste, is that, for example, in one particular case one of the executives was actually employed on a five-year contract in the middle of 2014. That particular executive's contract did not expire until somewhere around the middle of 2019, so they had only just been through a process, won an executive position and been given a five-year contract. For this particular executive it was between $170,000 and $230,000 a year at the SAES level 1 category of executive. So, as a result of this corporate beheading, taxpayers of South Australia had to pay out that executive somewhere between $200,000 and $300,000, because for every unexpired year of your contract you have to be paid out for about four months.

So, the taxpayers of South Australia have an interest in not only a sense of fair play, that is, how someone should be treated, even if you have decided that you no longer need them. There is a process you go through (and most chief executives do go through in terms of handling disengagement of executives), but in this case you have a series of them—and here is one example—where the taxpayers are having to fork out $200,000 to $300,000 as a result of the decision the chief executive has taken.

The Budget and Finance Committee has just so many examples of government waste that we see. The most recent example—the Hon. Mr Darley was there and he was probably as gobsmacked as I was—is from the Commissioner for Public Employment, the agency within Premier and Cabinet which is meant to be the role model, the template, for efficient public sector practice, the person and the office that issue guidelines and determinations on good practice in terms of management within the public sector.

We found that, on a budget of about $9½ million (a very small budget), there had been a $2 million blowout—a $2 million overspend in a $9½ million budget. If you were talking about the health department on $5 billion, you would be talking about a $1.25 billion blowout or something in the budget. It is an extraordinary position within the Premier's own department and responsibility.

The Premier and minister Close took a very close interest in the appointment of Ms Ranieri as the new Commissioner for Public Employment. I will not go over the details today, but there have been a number of examples where I have highlighted how the government engineered the appointment of Ms Ranieri to that particular position. I have laid on the record claims (still in a number of cases not denied by the Premier and the government) of concerns that public servants have had about that appointment process.

Still the details of a cabinet submission of 7 April 2014 from minister Close—if that cabinet submission ever sees the light of day, there is a very strong probability that minister Close will no longer be a minister, because there will be evidence of her having misled the parliament. So, minister Close is forever holding her breath that there is no leak of the cabinet submission of 7 April 2014 underneath her signature.

The final issue I refer to from the Budget and Finance Committee work, but there are many others I could have referred to, is the tortuous history of the forced redundancy policy. Mr President, as you know, both the government and the opposition took a policy of, if elected, introducing the parameters for a forced redundancy policy in the public sector. That is more than a year ago, in March 2014, but only in the last few weeks has the Commissioner for Public Employment finally issued the guidelines to departments as to how the forced redundancy policy will operate.

One of the concerns senior executives in departments have flagged with me about the policy is as follows. In some cases, chief executives have public servants who, more than five years ago, they declared surplus to their requirements, so we are talking about, prior to 2010, a chief executive and his or her department having identified a public servant whose job and position is surplus to the department's requirements. That particular person has refused to take a targeted separation package. Because it was voluntary, they refused to do so, so for more than five years they have had to continue to employ them and to find jobs for them.

Those senior executives were hopeful that, after March last year, in relatively quick succession they would be able to progress the separation of some of these officers. They knew it was likely that there would be at least a 12-month delay from March of last year, so they were hopeful that the period in and around about March, April or May of this year might have been the period that they could start taking some action. What has horrified a number of those executives now is that the new policy indicates that, even if someone has been surplus for more than five years, the 12-month period through which you cannot forcibly retire somebody and have to continue a task of trying to find alternative employment in the public sector for that person starts from the date that you send them the letter.

So, even if someone has been excess to requirements for six years, they still have to now be sent a letter, and there is another 12-month period that you have to go through before you can actually action the particular policy. As I said, some CEOs and senior executives are shaking their head at the decision that Premier Weatherill and Ms Ranieri and others have taken in relation to the forced redundancy policy. Enough on the waste side.

On the other side, on the revenue side, there is, as a result of the recent federal budget, significant good news for South Australia. Mr Acting President, as you will know, I have on a number of occasions, contrary to the untrue statements made by some government ministers, indicated our opposition to various commonwealth decisions which cut expenditure to important health and education programs, some road programs for local government and the concession commitments as well. That was a position not just of myself but also of Liberal leader Steven Marshall and Liberal members in South Australia as well.

