I will not repeat everything our lead speaker has said, but there are a few points that I wish to touch on. I will make a reasonably brief contribution, unless the Hon. John Gazzola heckles me too much, in which case it will become far more lengthy and it will drive everybody nuts.
Given the global financial crisis that we are facing, it is a very important time for the state’s economy to be managed efficiently but, regrettably, this inept government is in charge of controlling the purse strings. This Supply Bill comes to us after seven of the very best years this state has ever seen but, regrettably, there is little to show for it. The Rann Labor government has benefitted from record GST payments from the federal government.
The PRESIDENT: Order! The government members have been warned.
The Hon. T.J. STEPHENS: Thank you, Mr President, for your protection. This government has also benefited from record tax revenues. Yet, during the best of economic times prior to the current situation that we face, the government has run South Australia firmly into the ground. The Rann Labor government is all spin and no action. It really has done very little for the people of South Australia.
The Mid-Year Budget Review painted a very interesting picture of where our state is at. As some of my Liberal colleagues in another place have already explained, this government has never had a problem with revenue: it has had a problem with expenses. We have seen budget blow-outs in almost everything this government touches. Almost every project this government has undertaken has had a blow-out. Whether it is building an underpass or a bridge, or undertaking any project at all, the Rann government has stuffed it up. We are not seeing revenue problems, but problems with expenditure.
South Australia’s fiscal position and outlook is bleak to say the least. At the time of the Mid-Year Budget Review, there were budget deficits on all three accounting measures in 2008-09: a lending deficit of $819 million, a cash deficit of $801 million, and a net operating deficit of $112 million. All these have worsened since the Mid-Year Budget Review. The responsibility for this rests solely with the Premier and the Treasurer, and a Liberal government will again be required to come in and fix up Labor’s financial mess.
South Australia now carries the second worst budget deficit in the nation, with only New South Wales being worse off, and we all know what a basket case they are. Essentially, poor financial discipline and poor management by the Rann government has landed South Australia in financial trouble. To try to make up for his mistakes, the Treasurer has deferred infrastructure projects of significant value to the community.
Most of my Liberal colleagues have been involved in small business, and some of my other colleagues in this place will know that, in the good times, it is all about keeping your expenses under control so that your business has a strong future. Unfortunately, most people in the Labor Party do not have this type of business acumen, and that is why Labor governments so often fail on economic management.
I am sure that tonight Mr Rudd and Mr Swan will give us another glowing example of this when they unveil the biggest budget deficit in Australian history, and just watch them blame the former Howard government (a government with impeccable economic credentials), the global financial crisis—anything and anyone but themselves.
As mentioned, this state government has an expenses problem. Revenue has never been an issue, but we will still not hear the Treasurer talk about the windfall revenues gained from the GST during the good years. As we head into tougher times, one can rightfully ask: where has all the money gone? It has gone into trams, into bungled infrastructure projects and into a ballooning Public Service. It has been wasted while major problems, such as securing our state’s water supply, are no closer to being resolved.
I want to touch on state taxes. Since this government came to office, payroll tax is up 52 per cent. Taxes on property overall are up 104 per cent, and some categories of land tax are up 267 per cent. Taxes on gambling are up 29 per cent, insurance tax is up 43 per cent, and motor vehicle tax is up 35 per cent. This government is the highest taxing government in the state’s history.
The Commonwealth Grants Commission has indicated that South Australia has levied its tax revenue bases more severely than any other state or territory during 2007-08. Labor’s unenviable feat is that it has delivered the highest taxing regime of any state in the commonwealth.
I refer to payroll tax levied under this government. A business operating in Queensland with a payroll of up to $1 million will not pay one cent in payroll tax. A business in Tasmania will pay nothing in payroll tax. Over in the west, a business will pay $13,750 in payroll tax but, here in South Australia, it is $22,400. It makes no sense whatsoever. South Australia has the lowest payroll tax threshold in the country and one of the worst payroll tax regimes. It is uncompetitive, unfair and a disincentive to do business in our state.
Let me touch on stamp duty. As a parent of two young adults I am keen to see them break into the housing market, and I have previously spoken in this place about unfair stamp duties in South Australia. If you are buying a $300,000 property in Queensland you will pay $3,000 in stamp duty. If you are buying in South Australia you will pay $11,000 in stamp duty. We are the worst of all the states, except Victoria. Land tax is a major issue to business in this state. Many business people I speak to are concerned about the effect that land tax is having on their business. It is affecting their business to the point where they have had to sell some of their commercial property and look to invest interstate.
It is again worth looking at how they do things interstate. How much land tax does one pay on an investment property or business premises valued at $500,000 in Queensland? Not a cent. In South Australia the government will take $1,700 from you. If it is a $1 million property you are paying $11,400 in South Australia, but in Western Australia you would be paying about $700. How can the Rann Labor government justify this? What sort of signs are the Premier and the Treasurer sending to the business community when good businesses employing high numbers of people have to sell part of their assets and move interstate purely because of the disgraceful taxation regime in this state?
It is a restrictive regime that quite simply has to change. We have seen the community anger at public meetings and in the media and, clearly, something has to give. With those few comments, I support the bill, but I fear for the future of South Australians both young and old.