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Legislative Council - Fifty-Fifth Parliament, First Session (55-1)
2025-10-28 Daily Xml
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Bills

Highways (Works for Residential Developments) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 16 October 2025.)

The Hon. S.L. GAME (15:30): I rise to speak briefly in support of the Highways (Works for Residential Developments) Amendment Bill. This proposal is largely in response to the liquidation of Felmeri Builders and Developers in July 2023 at O'Halloran Hill, where 20 families were unable to occupy their homes due to the failure of Felmeri to construct appropriate road access and install related services. Fortunately, the government stepped in to ensure the homes could be completed; however, this bill is designed to introduce further measures to allow the Commissioner of Highways to undertake prescribed work without council approval.

While this measure is designed to provide the commissioner with the power to step in and complete infrastructure works when a building development fails, there has been considerable opposition from some councils and the Local Government Association regarding the bypassing of council approval, as well as the capacity for the commissioner to recover any expenses incurred in carrying out prescribed works from either the council or the developer. In the end, the paramount concern must always be the provision of fully completed homes with full access to relevant services and infrastructure for consumers who have been significantly disadvantaged through no fault of their own.

When councils approve construction work before appropriate infrastructure has been completed, situations like the Felmeri disaster can happen, leaving consumers in a very volatile financial position. If the government steps in to complete the works with taxpayer dollars, it is both fair and reasonable that councils or developers should foot the bill. It is also appropriate to prevent councils from passing on any of these costs to ratepayers. It is my understanding that the state government and the Local Government Association have reached an appropriate compromise regarding this issue of debt recovery, and amendments have been filed which will allow for councils to recover the cost of any required works in circumstances where there has been an error or omission in the advice given to council.

These amendments are appropriate and supported by the LGA, and will encourage councils to implement strategies and systems to ensure that any future development approvals are thoroughly examined before being given the green light. It also strikes the right balance between fairness and accountability, as well as upholding the rights of consumers, taxpayers and ratepayers. With that, I offer my support for the bill and the proposed government amendments.

The Hon. E.S. BOURKE (Minister for Infrastructure and Transport, Minister for Autism) (15:33): I thank the honourable members who have spoken on this bill. As we know, this is a significant bill that has come through the parliament to provide an extra level of protection and a framework, as the Hon. Ms Game has just highlighted, to protect our ratepayers and also to protect our taxpayers as well.

We know of the Felmeri example that happened some years ago, where taxpayers had to come in to help support this project that needed to be completed. This framework needs to be put in place so that we do not see examples of this again. Over the last weeks, I have taken on the feedback from the chamber and worked with the LGA to come to a position today where we have been able to introduce the amendments that are before the council. I want to thank everyone for their time and feedback.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

The Hon. B.R. HOOD: I rise to speak to a couple of things at clause 1. I also reflect on the fact that this bill passed the other place back in October last year. It is now here in the Legislative Council, yet we are receiving amendments filed at 12.30 today, so there was a little bit of a rush for us get our heads around them. As I stated in my second reading, the opposition were opposing this bill because it was a bit of a dog of a bill, and we knew that the LGA thought that as well. From consultation with the LGA after we saw these amendments filed, we believe that they are now broadly in support of these amendments. They sort of stitched up a few of the issues that were there, so the opposition will ultimately support this amendment bill and the amendments that were filed today.

However, I will still just ask these questions of the minister, which were formed prior to receiving these amendments after lunch today. In the House of Assembly, the former minister, Minister Koutsantonis, agreed to consult with the Local Government Association, which was ultimately opposed to this bill, and file appropriate amendments. When did these negotiations occur, seeing that we do have amendments filed? When was that consultation done with the LGA, either between the previous minister or the new minister?

The Hon. E.S. BOURKE: I appreciate your feedback in regard to the amendments being received today. We have put in a lot of work over the last week and taken on the feedback of the chamber, and I appreciate the chamber's feedback. We have consulted and engaged in a constructive manner with the LGA over that period of time to get to a point today where we have amendments that are being supported not only by the LGA but, I am hoping, by other members as well.

