Supply Bill 2017 | SPEECH


Second Reading

Adjourned debate on second reading.

(Continued from 13 April 2017.)

Mr VAN HOLST PELLEKAAN ( Stuart ) ( 11:04 :46 ): In regard to the installation of the cameras, I wholeheartedly support that. We in this parliament should be absolutely transparent, and as soon as possible, so I welcome the fact that that will be the case on 1 July.

In regard to the Supply Bill, we are being asked to allow the government to spend $5.907 billion, and I support that principle. It is important that, between the end of the financial year and the actual authorisation of parliament, the government has its budget passed. That the government should be allowed to spend up to the estimated amount of money is a very important principle.

There is a lot of trust involved in that request, and that trust is very much about how the government goes about spending money. That trust is about not only how the government goes about spending this particular chunk of money on this particular occasion but how the government goes about spending money on behalf of taxpayers, keeping in mind the extremely important principle that the money the government spends does not belong to the government, it does not belong to parliament, nor does it belong to members of parliament, or the Premier or the Treasurer—it belongs to all South Australians.

It is provided by South Australian taxpayers on behalf of all South Australians. The government spends that money on behalf of South Australians. That is where the trust issue comes in. The way to best judge whether that trust is well placed is to look at how the money has been spent during the time of this government and to look at the results of the spending of that taxpayer money. Let me go through some accurate, current economic statistics about South Australia. South Australia’s gross state product grew by 1.9 per cent in the 2015-16 year, but, unfortunately, that is compared with the national average of 2.8 per cent. It is very concerning.

Exports over 12 months up to March 2017 were $10.9 billion, but exports fell 6.2 per cent on an annualised basis, compared with the previous 12 months, down to that $10.9 billion. The government’s target is $18 billion. Its own self-nominated target is $18 billion by 2017. To the year ending September 2016, net interstate migration has been negative 6,484 people. Keep in mind that these statistics are as recently available as possible from the ABS and other data. We are losing people from South Australia to other states in Australia, where presumably they believe they have more opportunities.

On the jobs front, only 16,900 jobs have been created since the Labor government promised, in February 2010, that it would create an additional 100,000 jobs by 2014. Here we are in 2017, and 17 per cent of that promise has been fulfilled three years after the date when 100 per cent of it was expected to be fulfilled. There is a 6.7 per cent trend in South Australia in the annual unemployment rate up to March 2016—the highest in the nation. Up to March 2017, the seasonally adjusted rate is 7 per cent—again, the highest in the nation.

With regard to water prices, South Australian average household water bills have grown 233 per cent from 2001-02, when Labor came into government, up to the 2016 year. With regard to electricity prices (and I will have more to say on this a bit later on), in the last 12 months to the day since the government electricity and energy policy forced the closure of the Port Augusta power station, spot prices for electricity in South Australia in the wholesale market have increased 105 per cent. So, in one year since this Labor state government’s energy policy forced the closure of the Port Augusta power station a year ago to the day, wholesale spot prices have more than doubled. They have gone up by 105 per cent. Forward contract prices for the next two years have increased 46 per cent over the same 12 months.

Net imports of electricity from Victoria have grown by 48 per cent. Keeping in mind that 86 per cent of the electricity generated in Victoria was from coal, the government’s self-professed environmentally based policy to get rid of coal has only resulted in the importation of more coal-fired power from Victoria. If the government honestly believed what it says about electricity, it would understand that saving the planet is not only about emissions in South Australia. A policy that increases emissions in other states is not going to do what it says it wants to do. In that time, we have had six major blackouts, including the unprecedented statewide blackout on 28 September last year.

The government is spending $512 million per year just on interest for total public sector debt through the 2016-17 year—$512 million over 365 days. Juxtapose that against the fact that SA will receive $471 million more in GST in the 2016-17 year than in the 2015-16 year. All these economic indicators are going downstream at a rate of knots when the actual income from GST, which is not the only source but is the primary source of taxation income for the state government, is actually going up very fast.

