APPROPRIATION BILL 2014

Tuesday 01 July, 2014

Mr TARZIA (Hartley) (12:03): I support the comments of our leader. This is a shameful budget, which has been put out by an illegitimate government, a government with a two-party preferred vote of 47 per cent. It should not have had the right to be in government in the first place. It is a terrible budget.

Mr TARZIA (Hartley) (12:03): I support the comments of our leader. This is a shameful budget, which has been put out by an illegitimate government, a government with a two-party preferred vote of 47 per cent. It should not have had the right to be in government in the first place. It is a terrible budget.

I will summarise the budget before I go on: six deficits in seven years—another budget expecting deficit; a debt exceeding $14 billion; interest on debt over $1 billion in 2017; total liabilities of over $25 billion; state taxes which are the highest in the nation; capital city water charges, 220 per cent of which have been increased under Labor since they came in to power; a terrible workers compensation system; a terrible workers compensation levy scheme, which is the highest in the nation at 2.75 per cent, compared with 1.76 per cent on average across Australia; $2.3 billion of government work continues to flow and go interstate each year; and a shameful credit rating which keeps deteriorating under this government.

We in the Liberal Party understand that a strong credit rating is important and that lower interest rates are the result of a better credit rating: the state can borrow at much better rates, investors are attracted to state securities if interest rates are better and the credit is much more secure, and people have more acceptance of risk and investment in the state. We understand that investors will be better attracted to the state's securities, and that is why a strong credit rating is important. We understand that it shows the public and the private sector that the government means business and that it has a fiscal discipline in its economic strategy.

I see the increase of public-private partnerships. The public are not stupid. They understand why the government has to go to equity. It has to go to equity because it cannot pay its debts on time and, as we have heard already, the government is currently borrowing even to pay wages.

Madam Deputy Speaker, happy new financial year! I trust you had a good financial new year; I certainly did. Here we are: one Australian dollar is worth US94¢. The RBA cash rate is 2.5 per cent. As our leader alluded to, across the country in Australia we have Liberal state governments which are turning around their respective states. As the leader pointed out, their economic credentials are getting much better, because the thing is that this is a terrible budget, and as Liberals we understand economics. We understand supply and demand, the two fundamental variables in economics. We understand that one cannot spend what they do not have. The government keeps spending what they do not have. They have kept doing it. Six out of seven deficits they have delivered.

When you look at the Budget Overview, it is a beautiful, lovely glossy paper. It is colourful, it has cartoon characters in it, lovely simple spelling. It reminds me of a cartoon, and I would say that the economic credentials of this government are almost Disney-like. I am reminded of a fairy tale, Aladdin, where there is a bottle and a genie, and the genie comes out of the bottle. At the moment, it looks like the government are rubbing their bottle, they have been rubbing the bottle—

The Hon. T.R. Kenyon: It's a lamp.

Mr TARZIA: —hoping that after 12 years maybe this genie will pop out—

The Hon. T.R. Kenyon: It's not a bottle, it's a lamp.

Mr TARZIA: —and reveal itself, this magical being and eradicate the 12 years—

The Hon. T.R. Kenyon: Genies come out of lamps. Everybody knows this.

Mr TARZIA: —of waste and irresponsible spending, and I can hear the member for Newland interjecting. Thank you, member for Newland, for coming to Hartley last weekend and showing exactly where we need spending at IVF Campbelltown, but I will get to that in a second. But they think they can be like Aladdin and that a magical genie will come out of the bottle, the economy will do what they want just like the genie in Aladdin did but instead there is a bad genie that has been let out of the bottle, and it is all bad and I will explain why it is bad. The bottle that is the state economy has been rubbed up the wrong way for too long.

I would like to talk about two broad areas of the bill. One is the state budget at a glance and two is how it relates to Hartley in particular. At a glance, as we have heard, South Australians will be paying over $2.2 million in interest every day on Labor's debt which rises to $14.3 billion. The emergency services levy will cost the average household $150 per year and $8 per year for motor vehicles—a direct contradiction to what was promised the people of South Australia before the state election.

We have heard that fees, charges and fines will increase by 2.7 per cent. We have heard that council rates concessions for pensioners and concession card holders will be cut. These are some of the most vulnerable in our society and these concessions will be cut which is absolutely shameful. We know that the government has taken a knife to the health sector. It has broken a number of key election commitments, as our leader also explained. Small business continues to take a hit, which I will explain, and I will explain how that relates to the small businesses in Hartley.

