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Legislative Council - Fifty-Fourth Parliament, Second Session (54-2)
2020-05-14 Daily Xml
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Bills

COVID-19 Emergency Response (Further Measures) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 13 May 2020.)

The Hon. K.J. MAHER (Leader of the Opposition) (11:02): I rise to speak on this bill and indicate I will be the lead speaker for the opposition but there will also be a contribution from the Hon. Clare Scriven in particular. The opposition has supported all reasonable measures to protect the health of the community and support the recovery of the economy. In making this commitment, we must, as legislators, also apply scrutiny and help to improve legislation that has been drafted under pressure and in short time frames.

This is the sixth piece of legislation that the government has introduced that in some way has a connection to or is a response to the current COVID-19 emergency, and the opposition has supported each and every one. This began with the amendments to the Public Health Act and the Coroners Act along with a $15.3 billion Appropriation Bill. This is now the third piece of legislation related to the COVID-19 Emergency Response Act and these have introduced sweeping powers under the Emergency Management Act while also making temporary and permanent changes to a range of other legislation.

Across the range of emergency bills, the opposition and the crossbench have offered amendments and, with a few exceptions, these have received welcome bipartisan support. However, as with the other five pieces of legislation, so far there has been almost no consultation with external stakeholders and, in many cases, actually no consultation at all. The opposition and the crossbench have been provided briefings, often sometimes on the day of or the day before they need to vote on the bill. This has been one of the more disappointing parts of the last 2½ months.

The government continually talks about going through unprecedented times and the need to do things differently, but it has been reflected in a lack of consultation that has all too often been the hallmark of legislation in this place. Despite parliament only having been given a couple of days to consider the bills, briefing has revealed that the government has signed off on some proposals the day before when previous bills have gone through and waited at times up to six days to seek the assent of the Governor.

The scrutiny applied to emergency bills by the crossbench and the opposition has uncovered flaws in various pieces of legislation, and we have been able to make some improvements. Much of this could have been achieved before the bills reached the parliament, even with the brief discussions or short consultation.

While of course needing to respect the processes of the government, with cabinet processes and party room processes, it is almost incomprehensible why there has not been a greater degree of openness and cooperation. The opposition and the crossbench have demonstrated time and time again that we are taking a constructive and supportive approach to helping manage this emergency. While we hope that further emergency measures will not be needed, if they are the opposition extends an invitation to the government to do things a little bit differently.

The government could come to the opposition even before cabinet processes start, to outline the areas they are looking to change, take legislators into their confidence and talk about what needs to be done before there is a final completed signed-off piece of legislation that has gone through the cabinet and the Liberal Party party room later that Monday. They could come to the opposition and crossbench and say, 'We are looking at making reforms in the area of commercial leases, in the area of trainees and apprenticeships. This is the direction we are heading in. Have you any concerns or proposals?' That presumably could be done a week or two before the final legislation is completed, and that would go a huge way to alleviating some of the problems that we are seeing.

We have amendments filed, some this morning, and I will flag that there is another amendment in the final stages, to do with commercial leases, that should be ready within the next 15 minutes or so, which the opposition will file. I would have very much liked that to have been filed two or three days before we considered this bill. Unfortunately, the way the government has dealt with this in the consultation means that it is impossible to do so. It puts many of us at a huge disadvantage in being able to properly scrutinise the bill and being able to think about amendments.

I would suggest to the government if there are future emergency measures, talk early. Let us know what you are planning to do, and then there will not be amendments on the morning, amendments as we are going through the bill. I would not be surprised, as was the case in the lower house, if there were further amendments from the floor as we are considering it. The way the government has conducted it means it lends itself to that practice.

We have asked the government for explanations about some of the changes that have been made in this and other bills. Sometimes the government has offered the explanation that one organisation or another has asked for this change as the only reason. In other cases, the only explanation the government has offered for not doing something is that others have not done it. It is not the standard we should expect and it is not the standard we should set in the future. In an emergency more than ever, we need to be conscious of unintended consequences and make sure that when we are giving extraordinary powers to individuals and to government and organisations we get it right.

We have seen that some of the decisions of this government have left some of the most vulnerable workers high and dry, in terms of casual nurses without shifts, in terms of those in the performing and other arts sectors who work in government-owned enterprises who cannot access JobSeeker payments, and in terms of legislation that both the Labor Party and the Greens have put forward to protect workers who are on the front line, to make it easier to access workers compensation. They have not been taken up, yet we are expected to fall in and support—as we have done and as we will continue to do, because it is the right thing to do—measures during this emergency.

This bill expands on a range of earlier provisions. In this bill, we are replacing the elements of the act that deal with commercial tenancies to support the implementation of some of the elements of the National Cabinet Mandatory Court of Conduct—SME Commercial Leasing Principles During COVID-19, which is a national code that was agreed to, I think, right back in March. I will have a bit more to say about it later in the second reading speech.

The bill extends the effect of some regulations that are made under current emergency arrangements, and we will have questions about the nature and the effect of that during the committee stage. It expands the flexibility for the Community Visitor Scheme and the Chief Psychiatrist, and I note there have been amendments made by the shadow health minister, the member for Kaurna, Chris Picton, in the other place that the government has accepted.

It allows for increased direct interventions in the electricity market. It clarifies powers for authorised officers under the Emergency Management Act to remove children from premises. It provides for the suppression of traineeships and apprenticeships until January 2021, and my colleague the Hon. Clare Scriven will have more to say about those provisions. It makes two changes to development legislation, the first to increase the threshold referral from $4 million to $10 million and removes the need for consultation; and the second removes the need for concurrence of the local council for certain developments. It is noted that the bill involves a mixture of both temporary and permanent measures, the latter of which will obviously require a higher level of consideration before it becomes law.

I want to briefly reflect further on the first measure I outlined—that is, commercial leases. This bill completely repeals the previous section regarding commercial tenancies that was agreed in this place on 8 April. The new section outlines detailed areas in which regulations may be made but does not provide any meaningful guidance to landlords and tenants who have been crying out for that certainty. The government has provided a draft copy of regulations but these fundamentally deal with process matters rather than giving any guidance for outcomes or how those outcomes might be arrived at.

Whilst mediation is required under these draft regulations either party can refuse to engage in this process. The only recourse after that is to go to court and that may take months and come with huge costs. If the matter goes to court, the draft regulations say that the court must have regard to a range of matters but none are provided greater weight than others. This creates almost an unreasonable risk that a stronger party to a lease—whether that be a landlord or a tenant in the commercial situation—could more easily prevail in a court setting.

For parties who engage in the process in good faith there is a lack of clarity about what default or standard outcomes could be or the method of arriving at them. The opposition believes we should have clearer guidance. It is nearly six weeks since the Prime Minister published the mandatory code on commercial leases and we think businesses in South Australia deserve more guidance and better than what we are seeing in the act and the suggested regulations.

I will foreshadow how we are looking to deal with that. As I said, there is an amendment that is minutes away from being finalised. That provides, within the legislation, a little bit of guidance. The Code of Conduct for Commercial Leasing principles COVID-19 makes it clear that proportionality is to be the primary consideration—that is, the rent reduction being proportionate to the loss of turnover from the business concerned. The national cabinet mandatory code of conduct for small/medium enterprises commercial leasing principles during COVID-19 makes it very clear that that is the basis on which you can start to work out how a loss of rent might be apportioned—that is, the proportionality, a proportionate basis as a result of the commercial disruption caused to the tenant.

The amendment that we will have very shortly circulated seeks to include that in the legislation, to say that as far as possible that is the starting point for determining these leases. That gives some guidance, some certainty and a starting point for how you might negotiate the issue of commercial leases. We think that is good for both landlords and tenants, to have some idea as to how it might be started, but it also leaves flexibility for all the things that are in the regulations to also apply, and I think shows more faith with the national mandatory code.

That having been said, I am sure we will, as we did last time, work together in a very cordial and civil manner to try to resolve some of the areas around the edges. I reiterate that the opposition stands firm in its support of making sure that those who are keeping us safe have both the powers and protections they need to do so.