The Hon. B.R. HOOD: How does the government intend to handle the potential political and financial fallout from councils if this bill does exacerbate tensions between state and local governments over planning authority?

The Hon. E.S. BOURKE: This bill is an additional framework. It is there, but hopefully it will never need to be used. As we have seen, the LGA have made commentary about the fact that having a framework like this sort of enforces them to put frameworks in place to make sure that nothing can happen. As far as I am aware, the council will only be held responsible if they have reported incorrect information to the State Planning Commission. If they do the right things and if they have legislation like what we are putting through today that reinforces why they need to put those protections in place, they should never find themselves in trouble.

The Hon. B.R. HOOD: I thank the minister for her response. I will have some questions at clause 3 which go to the substance of her answer. I have one more question at clause 1 before I will move on to clause 3 at the appropriate time. Can the minister advise the chamber: before arriving at this legislative solution for the bill and the amendments that were filed today, did the state government consider amending consumer protection, building insurance arrangements, indemnity bonds and guarantees, amendments of the Community Titles Act 1996, the Building Work Contractors Act 1995 or any other solutions and, if so, what were they and why were these ultimately rejected? I can give some examples if the minister needs.

The Hon. E.S. BOURKE: I thank the member. As I highlighted before, this bill and this framework build on things that we have already sought and are seeking to achieve. The bill supports the work of the state government in better protection for consumers who are involved in such important milestones as building their first home. We know building your first home is a pretty significant moment for anyone. It is your biggest financial asset, and we need to make sure that people are protected when doing so.

On 11 July 2025, I am advised, the government announced that maximum insurance payments will increase to $250,000 if a builder fails to deliver a finished home. The 66 per cent increase will see home builders receive up to $100,000 more in the event their home is not completed. I am also advised that the introduction of the State Planning Commissioner's direction on 12 June 2024 also enforces these.

The Hon. R.A. SIMMS: I thought it might be worthwhile, just to save time during the debate, if I clarify my position as well, given things have changed somewhat between the second reading and the third reading stage of the bill. When I had an opportunity to make my second reading contribution, I admonished the government for the way they had approached this. It seems the minister has taken on board the feedback and I do appreciate that, so I do want to commend her for listening to the feedback of stakeholders. I think it is an example of what this chamber does well: members of parliament expressing concerns, raising issues and the government going away and actioning that. So I do thank the minister for taking on board those concerns.

I had understood initially that the LGA were opposed to this proposal, but similarly I have been advised that they are now no longer opposed to the government's proposal. On that basis, I will certainly be supporting the amendments the government has put forward and I will reserve my right on the legislation overall, but I recognise that, with the Liberal Party in support, my vote is no longer critical in any case. I will closely listen to the debate, but, nonetheless, I will certainly be supporting the amendments and I thank the government for taking up those issues.

Clause passed.

Clause 2 passed.

Clause 3.

The Hon. E.S. BOURKE: This amendment is very similar to a lot of the other amendments. It is there to increase the reporting requirements. This amendment incorporates feedback from the LGA to ensure that the minister's approval is required when recovering expenses incurred by the Commissioner of Highways from either the relevant developer or council. I move all the amendments in my name:

Amendment No 1 [InfraTransport–1]—

Page 3, line 14 [clause 3(4), inserted subsection (9a)]—After 'may' insert ', with the approval of the Minister,'

Amendment No 2 [InfraTransport–1]—

Page 3, line 16 [clause 3(4), inserted subsection (9a)(a)]—Before 'the council' insert 'in the circumstances referred to in subsection (9ab)—'

Amendment No 3 [InfraTransport–1]—

Page 3, line 17 [clause 3(4), inserted subsection (9a)(b)]—Delete 'with the approval of the Minister—'

Amendment No 4 [InfraTransport–1]—

Page 3, after line 18 [clause 3(4), after inserted subsection (9a)]—Insert:

(9ab) For the purposes of subsection (9a)(a), the circumstances are where—

(a) the State Planning Commission issued a certificate for the division of land under section 138 of the Planning, Development and Infrastructure Act 2016 in relation to development in the designated residential development area approved under that Act; and

(b) in connection with the issuing of the certificate, the council advised the State Planning Commission that—

(i) any common driveway or private road (including all access points to and from the common driveway or private road) set out in the approved plans for the development had been constructed; or

(ii) the applicant for the development had entered into a binding arrangement, supported by adequate security, with the council for the satisfaction of (among other things) the requirement to construct the common driveway or private road; and

(c) the advice referred to in paragraph (b) was incorrect.

