Legislative Assembly

Thursday, 16 August 2007

THE DEPUTY SPEAKER (Mrs D.J. Guise) took the chair at 9.00 am, and read prayers. SUSTAINABLE MANAGEMENT OF FISH STOCKS Petition MR G. SNOOK (Moore) [9.01 am]: It is my pleasure to table a petition on behalf of the Zone C Professional Fishermen’s Association. The petition reads - To the Honourable the Speaker and Members of the Legislative Assembly of the Parliament of Western Australia in Parliament assembled. We, the undersigned, say that there is a need to ensure the proper and sustainable management of fish stocks in Western Australia. Now we ask the Legislative Assembly, when considering amendments to the Fish Resources Management Act 1994 or its regulations or management plans, to ensure that the amendments are in the best interests of the fisheries management by: 1. ensuring that the introduction of Integrated Fisheries Management requires that where a fish stock is allocated proportionally amongst user groups those groups will receive proportions of the total allowable catch and that any changes to future regulations relating to the allowable catch of that specie will not alter the proportions allocated. 2. rejecting any amendment to the West Coast Rock Lobster Fisheries Management Plan that in any way diminishes or removes current fishing rights or creates new or additional fishing rights. The petition bears 110 signatures. [See petition 236.] PAPERS TABLED Papers were tabled and ordered to lie upon the table of the house. SUNSET SITE CLASS A RESERVE NO 1667 Removal of Notice - Statement by Deputy Speaker THE DEPUTY SPEAKER (Mrs D.J. Guise): I advise that private members’ business notice of motion 1, notice of which was given on 15 August 2006 and renewed for a further 30 sitting days on 28 November 2006, will be removed and will not appear on the next notice paper. BUSSELTON HOSPITAL - RELOCATION TO VASSE Notice of Motion Mr T. Buswell gave notice that at the next sitting of the house he would move - That this house calls on the Minister for Health to - (a) acknowledge the outcomes of the referendum recently conducted by the Shire of Busselton which showed overwhelming public opposition to the government’s plan to relocate the existing Busselton hospital to Vasse; (b) reconsider in light of the referendum result and the government’s own specialist reports the decision to relocate the Busselton hospital to Vasse; and (c) initiate an independent probity audit of the processes utilised and decisions made in relation to the relocation of the Busselton hospital, with the outcome of the audit to be publicised. MR BARRY MACKINNON - RETIREMENT FROM DISABILITY SERVICES COMMISSION BOARD Statement by Minister for Disability Services MS S.M. McHALE (Kenwick - Minister for Disability Services) [9.04 am]: On Monday I had the pleasure of attending a function to honour Mr Barry MacKinnon on his retirement as chair of the Disability Services Commission Board after a period of almost 13 years at the helm. Barry MacKinnon has provided strong

4204 [ASSEMBLY - Thursday, 16 August 2007] leadership to the disability sector as head of the commission board. Barry took over at a time when the Disability Services Commission was in its infancy and since then has been instrumental in creating a nation- leading system to support people with disabilities and their families and carers. Barry has helped guide the development of the sector from a disparate collection of agencies to a strong and united force with shared values and goals. His contribution was significant, with members from both sides of the house acknowledging that his bipartisanship was without question. Barry’s involvement with the disability sector has resulted in a number of systemic changes to the provision of services to our clients, which will have tremendous benefits for people with disabilities in this state for years to come. Over the course of his chairmanship, his dedication to the sector through reviews will ensure that we remain responsive to the needs of clients, families and carers. His commitment to standards monitoring and the provision of quality services to our clients has been second to none. While this may appear mundane, the standard of service provision clearly impacts directly, and sometimes drastically, on a person with a disability, and Barry’s commitment to ensure standards monitoring has been recognised for the important work that it is. Barry has used his political and business expertise to assist his work as chair of the commission. Without a doubt, one of his best achievements was to get both state and federal Treasurers to recognise the tax burdens on people with a disability and their families and to make a number of substantial changes to their arrangements. I thank Barry on behalf of all people with disabilities, their families and carers and I also thank his own family. I thank him on behalf of the state government and all the former ministers, both Labor and Liberal, who have worked with him. COMMUNITY DEVELOPMENT AND JUSTICE STANDING COMMITTEE - NATURAL DISASTER RELIEF REPORT Statement by Minister for Police and Emergency Services MR J.C. KOBELKE (Balcatta - Minister for Police and Emergency Services) [9.06 am]: In 2006, the Community Development and Justice Standing Committee began its inquiry into Western Australian natural disaster relief arrangements. It specifically looked into the adequacy of state government assistance under the program for persons affected by a natural disaster. The committee tabled its report, which was the result of intensive, comprehensive and exhaustive consultation and research across the state, in this house on 10 May 2007. I commend the chair of the committee, the member for Joondalup, Tony O’Gorman, and committee members for the priority placed on this inquiry and the thoroughness of their investigations. The committee put forward a report to government making 14 recommendations that are intended to address and resolve any concerns of affected communities. These recommendations are supported in principle and can be grouped around five key themes, being: equitable financial contributions by local governments; improving the dissemination of information to those affected and increasing support to local authorities in time of natural disaster; increasing the amounts available for personal hardship and distress payments; making improvements to enable damaged infrastructure to be upgraded to a more resilient standard; and extra measures, including covering the cost of fencing materials and the secondment of staff to aid local recovery efforts. The Fire and Emergency Services Authority has already started to work through a number of initiatives, including State Alert and redevelopment of its Internet site, to ensure that comprehensive information is available to the community and particularly those affected by a natural disaster. This includes details of WANDRA objectives, assistance measures, administering agencies, eligibility criteria and application forms. A response to the committee’s report was due in this house earlier this week and I apologise that it was not finalised by the due date. A number of the recommendations raise significant issues for groups with an interest in our natural disaster relief arrangements, notably emergency service workers, local governments, primary producers and our main state government-body partners. As a result, FESA is still conducting consultations with appropriate agencies and a final analysis of the recommendations. An integral part of this is to consider the implications of changes made this year by the commonwealth government to the natural disaster relief and recovery arrangements, which have direct flow-on effects to Western Australia’s natural disaster relief arrangements. A final response to the recommendations and a report to this house will be forthcoming as soon as possible. Again, I thank the committee for its work and in particular its determination to ensure that Western Australians affected by a natural disaster receive the amounts due to them under natural disaster relief arrangements. LONELY PLANET TOURISM PROMOTION Statement by Minister for Tourism MS S.M. McHALE (Kenwick - Minister for Tourism) [9.09 am]: I am pleased to inform the house of two important initiatives by the Carpenter government to promote Western Australia as an ideal tourism destination to a worldwide audience. Thanks to a new partnership between Tourism Western Australia and globally recognised travel brand Lonely Planet, Western Australia will feature on Lonely Planet television and websites