The Hon. C.M. SCRIVEN (11:14): I will speak briefly at this stage and then have more to say when we are going through the specific aspects in the committee stage. The emergency response amendment bills have been, obviously, implemented in terms of the current pandemic that we have. The opposition has been very cooperative with most if not all of these changes that have happened in both this current bill that we are considering, as well as in previous bills; however, it has been on the basis that this is for the period of the COVID-19 emergency only.

Nearly all of the legislation is based on an end date of 30 September, at this stage; however, what we have seen in this current bill is attempts to make some changes that will last much longer than that, specifically to January 2021. I think that flies in the face of the agreements that have been made, the understandings, the principles that this is for the emergency period only and that is currently until 30 September. This interacts with a number of aspects, particularly federal assistance packages that have been announced by the federal government, which end on 30 September, such as the JobKeeper arrangements. We have seen quite strong statements in the media this week that this will not be extended.

In terms of training and skills and apprentices and trainees, we need to ensure that we are looking at the overall holistic situation that people who are apprentices or trainees will find themselves in. As I said, I will say more about this in the committee stage, but that is the basic principle that we need to bear in mind. The opposition is generally supportive of the proposed measures contained within the bill in general, but we do have some specific concerns. I understand that the Hon. Mr Parnell has filed amendments in terms of some of the planning aspects and I have filed an amendment in terms of the Training and Skills Commission.

We have had contact from a number of group training organisations, talking about the difficulties within the industry to ensure that apprentices and trainees receive sufficient on-the-job training. Employers have had to renegotiate with group training organisations. There has been a period of huge uncertainty and difficulty for employers as well as for trainees and apprentices. If there are disputes relating to an employment contract of an apprentice, they are dealt with through the Training and Skills Commission.

The question we are asking is: why does the opportunity to suspend a contract of training need to be up until January 2021? This matter was debated a few nights ago in the other place and the member for Lee unsuccessfully attempted to have the date made consistent with the other COVID-19 legislation to 30 September 2020. Our concern, particularly in regard to the proposed date, is twofold: one is that consistency, which I have already referred to, and secondly, it is that thousands of apprentices and trainees across South Australia would potentially be left with zero economic support by any level of government after that date if their traineeship or apprenticeship is suspended.

By 30 September, support that apprentices and trainees currently have access to via their employer, such as the JobKeeper payment, others the wage subsidy payment, Coronavirus Supplement payment, and the federal economic relief package, will have all concluded—they will have all concluded. Minister Pisoni in the other place has acknowledged that there is support in place for apprentices up until that date, but he also acknowledged that there is no other support in place for them after this date. There is no direct state government support for apprentices and trainees from 30 September until January, unlike other states where bodies such as their construction industry training board or funds or the equivalent bodies have offered direct support for trainees and apprentices in the industry. In South Australia we have not even had that.

We have had some answers back from the government, and I do thank them for that. There were answers to questions raised in the other place and also some that were raised in the briefing, which, as the Hon. Mr Maher has already mentioned, was only given late Monday afternoon for legislation being introduced on Tuesday. Some of that does refer to the issue of whether apprentices and trainees whose contract of training has been suspended will be able to access JobSeeker, and I will say more about that during the committee stage, as I think that the information provided by the government is not complete.

Minister Pisoni in the other place said that by agreeing to these changes it would allow apprentices and trainees to look for other temporary work in the three-month period between 30 September and 1 January, but surely it must be clear to everyone that that is a very naive assumption. This state is projected to hit double-digit unemployment in the very near future, and the likelihood of a suspended apprentice or trainee finding other work in that period will be most unlikely.

The suggestion goes against the principle that minister Pisoni says he is committed to, which is trying to ensure that there is a continuing relationship between the employer and the apprentices and trainees. We do not want to send a message to apprentices and trainees that they will not be supported, that they are not being helped, that they are on their own. The opposition does not support that kind of approach. We want to ensure that they are afforded protections.

We have also had concerns raised with us from employee representatives about the potential to misuse this piece of legislation so that apprentices and trainees will be extremely disadvantaged. That is why we think the suspension should be in line with the COVID-19 emergency declaration period. If there is a need to extend it, then we can certainly come back and in this place debate it again and can certainly move emergency legislation, as has happened here this week with very short notice, to further that date if it is required.

But the government has not explained why it is required, and therefore we will be urging the government to accept our amendment and ensure the suspension period is consistent with the COVID-19 emergency declaration period.

The Hon. F. PANGALLO (11:21): I rise to speak in support of the second reading of the bill and, like the opposition, we certainly had concerns about the rush to get this bill passed through parliament. It is one of those things that I find disturbing, when legislation is thrust before crossbenchers and others to make a hasty decision when you have not had time to properly absorb what is contained in it. I echo the Hon. Kyam Maher's comments about the lack of time to absorb the actual impacts of these measures and determine areas that perhaps need improvement. You need time to analyse and see whether they are going to be workable.

Another disturbing aspect, which I believe the Hon. Mark Parnell will address, is trying to sneak through permanent planning changes in what you would call an omnibus bill. Again, you have to ask why this should not be dealt with elsewhere in another piece of legislation, or at another time, rather than be thrown in with the COVID-19 emergency measures that have been thrust before us today.

The Hon. Kyam Maher also highlighted some amendments in regard to commercial leases and how it appears to fall short of the national cabinet's mandatory code of conduct. This has also been pointed out by the Law Society and, like them, I can foresee problems with the mediation process, creating backlogs and delays in the system before there is a resolution to it. The Law Society has rightly pointed out that there needs to be a proper adoption of the national code. Apparently, they wrote to the government on 8 May, calling for the government to adopt the code in South Australian law. It does not appear that this is happening.

It appears also that there is a variance from the national code in regard to deferring the payment of rent, and I will refer to that letter from the Law Society, particularly one point where they point out that:

Furthermore, pursuant to Regulation 9(5)(e) the Court has the power to 'defer the payment of rent under an effective lease for a specified period not exceeding 24 months from the date on which the Order is made'.

The Law Society says that this appears to deal with deferred rent and says that it is contrary to the provisions of the code, which stipulates that deferred rent be recouped over at least 24 months. I guess that is something we can address during the committee stage. The Law Society also believes that some of the regulations do not satisfactorily reflect the code. I will read from their letter by their Chief Executive, Stephen Hodder. Under the subheading, 'Proper adoption of the Code', it states:

Overall, the Society considers the Regulations do not satisfactorily reflect the Code. As currently drafted, it is not clear as to whether the Government wants parties to a commercial lease to either follow all or some of the rent relief principles set out in the Code.

The society submits that this should be made much clearer, that is, by the suggested amendments they have made to the regulations that were sent to the government. It should also not be left to parties to analyse the factors the Magistrates Court may have regard to; rather, the principles set out in the code should be fully adopted in the regulations to provide clarity with respect to negotiations between parties, rent relief and the relevant proportionality principles to be taken into account.

Essentially, what the Law Society is saying is, 'You have rushed it. You should have consulted and perhaps you would have been able to come up with something that was going to be infinitely more workable.' I will point out that my colleague the Hon. Connie Bonaros has amendments and she will go through those in her address.

The Hon. C. BONAROS (11:26): As we have said before, this bill is the result of exceptional circumstances and exceptional circumstances do call for exceptional responses. This is another example of that. I echo the sentiments of other members. We have all made a very genuine effort to pass every piece of legislation that has been put before us in very tight time frames. It is legislation that otherwise would have taken perhaps weeks to consider. We do not have that benefit, given the nature of the bill and COVID-19 in particular, in this instance.

But it does appear that this has created a bit of a catch 22. If we do not pass the legislation, those caught up by the legislation could potentially be left in the dark until we sit again and have ample opportunity to consider them. If we rush it through, we obviously run the risk of making errors. That is not a good way to make law and we have said that over and over in this place, but these are not normal circumstances. We know that.

Obviously, we support the second reading of the bill. There have been a number of concerns that have been canvassed by members already. The Hon. Mark Parnell and the Hon. Tammy Franks have also raised concerns, which will be canvassed shortly. I do not intend to go over all those now, because I think we will be dealing with these in some detail during the committee stage of the debate, but I think it is worth pointing out for the record, as my colleague just did, the submission that has been provided to us in time by the Law Society, which has taken the time to ensure that we are all equipped with as much material as it can provide us with in the time available.

