Budget Reply (Appropriation Bill 2015) | SPEECH


Mr VAN HOLST PELLEKAAN ( Stuart ) ( 12:25 :34 ): It is a pleasure to follow such a fine speech by the Leader of the Opposition. He has done an absolutely outstanding job, as he does day in day out, leading us and holding the government to account, but it is my turn to respond to this year’s budget on behalf of the people of Stuart. Let me just say that of course no budget is all good or all bad, but there is a lot more disappointment in this budget than we were led to believe would be the case. Let me touch on a couple of positives to begin with, and then I will probably use the remaining 19 minutes of my time to talk on the other aspects of the budget.

The additional funding for tourism is a positive aspect of this budget. It will help metropolitan South Australia, it will help regional South Australia, and I welcome that. I hope the money is spent very wisely. There are a lot of very capable people working within SATC and we need to get that money out. We need to make it as effective as possible and get it out so that it actually contributes to effective marketing and to growing the efficiency of our existing businesses. To me, one of the most important aspects of growing tourism is improving tourism product and developing the product that is out there.

Of course, we welcome the tax relief. Any tax relief is welcomed by households or businesses, or employees for that matter, because employees are part of households and businesses, so they benefit as well. The extension of one year of the increased threshold for payroll tax is certainly welcome, but I cannot see why this government just wants to extend it for one year and one year and one year, unless, of course, it is because they do not want the full liability of that decision to be throughout the forward estimates. They only want the liability to be in the next year and so they hide the true picture.

The reduction in stamp duty is very positive, but why is the government having the vast bulk of that relief in the fourth year of the forward estimates after the next election? I can only imagine, again, that they are holding off on providing the benefits to our state, but they are also holding off on attributing the genuine cost to the budget. They are trying to make themselves look better than they actually are. Yes, of course we welcome the tax relief, but they have not gone nearly far enough.

We need to pursue employment, and greater employment needs to be the highest goal of this government and the budget. We need to do that by supporting business to employ people, not so that we have wealthy business operators—that is a lovely by-product, and good luck to them and their families—but so that they can have productive businesses and can employ people, and employ more people, and so that the people they employ can have secure employment. That is the reason to support businesses: so that they can provide secure, ongoing employment to their staff so that those people then can improve their lives with some security, so that they can go to the bank and get a mortgage, so that they can be sure that they can look after their kids and their families as they grow up, so that they can get a car loan and so that they can pay off their mortgage and have security. That is the reason to support businesses but, unfortunately, this budget is not doing that.

The Treasurer does talk about it but, unfortunately, it is just not happening to nearly the extent it should. I have given a couple of examples of where they are talking about benefits that do not actually accrue for a very long time and, if they were genuine about trying to support those businesses so that they could provide secure employment, they would bring forward those benefits.

The most recent figure we have for unemployment across our state is 7.6 per cent. It is the highest unemployment in the nation. It is an absolutely disgraceful position to be in. Guess what, Deputy Speaker: this budget provides us with the lowest jobs growth target of any state in the nation. Those two things just do not go together. If you are in a dreadful situation with regard to unemployment, you should have a very hardworking, ambitious budget that unlocks the productive capacity of our state and provides an employment growth target of much greater than 1 per cent and certainly not be targeting, again, to be the lowest in the nation.

We have seen unemployment grow and grow and we have had a lot of very unfortunate shocks. In the mining industry, in November 2014 (seven or eight months ago), the government announced boldly that it was going to create 5,000 new jobs for our state. That is a fantastic target. But, guess what? We have lost that many in less than a year. In the eight months since that target was announced, we have lost as many jobs as the government said they were going to create.

Do you know what is the most disappointing thing about that, apart from the obvious loss of jobs? I heard the Premier stand up at a South Australian Chamber of Mines and Energy awards night a few months ago and say to everybody assembled—hundreds of people from the industry were there—’We have set an ambitious target in government and now it’s up to all of you to deliver.’ That is exactly what the Premier said, that the government had set an ambitious target but it was up to the industry to deliver on that target. Isn’t that a disgraceful way to support industry—to have big banner headlines, that are not even being achieved, and eight months later we have lost as many jobs as were going to be achieved in the industry, and at the same time to shamelessly say that it is up to somebody else to deliver that target? That is where we are at at the moment, and that is completely unacceptable.