(9ac) Before giving an approval under subsection (9a)(a), the Minister must—

(a) give notice to the council for the district in which the area is located of the proposed approval (which must set out details of the circumstances referred to in subsection (9ab) in relation to the development to which the proposed approval relates) inviting the council to comment on the proposed approval within a period of not less than 30 days from receipt of the notice specified by the Minister; and

(b) take into account any response received from the council.

Amendment No 5 [InfraTransport–1]—

Page 3, after line 31 [clause 3(4), after inserted subsection (9e)]—Insert:

(9f) Any expenses and interest recovered or recoverable by the Commissioner under subsection (9a) in the circumstances referred to in subsection (9ab) may, if the relevant council considers that any error or omission in advice referred to in that subsection occurred as a result of an act or omission of the relevant developer or another person, be recovered by the council from that relevant developer or other person.

Amendment No 6 [InfraTransport–1]—

Page 4, after line 3 [clause 3(5), after inserted subsection (15)]—Insert:

(15a) If the Commissioner varies a plan to open or close a road in connection with prescribed works carried out by the Commissioner for a development in a designated residential development area, the Commissioner must, as soon as reasonably practicable after completion of the prescribed works, vary the plan so that it is in accordance with the plans and specifications for the road approved in the development authorisation.

Amendment No 7 [InfraTransport–1]—

Page 4, line 31 [clause 3(4), inserted subsection (19)(c)]—Delete 'appropriate' and substitute 'reasonably necessary'

This reflects the LGA's desire for there to be consistency in the decision-making process, which I think was highlighted throughout the second reading speech, as we heard earlier. Prior to this, it was only the developer that had to seek approval. The amendments are now being made consistent throughout the language so it is not only the developer but the council that will need to seek approval.

The Hon. B.R. HOOD: Just to get your advice, Chair, can I ask all questions of clause 3 here?

The CHAIR: We are basically putting all the amendments, so ask your questions and then we will put the question when we have answers.

The Hon. B.R. HOOD: That is good because I will be speaking to the amendments as well. On clause 3, amendment No. 2, the amendment to section 26, given the potential of conflict between local councils and the commissioner, how does the government intend to mediate any disputes, especially in cases where the commissioner's decisions contradict local planning objectives?

The Hon. E.S. BOURKE: Ultimately, it will need to be the minister's decision, as I am advised.

The Hon. B.R. HOOD: How will the government ensure that the commissioner does not overstep these powers, particularly in developments where infrastructure has unique local requirements, such as heritage or environmental concerns?

The Hon. E.S. BOURKE: I am advised that if it comes to certain aspects of approvals that are required, there will be particular acts that will need to be considered, and the state development approval process would be one of those.

The Hon. B.R. HOOD: In carrying out any prescribed works under this section, will there be a statutory obligation for the commissioner to consider the following issues: roadside drainage, stormwater run-off capacity, the ability for waste collection trucks to navigate the road, access for emergency vehicles, kerbside trees and other vegetation, footpaths, on-street parking, the overall amenity and liveability of the street and adhering to the infrastructure standards currently under discussion?

The Hon. E.S. BOURKE: I thank the member for his question. I guess going back to the intent of this bill, which is that there are prescribed works that will include: what makes a good community? At the very beginning, the plans that need to be put in place are what needs to be delivered, but also the plans need to be inclusive of the appropriate items that you need in infrastructure, from stormwater, wastewater, sewerage management and other facilities that make a community function. The intent of this bill is that those items are delivered. A developer cannot just walk off and not put in the required infrastructure that they committed to doing. As well as that, the council will have to make sure that they put that in that plan at the beginning and they approve the plan through the appropriate mechanisms.