I note that there are amendments on file. I note that there are amendments being filed as we speak. I note that I have just received an amendment. My initial glance at that amendment would suggest that it is probably in line with the Law Society's submission. I may be completely wrong, because I have not had the opportunity to read it in detail as yet, but what I would urge the government to do at this point is to continue to work collaboratively with us and work through these issues.

If there are serious concerns that have been raised, particularly in relation to the commercial leases, particularly in relation to whether or not we are following the mandatory code of conduct as we should be or whether we are leaving things out of this legislation that could otherwise be incorporated, then I would urge the government to give appropriate consideration to those amendments in light of the feedback that we have received, particularly from the Law Society.

They have gone to some length to point out that they think this bill and the proposed regulations do not go far enough in terms of the code. They do not go far enough in terms of reflecting the code and addressing uncertainties for parties trying to negotiate commercial leases during COVID-19. The Law Society have made it clear that they think the regulations need to be amended. They say that needs to be done to direct the parties to negotiate and agree upon relief in accordance with the code. We know from the briefing we have received that some of the provisions in the code have not been included in this bill.

I will make the point, Mr President, because I think it is important not just for you but for all members, that we are leaving a great deal of what we are dealing with to regulations. We are relying heavily on regulation-making powers. I just make the point for all members that I already have a number of meetings scheduled today, tomorrow and next week with ministers and their staff in relation to regulations that were made under previous COVID-19 bills, and that is because some of them fall short of what we agreed to in this chamber. Obviously, they are the subject of consideration by the Legislative Review Committee. I will obviously not discuss that because I cannot, but I make the point because when we are relying on regulations, we are also relying on the government to get it right.

It would appear in some instances that there are questions that have arisen. There are questions that I have raised from when we first received those regulations and the reports. Most concerning is the fact that the advice that we have received back to date, not through the committee process—I will not speak to that process—but through the briefings, has been inconsistent. The advice that we received back from the Attorney's office in relation to the coverage of those regulations, initially, was that what we thought was problematic was not a problem at all. Up until the briefing that we had on Monday or Tuesday—I cannot remember which day it was—the advice remained that there was no problem with the regulations.

Later that day, that advice changed. In relation to the specific instruments that I have been alluding to, it does appear that there is a problem with them insofar as sunset clauses are applicable, so I have now taken it upon myself to meet with those ministers and their staff to ensure that those clauses reflect what I think and what I am sure other members would think was agreed to in this place. That is the problem with relying on not only rushed legislation but also then rushed regulations. I am grateful to those ministers and their staff and the government, who have accepted that there are issues with the regulations and are working with us to address those.

I will not speak to all the issues. I note again for the record that there are amendments under the Planning, Development and Infrastructure Act that do not appear to be necessary in here and are questionable. There are obviously issues in relation to training and skills development, which the Labor Party has taken on board, and there are also issues I would say in relation to the savings and transitional provisions, which I have just canvassed in terms of the expiry dates and the sunset clauses that apply to them. Specifically, they are that, if a regulation is made under the COVID bill, then obviously it will expire. If it is made under a separate piece of legislation, then it is not clear that it will expire come the September date that we have set a sunset clause for.

I note also, in relation to the removal of children, that the Hon. Tammy Franks asked a question during the briefing about the extent of the consultation that took place. The guardian and Commissioner for Children and Young People have been consulted but the Aboriginal Legal Rights Movement have not. We have raised questions, and the Hon. Tammy Franks raised several questions. I think we got some understanding around the issue of what a place of residence is intended to be under the bill and the sorts of situations where a child is likely to be removed and placed back in their place of residence, as opposed to away from their place of residence. These are the sorts of things that we have been trying to work through in the very short time available to us.

It also is important to note those clauses because I think it gives rise to questions around custody agreements, particularly cases where there are no formal custody agreements. We know that the courts have been inundated during COVID-19 with applications regarding custody agreements. We know that they have now had to implement a fast-tracking system to ensure that those applications can be considered in a more appropriate time frame. When we have provisions that relate specifically to the removal of children and very little clarity around formal custody agreements, then that does also raise some level of concern.

There are lots of issues which we will have to work through in the next few hours, I suspect. Again, I just make the point to the government that we have all come here in good faith and agreed to work collaboratively with the government to get these changes through because we are talking about exceptional circumstances, we are talking about unprecedented passages of legislation. I would urge them very strongly to consider the amendments that are being put on the table and the reasons for those amendments, particularly in light of the feedback, albeit limited, that we have received and the problems that have been brought to our attention by those very limited means of consultation that have taken place, particularly with the Law Society.

With those words, I indicate that SA-Best supports the second reading of the bill but we will be giving due consideration to all of the amendments filed by honourable members.

The Hon. T.A. FRANKS (11:37): I rise as one of two Greens who will be speaking to the COVID-19 Emergency Response (Further Measures) Amendment Bill today. As other members of this council have outlined—although I note with the exception of a government spokesperson on this bill—we are facing another rushed piece of legislation. For those playing at home, we were offered briefings on this bill sight unseen either on Monday or Tuesday. Most members of the crossbench attended a briefing on Tuesday morning just before the parliamentary week commenced, and here we are two days later debating the bill.

The bill has ostensibly claimed to be putting into place some of the national decrees, but it has a range of other measures as well. It is definitely an omnibus bill. I know my colleague the Hon. Mark Parnell will be discussing at length, no doubt, commercial leases and those aspects. I have focused on my parts of the portfolio of the bill and raised some concerns in the briefing about schedule 2, the provision under 25A—Removal of children, which states:

25A—Removal of children

(1) Without derogating from section 25, an authorised officer may, for the purpose of ensuring compliance with any direction under that section, remove a child from any premises, place, vehicle or vessel to a place of residence of the child or to a hospital or quarantine facility, as the authorised officer thinks fit (and may, in doing so, use such force as is reasonably necessary).

(2) In this section—

child means a person under 18 years of age; place of residence includes, in the case of a child who is in the custody, or under the guardianship, of the Chief Executive under the Children and Young People (Safety) Act 2017, any place directed by that Chief Executive.

My initial question was: why are we doing this? What is the need for the police to have additional powers to remove a child under the age of 18? To that, the response on Tuesday morning and followed up in writing was, 'The police want it. The police have asked for this and they want it.' The following questions were: why do they want it? What do they want to do? How do they propose to implement this? What is the need for this new measure identified under the pandemic? To date, we are still waiting for a why.

As the Hon. Connie Bonaros mentioned, I also asked who had been consulted in regard to the particular provision. I was told SAPOL was consulted, which is unsurprising given they want it. Certainly, one would have imagined the question that might have been asked in that consultation is why they want it, but so far, we do not have that really substantial level of detail. One would imagine that question would have been asked far earlier in the process than at a crossbench briefing on Tuesday morning. We were also told, though, that the guardian and the children's commissioner have been consulted about this provision, so my first question to the government is if they can please provide the response from that consultation process because we have not seen that as yet.

A group that was not consulted and that I spoke to this morning is the Youth Affairs Council of South Australia (YACSA). Their immediate concern, as we have been raising under this pandemic, was that children often are not safe at home. Children are often not in their place of residence because there is violence in their family home or sexual assault and abuse. I would like the government to respond how they have accounted for those concerns raised by YACSA and to explain why they did not talk to YACSA about this particular provision.

As somebody who grew up in a family where the home was not safe, under this pandemic, if I was still a teenager, I would have my physical safety at risk right now from provisions such as this. Is the government really purporting that a child's safety is to be put at risk by enabling excessive police powers to remove them back to a place of residence that may well not be a safe place?

We will cover further questions that were put on notice to the government when we get to that particular amendment. I note that they have been circulated in writing and I hope that they have also been circulated to the Labor members as well as the crossbench in terms of the response to further questions on that police removal power.

YACSA quite rightly also raised why is the prescribed precinct power not adequate if, for example, as I suggested on Tuesday, the government and the police are perhaps concerned about skate parks, gatherings outside schools after school or at the Rundle Mall Mall's Balls outside the newly opening shops? Perhaps this is the issue that we are seeking to remedy here.

In terms of the powers, one assumes that they are in regard to gatherings, but if the government could clarify that because it certainly has not been made clear to date what exact need the police have to remove children. Is it only from public places? Has some other need been identified? If this is pretty much a playground, skate park, Burnside pump track type of provision, then where has it been proven that, in fact, these children are gathering in dangerous numbers?