Another great disappointment for me in this budget has been a complete lack of support for families and households and any relief whatsoever from cost of living burdens. We have high electricity prices, high water prices and high taxes across the board. The government brags about removing the River Murray levy which will save a household on average $40 each, but they are actually increasing the emergency services levy at the same time and that will cost the average household $205 each. There is no relief for households. In fact, they are pushing up the cost of living for households.

To get back to the employment issue, the emergency services levy is not only a burden on households but also a burden on employment. The emergency services levy is a tax on employment because it is a tax on property. Every single business, whether a self-employing business or a business that employs other people as well, works, in one way or another, in a situation where they have to pay that increase. If they work in owned premises, they pay the increase. If they work in rented commercial premises, they pay the increase through outgoings which the landlord will pass on directly to the business as the tenant. If they work from home, they pay the increase in the emergency services levy. While this government makes big claims about trying to look after business, employment and families, it is doing exactly the opposite.

With regard to infrastructure, infrastructure is incredibly important. The government talks about infrastructure, and has done for a very long time, but it is again not following up with action. We have two key infrastructure projects that need to be pursued at the moment. They are two key regional pieces of infrastructure, and I mention them specifically as a regional member of parliament.

The upgrading of the Strzelecki Track is very important. Sealing that 470-kilometre piece of road will improve the transport and other efficiency of our state enormously. There are three key industries—they are not the only ones—that work in the north-east of our state: oil and gas, particularly in the Cooper Basin; tourism; and the cattle industry, and they will all benefit by having that road upgraded.

Another very important piece of infrastructure is a deep-sea, multi-user export port and, again, the government has talked about this for a very long time. A year ago the government committed to within a year from that point of time—so by now—producing for the public a plan for a new export, deep sea, multi-user port that would support our existing resources and agriculture industries and help them both grow, exporting typically iron ore, grain and other products. We need to have that. A year ago they promised to have a plan. They did not promise to have the port; they promised to have a plan. You cannot build the port if you do not have the plan and we are still waiting for the plan. The government has recommitted and recommitted to providing this plan, but they have not yet developed it. We need to see it.

I do not say that the government needs to fund all the money required to develop a brand-new port. Certainly, they do not need to do that, but they do need to show leadership so that financing will be attracted to this very much needed project. Infrastructure, in general, is incredibly important because jobs are created while the project is developed, but that is actually the second tier priority. That is a big help and we all welcome in regional South Australia or in metropolitan areas when infrastructure is developed, but the key issue is the ongoing jobs (the additional capacity that is created) and the additional efficiency that is created. They are the two things that are very important that come out of infrastructure and if they do not provide those into the future then they are not productive, efficient, worthwhile infrastructure. So, yes, there are jobs while they are being built, but they need to improve our economy and those two projects, the port and the Strzelecki Track, would both do those things.

The employment situation in our state is dreadfully concerning for all of us here, and I am sure government members are very concerned about that as well, but somehow the message is not getting through to cabinet and the senior decision-makers about what needs to be done. We are losing jobs at Holden faster than was predicted. There are now only 1,260 employees left at Holden and, let me tell you, they are doing an outstanding job. The employees working at that Holden factory are doing an enormous job. They are surprisingly winning awards within the entire worldwide GM group for their productivity improvements and their innovation. They are doing everything they possibly can. The workers and management have taken it upon themselves, every man and every woman, to be as good at their job as they possibly can be right until the very last day that that factory is building cars, and I commend them for that.

Unfortunately, they are losing employees faster than was predicted and yet the government is supporting them slower than they said that they would. We are losing employees quicker than was predicted and yet the money in the budget that the government has set aside specifically for programs to help the Holden workers in the north of Adelaide and all of the other people affected by this very unfortunate automotive transformation at the moment is not being expended as quickly as the government said they would.