Whilst a lot of taxpayers' money has been wasted attacking those federal government decisions, we have heard virtually nothing about a decision in the federal budget which will mean an extra $146 million unbudgeted GST windfall to South Australia for next year, for 2015-16. So, there is $146 million extra which the government did not think it was going to get. It is unbudgeted, so it is not as the treasurer often claims, 'I can't spend that money. Yes, it is additional federal money, but it is targeted to go towards hospitals, schools, roads' or whatever it is. It is not targeted, it is not tied: it is $146 million of unbudgeted GST windfall money for next year.

In total terms, the GST money for next year is actually a $571 million increase compared to this year. The difference between the $571 million and the $146 million is that just over $400 million of that has already been estimated by the state government as additional GST money, and they may well argue that they have allocated its expenditure. There has been precious little publicity, I might say, about that extra $425 million; nevertheless, it is additional GST money, but the government will claim that it has already been aware of that. This additional $146 million, however, they cannot claim as being expected income.

Similarly, we will see, although the exact numbers are not clear, that for the forward estimate years there are significant additional elements of unbudgeted GST windfall money for 2016-17, 2017-18 and probably 2018-19 as well. So, there is $146 million extra next year, and there is likely to be that and more for each of the forward estimate years, and the detail of that will need to be teased out during the estimates committee and possibly Budget and Finance Committee meetings as well.

The $146 million is significant because that would be more than enough, for example, to have prevented or to reverse the massive slug on the family home through the removal of ESL exemptions. It is also certainly more than enough to fund the additional cost of living concession that the state government is introducing, so it says, in this budget instead of the local government council rate concession. It is also more than enough to ensure the continued operation of the Repat Hospital and also the various existing emergency department services (at their current level) that are under threat at the moment. That is a significant issue in terms of the Supply Bill and as we enter the Appropriation Bill debate.

The second one is obviously the Motor Accident Commission privatisation. I note the confused—is the polite way of putting it—position of Treasurer Koutsantonis in relation to the privatisation of the Motor Accident Commission. Yesterday on ABC radio, in a heated interview with Matt Abraham and David Bevan on the breakfast program, the Hon. Mr Koutsantonis trenchantly claimed, and I quote, 'We're not privatising the MAC.' They were his exact words. That is completely contrary to any number of statements that the Treasurer has made both inside the house and externally about the decision in relation to the Motor Accident Commission. On ABC radio in December last year, he said:

…we announced the privatisation of the Motor Accident Commission…we didn't try to…use any weasel words, I said it was a privatisation, it was a sale, we're going to get out of the business. We think the private sector can issue insurance a lot more efficiently than the government.

He is quite clear, unequivocal and explicit. He said, 'I said it was a privatisation. We announced the privatisation of the Motor Accident Commission.' He has said similar things in the House of Assembly. On 7 May he said:

The Leader of the Opposition will have to wait for the budget to see how the privatisation of the Motor Accident Commission will be treated.

On 26 March 2015 he said:

We are not closing the Motor Accident Commission, like the Leader of the Opposition has said: we are privatising it.

I do not know whether the Treasurer cannot remember what he said or whether he is suffering from memory loss or whether he just makes up the story as it suits his purpose. When he wants to argue that it is a privatisation, he says, 'Yes, I'm explicit. Of course I've said it's a privatisation.' When he is getting belted in a difficult radio interview, he says, 'We're not privatising it.'

I think the dilemma the state has is that here we have a bloke who at least formally has the title of the Treasurer of the state of South Australia, and at least for the moment represents the state in terms of the state's finances, and one cannot work out whether he knows what he is doing in relation to the Motor Accident Commission. Is he or is he not privatising it? Which particular statement of his are we to believe? Or, as I said, are we in the sad position where the Treasurer of our state just makes it up as he goes along, changing the argument depending on the circumstances, prepared to contradict himself completely on any number of occasions in relation to his public statements?

The budget impact of the Motor Accident Commission will be critical. Certainly, as the Hon. Mr McLachlan has indicated, the government is taking into the budget and out of the Motor Accident Commission approximately $1.15 billion in retained earnings. It is doing that in two ways: in part, through a dividend payment; in part, through a return on capital. It is done in that way because there are different budget treatments.

The budget treatment in the Mid-Year Budget Review is different from the budget treatment when the policy was originally announced in the 2014-15 budget. We understand that discussions are still going on between the Treasury, representing the government, and the Auditor-General in relation to the appropriate treatment of taking money out of the MAC and putting it into the budget, which bits can impact on the net operating balance and net lending and which bits have an impact only on the net debt.