I note that in schools, we do not mind children gathering without social distancing, and I note that as they leave schools, they will be gathering in large numbers to catch the bus or the train home, possibly to get on the Gawler line and again to possibly break the directions on social distancing and gathering through no fault of their own. There has been no explanation why suddenly the police need these extraordinary powers applied to children. For the government to bring this before us in a rushed way with no consultation provided other than that the police want it is not only inadequate, it is reprehensible.

I have sought to delete that clause in an amendment to this bill, and I say to the government that if it is necessary then bring it back in three weeks' time with the appropriate consultation done, with the evidence that shows it is required, and then we can have a reasonable and rational discussion with the government in this place. I am sure that all members would facilitate that. Do not have a lend of this parliament by rushing this sort of legislation through when you have not identified a clear need for it.

Another area about which I have some questions for the government and that I would like to highlight today is the human biosecurity emergency declaration impact on the South Australian community, with particular attention to Davenport community. Davenport Aboriginal community is just a couple of kilometres outside Port Augusta. Both myself and the Hon. Kyam Maher, in a previous incarnation of this debate in one of those other rushed bills, raised our concerns that Davenport community was not consulted before coming under the Biosecurity Act and the extreme provisions of restriction that that entails.

Imagine if in the suburb of Burnside suddenly people put up fences and there was a penalty of $63,000 if you went to the wrong side of the street, but nobody had even bothered to tell you that this was going to happen. You woke up one day to have bollards and a boom gate and 24/7 patrols at the end of your street, and no consultation was done to find out whether or not you needed to get your kids to the other side of that road to go to school, whether you had health needs, whether you had a heart condition, whether you needed dialysis, or how you were going to get food from the local grocer.

In that community, there is no school, there is no store and there are no ongoing health services. It is a very different community from that, for example, of the APY, which is far more self-contained, but what was seriously concerning was the lack of consultation with the residents who live in that community about their day-to-day needs and their day-to-day lives.

I am very pleased to see that the Davenport Community Council has actually lifted the restrictions and requested to be removed from the Biosecurity Act. They posted on 12 May (Tuesday) that until they have official notification from the state government, while the Biosecurity Act has been requested to be lifted, the community continues to remain closed until they have that certainty.

My second question for government—and I have flagged this with the Minister for Health and Wellbeing, so it is not unexpected—is to outline what process applies now. My understanding is that the state government now has to contact the federal Minister for Health, Greg Hunt, and make a request. I note that already two communities in South Australia have successfully removed themselves from the Biosecurity Act, so it is not that this is unprecedented. In fact, this will be the third community to remove themselves from the Biosecurity Act.

But where is that process? Has the state government contacted the federal Minister for Health? How long will the approval take for that federal determination to be made? At the moment, Davenport residents had written petitions, and had in many numbers from many families—not just one family, but many families—expressed a range of concerns about how they were to access the basics of life. It was even to the point that they could not get their mail, let alone food, education or health services, or attend their jobs.

In fact, I know of at least two community members who have lost their jobs as a result of this particular restriction being imposed from on high without consultation, by the community council agreeing with the state government's request. Could the government outline where that process is up to and put it on the record for the community residents of Davenport, who are now wondering whether or not they are subject to a $63,000 fine if they leave or enter their community under the inappropriate provisions that applied just a week ago?

It has been deeply disappointing that there are not lines of communication that are made clear by the government. I briefly addressed this yesterday in my matter of interest speech. I have been contacted by various human rights groups, including the Human Rights Law Centre based in Sydney, because they are concerned about some of the South Australian directions or lack of directions coming from the State Coordinator.

In other states, a contact detail for the State Coordinator or their equivalent is readily available. However, there are no direct contact details for the State Coordinator available on any of the sa.gov.au COVID websites. When I rang the COVID hotline last week after some great confusion and being told I should look at the website and then the person looking at the website themselves and saying, 'Oh, yes, you're right; it's not on there,' I was told to ring 13 1444 because that is the non-emergency police number and, of course, the police commissioner is our State Coordinator.

This is entirely unacceptable. I note that when I made that point it was then suggested to me that I perhaps contact the police minister Corey Wingard. I found this also an unacceptable proposition. Then the manager took on the call and promised me that she would escalate this to the committee that addresses these issues with the COVID hotline and that my issue would be taken with urgency to that committee and I would be contacted. I gave my mobile phone number and I am still waiting for a contact detail for the State Coordinator to raise concerns about his directions.

There are no accountability measures being put in place here. I note that the website itself had broken links to the absolute basics: to definitions, for example, of what was deemed to be essential. Given we are now in a world where 'essential' looms large in our lives in terms of our movements and activities, the fact that when you clicked on the link for the website and could not see what was deemed essential should be ringing alarm bells for this government about how well they are implementing their emergency response. I do not doubt that people are working incredibly hard but we do not have the same level of scrutiny happening that the New South Wales government ensured and has put in place. We do not have the same level of accountability that other states have implemented.

As the Leader of the Opposition noted, I think this is the sixth bill but certainly the third rushed bill that we have seen. If we do not have those levels of accountability and transparency then really our patience and our trust will start to wear very thin. Those basics need to be in place to ensure that these extraordinary powers that we keep being asked to provide for, that already have been approved—in fact, the last piece of legislation allowed the suspension of any particular law of this state. Why they are not being done in a more transparent way through directions is certainly a question that begs to be answered.

Our patience is wearing thin. For what purpose do the police need to remove a child? That has not been established or responded to. I look forward to not fulsome answers, because people keep misusing the word fulsome in this and the other place, but frank answers to that question, honest and transparent and truthful answers to that question, and a response as to why it is not accommodated for in other pieces of legislation that already apply, and why it is necessary. It is the most basic question a parliament can ask when a government introduces a law: why are we doing this? And the answer should be provided.

With that, I look forward to the committee stage. I certainly have significant concerns that we are not engaging in good practice with lawmaking in this place. I note that we are rushing this bill through this week because in fact just last week the government issued a new sitting schedule, so we have put this upon ourselves by now having a longer period of time between this sitting week and the next. If this bill was so necessary, why did we not keep the additional sitting weeks that were to come?

The Hon. M.C. PARNELL (11:54): I, too, rise to support the second reading of this bill. I will start by associating myself with the remarks of my colleague the Hon. Tammy Franks in relation to improvements that we believe should be made to the process in relation to these emergency bills. Some similar comments were made by the Leader of the Opposition and I think both honourable members are on the mark. We have bent over backwards to suspend our usual processes, to put other work aside, to prioritise these bills and yet what we see is when we dig deep we find the government actually did have the capacity to talk to us much earlier in the process than they did.

At the risk of being seen to be too much of a pedant, I did note that it was only after contributions on this bill had commenced that the copies were distributed in the chamber. Certainly, we had electronic copies two days ago, but I am just making the point that in normal circumstances no-one would accept the fact that debate could commence on a bill without the bill actually being distributed in the chamber. These are remarkable times—unprecedented; I think I have heard that word a few times—and we are bending over backwards to assist because we are here to act in the best interests of the state.

Whilst I have not formalised my personal decision-making matrix and the Greens have not formalised one, I do not think these will be contentious, but the way I look at this bill, as other bills that relate to the COVID-19 pandemic, the first thing I am looking for is: does the bill and every part of it have a genuine connection to the pandemic? The subsets of that question are: do the measures in the bill help keep the community safe? Do the measures help people to get through this crisis economically? Does the bill help in the recovery of communities and the economy? Does the bill involve necessary economic stimulus?

The Greens, as other parties, have been supportive and we have been constructive and have allowed these bills to go through with minimal changes. As more than one member has said, in normal times we would not do this, but we are doing it in the best interests of the people of South Australia. However, despite our willingness to suspend usual processes, we are not going to suspend our scrutiny of this legislation to the extent that we can in the time available. If we were to take any other position, there would be very little reason for parliament to even sit. We will do the best we can with these bills in the time that is available to us.

As other members have said, what we need to look for as we are scrutinising this bill and others is unintended consequences. We are looking for examples of overreach and, in my case in particular, I am looking for examples of where the government is actually pursuing another agenda under the guise of COVID. Sadly, I think this bill contains some elements of that latter point, that there are some things in here which are more reflective of a broader government agenda than they are directly necessary or relevant as a response to COVID.