Regarding unbudgeted spending, to go off on a slight tangent, the principle of budgeting is exactly the same in a one-person household, a 10-person household, a state or a nation. You have to balance your income versus your expenditure and you have to plan exactly how you are going to manage. If you deliberately plan to have a year where you are going to spend more than you earn, that may well happen for very good reasons, but you have to have a plan to repay that deficit. You have to have a plan over coming years for how you are going to make that money back, and you have to know that that deficit is being spent for good reasons, not frivolous reasons.

I am sure all of us would agree that productive infrastructure spending may well be a good reason to have a deficit. Spending to pay public sector wages would not be a good reason to go into a deficit. I am not suggesting that those people who turn up to work every day and do their jobs properly should not have their wages paid. Of course they should have their wages paid but, in the context of the government budgeting process, it does not make sense to be going into debt.

As a former minister for forests said, it does not make sense to be spending taxpayers’ money as if it were a credit card to pay for wages. That was a former Labor forestry minister—Michael O’Brien. But between the 2003-04 year and the 2015-16 year, the state government has spent $4 billion more on general government operations than it had budgeted, so it cannot manage its own expenditure. Four billion dollars is a massive amount of money. It is not just an extra half a per cent here or there. Four billion dollars of unbudgeted spending is an extraordinary situation to be in.

I come back to this issue of trust. The government asks us to support the provision of just over $5.9 billion for its spending. As I said before, I have no problem with the principle. We will support it, of course, based on the principle, but the questions of trust, about how the government spends their money and whether it is in the best interest of South Australia, are very serious issues. The snapshot I have just given are figures provided by the shadow treasurer. They are the most up-to-date figures available from reputable sources and they make it very clear that South Australians are not benefiting from state government spending the way they should.

Let me just take a more detailed step into my electorate of Stuart. As people know, the electorate of Stuart is very large. It is a country and outback area, with Port Augusta as its major regional centre and Kapunda as the next largest town, only 75 kilometres from Parliament House, all the way on up to the Northern Territory border. What is most striking to an outsider about the electorate of Stuart is the diverse range of communities of interest. It is part of the Barossa Valley, part of the Riverland, most of the Mid North, the regional centre of Port Augusta and a big chunk of the Upper Spencer Gulf coastline. It is almost all of the north-eastern pastoral area of South Australia.

It has a wide range of local communities with very different local interests, local engagement, local employment opportunities, local recreational opportunities, etc. However, I will tell you one thing they are completely united about: they are absolutely sick and tired of hearing the sorts of statistics I have just read out about our state’s economy. They are completely united in being sick and tired of the way the government is spending their money but not getting the results they deserve and, in fact, not getting the results that the government tells them to expect.

I have talked about unemployment across the state. Let me provide the latest figures available on unemployment in Upper Spencer Gulf. All the Upper Spencer Gulf cities combined have a 9.8 per cent unemployment rate compared with a national average of 5.7 per cent. These are the latest figures available. The City of Port Augusta, which I represent, has a 9.9 percent unemployment rate, and in the cities of Whyalla and Port Pirie it is also significantly above the national average. There are many reasons for this, one of which is that the government is not delivering the economic outcomes that it always promises to deliver when it spends taxpayers’ money.

One of the most heart-wrenching aspects of the unemployment rate is population decline. The most recent figures for regional South Australia over the last 12 months show that population growth in the Flinders Ranges has been negative 1.7 per cent, outback population growth has been negative 2.5 per cent and total outback and north-east population growth has been minus 1.1 per cent. This is compared with an Australian average of plus 1.4 per cent. The communities I represent are being incredibly hard hit because government spending is not delivering the economic outcomes that the government says it will, and that is leading directly, through a wide range of negative mechanisms, to very high unemployment—approaching 10 per cent.