Of course, we in the Liberal Party understand that small businesses are the engine room of South Australia with over 100,000 small businesses. We understand it is the engine room. We understand that it is business that will get us out of the rut in this state, but the government? What are they looking to do? No, they want to punish small business. They want to punish small business because they think that the government can keep spending money, that we can spend our way out of this trouble. I tell you what: it has not worked. You have had 12 years and it has not worked. The budget has no plan to create or grow the economy, and this government has certainly—correct me if I am wrong—promised to create 100,000 jobs by 2016. Former premier Mike Rann promised 100,000 new jobs in South Australia by 2016. It would take a significant genie to make that happen.

Under this budget, South Australia's fiscal position is in serious decline. Our credit rating has continuously deteriorated. Over the past year, the government has delivered a total of $2.9 billion of deficits. They spent when they did not expect to spend. They spent $2.9 billion and they have racked up $14 billion worth of debt, a $4 million increase in debt accumulation every day, when you break it down, Deputy Speaker, every day for the last eight years. South Australia has a ratio of net debt as a proportion of gross state product which continues to lag behind all comparable states.

The commonwealth government contributes to basically half of this state's revenue when you factor in the GST. Put simply, it is a government that is addicted to debt and it is addicted to handouts from the commonwealth and basically anyone they can get it from. I reiterate what the leader was saying, that we would not mind if this debt was being spent to facilitate growth in the constructive component of our economy. We actually would not mind it; but, no, it is not being done.

One only has to look at the recent projects the government is considering such as the O-Bahn, whereby it scrapped a much smaller proposal several years ago because it could not justify the spending. Here, we see a much larger spend in the project with no cost-benefit analysis, no net present value. It is absolutely shameful that we are wasting taxpayer resources when we cannot justify them, economically, being spent.

I spoke in my maiden speech and on the Supply Bill about the gradual decline in revenue that the state has been facing over the last 12 years and the importance of expanding our export market particularly in the resources sector to assist the replacement of this revenue shortfall. In Australia, we export, it is estimated, over $300 billion in goods and services each year, and that number is expected to grow.

Well, let me give you some interesting facts, Deputy Speaker, about how much the other states grow in exports and then let's examine how we go. Here is our comparison with Western Australia, a state population-wise which you would have considered at one point in time was a pair with South Australia. Western Australia currently exports over $130 billion—$130 billion. South Australia, $12.3 billion—12.3. It is absolutely ludicrous. When you compare the pair there really is no comparison. The other mainland states tell the same story: New South Wales exports, over $63 billion; Queensland, $55 billion; Victoria, $36 billion; yet South Australia, $12.3 billion. We actually account for just 4 .3 per cent of all exports in Australia.

Why are exports important? Because exports are usually generated by small businesses. Goods go out of Australia, money comes back into Australia. Why is that important? Because when money comes back into South Australia companies are able to create jobs. I looked at the census business index, which released its report in June 2014, and it actually highlights the proportion of small/medium enterprises exporting in the last year by state and territory.

It is fitting to note that South Australia lags behind every single state and territory in Australia except Tasmania. We lag behind every single state; we are second only to Tasmania. Business confidence, as the leader explained, has dropped significantly: 14 percentage points in South Australia alone. We have a serious crisis on our hands in this regard. We were hoping that some productive resources would be put into exports and into this part of the economy, but it just did not happen in the budget.

It is not as if we do not have the capabilities or the opportunities in South Australia. We currently sit on what is said to be the world's largest reserve of uranium; so, there is so much potential there. Just think about how our state could be transformed with some bipartisan vision, perhaps, if the Olympic Dam expansion had gone ahead and other potential energy sources are looked at. Just think of what we could achieve as a state if the people had a government that was prepared to work with companies like BHP to secure our future revenue base, not to tax them out of the market, which is what they did with taxes like the mining tax and the carbon tax.

This government stood hand in hand with the federal Labor government of the time and said, ‘Yes, we are happy with these taxes.’ It is an absolute disgrace. BHP have gone now—they have gone. They are in South America, they are in Africa, and they are in Canada. They are in all these other countries where they seem to have more success negotiating with a government, whereas this government just does not understand the concept of sovereign risk. Companies want to come here; they want a reason to come to South Australia, but how can they do business with a government which just does not understand economics, which just does not understand supply and demand and which just does not understand that no-one is going to shop with you if you have the highest prices in town? It is beyond me, and it needs to be fixed.