I want to speak briefly in relation to just one aspect of the bill now—we will have more to say in committee—and that is the bits that relate to the planning system. What I will say is that I am going to tone my remarks down a little bit from what I had originally prepared to say because I did have the advantage of a brief chat with the planning minister in the corridor as my colleague the Hon. Tammy Franks was on her feet and he indicated that the government was supporting some of my amendments. The Hon. Clare Scriven has indicated to me that the opposition is supporting some of these amendments as well, so I will not labour those points, but I will go through why I have moved the amendments that I have.

I will do them in detail in the committee stage, but just now, briefly, they relate, in the main, to section 49 of the Development Act. This is basically a pathway for approving development that has changed a bit over the years and now, in my view, no longer resembles its original purpose. The heading of that section is 'Crown development', and the rationale goes like this: if the government wants to do things, then surely the government should be able to do them without having to go through the same assessment pathway as a person wanting to built a rumpus room or a garage.

In other words, government projects should be treated differently and should in fact get special treatment. So the regime for section 49, if the government wants to develop something, the decision-maker is the Minister for Planning and the Minister for Planning is not obliged to follow the same planning rules that everyone else does. If the Minister for Planning wants to make a decision on a government project that is completely at odds with the planning rules that everyone else has to comply with, the minister can do that. That is section 49.

If you are in government you might say, 'Hear, hear, that's how it should be; it's a government project, we're just going to do it, and we're not going to let the planning scheme, zoning or anything like that stand in our way.' The reason I say that section 49 has changed is that over the years the government has vacated the field in relation to a lot of areas that were traditionally only ever done by the government. A classic example, raised here often, is the power network.

The power network used to be that the government made the electricity at a government-owned power station, the government transmitted the electricity on publicly-owned poles and wires to the cities, towns and regions and the government then distributed that electricity through publicly-owned poles and wires, and in fact the government dealt with you as a customer through a publicly-owned energy retailer. Everything from whoa to go was in the public realm.

Now, of course, we see that the government has almost entirely vacated the field, and each part of that process is now in the hands of the private sector. But, what that has meant for section 49 is that over the years various governments have said, 'Well, when we say "Crown development", we don't mean that the Crown actually does the development itself, but it is sort of anything the Crown used to do in the past.' Provided there is a government department that is prepared to sponsor, if you like, a private project, then that will also get the benefit of this fast track section 49 process.

So people look at section 49 of the Development Act (I am sure most people sleep with it under their pillow, as I do) and they would see the heading 'Crown development', and they would say, 'Oh, that is just government projects; we understand that they get special treatment.' But I can tell you that new fossil fuel-fired power stations are dealt with under section 49. There was some private railway works I remember 10 years ago in which I was involved; they were all done under section 49.

A private company dredging the commons so that bigger ships can come in were all processed under section 49, not because they were government projects (they were private projects), but because that was the sort of thing the government used to do, and they have extended that privilege of special treatment to these private companies.

So section 49 is important, and the important aspect of section 49 is that, even though the minister makes the final decision, even though no-one is allowed to appeal against anything the minister decides, what we must hang on to is at least the ability for people to engage in the process with their submissions, with their comments, and we must also maintain their right to eyeball not the final decision-maker—you can always eyeball the minister, if you can get an appointment—but eyeball the State Planning Commission who is, if you like, the gatekeeper between the applicant and the decision-maker.

The right to go along to a hearing: I went to a hearing a couple of years ago up at Mallala with a new gas-fired power station being proposed—lots of other residents came as well. So, we have to hang on to those rights: the right for the public to engage and also the right for the local council to engage. These are government or private developments, nearly always in our local council area, yet what the government was proposing in this bill was to say, 'Well, you don't even need to consult with the local council—they're just not part of the process any more, let's just rule them out,' and that was completely unacceptable.

So I put a number of amendments forward. I will talk to them in detail later, but one of them was—and this was a compromise the Greens were prepared to accept—that, if the government is worried that these projects take too long to process and to assess, why do we not look at the time frames rather than trying to rule out local councils altogether?

The government was concerned that these projects are sent to local councils and local councils have two months to decide whether they want to make a comment or not. In normal circumstances that might be quite reasonable. These are often very large projects. They are often very complex. But if the government is worried about two months being too long, let's trim that.

My amendment trims it down to 15 business days. I did not pluck that figure out of the air. The government was not proposing to interfere with public consultation for which the time period is 15 business days. So, in other words, if you reduce the council's consultation period from two months to 15 business days—the public already has 15 business days—the council is consulted simultaneously with the general public and you have absolutely lost nothing. In fact, you have gained one and a bit months—two months down to three weeks, effectively You have saved five weeks.

The minister has told me the government is prepared to accept that. The opposition is accepting it. I do not need to go any further. That is a good outcome. The importance is that, by leaving the local council in the process, what the act says is, if the local council is really unhappy with one of these private or public Crown developments, the local council's concerns must be put before the minister. The minister must have regard to the fact that the local council does not like this project. It does not mean the minister cannot ignore them. The minister can, but the minister at least has to consider their submission.

The other thing that is important—and I might check this with the clerks later—is a provision that says that, if a local council does not like a project and tells the minister, 'We don't like this project' and if the minister says, 'Well, thanks very much, but I disagree with you. I'm going to approve this project anyway,' the fact of the council's disagreement must be tabled in parliament.

I do not recall having seen one for a very long time, so I do not think it happens that often, but I will check and see. It is possible that, when ministers give notices and lay papers on the table, there are some snuck in there. I do not recall seeing one for a very long time. But it is an important part of the checks and balances because what it says is that this parliament will be told if the Minister for Planning is approving projects that the local council is dead against. At least we get that information. We have the ability then to ask questions about it.

Another aspect of my amendments that has not found favour with the minister, and I suspect not with the opposition as well, is the threshold for public and council consultation. The threshold for these projects—as I said, they are mostly government projects, but a lot of private projects are in there as well—has been $4 million and $4 million makes sense because that is the threshold for the Public Works Committee. They have to consider all government projects over $4 million, so it makes sense that that is the threshold for section 49 of the Development Act.

The government is proposing to raise that to $10 million, so, in other words, in a worst-case scenario, any private project that has the support and sponsorship of a government department that is valued at, say, $9½ million, can be approved by the minister without seeking any input from the public or from a local council. Basically, that is the worst-case scenario under this bill because they are increasing the threshold from $4 million to $10 million.

When we asked in the briefing what particular projects the government had in mind for effectively fast-tracking under this regime, the response we got back was that there was no list but there were a few projects. I think they identified these because they thought, 'Who could possibly disagree with them?' They were some performing arts centres at some schools. I guess they fell into the category of shovel-ready projects and the government assumed, 'Who could possibly object to a performing arts centre at a school?' I had a quick look at the public register. The ones I found were: one at Para Hills High School in Salisbury, one at Hamilton Secondary College in Mitchell Park, and one at the Ocean View P-12 College in Taperoo. They were the ones that I found.

Again, I do not know the merits of those projects. I am a great lover of the performing arts. They sound like they are possibly great projects. But what I would just remind members of is that the last time we had a stimulus program that involved schools, there was funny business afoot. There is one example I remember. If members recall, school halls were the poster child of the recovery. 'We're going to build school halls.'

There was one school, a private school, that had wanted to build a hall for some time. Their plans were inappropriate: they were too close to the neighbours, they did not have the support of the community and they did not have the support of the local council. So, what did they do? Having had their application rejected, they just waited until the stimulus package kicked in and then, all of a sudden, under the fast-track arrangements they got their building. That is the sort of problem that we need to make sure we avoid.

The other aspect of my amendments relates to another section of the Development Act, section 35, and this is in relation to types of developments that are called 'noncomplying'. I have given examples in the past. No offence to the good people of Burnside, but if you want to build an abattoir in the residential streets of leafy Burnside, quite rightly that project would be classed as noncomplying; it is not something that was envisaged in the development plan. Similarly, if you want to build a 20-storey skyscraper at Seaton, it would be noncomplying. It is not something that has been envisaged, it is not something that people want, so it is a noncomplying development.