If people cannot get jobs, they cannot stay. It is a dreadful situation for a household to be sitting around the kitchen table when the key breadwinner has lost their job, whether that is the man or woman, the father, the mother, whoever it is, in a wide range of different households. They sit down and say quite openly and frankly to each other, ‘Look, we’ve done the sums and we’ve looked at our commitments.’ It might be a house mortgage, it might be a car loan, it might be commitments to the kids.

Whatever it happens to be, they say, ‘Do you know what? We can meet our commitments, including our daily, weekly and monthly consumption spending, maybe for three weeks,’ maybe for three months, in a different household, maybe for six months in a another household if they are very lucky. However, the principle is the same: they sit down, they do their budget and ask, ‘How long can we be without an income? What can we do to cut our spending so that perhaps we can stretch that time?’

When that household cuts their spending, it cuts the income to business and service providers in the region, and that then flows to their employment opportunities. They do everything they can to stretch their capacity to stay in the region without an income, but whether it is three weeks, three months, six months, a year, whatever it happens to be for that particular family, if they cannot get a job the time comes when they have some incredibly hard decisions to make.

The sensible, well-meaning, practical people of the electorate of Stuart do not wait until the last night and say, ‘Oh, we’ve just run out of money. What will we do tomorrow?’ They start planning much earlier than that and say, ‘Do you know what? We probably have to start looking for a job and it probably needs to be somewhere else in South Australia or interstate.’ You can see how the figures I read out all connect and are intimately connected to households in South Australia, in Port Augusta, in Kapunda, in Jamestown, in Burra and in Peterborough, right down to the tiniest communities such as Bower, in the electorate of Stuart.

Our primary, most important focus here should be to support people in South Australia. Whether they are in a one-person household, a 10-person household, it does not matter: supporting people in South Australia must be our most important priority. We can all argue about the different ways to do that. For example, the Liberal Party has an incredibly strong belief that one of the best ways to support people is by supporting small and medium-sized businesses because those businesses are employers, and if they are successful they can provide secure employment, and secure employment allows households to get on and live not only day in, day out, but year in year out, and live successful, thriving and positive lives.

The Labor Party can have different views about the best way to help people, but we must all be here to support people. This all comes unravelled when a political party, such as the Labor Party, which has been in government for over 15 years now, is elected, is entitled to govern and is entitled to implement its spending programs that it says will deliver particular outcomes for the people of the state. The government is entitled to do that, but the problem is when it does not deliver and it says, ‘We will spend your money, South Australians, in this way, for these purposes, to get these results,’ but year in, year out, they do not deliver.

That is why we have the highest electricity prices in the nation, that is why we have the highest unemployment rate in the nation and that is why, unfortunately, we have people leaving our state in droves. Let’s hope that a lot of those people come back. Let’s hope that after the next election we will have a change of government and things will improve enormously and that as many of those people as possible come back to South Australia; I have no doubt they will want to. The real practicality is that if a young family moves away and their children start at a new school and they develop new friendship groups, and they get established and have new employment opportunities in other places, they will not automatically be able to uproot themselves with the snap of a finger and say, ‘There’s job back in South Australia. I will go back now.’

They may be able to. Let’s hope that as many as possible can do that, but the reality is that will not be possible for all of them. Their 10-year-old children will soon be 15-year-old children and those 15-year-old children may say, ‘Yes, it was great back at home in South Australia, but the world has moved on. I am 15 now, I’ve got friends in school and I want to stay.’ That will tug at the heartstrings of those parents and make it a very difficult decision for them to come back.

The problem is that this is not a quid pro quo. We are not getting people coming from other states into South Australia, but maybe we will lose some and maybe we will gain some and our communities, which must be at the heart of everything we do in this place, will be okay. We have negative net population growth. We are having thousands of people leave our state every year—in the last 12 months six and a half thousand people—because the government is not delivering on its spending promises, as it said it would do.