Well, what would you expect, Deputy Speaker? We actually have a government that the people did not want. Only 47 per cent of South Australians voted for this government—here we are. One thing I will ask this government to do, since they are in government, is to stop blaming everyone else for their problems. Stop blaming the federal government for your problems. Stop blaming the high Australian dollar for your problems.

There are states in Australia that seem to be getting on with the federal government. There are states in Australia that seem to be increasing their exports much more rapidly than South Australia, even with a higher Australian dollar. There are states in Australia that are booming at the moment, and it is an absolute disgrace to see that we are not following the lead.

I am asking the government for some leadership here, please, not just for the people of Hartley but for the people of South Australia, and in particular for the youth who are unemployed. I see young professionals, day in day out, coming to my door in my EO in Hartley who do not have jobs at the moment. It is tough out there at the moment. Have a look at the accounting graduates, the law graduates, the tradespeople, the nurses and the teachers who cannot get jobs at the moment because the economy is contracting.

There are a few projects in the budget that do concern Hartley in particular, and I wish to elaborate on them. The Paradise Interchange—I, along with the member for Morialta, I am sure, would certainly welcome an upgrade of the park-and-ride spaces at the interchange. I will just point out, that the member for Morialta and I have fought tooth and nail, lodged a petition over the years, doorknocked the entire area, and made sure that this government does take the people of Paradise seriously. I welcome the member for Morialta’s efforts on this who, along with myself, championed the issue and what they have been able to do.

I am a passionate supporter of Neighbourhood Watch, and I would like to mention that the government is looking to spend $2 million over the forward estimates to reinvigorate the Neighbourhood Watch program. There are a number of hardworking Neighbourhood Watch groups in Hartley, including Campbelltown, Magill, Auldana/Magill/Skye, Paradise, Tranmere and Kensington Gardens. They have deep roots in the community, they are an integral part of the community, and they contribute greatly to the harmony of the area. I applaud the government’s proposal to spend more money in Neighbourhood Watch—a great community organisation which goes to improving rates of crime standards in our area.

The failures of the budget are many in Hartley, but I wish to talk about a few issues in particular. Payroll tax changes that were proposed by the state Liberal Party for small businesses were welcomed by the public in Hartley on several fronts; however, they have been rejected by the government because the government does not understand that the small business sector is so fundamental to the growth of this economy.

The emergency services levy, which is effectively a new land tax, has also been flat out rejected by the people of Hartley, and I ask the government to consider scrapping that proposal. It is an absolutely shameful proposal and it needs to go. The government had a conversation about it over a year ago and it was flatly rejected at the time. Let me just say that it has been rejected on the whole down the track.

There are a number of issues that I have brought to the house’s attention that have not been addressed by the Treasurer, and I wish to elaborate on what they are. A road traffic management plan needs to be established—the new McNally development. We have asked that this be done; it still has not been done by the government. Furthermore, a road traffic management plan for Newton Road and St Bernards Road was recommended many years ago by a former member of Morialta, before the current one, but still we see no funding for the upgrade of Newton Road and St Bernards Road. I certainly implore the Treasurer to consider that.

At Lochiel Park in Campbelltown, we still have a gross pollutant trap which does not work, and I call on the government to spend some money to fix that. In regard to Felixstow, the Felixstow master plan is a fantastic project which I have spoken to in this place before. I would also ask the government to consider contributing funding to assist councils in that project. Payneham Road is a road that has been abandoned by this current government for many years now. I would also ask the government to consider a proposal, a report and an upgrade to the Payneham Road area.

In addition, the Glynde substation is a huge issue; the previous member for Hartley had words to say about it, the Treasurer has had words to say on it in the house, and I have raised this in question time. It is sad to see that there has been no allocation of funding in this budget to relocate the Glynde substation to an alternate site. It is shameful, and it shows total disregard and disrespect for the people of Glynde who want this substation moved. I will continue to fight for the local residents to ensure that we do all that we can as an opposition to hold this government to account on that particular issue.

There are a number of failures in this budget. Overall, I will be supporting the bill. In a nutshell, this budget simply does not allow for the improvement of the productive capacity of the state, and that is the biggest failure here: no vision, no plan for our future.