Under the current rules for noncomplying developments that are being approved by a government agency like the SA Planning Commission, the local council has to agree. There is a concurrence provision. It says, 'You can't build one of these things that is completely out of the imaginings of the planning scheme. It is not something that's ever been envisaged. We're not saying that you can't build anything that is not noncomplying, but you've got to have some checks and balances,' and the main check and balance is the local council has to agree.

It may well be, with some of these projects, that they are good projects and they deserve to be supported; they just have not found their way into the planning scheme because no-one thought that anyone might want to do that in that location. So not all noncomplying developments are bad, but at least you have to go through more checks and balances to make sure that they are appropriate before they are built.

What this bill seeks to do is remove that ability for the councils to provide concurrence, but it does not just move it for the duration of the pandemic; it removes it forever. It is a permanent change to our planning laws that writes out local councils from the process—they now no longer have a role in decision-making—and it does that forever. That falls into the category of overreach. We know it is ideological because it is a regime that in maybe less than a year will be coming in anyway as part of the new planning system because of the new planning and development act.

Councils basically said to me, 'Well, we lost that debate a little while ago.' Well, I am keen to hang onto it for as long as we can because I think, with noncomplying developments, you should have that local council requirement for concurrence. I understand the government is not supporting that one. I will doublecheck with the opposition on that one. It does clearly fall into the category of ideological opposition on the back of COVID that I do not think merits support in this bill. So that is the third of my amendments.

The other thing that I might say at this stage, just in passing and in conclusion, is that the test that I outlined before about the lens through which we look at these acts is also the lens through which we examine regulations. Later on this afternoon, when we get to the appropriate time on the Notice Paper, I will be moving to disallow some development regulations that fall into the same category, in my view, of overreach.

I do not need to say any more than that now—that is a matter for later on—but I will be giving notice today of an intention to move disallowance of some further planning regulations that I think fall into the category of overreach. With those remarks, I will be supporting the second reading of this bill.

The Hon. R.I. LUCAS (Treasurer) (12:15): I thank honourable members for their contribution to the second reading of the bill and I acknowledge, to use a word the Hon. Mr Parnell used, the unprecedented nature of both the pandemic and our parliamentary processes as we consider yet another COVID-related emergency piece of legislation.

One specific issue the Hon. Mr Parnell referred to is the late arrival in the chamber of the bill for our debate. The explanation for that, I understand, is that whilst we did have electronic copies a couple of days ago it was actually amended in the House of Assembly and had to go off to the printer. I think the amendments moved by the opposition and agreed to in whole or in part by the government had to be incorporated into the government's original bill. That is the explanation the clerks have provided me with.

In addressing the bill, I say at the outset that, given the complexity of the legislation as consistent with the omnibus bill or the COVID (1) bill, if I can refer to it that way, where it traversed a whole range of different areas, in terms of the committee stage of the debate it may well assist if we can compartmentalise questions, debate and consideration of amendments, etc., into the various sections of the bill.

I know in a number of the bills we have had an all-in in clause 1 and then sometimes in part replicated that debate as we have got to the specific operational clause. It is entirely within your hands, Mr President, as Chair of the committee, and also those of members of the committee, but I think that might assist the process, which may well take us some time today. It is ultimately up to you as Chair and to members of this chamber. I will be responding on behalf of the government based on advice from differing offices, so it will be easier if they come in chunks; that is, for those that relate to the planning area I will need somebody with some knowledge of planning, or certainly someone with more knowledge than I have of planning, and similarly with the other areas.

I understand there is one area where another minister will come down to respond. I think the Hon. Ms Franks has had a discussion with the Minister for Health in relation to some issues that she has raised. The Minister for Health has indicated that as long as we can sort out a particular time that is of convenience to the Hon. Ms Franks, the committee stage process and to the Minister for Health in terms of his daily public commitment—although that might be earlier today—he will come down and handle those specific questions the Hon. Ms Franks has in relation to Davenport. As I understand it, he has had some detailed involvement with the issues that are of importance to the Hon. Ms Franks and, indeed, some other members as well. With that exception, I will handle the other questions.

In relation to the bill that is before us, acknowledging the shortness of time that all members have had to consider what is important legislation, from the particular area where I have had the greatest involvement, which is of course the commercial leases area, I place on the public record that there is extraordinary pressure building in the community for a resolution via the parliament on this particular issue of commercial leases, from both the landlords' viewpoint and from the tenants' viewpoint, as well as from a range of other stakeholders: banks, financial institutions and, indeed, others as well. The government will not be in a position to Gazette the regulations, which will provide the rules, until (or if) the parliament passes the legislation before us.

So the structure of the bill, as I will highlight later, is consistent with what is occurring in most other jurisdictions. That is, the parliament gives a broad regulation-making power and the operative sections of the short-term commercial leasing arrangements in New South Wales and Victoria and some other jurisdictions have essentially been packaged into regulations. That gives the capacity for quick and flexible response, if it is required on occasions, to amend a regulation or regulations if there happens to be a particular issue. Given that we are two months into what was originally estimated to be a six-month emergency period potentially, time is obviously of the essence. Whilst that may or may not be as critical in some of the other aspects of the bill—and we can have that debate—on the issue of the commercial leases, there is considerable pressure.

At the outset, I agree with the comments of the Hon. Ms Franks, I think it might have been, or the Hon. Mr Parnell—and that is perhaps not surprising given my great sympathies with the Greens and their views on some issues—that it is incumbent upon the government to answer the question as best as it can as to why we have introduced various provisions. I do not disagree with that as an essential principle. In the end, whether the majority of the parliament agrees with the reasons for that is entirely a decision for the majority of the parliament, but I accept the threshold principle that has been established by one of the two members of the Greens. That is, if the government is trying to put something in there in terms of emergency legislation, it should at least give an explanation as to why it is urgent and cannot be considered at a later stage.

In relation to the commercial leasing provisions, I put now and will put again later that there is a very powerful case as to why that has to be resolved because there is already considerable pressure from landlords, tenants and others to resolve exactly what the rules are going to be so that the Small Business Commissioner, who I have had regular conversations with, can have his riding instructions in terms of how we might resolve ongoing issues of dispute. So I accept the threshold principle that was established. It is for the government to at least put on the record the reasons why something has to be resolved now, and then it is ultimately up to the parliament as to whether it accepts that as a sufficient justification or not.

In relation to the commercial leasing provisions, I want to address comments in relation to that because, from my viewpoint, as I said, it is the most critical area with which I have had association over recent times, together with the Attorney-General and many other areas. The first point I would make in relation to this area is a point I made briefly earlier, and that is that the structure and approach we are adopting is the structure and approach that is being adopted by a majority of other jurisdictions—that is, a broad power within the act and then the operative provisions being actioned through actual regulations.

What I can say is that there are still two other jurisdictions, the Labor government in Western Australia and the Labor government in Queensland, which are still wrestling with this whole area. They have gone out to a consultation period and they are still to resolve what their final position will be by way of legislative change or regulatory change in those particular jurisdictions. But what the Western Australian Treasurer has confirmed to me and all other treasurers and, to be fair, the former Queensland Treasurer confirmed to me on behalf of the Queensland government—and as I think members are probably aware, there has been a recent change in terms of the holder of that position in the Queensland parliament.

Every state and territory Treasurer—Labor and Liberal, even including the two who have still not brought down their position but they nevertheless agreed with this premise—has agreed that they will not be implementing the national mandatory code that was announced by the Prime Minister. That is, every jurisdiction, state and territory, Labor and Liberal, has indicated that they will not be implementing the national mandatory code word for word.

They have all indicated, as indeed we have, that they sought to adhere to and honour the essential elements of it. New South Wales has said they 'seek to give effect to'. One other jurisdiction has said similar words to us—that is, 'have regard to' the national code—but every state and territory treasurer, including the two Labor treasurers who have still not finalised their position, has nevertheless agreed with the view that they would not be implementing the national code as it was announced by the Prime Minister.

I note that I have had correspondence from the Leader of the Opposition on behalf of the Labor Party that they supported the national code and wanted it implemented. I indicated that the government had a different view. I note also that a number of members have quoted the correspondence from the Law Society. They have indicated their belief that the national code should be implemented. I suspect they are probably coming from the position that this was announced by the Prime Minister, and they may well have an understanding or an expectation that all jurisdictions were implementing the national code word for word. I do not know that to be the case. I can only take the letter as it has been written, but it nevertheless says the government should be implementing the national code.