Clearly, the way they have currently structured the documents, as per the Mid-Year Budget Review, there is an impact on the net operating balance for 2014-15 and also some impact on the net debt in 2014-15; there is no impact in 2015-16 and some impact on the net debt in 2016-17. However, it certainly would not surprise anyone if the government did not shuffle around the money, and maybe even shuffle around the accounting treatment, in terms of what the impacts on the net operating balance might be; it may well be different from 2014-15. We might even see the impact from 2016-17 being brought forward to 2015-16 financial year, if that suits the government's purpose in terms of the presentation of accounts.

Of course, that is not going to be the end of it. Whilst they are only informal estimates—the just under $1.2 billion that has been taken into the budget—ultimately, if the policy is implemented as broadly publicly outlined, another $500 million to $1 billion, depending on the performance over the next 12 to 18 months, might be able to be returned to the budget in one form or another. Of course, that is impossible to accurately predict at this stage; nevertheless, the initial estimates in relation to $1.2 billion have been accurate.

I can only refer members to a discussion the Budget and Finance Committee had with the Under Treasurer in the middle of last year when they were predicting only $500 million to be taken into the budget and indicate that, based on information that industry sources and departmental sources were talking about, over $1 billion would be taken into the budget. Five months later, of course, we saw that occur in the Mid-Year Budget Review. The issue of the MAC, its budget treatment and the actual policy parameters will be critical as we look at these Supply and Appropriation debates.

The final two areas to which I want to address some comments are what need to be—and again I can only agree with my colleague the Hon. Mr McLachlan—at least in the first case, the key aspect of what the government and we ought to be about, that is, the issue of trying to turn around what is an economic basket case. In question time today, when she was asked about the government's promise in February 2010 of 100,000 jobs within six years, minister Gago listed a whole range of things she claimed that the government and she were doing.

Of course, the simple response which came by way of a number of interjections was, 'Well, whatever you've been doing has failed because, the promise of 100,000 jobs by February of next year, you have achieved about 6,000 of those.' You are about 94,000 short. There is a 7.6 per cent unemployment rate in South Australia and the national average is just on 6 per cent.

So for all of the pages and pages of carefully prepared Dorothy Dixer responses that the minister read onto the public record, the simple response to all of that was, 'You've been there 13 years, you've been given more than enough chances and you've failed. You've tried all of your programs—your economic programs, your jobs plans, trying to direct things and ultimately you've failed.'

And the minister said, 'We are going to have another jobs plan.' It will go the same way as all the other jobs plans have gone because it does not recognise, and this government does not recognise, this Premier doesn't recognise, and this Treasurer has no hope of recognising the simple fact that governments will not be able to create the jobs to turn the economic basket case around.

Governments can create the environment within which the private sector can operate in partnership with the public sector. There is a role for the public sector in terms of infrastructure provision and policy framework, etc., but the problem with this government is after 13 years, it is still beholden to the view that it knows best, and that it has a jobs plan.

Minister 'Mayer', as his leader refers to him, minister Maher as everyone else knows him to be, talks about a $11.25 million strategic investment package. Terrific. No particular argument about trying to do as much as you can but the problem with this lot is that they actually think that in and of itself that is going to solve the problem. They missed the point that the costs of doing business in this state are the highest or equal highest in the nation. We suffer the disadvantage of distance from market. It costs us more just to get to our markets in the eastern states if we are selling within Australia.

Yet we have a position with this government after 13 years, that the only area where it can now belatedly argue that it has done something, with the support of the parliament, is in fixing some of the problems that it created for itself, by itself, in relation to WorkCover over 13 years. In net terms, the WorkCover premium rate is still higher than the national average and higher than most of their competitors' firms in the other states.

The problem this government has got which it does not recognise is that somehow if you want to actually achieve something, we have to actually reduce the cost of doing business for small and medium-size enterprises in South Australia. When Liberal leader Stephen Marshall, the member for Dunstan, at the last election outlined a package of starting to provide reduced costs of doing business so that you could create jobs in South Australia, we had the class warfare response from Premier Weatherill and Treasurer Koutsantonis that this was just trying to provide extra dollars for wealthy business mates of the Liberal Party.

This was the line—and I am sure when we get to the Appropriation Bill we will be able to quote it chapter and verse—that the Premier and the Treasurer were using, that if you provide tax relief to businesses, all that is about is the Liberal Party providing extra dollars to their wealthy business mates. It will be interesting to hear how Treasurer Koutsantonis and Premier Weatherill justify any potential changes that they might make, modest in their nature I am sure, in relation to business tax relief, because surely at some stage they are going to have to recognise that whatever it is that they have been doing for 13 years has been an unmitigated disaster, it has been a failure.