[ASSEMBLY - Thursday, 16 August 2007] 4205 and in Lonely Planet newsletters. The partnership will promote our state to over five million consumers in more than 170 countries. Lonely Planet’s audience is made up of free and independent travellers, which is an ideal fit for Western Australia’s adventurous tourism experiences. As part of the partnership with Lonely Planet, Tourism WA has developed English and Japanese language microsites featuring new TV footage, podcasts, a consumer competition, and images and articles from Lonely Planet. This is the first time that Lonely Planet has worked with a state tourism organisation to create custom video specifically for a destination. This week, Tourism Western Australia also launched a new TV website, www.westernaustralia.tv, or WATV. This is television on the Internet, whereby viewers can select what they want to watch and when they want to watch, for free. WATV is another Australian first, and proves we are ahead of the game when it comes to marketing Western Australia in the online forum. This initiative is expected to be viewed by millions around the globe, and features highly engaging and motivational content that takes the promotion of Western Australia to a new level. Footage of WA’s key destinations and major events is featured along with celebrity interviews undertaken around WA by Michael Peschardt, one of the BBC’s leading foreign correspondents. Through these innovative marketing initiatives, the Carpenter government is demonstrating its ongoing commitment to growing tourism in this state using the latest multimedia technologies.

CHILD PROTECTION AND INTERNET WEBSITES Grievance MR A.J. SIMPSON (Serpentine-Jarrahdale) [9.11 am]: My grievance today is to the Minister for Police and Emergency Services. I will give a brief explanation. The daily program states that the grievance is about the protection of children on MySpace. However, it is also about the big worldwide web that we have in our society today. I will elaborate a little on that area. As we know, people are now able to access the world from their laptops, their computers or their phones. People use websites such as MySpace, Facebook and YouTube as a way to express themselves through the computer. Some situations have unfolded in the past couple of years in which people have used these websites for the wrong purpose. I will elaborate. MySpace and Facebook are web pages that have been set up for what I would call the Y generation. People in the Y generation have a strange way of expressing themselves. They can hop onto the computer, make a video and supply it to the world. Sometimes we may look at those videos and wonder why they would do it, but that is what they want to do and that is what they like to do. The Y generation is definitely an interesting group in our society. Just recently during local government week, the members who attended would have heard a person speak about the Y generation and how the main things in life for a person in the Y generation are a mobile phone and an iPod, and then a car and a number of other items. It was quite interesting. Those people are very much into the world of consumerism. They want all the gadgets. It is interesting how society is changing. I mentioned YouTube. The way it unfolded is very interesting. Those who have looked at the YouTube website would probably be quite surprised to learn that three guys started it back in 2005. In 2006, they sold it to Google for $1.65 billion. That was all for setting up YouTube. The way in which that process unfolded is amazing. MySpace is run by Rupert Murdoch. I am not sure who runs Facebook. However, it is a similar sort of website. People express themselves on the site. They post their interests, what they want to do and the music they like. Other people can then leave them messages. A person can go to a chat room and talk to those people. I imagine that a lot of members in this house would wonder why anyone would want to do that anyway, when a person can pick up the phone and speak to someone. However, that is what they want to do and the way they want to do it. That is YouTube. Msn is another website, and it is run by ninemsn. There is also the Yahoo!7 website, which competes with msn. Msn has chat rooms, which I use in this chamber quite a lot to speak to the staff in my office in Byford or to my children when they get home from school. In that chat room, people can turn on a camera and they can turn on the audio so that they can speak to each other. It is all a way of communicating. I can understand that quite easily. It is like having a direct conversation. The words are being typed, but it is direct, similar to a phone conversation. It works well. However, the world of the Internet is becoming very much bigger. Before I stood, both ministers who presented ministerial statements spoke about using the web to advertise what is happening in Western Australia. The Minister for Tourism spoke about Lonely Planet and putting videos on a web page to promote Western Australia. That process has unfolded. It is quite interesting that we all now take the Internet for granted and move along. However, my grievance is about the fact that MySpace can also be used as a hunting ground by all types of people who are looking for enjoyment - I will say no more than that. I will read from a statement put out by MySpace on 29 June this year. It states -