The Hon. B.R. HOOD: I thank the minister for her response. Ultimately, I guess, it speaks to amendment No. 4 in the minister's name, which is essentially saying that there is a possibility that councils could stuff that up, because if they do not actually have adequate security and binding arrangements with the developer and all things in place, the commissioner is going to be able to find the council to be responsible for having to pay that money back.

I guess with regard to that question then, should it be the council's fault that they have not done the work, that they have not followed the obligations of ensuring all of those things I listed off are going to be done correctly, the commissioner will do them and who, ultimately, would do the work for the commissioner to ensure that those things are done if council has not actually done its job?

The Hon. E.S. BOURKE: As I highlighted earlier, even the LGA themselves have highlighted that having a framework like this will make sure that they put mechanisms in place to protect them but, ultimately, protect their ratepayers. They are going to be more diligent, they will be doing their homework when they should be doing their homework, and that is the significance of the framework we are providing today. It is a reminder of how important homework is.

The Hon. B.R. HOOD: With regard to clause 3(4)(9a), when the commissioner performs or undertakes prescribed works on private land does the relevant council receive any benefit or service from that work? My question is aimed at getting the minister's advice on whether the council is paying a fee for a service.

The Hon. E.S. BOURKE: I am advised there would be no fee. It will just be a recovery of costs.

The Hon. B.R. HOOD: If not a fee for service, is the charge levied on the council in proposed section 26(9a) a new tax on councils or developers? How does the government explain the breach—I will not be asking that question. Is it essentially a new tax on councils or developers?

The Hon. E.S. BOURKE: I am advised it is not.

The Hon. B.R. HOOD: Still on 26(9a), to pay these costs, if a council cannot raise the money by way of rates, charges, levies or fees then can the minister explain how they can raise the funds? Is this clause almost a legal impossibility for a council to comply with, most especially if we think about small regional councils with a very small rateable base?

The Hon. E.S. BOURKE: As I have highlighted a couple of times now, the bill has been put in place to ensure that it is really a protection for councils just as much as it is for ratepayers. This framework needs to be put in place and they need to make sure the mechanisms are there so they do not find themselves having to step in and provide these services and be on the wrong side of the story, essentially.

We know that it is important that these charges are not passed on to ratepayers. As the Hon. Sarah Game has highlighted today, ratepayers would not be expecting that because that homework was not done earlier they would have to pick up the tab and pay for it. It is really making sure that the developer is held accountable if they are in the wrong. If council do not do their homework, which I dare say would be very rare, this reinforces the need for them to do it and putting that framework in place.

Councils play a significant role in our community: they are at the forefront, they are the closest to the community, they play a really big role and, as you have highlighted, we have big councils, we have small councils, but having frameworks like these are really important to remind them to do the work early, protect the community early and they will not need to worry.

The Hon. B.R. HOOD: I thank the minister for the response, but I cannot help feeling that this is a bit like parliament making laws simply saying, 'Crime is illegal. Don't do crime', and we will just assume that no-one is ever going to do a crime. Sometimes things go wrong. Sometimes, for whatever reason, councils may have not done their proper due diligence—changes of CEOs, changes of general managers, something might fall over, and ultimately it will. I guess the question still stands: can the minister clarify what will happen in circumstances where councils are required to go into debt—significant debt in some cases—to meet the costs payable under this bill? Will the council be required to take on the debt if ultimately that debt can never be paid?

The Hon. E.S. BOURKE: I think a few layers are involved. The minister has to provide final approval and would be able to work with the council along the way as well. So it is not just that it has happened and that is that—there would be time to work through that process, which is why that ministerial approval is also important.

The Hon. B.R. HOOD: Ultimately it will be a decision of the minister in discussion with the council. Let us say the council has a ratable base of $10 million and a development essentially falls over, it is found to be the fault of the council, and that development is worth some $40 million, four times their ratable base, will the minister then just say, 'Oh, okay, you guys just can't handle it so we are going to lump the money on the rest of the South Australian taxpayers'? Is that essentially the answer to that question?