The performance indicators are there: 7.6 per cent unemployment, highest in the nation; business costs, highest or equal highest in the nation; and for 100,000 jobs meant to be delivered in six years they failed by the tune at the moment of 94,000 of those particular jobs. That is where the focus has to be and that is the problem that this state government has.

I turn to the final issue, which is, of course, the critical issue for people out in the community: the cost of living. This government may well, on the back of MAC privatisation and other decisions, manufacture a surplus for the first time in six or seven years for the coming financial year. They will do so in part on the basis of privatisations, but I think that analysis misses the point.

The other key factor is the government will do it if it does it on the back of smashing long-suffering South Australian families with massive increases in taxes and charges and in the cost of living. We see the $90 million a year slug on struggling South Australian families with the ESL. We saw the attempt to slug families in relation to the car park tax, where they were unsuccessful. We have seen the threat in relation to concessions withdrawal, which they have been forced to back away from. We have seen the threats of a broad-based family tax on the family home, which the Treasurer now says he is not going to implement.

Let me put on the public record here and now that I do not believe Treasurer Koutsantonis. Given that he is known by many as the 'welsher from the west' in relation to not coughing up gambling debts to other members of parliament, I am in a particularly insightful position to know whether or not you can take this particular man at his word. Whether it be private gambling debts which he does not honour or, more importantly, political promises, I do not believe Treasurer Koutsantonis. I think he wants to tell the people of South Australia that he does not want a tax on the family home prior to the election, and then straight after the election, if they are re-elected, they will introduce a tax on the family home.

That is what they want to do. Treasurer Snelling talked about it and then backed off. Treasurer Koutsantonis talked about it, and when the campaigns commenced in some of the marginal seats elsewhere, the back bench told him, 'Back off, Treasurer, we're a bit nervous about you going down this particular path.' They have backed off for the moment, but mark my words, if they are to be re-elected then they will be introducing a land tax on the family home.

It is imperative for the Liberal Party to make sure that the people of South Australia in those marginal seats are aware of the stark choice that they are going to have. If Mr Weatherill and Mr Koutsantonis are re-elected, you will have a tax on the family home, because that is what they secretly want to do.

We have seen it in relation to MAC. They said they were not privatising, yet more than 12 months before the election they were spending $100,000 on UBS Consultants to scope out the privatisation of the Motor Accident Commission. They hid the expenditure in the annual report of Treasury and Finance under a cost item which referred to the privatisation of SE forests. That is how sneaky, that is how deceptive, Premier and Treasurer Weatherill was. He spent $100,000 of taxpayers' money on UBS to look at his privatisation of MAC and then he hid the expenditure under a line which referred to payments to UBS for their known work on the South-East forestry privatisation.

How anyone gets away with that sort of deception, I don't know. The media, from top to bottom, ought to be pillorying Premier and former treasurer Weatherill in relation to that particular act of deception in relation to the MAC privatisation. There is the example: they said one thing, 'We're not privatising,' but straight after the election they are privatising.

They have form. They wrote letters to the Australian Hotels Association at an election, promising not to increase gaming taxes for the next four years—coincidentally, they happened to get a donation of $100,000 from the Australian Hotels Association. The very first budget after that election, the Labor government introduced massive increases in gaming taxes. The treasurer at the time, Mr Foley, said that he had the moral fibre to break his election promises; he patted himself on the back because he had the courage to actually break an election promise. That is the sort of front that some of these Labor ministers have had and continue to have.

So, do not believe Treasurer Koutsantonis and Premier Weatherill when they say they are not going to introduce a tax on the family home, a land tax. Trust me: their form is there; it is evident for everyone to see. When they say they will not do something you know that they are already doing the work, they have already done the work and in the first budget after the election, if they were to be re-elected, they will be introducing it.

Struggling South Australian families are already being smashed, and if a budget surplus is delivered it is going to be delivered on the backs of long-suffering, struggling South Australian family budgets. They are going to get smashed with ESL increases, they are going to get smashed with tax charges and rises right across the board. At the same time water costs continue to skyrocket—more than 200 per cent increases in the time of this particular government—and that is going to continue to rise. As I said, the two key critical issues on which this budget and this Supply Bill ought to be judged will be the cost of living issues and the creation of jobs issue. What, if anything, will this Supply Bill, combined with the Appropriation Bill, do in relation to those two key critical areas?

My contention, in wrapping up the Supply Bill debate, is that over 13 years this government has failed on both of those counts—that is in terms of jobs and costs of living—and it is highly likely for the next three years of this term that it will continue to fail in terms of creating jobs for South Australians and in terms of providing any cost of living relief for long-suffering South Australian families.

Debate adjourned on motion of Hon. S.G. Wade.

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