I do not want the government to waste the money. I am not saying just pump it out there, spend it on any old projects and who cares whether it is efficient or not. That is definitely not the case but, goodness gracious, by now they should have some effective, productive, useful programs in place that will help. Holden is getting on with the job. They are spending the $15 million that they have put into South Australia and Victoria to support their people in transition. They have an excellent program working there. They are getting on and doing the job, but the state government saved $2 million out of their program from the financial year that is just finishing today. Of all of the places to try to save money, that is not the place to target. These people need help and they need it faster than we expected they would.

Not saving but overspending by this government has been its nemesis for as long as this government has been in office. It has perpetually overspent and this year is no different. We have a situation where, over the forward estimates, the state government is going to receive from the federal government $892 million of additional federal government income, yet it keeps overspending and overspending. There is a history of this government receiving unbudgeted additional income, yet unbudgeted spending is outstripping that income, and that is a habit that just has not changed.

To its credit, the government is still forecasting a $43 million surplus next financial year—the financial year that starts tomorrow. Let us hope that it achieves it—history tells us that it will not. It has just handed down a deficit well in excess of the deficit that was forecast for the financial year just finishing. I am not at all optimistic that it will reach the surplus it is predicting for the new financial year. However, let me tell members, if it does it will be thanks to the federal government; if it does it will be because the federal government has given it more unexpected additional income than its most likely overspending which is about to commence. So, if it is able to have a surplus do that it will be thanks to the federal government but, unfortunately, it is highly unlikely.

Overspending has been the downfall of this government. We have a situation where hundreds of thousands of dollars is being spent on redundancies for public servants at the same time as the number of public servants in the state is growing. That is just one example of dreadfully inefficient use of money. We have a situation where $176 million, I think it is, needs to be spent unbudgeted—so, an overspend of $176 million—to transfer patients and equipment from the old Royal Adelaide Hospital to the new Royal Adelaide Hospital.

It is impossible to imagine that not one of these people—not one person within government, not one person within the health department, not one person analysing the PPP that put all the financials together, from an orderly doing important work in the hallways of hospitals all the way through to the chief executive of SA Health, or any of the financial people who scrutinise this—thought, ‘Gee, we’re going to need some money to transfer the patients and the equipment and all of the things that have to go from the old hospital to the new hospital.’ I do not believe that they did not think of it. I do believe the government thought about leaving it out of the budget to make the budget a few years ago look a little bit better, and that is the sort of thing that catches the government out.

There are two aspects to its overspending: one fact is that it just spends and spends more than it expects that it will; but the other aspect is that it hides necessary expenses out of budgets to make the budgets look better, and that is exactly what I was getting at with the things I discussed earlier with regard to, for example, extending the payroll tax by one year so that years 2, 3 and 4 do not actually have to show the cost to the budget of forgoing that payroll tax income.

It is not an accident: it is the government’s way of making things look better, but, unfortunately, it is not making them look good enough. We could talk about the budget for as long as we like and we can all share our different opinions and agree or disagree, but the most important thing going on in our state at the moment from a budgetary and an economic perspective is our incredibly high unemployment rate—7.6 per cent at last count and we know how many thousands of jobs have been lost across the state since then.

In the last minute I have left, let me just tell you how dreadfully disappointed I am that the government did not put any relief in this budget for the Alinta workers, their families and other employees affected in the communities of Port Augusta and Leigh Creek and surrounding districts. The announcement that those jobs were going to be lost was made a week before the budget. I understand the last minute issues about printing, but I also understand that there would be money made available.

An announcement could easily have been made that there was support for those people and those communities in this budget. It could easily have been explained: ‘Look, we haven’t got a page, we haven’t got a line item, we haven’t got something in the budget paper books that have already been prepared, but here is an allocation of money,’ because there have been other announcements since the budget was handed down for other things they thought were a priority. I am terribly disappointed that they did not consider the Alinta workers and the other people who will lose their jobs because of Alinta’s decision, and affected communities, a high enough priority.