The Hon. E.S. BOURKE: I feel, in regard to this issue, that we can keep trying to skirt around the edges about who is paying or who is not paying, but I think ratepayers rightfully need levels of protection put in place when they are investing in the largest piece of infrastructure they have, that being their home. It is their biggest asset and they would anticipate that, when a council is signing off on a plan and when a developer is putting in a plan, they are including the appropriate infrastructure that makes that community function. If that is not happening, that is the only time a council is going to have to worry.

Councils of themselves, through the LGA, acknowledge that this is an important framework, one that will encourage them to be thinking about what mechanisms need to be put in place to ensure those protective frameworks are available. This is an opportunity for them to think about how to best protect their ratepayers, but how to also protect the individual councils, as it is for the developer. Developers will also need to make sure that the infrastructure they say is going to be there is there.

Without these protections, without these frameworks, we are leaving ourselves open. That is something that, as a government, we are not willing to do. That is why we have introduced this framework, that is why we have introduced those previous initiatives that I mentioned earlier, because we want to make sure that, at the end of the day, when a South Australian builds a home they are protected.

The Hon. B.R. HOOD: I thank the minister for the response. I certainly agree that we want to ensure that councils are doing the right thing, and we acknowledge that these amendments do really improve what is ultimately not a great bill in the first instance. I guess in terms of having to recover that cost, there are still some questions there which are a little bit fuzzy. If council simply cannot do it by raising rates or any other way, there could be a situation in which we find a council is essentially having to go into administration if they have not done their due diligence for whatever reason.

Moving on to (9ab), which is under amendment No. 4 in the minister's name, what examples can the minister give of examples of binding arrangements and adequate security that would satisfy the commission that the council was not liable for expenses under proposed subsection (9a)?

The Hon. E.S. BOURKE: An example I have been advised of could be the use of a bond, so that a bond could be held onto and that could be a way of creating a bit more security as well.

The Hon. B.R. HOOD: I thank the minister for the response. Proposed subsection (9f), under clause 3 in amendment No. 5 from the minister, states:

Any expenses and interest recovered or recoverable by the Commissioner under subsection (9a) in the circumstances referred to in subsection (9ab) may, if the relevant council considers that any error or omission in advice referred to in that subsection occurred as a result of an act or omission of the relevant developer or another person, be recovered by the council from that relevant developer or other person.

Can the minister confirm that the proposed subsection (9f) is not just a catch-all to allow the commissioner to recover expenses incurred from council, regardless of whether they have provided sufficient evidence to the existence of a binding arrangement under (9ab)?

The Hon. E.S. BOURKE: I am advised that this amendment enables the council to pursue someone if they have been provided the incorrect advice. This has been included in consultation with the LGA and came about because previously there was no mention of this in the bill. The amendment seeks to clarify the council's ability to take civil action against the relevant developer or another person who they consider to be responsible for the incorrect advice being given to the State Planning Commission.

The Hon. B.R. HOOD: If the developer provides advice and proof of a binding arrangement that the work of a, say, common driveway, etc., will be completed, if not already, but the developer is found to have provided that in error or omission, can the commissioner still seek to recover that from the council and, if not, how will the commissioner recover it?

The Hon. E.S. BOURKE: I am advised the government would always go to the developer first, unless the council themselves have incorrectly advised the State Planning Commission.

The Hon. B.R. HOOD: So if the government goes directly to the developer, what happens if the developer has already gone under?

The Hon. E.S. BOURKE: We would have to check to see if the council had incorrectly advised the SA Planning Commission but, obviously, in the circumstances where a company goes bust it is not a nice situation for anyone involved at that point.

The Hon. B.R. HOOD: So if the council is not at fault but the developer is, and the developer is in administration with no way for the commissioner to cover the debt, that then ultimately rests with the state government?