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The owners of the popular website MySpace have admitted the internet phenomenon has become a hunting ground for sex fiends and are lobbying the Federal Government for a child sex offender database to identify perverts. The Rupert Murdoch-owned company behind MySpace, the world’s biggest internet chat and social network, is urging justice ministers across Australia to create a computerised list of known sex offenders that can be cross-referenced with MySpace’s list of users. Hugely popular with teenagers and twenty-somethings, MySpace claims to have 175 million users worldwide and three million users in Australia. The site allows anyone to set up their own personal web page, complete with photos, videos and other personal information. Federal Justice Minister . . . and his State counterparts are being asked also to pass laws requiring all child sex offenders to register email and internet accounts, with tough penalties for those caught using secret accounts. It goes on to say - A US-based team is now reviewing all photos and images placed on personal MySpace pages, including pages of Australians. This is how the issue arises. If a person is operating a website such as MySpace and someone uses it for the wrong reasons - he might be putting certain images on the website - one would think that there would be a crackdown on that website and it would be shut down. This year, the people who run these sites have become aware that the authorities are going to start monitoring the photos and videos that are put on the sites. This issue is of concern. As a parent, you will understand that, Madam Deputy Speaker. I say to the minister that we must get together and put some tough laws in place. We must put pressure on the federal government - I will support the minister in that process - to toughen up the laws. As more and more of these websites appear, we are getting to the stage at which we must not only catch the people who are doing the wrong thing, but also have the power to shut down these websites altogether. We must have more power in that area. In January this year I attended a conference in Nevada. At that conference, there was an information technology area, and working groups gave speeches. One guy spoke about the fact that a person could be defamed on MySpace or a similar web page, and the offender could get away with it because he could not be tracked down; all there is is an email address. Because that person said something about somebody else, is it defamation or is it not? If those words were printed in the newspaper, the person could be tracked down and sued for defamation. Copyright and similar laws come into the equation. I say to the minister that today we need to look at toughening the laws and bringing in penalties to deal with this situation. We need to introduce legislation to protect our children from the sex predators who are out there and who use the Internet as a way of hiding their identity. Members on this side of the Parliament would support the minister in that process and in putting pressure on the federal government also. I understand that it is a bigger picture than just the one in this state. However, I think we could lead the charge. MR J.C. KOBELKE (Balcatta - Minister for Police and Emergency Services) [9.17 am]: I thank the member for his grievance and for his interest in technology and using it to our advantage. I also thank him for his concern and caution about how people can use that technology for matters that are quite horrendous, which is something that we totally reject. He therefore quite rightly raised the issue of how we can ensure that our laws and our law enforcement agencies are able to provide maximum protection from those people who seek to use the opportunities that are now available through the use of modern technology to take advantage of people and commit a range of crimes. In his use of this technology, the member is a bit ahead of me, but I am certainly aware that many people with whom I work and my family make incredible use of the Internet for communication purposes. It is certainly seen as a big step forward that opens up a whole range of opportunities for people to be able to communicate. Therefore, it is a very positive thing. In fact, we have some family friends. The two sisters are very close. They are adults. One married and moved to the United Kingdom. For some years the two sisters have maintained very close communication by using the Internet and being able to see each other when they talk to each other. Those sorts of advantages are fantastic. However, I will not go into that, because that would take up time, and it does not go to the direct point that the member has asked me to address; that is, how we can put in place protections so that people who are either perverted or out to commit crimes will not be able to use this communication technology to find victims or abuse people. There are myriad issues, which, in the time available today, I am not able to tackle. However, there are two issues I will take up. One is the success we have had with the government’s cyber predator legislation. That has been very effective. It enables the WA Police major crime division and its cyber predator team to pose as people who are young and potentially a target of predators. If people attempt to take advantage of the police officers posing as children, they are open to a range of offences and will get caught. Offenders face five years in jail for

[ASSEMBLY - Thursday, 16 August 2007] 4207 some offences if they believe that the child was aged between 13 and 16 years. The changes we have made to the Criminal Code include creating an offence for using electronic communications to procure a child to engage in sexual activity or to expose a child to indecent material; providing for the issue of a court order requiring suspected paedophiles to provide police with access to data storage devices such as computers and mobile phones; and amending the Working with Children (Criminal Record Checking) Act 2004 to include the offence of using electronic communications to procure children for a sexual activity or to expose children to indecent material. We have put in place the laws and we have put in place officers from the WA Police who are out there monitoring these new forms of communication. They are certainly having some success. In that area there has been a very good response. It is not a situation in which we can say that we have done it all; it is a continually moving area and there will be new challenges that arise. I think we have made a very good start with the cyber predator unit and the laws we have. The other matter that the member raised is that when people already have a conviction for an offence that involves child sex abuse, they are clearly in a group that would be seen to have a much higher probability of seeking to use this communication technology to find other victims or to continue abusing people. It does not mean that each individual would, but we are clearly dealing with a group that has a higher probability of being involved. Those people are covered by the Community Protection (Offender Reporting) Act. The act has a range of powers so that the police are able to monitor such people and know where they are. Currently, there is no requirement for people who are captured by a community protection reporting order to disclose all the sort of information that might relate to their use of the Internet and various communication devices. We need to look at how we can improve that particular area of law covering communications. There is clearly a key responsibility with the commonwealth. As a state, we will continue to monitor this area of the law to see how we can improve it so that it is a further support for what we are currently doing with our cyber predator laws and the activities of police in that area. It is certainly a very challenging area because the technology is changing so rapidly and more and more people are becoming involved in it. We also have an important role to play in educating the public, particularly parents, who may not be aware of what their children are doing on the Internet. We must try to ensure that that area of parental supervision is there. Of course, that supervision will be very difficult to achieve if parents are not familiar with the technology. They may have no idea of the potential threats and risks to their children; it is something they could be totally oblivious to. There is also the issue of trying to educate parents so that they understand their responsibility concerning their children using telecommunications equipment and the Internet. It is also an issue with our schools and educational institutions. It is my understanding that they have put in place a range of protocols and restrictions. Some years ago one of my sons was warned off using the Internet in his school because he did something that was outside the rules. It was not, of itself, in any way to be seen as bad, but there was a tight set of rules in the school to make sure that its students were not going to be open to this sort of abuse. He did something minor that broke the rules. The school was monitoring the situation. That shows that schools are very conscious of the risks. They try to ensure that they fulfil their responsibility of duty of care to their children. This is a much bigger issue and I thank the member for raising it. We are looking at how, across a range of areas, we can improve both the law and the operation of the WA Police to make sure that we provide protection, particularly to our young people, from predators who seek to use the Internet and other means of communication to take advantage of people and potentially make them victims of crime. SCHOOL MEMORIALS Grievance MR P.W. ANDREWS (Southern River) [9.25 am]: My grievance is to the Minister for Education and Training. I am very pleased to have the opportunity to make this grievance, not only because it is to the Minister for Education and Training, but also because of his previous military career and his work on the Bali Memorial. The issue I raise today concerns memorials in schools. If the minister were a bit older than he is and of my vintage, he would remember that back in the 1960s and 1970s there was a feeling in Australia that Anzac Day was going to lose its importance in Australian society. The reason given at the time was that the Vietnam War was going on and there was a strong antiwar feeling. It was the time of the beginning of considerable immigration from other countries that did not have an Anzac tradition. It was felt that the antiwar feeling and the changing face of Australia would result in the loss of Anzac Day. In addition, the generation of original diggers was passing away in the 1960s. It was a very strong concern. What has happened since then is that people from overseas have adopted the tradition of Anzac Day. If the minister were to visit any school in his ministry, he would find that children from all backgrounds celebrate Anzac Day in the same way as every other kid at school. A new generation has grown up with different backgrounds. It has meant that the Anzac Day tradition, particularly in schools, is becoming stronger every year.