I will address in greater detail during the committee stage our views in relation to aspects of the Law Society letter, because that has been quoted by others, but I think the areas where they have disagreed with what the government is doing are on the premise that we should be implementing the national code as it has been announced. As I said, that is not an unreasonable position for them to have adopted. I make no criticism of that, but I just think that members need to be aware that the government, for the reasons that I will outline, together with every other state and territory government, decided that whilst we will have regard or give effect to the essential elements of it, there are some provisions that in our collective view are impractical and incapable of implementation.

I will give one simple example to the lawyers in the congregation. It talks about binding mediation. I am not a lawyer, as I often say, but I have no understanding of what binding mediation is. Mediation, to me, is an attempt by an honest broker to resolve an issue between two conflicting parties. Ultimately, if you cannot mediate a result, someone then has to make a decision. A binding mediation, depending on how you want to interpret 'binding mediation'—and I do not know—seems to be a contradiction in terms.

The national code requires binding mediation. It makes specific reference to small business commissioners or their equivalents, all of whom, in most jurisdictions are, I assume, a bit like ours, where the Small Business Commissioner has the power to mediate and seek to resolve and may well have the power to demand documents, etc., but in terms of disputation between parties, seeks to resolve the issue.

The process that we are suggesting here—and most of the other jurisdictions are doing the same—is not to use the mediator to make binding decisions. In essence, you have to go through the mediation process if you cannot reach an agreement, but ultimately if you cannot have the Small Business Commissioner, or the equivalent in each other jurisdiction, you have to go somewhere else to have a final decision taken, in our case the Magistrates Court. In a number of other jurisdictions they use a similar court. Some of them use the equivalent of our SACAT, for example, as the decision-making body that makes the final decision.

We think that whilst it is inconsistent with the national code, it makes much more sense in terms of trying to resolve commercial leasing disputes. In the first instance, we wholeheartedly agree with the Prime Minister and the national cabinet. Hopefully, a large majority of landlords and tenants in good faith will negotiate an acceptable arrangement between themselves. If that cannot occur, there is a requirement to go through a process of mediation, in our case the Small Business Commissioner, and we can talk about that. However if, ultimately, the Small Business Commissioner cannot resolve the dispute, someone has to make a decision, and the structure we are proposing is the Magistrates Court for a decision.

As I said, most of the other jurisdictions that have publicly announced their position have headed down a similar path. There is not a binding mediation with a decision coming out of the Small Business Commissioner. Ultimately, if one of the parties refuses to engage with the Small Business Commissioner or their equivalent, in our case the Small Business Commissioner will issue a certificate that says that one of the parties has refused and in the end it will have to be resolved in the Magistrates Court. We hope they will be few and far between, but that is entirely possible.

The second point I think we have to bear in mind is that we have had, as a government, strongly differing views about how these issues ought to be resolved. One of the facts that we have to accept is there are poorly behaved landlords but there are also some poorly behaved tenants. Sometimes the poorly behaved tenants may well be very big corporate entities. The point that some landlords have made to us is, 'Don't just assume that it's the landlord in the dispute that always has the power.' It may well be that a big corporate giant—and this is public, Solomon Lew had a range of outlets that he just closed down, a whole series of his tenancies right across Australia. I am not sure where it is now but at varying stages he just refused to pay any rent for a six-month period and basically said, 'Hey, we're all closed down and we're not going to pay any rent.'

There are some cases, of the Solomon Lew type, that may well be up against a very big landlord, an equally big corporate giant, but in many cases their outlets may well be in smaller suburban shopping centres where the landlord may well be a small or medium-sized entity or a landlord where he or she may well own just the one premise or a small number of premises. We have to bear in mind that the power imbalance is not always that the landlord is much more powerful than the tenant. In some cases they are equal, but in other cases the tenant has much more power in terms of these negotiations than the landlord.

That is one of the other factors that all state and territory governments have recognised in why they have moved away from the rigid and defined certainty that seemed to be evident in the national code. There is a view, which we agree with in South Australia, as a government, that there is a power imbalance but it is not always one sided, and it is impossible in legislation to dictate a one-size-fits-all provision which covers all the circumstances.

The other example of that which I will give again comes back to the Law Society's submissions to us in relation to proportionality, and it is the subject of the amendment that the Hon. Mr Maher has flagged on behalf of the Labor opposition in terms of proportionality. There was a view from the Prime Minister and the national cabinet in what came down that there was a sort of automatic proportionality between the loss of turnover and the loss of rent and the impact on the landlord and, therefore, in some way if there has been a 50 per cent loss in turnover, there should be a 50 per cent reduction in the rent—some sort of automatic proportionality—or it should be given very significant weight in the nature of the amendment that the opposition is flagging with us.

Anybody here who has either been a tenant or a landlord, or has had experience with it, will know that there are literally thousands and thousands of different arrangements in relation to leasing arrangements. A landlord may well be the oft-mentioned mum and dad investor from last year who has accumulated a number of properties over a period of time, no longer has any debt or mortgage arrangements in relation to it and is relying on that income as their sole or significant source of income upon which they live from year to year.

On the other hand, there will be some landlords who are significantly mortgaged to their bank or financial institution in terms of how they are financing their particular property. The notion that a 25 per cent or 50 per cent reduction in turnover automatically transposes in all cases, or in most cases, to a 50 per cent reduction in rent, and therefore a 50 per cent reduction in net income, is fanciful because there are all these different arrangements in relation to the financial arrangements which back the landlords and the leasing agreement.

The Property Council and a number of other individual landlords have produced to the government and to others who are interested in this particular debate examples of where a 25 per cent reduction in turnover leads to a more than 50 per cent reduction in net income to the individual landlord. So there is no direct proportionality at all—25 per cent/25 per cent, 50 per cent/50 per cent. They have produced evidence, which clearly demonstrates in examples that they have produced that you just cannot assume that a 25 per cent reduction in turnover should automatically transfer into a 25 per cent reduction in rent and that 25 per cent reduction in rent would only mean a 25 per cent reduction in net income for the individual landlord.

As I said, in certain circumstances, if you use that proportionality principle, it is more than double the impact on the net income of the particular landlord, depending on how they are financed and depending on how they are structured. We can go into a lot more of those sorts of details during the committee stage, but I flag that example prior to the lunchtime break in question time, because those members who are interested in them—and we obviously will not be supporting the amendment being moved by the Leader of the Opposition in relation to the proportionality for those reasons, the reasons that I am giving. But I think members need to just think through the issue of, in essence, the pre-eminence of the principle of proportionality as espoused in the national code and its applicability in relation to trying to settle sensibly a whole range of different circumstances in South Australia.

It is our view that the Small Business Commissioner is well aware of the national code and that the Small Business Commissioner, if he has to come in to try to mediate these particular disputes, can take into account that particular guideline. He is not mandated to, he is not required to, but he can take it into account. But he has the absolute flexibility to look at the different circumstances and if he is convinced that the use of proportionality would mean a massively bigger reduction in the net income of the landlord, he is not required to follow that particular principle, and he does not have to use the device—and actually I think in the Labor Party's amendment it is not really the Small Business Commissioner, it is the Magistrates Court—and that it is only in exceptional circumstances that you should be able to deviate from the proportionality principle.

With great respect to the Prime Minister and to the national cabinet, we just do not think that the practical implications of proportionality have been properly thought through in terms of trying to resolve these particular disputes. The reality is, it is the states and territories that have to implement commercial lease legislation. It is not an issue that the federal government have an active engagement in; nevertheless, the national cabinet saw this is a critical issue, and it is, and the Prime Minister drove a particular view in relation to it.

We are adhering to essential elements of that, so things like if there is to be rent relief through the process, 50 per cent of that should be by way of waiving rent and 50 per cent of it should be deferred. It is true to say that the national code says that it should be for a period of no less than 24 months. We have taken a different view from that: we believe a period of up to 24 months, and allowing the Small Business Commissioner and/or the Magistrates Court to work within those provisions.