The Hon. E.S. BOURKE: That would be a process that would be worked through. Again, it would come back to the beginning of this process and the council and also the developer doing their homework. The council needs to be looking into the viability of the developer taking on a significant project in their community, or just a project that is there to build homes. As much work as can be done as early as possible is going to put those protections in place, trying to avoid the circumstances you are highlighting.

The Hon. B.R. HOOD: But the minister would acknowledge that, ultimately, those circumstances could happen, where a council has done everything in its power to ensure they have ticked every box, that they have a security—and let's say that security is a $1 million bond, or even a $5 million bond—but the developer, for whatever reason, goes into administration and falls over and the works that are needed to complete that development are in excess of $10 million to $20 million. Where is that liability going to sit if the council is not at fault but the commissioner still needs to actually finish the work?

The Hon. E.S. BOURKE: This bill is there for the circumstances of a developer walking away without completing the job they should have completed. That is the protection this bill is seeking to achieve. It is there to make sure that if you made a commitment at the beginning that you were going to put stormwater in as well as other basic infrastructure that enables you to turn on your taps, to have a functioning household, that is upheld.

This framework we are putting forward today is there to achieve the same things. That is the focus of the bill before the chamber today: making sure that there is a framework available, a framework that is there to protect the ratepayers and enable them to have a little bit more confidence when they are building a home that the infrastructure they have seen on the plan is there at the end of the project.

The Hon. B.R. HOOD: I acknowledge what the minister is saying there, but I am just trying to understand what is within the intent of the bill. We have a situation—especially with the amendments that have now been filed—where as long as the applicant for the development, as stated in (9ab)(b)(ii), has entered into a binding arrangement supported by adequate security, if that developer then falls over, by virtue of the legislation, which will ultimately be passed today, if the council has done everything right there is still a case in which the state government is ultimately going to be holding the bag on finishing a development—should the council have ticked every box legislatively but the developer has still fallen over.

The Hon. E.S. BOURKE: I am advised, and as we talked through before, it is really upon both those parties, the developer and the council, to put that rigour around the approval at the beginning. So that is having a bond in place, as you have also highlighted, but also making sure that the appropriate infrastructure can be put in place as per the plan.

We can talk round and round in circles, and I appreciate what you are saying from the other side, but at the end of the day this bill that is before the chamber is about putting a layer of framework in place that will hopefully, as has rightfully been highlighted by the LGA, make councils think a little bit harder and start putting that rigour in really early about what an appropriate development looks like and what is a home need, as will the developer.

They now know that they will be held accountable, and that is really important here. I know you agree with this. Being held accountable is an important aspect of this bill, and that is why it is being introduced. It is just another level, another layer in the frame that ensures that a home can be built and have the appropriate infrastructure that goes with it.

The Hon. B.R. HOOD: I thank the minister for her response. We certainly do want to see that accountability there. There just still exist those sorts of rough edges. I think this bill can and may cause us to see, I suppose, unintended consequences with regard to councils and developers wishing to work with councils, most especially when we do have the sort of language within the bill which talks about 'adequate security'. We are not legislating what that security might be. I am assuming that it is not going to be in the regulations in terms of what that security should be either.

Should security be 50 per cent of a project? Should it only be 10 per cent? Does that then leave council open to this issue again, should that developer fall over? I think these issues existed with the bill prior to these amendments, and again I acknowledge that these amendments are going some way to taking those rough edges off, but probably not all the way. Did the LGA still give their concerns to the minister, or has anyone else or any other body given concerns to the minister that requiring words to the effect of 'adequate security' could cause developers to think twice about developing with local councils?

The Hon. E.S. BOURKE: I am not aware of receiving any requests in regard to that particular matter. I am advised that it has been modelled on the State Planning Commission's practice. I do not know the complete name, but it is being modelled on another complementary piece of legislation.

Amendments carried; clause as amended passed.

Remaining clauses (4 and 5) and title passed.

Bill reported with amendment.

Third Reading

The Hon. E.S. BOURKE (Minister for Infrastructure and Transport, Minister for Autism) (16:08): I move:

That this bill be now read a third time.

Bill read a third time and passed.

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