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It is important to remember that we are looking at the ninetieth anniversary of the great battles on the Western Front: the Somme, Passchendaele and others. In the Great War, 1917 was a horrendous year for Australian armed forces. Last year was the fortieth anniversary of the Battle of Long Tan. We can see all the anniversaries that are occurring that continually point out the role that our servicemen and women have played in Australian history. It is important to remember that we are only seven and a half years away from celebrating the 100th anniversary of the Gallipoli landings. This is part of the lead up to 2015. Perhaps we will be in government, but it does not matter which party is in office. We need to work continually in the lead up to that 100th anniversary. Part of that effort has been the Anzac Day working group small grants scheme, which has been an outstanding success. It has allowed older memorials and rolls of honour to be upgraded and maintained. It is a very important tradition. Part of the small grants scheme was to create memorials and honour rolls in areas with no existing memorials and no eligibility for other funding. My electorate is on the fringe of the city. Memorials have traditionally been in the inner city or in older parts of the city, such as Gosnells. There are no memorials for people to celebrate Anzac Day in outlying areas in my electorate, such as Canning Vale and parts of Thornlie. I use Southern River as an example. They are relatively new areas and memorials are therefore not present. Schools, which are used for gatherings of people on Anzac Day, are attracting greater and greater crowds to their ceremonies. It is not just the parents and grandparents of the children who attend; people from the local community also attend. Schools are becoming much more of a focus for Anzac Day ceremonies, not just for the children, but for people from surrounding areas. A classic example is Damla College, a school run by the Turkish community. It has a day of celebration - Children’s Day - which observes both a traditional Turkish holiday and Anzac Day. It is fantastic to see those who fought each other in World War I coming together. The school is a fantastic example of how sacrifices on both sides can be remembered. Given that schools increasingly focus attention on Anzac Day, I would like part of the planning process for new schools - for example, schools in my area such as Excelsior Primary School, Caladenia Primary School and the new school the minister is building in Southern River - to incorporate some sort of memorial. I use the term “memorial” not in the strict sense of a war memorial; it could take any form. It might be a memorial garden, a sculpture, a mural, or some sort of interactive, permanent display - anything that the local community thinks would be suitable for its school, and which could at the same time be used as an Anzac Day focus. The schools in my electorate do a fantastic job. They tend to use the traditional flag in the traditional setting, but I think there is an opportunity during the planning phase of a new school for this to be incorporated, for example, in the garden design. Ranford Primary School, which is now in my neighbouring electorate, was one of the first schools in the area to invite the outside community to the school for the ceremony. It still celebrates Anzac Day by inviting members of the local Returned and Services League and various guest speakers. I would like this idea to become part of the formal planning process for new schools so that future school generations can look at the memorial area as a focus for Anzac Day and other commemorations and ceremonies that take place, and it does not become the site for a one-off event - the “one day of the year” - but rather, a permanent part of the school. There is no better reminder for students about car accidents and students who have been killed in car accidents than a memorial garden. The DEPUTY SPEAKER: I think the member’s time is up. MR M. McGOWAN (Rockingham - Minister for Education and Training) [9.32 am]: I thank the member for Southern River for his grievance and his obviously well thought out ideas on this subject. The concept of schools getting involved and gaining an understanding of Australian history and the role of past generations in the defence of the nation, or the pursuit of the foreign policy of the nation, is no doubt worthwhile. Since it has been in office the government has taken the view that it is important to have a reasoned and sensible approach to this issue; not jingoistic, but a reasoned approach that takes account of Australia’s history and acknowledges the contribution of those who have gone before. The government has therefore put in place a range of initiatives. One such initiative is the annual Anzac Day trip by 12 to 14 public and private school students from around Western Australia to an acknowledged Australian military heritage site. Traditionally the trip is to Gallipoli, but sometimes it is to northern France and on one occasion it was Greece. Students from schools across the state can apply to be part of that process and undertake essays, speeches, research and so forth, in order to be selected. That has engendered enormous interest in schools across Western Australia, particularly public schools, and it has also allowed teachers to undertake some research. The government has put an instruction in place to ensure that all public schools have an Anzac Day ceremony. The government has rehabilitated and refurbished the State War Memorial, which was in a state of dilapidation. We have set up various registers - websites and the like - for people’s stories to be published, and a register of all the honour boards and memorials around the state so that we know where they are, what they contain and so forth. We undertook to amend the Anzac Day Act and erected in Fremantle a statue of John Curtin, the Australian Prime Minister during World War II. Very importantly, we undertook the Anzac Day small grants