A period of not less than 24 months is pretty tough on some small mum and dad landlords. If, ultimately, the decision that comes down from the Small Business Commissioner or the magistrate is—let us say they are going to lose $10,000 rent a month (or whatever it is) and $5,000 they have to give up as a waiver, that is, they do not get it at all, and the other $5,000 they do not get back for at least two years because it is deferred, then what does the mum and dad investor do for two and a half years? They have lost that particular amount.

That is why we think that saying to the Small Business Commissioner and the magistrates that they have a period of up to 24 months is a much more sensible course of action. The Small Business Commissioner or the Magistrate's Court can say, 'Okay, you're a landlord, you're sufficiently well set up to be able to defer this up to 24 months.' In some other cases the landlord may well be able to make a persuasive case that says, 'Look, I'm going to be bankrupt in six months; if I've got to give up 50 per cent of my rental income, and I've got to defer the other 50 per cent for no less than two years, I'm going to be bankrupt.' It is that sort of flexibility we think that the mediator, through the Small Business Commissioner, should have to say, 'Okay, in that circumstance it will be six months.'

In another circumstance it might be up to two years, and we think that is a reasonable compromise, but, yes, the Law Society highlights that as where we are differing from the national code. I think we should just accept the fact that we are different from the national code and we need to, in essence, agree with where we are differing from the national code, or not. We are not going to be implementing the national code because we think some aspects of it are impractical and are incapable of quick resolution of what are going to be, potentially, a significant number of ongoing disputes between the parties.

There are a couple of other aspects of the national code that we are not choosing to implement. There is one that requires the ongoing appointment of, in essence, an advisory committee, the codes administration committee. We are not aware of whether any other jurisdiction is doing that as well. We are essentially two months into hopefully no longer than a six-month emergency period; we need to get on with it. This parliament needs to make a decision one way or another whether it supports the government's attempt at a reasonable compromise in relation to these issues, and then allow the Small Business Commissioner and the Magistrate's Court to get about the difficult task of resolving most of these issues.

Another committee that opines on the merits or otherwise of what is going on whilst we are trying to resolve these particular issues, particularly given that we have potentially only up to another four months, then that in our view does not make sense to incorporate that and we have not incorporated that. Again, that is something we have not picked up in the national code.

There are a small number of other areas where we have not picked up the elements of the national code, but there are a significant number of elements of the national code that we have picked up: that is, not allowing tenants to terminate leases; the code applies to 30 September or implements the national code arrangements; rental waivers; and the 50 per cent issue is very significantly implemented in this proposed package that we have.

Regarding the issue of no fees, interest or other charges should be applied with respect to rent waived, we have adopted that in respect of rent deferral. Landlords must not draw on a tenant's security for non-payment of rent—we have adopted that. The tenant should be provided with an opportunity to extend the lease for an equivalent period of the rent waiver or deferral period—we have adopted that. Landlords agreeing to a freeze on rent increases, except in certain circumstances—we have adopted that. Landlords may not apply any prohibition on levies, any penalties, if tenants reduce opening hours—we have adopted that.

One of the other ones that was heavily contested—and I should refer to this—is limiting this coverage to tenancies with a less than $50 million turnover. We have adopted that. That was quite controversial. The Property Council, to be fair, wanted that $50 million figure. They believe that $50 million figure might be appropriate in the bigger jurisdictions of New South Wales and Victoria but that in South Australia we should reduce it because we are much smaller in terms of the size of our tenants and landlords. We are not as big as the Sydney and Melbourne arrangements.

On the other hand, we had other stakeholders who wanted to increase the $50 million to an even higher figure, perhaps as high as $100 million. In the end, we accepted the national code compromise of $50 million. We accepted the national code compromise that, where you have a big related corporate grouping, which might have 100 separate outlets throughout the country, each of which would be less than $50 million but they are part of one particular corporate grouping, that is excluded from the provisions of this.

That would be, for example, a Solomon Lew-type arrangement, where they are not able to claim protections against eviction, for example, for each of their separate 100 tenancies around the nation because each of them happens to be less than $50 million because clearly they are part of one group. They are above $50 million. They therefore do not get the protections under this particular legislation.

But franchise arrangements consistent with the national code are included. So, if you are a separate franchise arrangement and you are under a $50 million turnover, you are protected in this particular arrangement. That was a recommendation in the national code. Whilst we had arguments not to accept that as well, we have, in the end, accepted that particular aspect of the national code. As I said, we have not accepted the issues in relation to binding mediation, whatever that meant, in the national code. We have implemented the process that I outlined.

There is one remaining point in relation to the issue of commercial tenancies that I should have related. I was talking about the fact that proportionality is not as easy as perhaps the national code would have led us to believe; that is, a 25 per cent reduction in turnover may well lead to a 50 or more per cent reduction in net income for a landlord if that 25 per cent reduction in turnover had to be transferred into a 25 per cent reduction in rent relief on the proportionality principle.

The other issue in relation to that—and again a number of landlords have provided their own details—is in relation to banking covenants or debt covenants. These are issues of interest coverage ratios, which some members would be very familiar with, and loan devalue ratios, which banks place upon landlords in terms of the borrowings that they have.

What a number of these examples show is, if you follow the proportionality principle—that is, the 25 per cent reduction in turnover means you have to reduce your rent by 25 per cent and it means that, in some circumstances, because of the way they are structured it leads to a 50 per cent or 100 per cent loss of their net income—in many cases these landlords are saying that they will breach their debt covenants with the banks. Their ICR (interest coverage ratio) will drop below the requirement of the bank or, if the valuations change—and we have already seen valuations change in banking institutions—their LVR drops below the LVR. In those cases, the banks at the end of the six-month period will be able to foreclose on those particular landlords.

They are the sorts of circumstances that we believe the Small Business Commissioner and the Magistrates Court should take into account. That is, the landlord in that particular experience is going to be able to say, 'Hey, this is where I am.' Those landlords—and the Property Council also supports them—say, 'Look, if you actually, in the national code, require the banks to in essence adjust their financial arrangements with the landlord consistent with what you are requiring of the landlord, then it might be a more defensible position.'

Of course, the bank's situation, which the commonwealth government and others have overseen, is that they have deferred repayments, which has been good, but in the end all of the repayments still have to be made. Eventually, the banks have a legal capacity to collect all of their deferred loan repayments at a particular stage after the six-month period has expired. If what we do during the six months means that the debt covenants that these landlords have, such as the ICR (interest coverage ratio) or the LVR (loan to valuation ratio), are breached, then the banks have the capacity, if they so choose, to foreclose.

It is another important issue for members in this very complicated area. I think my plea to members is that we should, in the first instance, use good faith negotiations between the landlord and the tenant. But then if that does not resolve the issues, we leave the responsibility with the Small Business Commissioner and the Magistrates Court to resolve, bearing in mind all of these complicated, different arrangements.

It will depend, as I said earlier, on whether or not the landlord has had to take out significant loans to finance their investments or, in a different set of circumstances, you have a mum-and-dad investor who owns all of them but nevertheless is still relying on every bit of rental income they can get to survive on, or not; and then you have a whole variety of differences in between.

For us as a parliament, whether we say, 'Okay we've got to legislate a national code because the national code says this is what you should do; it should be proportional,' or for the amendment that the Labor Party wishes to consider, 'Yes, you should follow it, however in exceptional circumstances you can move away from it,' we think it is not just exceptional circumstances.

We think there is myriad of examples right across the board and the flexibility of allowing the Small Business Commissioner or Magistrates Court to resolve issues, to look at the individual circumstances and to resolve them, is the best way to go. It sounds better, it sounds easier, if we in the parliament say it is directly proportionate, or indeed something else; that is, we say, 'This is it, you just do it this way and you go way and resolve it in those ways.'

All I can alert members to is that if that ultimately was to be what came out of the parliament, we would have very significant issues in terms of trying to resolve the individual arrangements of thousands of landlords and tenants in terms of trying to seek a resolution to what are complex issues. With that, I will conclude. We will pass the second reading because I think everyone has indicated support, and I will propose that we adjourn the committee stage until after—

Members interjecting:

The Hon. R.I. LUCAS: I think everyone has indicated they are supporting the second reading. Then I will seek leave to suspend so that we can have the lunch break and question time and resume after question time.

Bill read a second time.

Sitting suspended from 12:55 to 14:15.

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