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Legislative Council - Fifty-Third Parliament, Second Session (53-2)
2017-07-05 Daily Xml
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Bills

Parliamentary Committees (Public Assets Committee) Amendment Bill

Introduction and First Reading

The Hon. R.L. BROKENSHIRE (16:21): Obtained leave and introduced a bill for an act to amend the Parliamentary Committees Act 1991; to provide for the establishment of the Public Assets Committee; and to make a related amendment to the Parliamentary Remuneration Act 1990. Read a first time.

Second Reading

The Hon. R.L. BROKENSHIRE (16:22): I move:

That this bill be now read a second time.

Sir, this bill will establish the Public Assets Committee. The committee will consist of six members: three from the other place and three from this council. Ministers will not be eligible for appointment to the committee. Public asset is defined as any asset held by or on behalf of the Crown or a state instrumentality. Assets will include a present, contingent or future legal or equitable estate or interest in real or personal property.

The functions of the committee will be to inquire into, consider and report on any proposed sale of public asset referred to it. The committee will consider the stated purpose of the proposed sale and the necessity or advisability of the proposed sale and the present and prospective value of the asset and any other advantages or disadvantages related to the proposed sale. It is proposed that public assets valued at more than $50 million must not be sold unless:

the committee has inquired into the proposed sale,

the final report of the committee has been presented to both houses, and

the proposed sale has been approved by resolution of both houses.

Examples of sale of public assets include ForestrySA. South Australian taxpayers are now $100 million a year worse off as a result of the sale of ForestrySA. The government sold off ForestrySA in 2012 for $670 million. Documents lodged with the financial regulator show that the new owner has managed to generate annual profits as high as $125.5 million in one year. It looks like they will get a full return on their investment in just a few years and then look forward to something like 95 years of recurrent handsome returns—money which will go to the private sector which could have been coming into Treasury to assist the taxpayers of South Australia. The new owners are in fact generating four times the profits than under government management. This is clearly an example of the Labor government choosing quick cash over long-term gains.

Another example is the Motor Accident Commission. The sale of the Motor Accident Commission was announced in 2014. It is estimated that the Motor Accident Commission has assets worth more than $2 billion, and the board of MAC did urge the government to dump plans to privatise the compulsory third-party market and offered the huge one-off windfall in addition to an annual budget payment of up to $150 million in recurring dividends—in other words, ongoing, year in, year out—but we saw that this government rejected that.

The Lotteries Commission was sold to Tatts for $427 million in 2012, and they have exclusive rights to sell South Australia lotteries products for the next 40 years. We now see in the budget papers that the government is intending to sell something that in my wildest dreams I would never have thought would be sold by any government. It would never have come across the radar because it was untouchable. It belongs to the South Australian community. That is the Lands Titles Office. You would have to ask how they are going to secure all the intellectual property—very complicated and very confidential property.

They will probably sell it off to a Chinese-backed, government-backed company. They are estimating the sale price at $400 million. Industry organisations are concerned that the sale will lead to exploitation of valuable private information. We have the Public Service Association, the Law Society, the institute of surveyors, the Institute of Conveyancers and the Real Estate Institute all arguing against the privatisation, describing the Lands Titles Office as one of the most efficient government agencies.

I raise these points in my second reading speech because, although this government may have had some changes in cabinet and a change of Premier, this is a Labor government that has been continually in office for 15 years. By March next year, it will have been in office for 16 years. When they go to the next election, I know that 16 years prior to that, this same government made a pledge about taxes and about privatisation. We will not talk about taxes today because that will occur at another time when we debate the budget bill, but we will for a moment talk about privatisation.

This government promised and made a pledge to the South Australian community that there would be no more privatisation, yet I have highlighted here four examples of privatisation. If you add up those figures from the four examples I have highlighted, there is something over $3 billion worth of assets that the government has sold. Iconic assets that could give regular returns on their asset value to the South Australian community have all been sold. What makes it even worse is the broken promise and the fact that there has been no democratic process, unlike with ETSA.

This government won two elections hitting the opposition on privatising ETSA rather than actually being focused on fixing the problems that were looming with electricity, which they were told about. This government promised no more privatisation but in the case of ETSA, the sale did have to go through the democratic process—a very tough one and very drawn out process through both houses. There was due diligence and democratic process under the Westminster system for ETSA, but they found loopholes to avoid any scrutiny from the parliament on the privatisation of the assets I have just highlighted.

Unlike the sale of ETSA, where the money went into reducing core debt, a significant debt after the previous Labor government had overseen the debacle of the State Bank, none of these assets are going off core debt. They are going into a recurrent budget and, if these assets were not in that recurrent budget, instead of having $70 million or $80 million surplus this year we would have had hundreds of millions of dollars of deficit. So it is being squandered, and it has not had the scrutiny and democratic microscope over it that it should have.

When I go right across the state and talk to the communities—as I am sure my colleagues do, too—they express real concern about privatisation. They particularly express concern that this government has broken a promise and privatised their assets without even letting the parliament have any input. There are not a lot of assets over $50 million left in the ownership of the state government.

The reason why, after deliberation and consultation, we chose $50 million is that over on Yorke Peninsula, as a case in point at the moment, there is a chance of a good, strong economic development at Wallaroo and all it needs is a small, unused government reserve to be freed up and sold off for a fairly insignificant amount of money for a major development. We are not going to restrict the government and the minister from having the authority to sell those off, but when you start talking about assets of $50 million and above that should be scrutinised properly by the parliament.

So, I appeal to my colleagues to have a close look at this bill and the intent of this bill. I look forward to some good debate on it, and give notice that when we come back after the winter recess I will be advising colleagues of the date on which I will be putting this up for a vote. Without taking anything for granted, if passed here I want to see this bill put into the lower house so that it can be voted on before we get up at the end of this year before the next state election. I commend the bill to the council.

Debate adjourned on motion of Hon. J.E. Hanson.

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