[ASSEMBLY - Thursday, 16 August 2007] 4209 scheme program. The program is still in operation, and in fact the member for Yokine runs the project. The program has been expanded to also acknowledge Remembrance Day. There is roughly $1 million available for distribution over the next 18 months or two years for memorials, public address systems for RSL clubs and innovative projects people might have to acknowledge these aspects of Australian history. There has been a greater emphasis on these aspects of our history over the past few years than might have been expected. It is interesting that this has occurred at a time in the state’s history when there are probably fewer ex-service men and women from times of war than at any time over the past century. Obviously the numbers of veterans decline with the passing of time. There is actually a greater emphasis on these ceremonies now that most of them are gone, which is an interesting paradox. I am interested in the member for Southern River’s idea about schools having the capacity to put in place some acknowledgement of this part of our history, whether it be a memorial to veterans, a memorial to past students or, indeed, a peace park type concept, which some schools would probably be interested in. I recently visited the so-called Western Front; I have been there a few times. I visited a city called Ypres in Belgium and went to various parts of the former front. There are traditional war memorials on the old battlefields, which are incredibly interesting; military cemeteries with numerous headstones; and relics from the battlefields - the old pillboxes and so forth. In some places there are peace parks. One was opened recently by the Irish government in acknowledgment of all the Irishmen - of whom there were many thousands - who died at the location. The Irish government constructed a peace park rather than a war memorial, and it has become a significant attraction because it is a different way of looking at those events. In fact, on some of those battlefields, including one that I visited on the Somme River in northern France, there are peace parks that were established many decades ago by former veterans. Many veterans returned from the war as pacifists; their experiences had converted them to pacifism. They set up these peace parks as memorials to ensure that people look at the other side of conflict, which is the absence of conflict. There are interesting models that can be adopted. If schools wish to come forward with proposals, I am quite interested to examine them. Obviously there are often cost implications, but these things can often be established by P&C associations and interested groups, perhaps in conjunction with their local veterans’ groups and so forth. I would be not at all averse to looking at proposals from schools that are interested in doing these sorts of things. Ballajura Community College has set up an outstanding model with some very significant funding from the state and commonwealth, but it does not have to be that expensive; it can simply be some sort of acknowledgement. I am only too happy as education minister to look at and if possible progress any ideas people want to bring forward. Subject to guidelines, the grants program run by the member for Yokine may provide some assistance to schools that wish to undertake these sorts of measures. I thank the member for Southern River for his interest. It is an interesting and refreshing idea. VANDALISM ON BUSES Grievance MR J.E. McGRATH (South Perth) [9.39 am]: I rise today to speak about a problem that was raised with me recently, and that is the growing incidence of vandalism on buses, particularly in the southern suburbs. This problem was raised with me by the managing director of Southern Coast Transit, which operates about 300 buses in the southern area. The 106 bus is the only one of those buses that comes through my electorate. It is a bus that must have been going for a long time, because I recall catching it from Fremantle when I first started work at West Australian Newspapers as a copy boy. Mr R.C. Kucera interjected. Mr J.E. McGRATH: They are very modern buses now; a lot more modern than the ones I used to ride on. What was brought to my attention was an incident in Applecross only a couple of days ago. Ten kids got on the bus at Booragoon and two of them distracted the driver, which is a ploy that these kids use, while the others went crazy with textas and other marker pens in the back of the bus. They vandalised the seats, ceiling, floor and light fittings, and got off the bus at Canning Bridge. This was all picked up on closed-circuit television, and I believe that the footage will be sent to Crime Stoppers. As a result of that incident, the bus had to come off the road, and a couple of people had to work on the bus for eight hours to clean it up and replace the light fittings. The bus company has pointed out to me that incidents of vandalism on buses are on the rise. We have the worst record of any state in Australia in this regard. It has reached epidemic proportions. I have to say that we all appreciate and understand that vandalism is a senseless crime. It has been going on for a long time. I remember that vandalism was a problem when I was a kid. Kids would use coins to scratch the back of bus seats and things like that, but we were always told that the one no-no was public phone boxes. Some kids would pull the phones out of public phone boxes. In those days, a lot of people in the area I lived did not have phones in the home, so we were told, “What if there is an emergency and someone has to run to the public phone to ring a doctor and someone has damaged that phone or jammed it by putting things in the coin slot?” Therefore, vandalism has

4210 [ASSEMBLY - Thursday, 16 August 2007] been a problem for a long time, but I would have thought that in modern society, with the things that young people can do now with their lives, they would have moved past such idiotic behaviour. One of the things that is happening on these buses, which has been pointed out to me, is that people use broken compact discs or drill bits to scratch the windows so badly that they cannot be repaired and have to be replaced. If the bus company decided to replace all the scratched or defaced windows on the southern buses alone, the bill would be something like half a million dollars. It would be a massive impost on that company if it had to do that. Although it is a private company, it is performing a public duty. Cigarette lighters are used to burn the headrests on the seats, and there have been incidents of back seats being thrown out windows; people have just lifted the cushions off the back seats and tossed them out windows. Southern Coast Transit tells me that it has to replace three or four broken windows every week. Ray Cochrane from Southern Coast Transit is calling for help. He says that the age of these offenders ranges from as young as seven years old and up to 20. Some of them have been identified from the CCTV footage, so the company can go to a school and say that it believes these kids go to the school, ask whether the school can identify them and what the company can do. The schools have been helpful. I thought about raising this grievance with the Minister for Education and Training but, as I will explain later, I think it is more of an appeal to the Minister for Police and Emergency Services. The schools have been helpful; they have contacted some of the parents. Some parents have agreed to pay the restitution, but others do not, so some parents are responsible about it; nevertheless, it is a problem. Mr Cochrane has travelled overseas to look at what happens in other jurisdictions. He went to the West Midlands in the United Kingdom to look at a scheme that involves the police going to schools to educate young people about vandalism. These community police officers have become a conduit between the bus company and the government agency. Apparently, the system is working; it has reduced the amount of vandalism in the West Midlands. As a result of that, Mr Cochrane has asked the police department for one community police officer to go to schools in the southern region. Mr Cochrane is prepared to pay the officer’s wages. The schools could be targeted because the CCTV footage identifies the schools that these kids go to. If we had a uniformed police officer going to the schools, it would be much more compelling than someone from an agency or from the bus company. The police officer could say that committing these sorts of crimes on the buses is senseless. Mr T.R. Sprigg: You could rely on them as a deterrent as well. Mr J.E. McGRATH: Possibly, but there would only be one officer. There will be 100 officers riding on the trains once the Mandurah rail line gets up - we do not know when that will be. However, Mr Cochrane is not asking for officers to travel on the buses; he would like a community officer to do some work with schools. I think that we need some sort of task force to look at this problem. Education will take ages, and I would have thought that kids would be out of this habit by now and be going out and doing other more useful things. We even have incidents now - and this is not vandalism - such as people throwing stones and full bottles of beer at buses as they go past. That is a shocking crime; people’s lives are in danger when those sorts of incidents occur. My grievance today is mainly about vandalism and, as I have said, I have referred it to the Minister for Police and Emergency Services. This bus company, which I believe has the worst record of graffiti of all the metropolitan bus services, would like the support of maybe one community police officer, whom it is prepared to pay, to go to the schools - or maybe we could look at some program - to tell kids that vandalism is a waste of time and a senseless crime. The DEPUTY SPEAKER: Before I call on the Minister for Police and Emergency Services, I think the sound on the member for Kalgoorlie’s computer is still on. I ask him to make sure that the sound is turned off, please. Mr M.J. Birney: I have already attended to that, Madam Deputy Speaker. The DEPUTY SPEAKER: Thank you very much. MR J.C. KOBELKE (Balcatta - Minister for Police and Emergency Services) [9.47 am]: Thank you for that, Madam Deputy Speaker. With my sore throat, I do not want to have to speak over the noise of a member’s computer. The DEPUTY SPEAKER: The minister is welcome. Mr J.C. KOBELKE: I thank the member for his grievance and for raising what is a very important issue. Clearly, vandalism is a huge cost to the community and, in this case, to the bus operator. However, even worse is that public transport is incredibly important not only for mobility, but also to make sure that we have efficient transport systems. The Minister for Planning and Infrastructure has done a fantastic job in promoting public transport. If people see buses that are damaged, disfigured by vandalism or partly destroyed, it undermines their confidence in travelling on public transport. It undermines all the excellent work being done by the Minister for Planning and Infrastructure in making sure that a whole range of issues are covered, such as the impact on the environment through the carbon issues we are very concerned about. We want to have a public transport system

[ASSEMBLY - Thursday, 16 August 2007] 4211 that is not only efficient, but also attractive and that people feel safe on. Therefore, there is that secondary effect of vandalism on our buses and public transport, which causes great concern. The member for South Perth quite rightly said that Mr Cochrane from Southern Coast Transit has written to me. I received that letter and I am talking to the police to see how they might be able to respond. However, we need to look at what is already happening, because we have known for a little while now that there have been problems with buses, and certain areas seem to be hotspots. In fact, I did a bit of doorknocking with the member for Peel in his electorate for the by-election. I met two people who were bus drivers and they told me a whole range of stories, some quite horrifying, about things that had happened on some of the runs that they have been involved with. In making his grievance, the member gave some examples of vandalism on our buses, which certainly caused me concern. The Public Transport Safety Committee, of which Southern Coast Transit is a member, is in place to try to address this issue. It has overseen the delivery of a 10-point, multi-agency strategy, which has been referred to as Operation BusTed. That is an ongoing measure to try to deal with these issues. The member for South Perth noted in his grievance that CCTVs had been fitted to buses. That is part of the government’s response to make sure we have better intelligence and surveillance to try to catch these people. The member indicated that there had been some success in that regard. I will not go through all 10 points, but a number of things are being done to tackle the problem. The member is asking us to add to this an improved effort at schools concerning education and to the follow-up procedures regarding what action is taken when the culprits are caught. The Premier announced an antigraffiti strategy just a few weeks ago. Some of the vandalism being done is graffiti. Therefore, the measures we take against graffiti will improve how we can seek to reduce, if not stamp out, vandalism on public transport. A range of matters dealing with graffiti will cover some of these particular issues. In addition, in conjunction with the opening of the southern railway will be the development of the police rail unit of 50 police for the southern suburbs. A new $5.7 million purpose-built police station will be located next to the Rockingham railway station. Those extra police, along with the security guards who will be travelling on public transport, will target vandals. I recognise that that measure centres on rail and that the member’s grievance relates to buses. However, I am assuming that the people who are causing problems on the buses are, in some instances, also the people who are causing problems on the trains. We must look at it in a holistic way and tackle the problem on not just buses or just trains, but on both. The member’s grievance arose from a letter from Mr Cochrane that related in particular to the buses that are part of Southern Coast Transit. I accept that there are a number of issues. Although the police and a range of agencies have been working cooperatively on Operation BusTed, there is an opportunity to do more and to consider how we can spread that message. That is a very positive suggestion. Clearly it is a matter of whether the police consider that to be the most effective way to go. I give an undertaking to the member, and through him to Mr Cochrane, that I will certainly talk to the police to see how we can renew our efforts to deal with this type of vandalism. It may be that education is not as important as another aspect. Putting in place diversion- type programs for those who are caught might be more important. If we have a high rate of catching the vandals, that will be a very effective way of reducing vandalism. Some of the offenders may be repeat offenders. I raise that point to indicate that the police might decide that other efforts are more productive than education. When we know who the young people are who are involved in this type of vandalism and we know that a small group of them attend one school or another, perhaps we will need to deal with that group of young people to get the message out. Mr J.E. McGrath: Do you think that the parents should be responsible for the reparation if their children cause damage on the buses? Mr J.C. KOBELKE: Absolutely. As the member is aware, the government introduced a bill on parental responsibility. In the small number of cases when parents refuse to accept that responsibility, a penalty can be imposed on them. That is a matter that the two houses must deal with, because there is a difference of opinion between them. I totally agree that the parents should be held responsible. However, we must be careful. If the parents do not have any money and are on welfare, they should pay something out of their welfare payments, but it might have to be done over a long period. Parents who are battling to fulfil their responsibilities but who are not doing it properly must be given support rather than just having a penalty imposed on them. However, they should accept their responsibility for reparation if their children have been responsible for the damage. SCHOOL UNIFORMS, SPORT AND HEALTHY FOODS Grievance MR A.P. O’GORMAN (Joondalup) [9.54 am]: My grievance is to the Minister for Education and Training. I thank him for accepting my grievance at relatively short notice. I will raise three issues. The first concerns wearing uniforms in school, the second is about sport in schools and the third relates to eating healthy foods at

4212 [ASSEMBLY - Thursday, 16 August 2007] school. This grievance is a bit different because these issues have not been brought to my attention by parents or teachers but by school students. Although I do not entirely agree with their sentiments, they have approached me as their local member of Parliament to make a complaint and it is therefore appropriate that I take the matters as far as I can to see whether I can either get a resolution to their grievances or at least receive a good answer that I can take back to these young people. It is great that they are getting involved in the political process. The first issue is an old chestnut regarding school uniforms. In the 1970s I went to a school that did not require students to wear school uniforms. At one time there was a push to impose school uniforms on the students and, of course, we revolted and debated the matter. Three young men have approached me about the prohibition on wearing denim at school because they do not think it is appropriate and they do not feel comfortable with the proposed school uniform. They feel much more comfortable wearing their denim jeans or denim shorts. Some of them like to wear the big and wide baggy trousers that a lot of hip hop people wear. The pants are even bigger than cargo pants, and I have a problem with that. These students are the types of guys who wear boxer shorts and walk around with their jeans hanging on their hips. That is actually good because they are expressing their points of view in a proper manner rather than being disruptive or argumentative. They would like a rationale for the prohibition. I have given them the rationale that I believe is behind the prohibition on wearing denim and other clothing in schools and for enforcing a uniform dress code at the schools. The second issue concerns sport and was brought to my attention by a couple of young girls who do not want to participate in sport on a regular basis. They feel quite embarrassed getting into their gym clothes and sports gear. In my view they do not have the confidence to participate productively in sport or in the sporting subjects that are offered to them. They queried why they had to do sport and wondered whether they could do an alternative subject. Some of the girls are very interested in performing arts and believe that dancing and performing on stage provides them with sufficient exercise. I must add that none of the girls appeared to be super athletic but by the same token they did not appear to be excessively overweight either. They are well balanced young women. They are concerned that they must participate in sport, and they do not think that it is appropriate. I know that obesity and diabetes are concerning issues for young people. I will touch on diabetes when I talk about the issue of healthy food that was raised with me. Exercise greatly helps people with diabetes. Even if young people with diabetes are insulin dependent and need to inject insulin a number of times a day, they require exercise to get their bodies working correctly to reduce the sugar levels in their bodies so that they can maintain the appropriate sugar levels. The issue of healthy food was also brought to my attention by a couple of young people who like to eat sausage rolls and meat pies and to drink soft drinks. They have said that they will not comply with the program that the government has implemented in public schools. They do not believe that they must always eat healthy foods because their parents provide them with healthy food at home. When they go out or are at school, they believe that they should be able to purchase what they want. I spoke to the principal and teachers at their school and they told me that they have great problems policing the initiative. I am talking about high school students, not primary school students. The school is situated directly across the road from a shopping centre at which there are many fast-food outlets, including McDonalds, Red Rooster and Chicken Treat. It is no hassle for the kids to walk across the road to buy the junk food that they feel like eating. As I stated to the people who made representations to me, that is not something that I support. The school has put measures in place to ensure that students do not go across the road to buy fast food. As an extension of the healthy foods program, I refer to the various diseases suffered by people, such as diabetes. It is very difficult for students with diabetes to get appropriate food at school canteens. In fact, it is difficult for people with diabetes to get food appropriate food at our city and other restaurants and cafes. It is difficult to know whether the food available at canteens, restaurants and cafes is appropriate for those who suffer from diabetes. It would be a great if our schools could lead the way by labelling food that is appropriate for people who suffer from diabetes, similar to the way that the Heart Foundation puts a red tick on products that are healthy. It would be a great help for people with diabetes if our school canteens provided multigrain bread for sandwiches rather than just white bread. I have learnt from talking to various people that the seeds in cape seed and Swiss seed loaves reduce a person’s blood sugar levels. I ask the minister to address the issues that have been raised with me. MR M. McGOWAN (Rockingham - Minister for Education and Training) [10.02 am]: I thank the member for Joondalup for his grievance and acknowledge the obvious fact - it is demonstrated by the number of people he sees to discuss issues in his local community - that he is very much in touch with his local community. Well done! We have excellent public schools in Western Australia; indeed, they are outstanding. Our public schools have a very good workforce, an overwhelmingly supportive parent body and good facilities. Unfortunately, some people base their judgements about schools on things extraneous to those factors that I have just outlined. We have attempted to ensure that our schools are not only of a high standard, but also that they give the strong

[ASSEMBLY - Thursday, 16 August 2007] 4213 appearance of being of very high standard to the broader community. Public schools operate in a competitive environment. It is well known that private schools are increasing in numbers and enrolments. That is the nature of the competitive schooling environment. We want to retain a public school system that is more than a residual system. If we want to provide a public school system that offers excellent educational choices for parents, we must maintain a good level of enrolments. The Department of Education and Training has undertaken a range of measures this year that will improve not only the public’s acceptance of public schools, but also a range of the performance criteria for students in public schools. The member for Joondalup raised a few concerns, one of which related to food choices in schools. The department has ensured that school canteens serve healthy food because previously they were not necessarily serving healthy food. It has implemented a traffic-light system whereby some foods are not permitted, some foods are permitted on certain occasions and other foods are permitted all the time. I have visited more than 80 schools in the past six months. I have visited many school canteens and seen firsthand the outstanding healthy food choices that are tasty and good to eat. Some of the food being provided by public school canteens is not only healthy, it is delicious. I am aware that some students and parents do not like the fact that some foods are not permitted in school canteens. However, the fact of the matter is that the issue of obesity in schoolchildren was brought to our attention many times and we had to do something about it. That is why we have implemented that program. It is an unfortunate fact that many children do not eat healthy food at home. Those children will be helped by eating healthy food at school. Despite the various representations that have been made against the healthy food policy, we will not back away from it. We have ensured that all students up to year 10 perform two hours of physical activity a week as a result of the high levels of obesity and inactivity in our children. Although I am a strong supporter of embracing new technology, I am very concerned about the fact that after they get home from school, many children - I hear this often - sit in front of the computer until dinner, only to return to the computer until they go to bed. I hate to sound like an old curmudgeon, but when I was a school student, students would play sport, ride their bikes, swim in the river or play with one another after school. That is what everyone did. It was unusual for students to not engage in physical activity after school. I am talking about what happened in the late 1970s, early 1980s. Times have changed; the Internet did not exist back then. Kids are no longer as interested in physical activity because of the alternatives. The department is ensuring that school students undertake physical activity at school. It will not back away from that policy. Another measure we have put in place is compulsory community service for students in years 10, 11 and 12. Students must perform 20 hours of community service a week to graduate. That community service includes planting trees and helping out in nursing homes. Compulsory community service in our schools is a good thing. It is good for teachers because it gets them out of the classroom and provides them with the opportunity to do different things. The Department of Education and Training has also determined that the wearing of school uniforms be compulsory. It has issued a guide that schools can follow. The prohibition on denim is not absolute. If a school requires its students to wear denim for safety reasons - for instance, vocational students may need to wear denim - they can apply for an exemption. If a school attracts mature-aged students, it, too, can apply for an exemption. The banning of denim has been controversial among some parents and students. Certain schools have asked that I revoke that policy for them. People’s views about the wearing of denim will always be subjective. In my view, if we set standards, they must be adhered to. Standards must be presentational. Denim is an American style of school dress that does not fit with Australian traditions. Mr R.C. Kucera: In many of the American and English schools in which I have worked as a police officer, they are reintroducing uniforms to keep out those people who should not be in school grounds, such as drug dealers and gang members. It is also a safety issue. Mr M. McGOWAN: That is a very good point. Uniforms allow teachers to identify people who should not be in school grounds. That is an important component of having uniforms. I am a traditionalist in that sense. I know that our move in that direction has upset some people. However, the department must be the arbiter and enforcer of standards, and that is what it will continue to be. I have outlined four major improvements to standards in public schools across Western Australia. Parents should consider those standards when they decide which school their children should attend. I cannot claim credit for these improvements. My predecessors - the now Premier and Hon Ljiljanna Ravlich - created these measures. I am merely the beneficiary and enforcer of those measures. COMMUNITY DEVELOPMENT AND JUSTICE STANDING COMMITTEE Fifth Report - “Annual Report 2006-07” MR A.P. O’GORMAN (Joondalup) [10.09 am]: I present for tabling the fifth report of the Community Development and Justice Standing Committee, entitled “Annual Report 2006-07”. [See paper 3035.]

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Mr A.P. O’GORMAN: The Community Development and Justice Standing Committee has already completed two inquiries this year. It has held 40 deliberative meetings, taken evidence from 95 people and undertaken investigative travel to a range of intrastate locations. One of those inquiries, the inquiry into Western Australia’s natural disaster relief arrangements, was mentioned this morning by the Minister for Police and Emergency Services. We have already spoken about that inquiry, and the report has been tabled. I have had some very positive feedback on that report. The community of Western Australia, particularly the rural community, became very involved with that inquiry, and were happy to come and talk to us. The inquiry was referred to the committee by this house, through a motion from the member for Roe, supported by the member for Stirling. The previous inquiry, into the fire and emergency services legislation, was referred to the committee by the Minister for Police and Emergency Services, and the committee was happy to undertake that inquiry. That report was tabled last October, and again we have had some very positive feedback from it. One of the current inquiries the committee is undertaking was also referred by this house. It deals with the prosecution of assault and sexual offences across the state. A subcommittee has been set up, chaired by the member for Hillarys, and including the members for Churchlands and Maylands. A number of the members of the substantive committee have also taken an interest in that inquiry, and are participating in it. I thank those coopted members for their help with that inquiry. I find it a very difficult inquiry because of the nature of the subject matter, but I believe the report will make some very good recommendations. It has opened all our eyes to the problems of victims of sexual assault in particular, in not only obtaining justice but also getting over the trauma in the long term. I am hopeful that the subcommittee will produce some very good recommendations from that inquiry. The other inquiry, which is currently being undertaken by the substantive committee, was scoffed at a little in this house when the Speaker read out the terms of reference. Shorthand for the inquiry terms of reference is “joined-up government”. When the terms of reference were read in the chamber, a number of members thought it was a bit of a joke, and had a laugh. We have changed the terms of reference slightly to make them more readable for some people, because we did make them sound a bit highbrow. The interesting thing is that since that inquiry was announced I have heard many members talking about just that subject. Members have continually spoken about breaking down the barriers between government departments, and that is what this inquiry is all about. It is about working better across government, particularly in areas such as police and community development. It will be a very worthwhile inquiry when it is completed, and will provide some good direction for departments in breaking down those barriers. We have seen the multifunction police stations in our remote communities, where police, health care workers, education staff, and child protection and community development personnel work together as teams rather than in separate silos. This committee covers 16 portfolio areas, and this inquiry on joined-up government takes in the majority of them. I thank the substantive committee for its perseverance in this inquiry. It is a bit more than perseverance; members of the committee who have been involved in discussions on this inquiry are quite passionate about it. They can see great potential benefits. The deputy chair of the substantive committee, the member for Carine, has just walked into the chamber. The members for Kingsley and Geraldton are also members of the committee, and all contribute very effectively. Because joined-up government is such a large issue, the committee has put together a background paper that is available to all who want it. I also thank the committee staff. Dr Brian Gordon is the principal research officer at present. He came to us in December last year, and has proven to be a great addition to the committee. Jovita Hogan is the research officer, and she keeps us on track and keeps the information coming to us in a readable format. Many of the inquiries the committee is handling, particularly that into the prosecution of assault and sexual assault, involve quite tedious reading, so Jovita does a great job in keeping that together for us. Our previous principal research officer, Katherine Galvin, helped us through the fire and emergency services inquiry and the first part of the WANDRA inquiry, along with the other research officer we had at the time, Ms Dawn Dickinson. I thank all those staff for their assistance in getting us through the meetings and keeping us well organised. I commend the report to the house. MRS J. HUGHES (Kingsley) [10.17 am]: This year the Community Development and Justice Standing Committee has worked extremely hard and has come up with some reports that will be of great benefit to the government and to the community of Western Australia. One of the issues facing the committee was that most of its inquiries dealt with only one sector of its portfolio areas, primarily police and emergency services. The committee was quite concerned about the focus on single areas. However, the time taken to talk to individuals and people who contribute to the safety of the community, such as volunteer firefighters, was of huge importance, and we achieved a very good insight into the way things are on the ground. The committee has done very well there, with the assistance of its staff. I will raise an issue that the chairman has already touched on; that is, the inquiry into joined-up government. This is a very exciting inquiry. When I was working in local government one of the main issues I faced was that most functions worked in the silos. Planning did not work with the environment people, and the environment

[ASSEMBLY - Thursday, 16 August 2007] 4215 people did not work with community development, and so on. As a result, no really good decisions were being made because matters were not being looked at holistically. Now that I work in the state government, I find that many of the issues facing my office daily, whether they be about housing or planning, span several areas. How do we obtain the information we need to help investigate and fix issues? More often than not we need to go through two or three departments to gain some sort of understanding of how to move forward. I am very hopeful that this inquiry will open up some opportunities for government departments to work more collaboratively, rather than in the silos. The issue is not to create super ministries; it is to create agencies that talk to one another, sit down together and try to come up with solid answers. For instance, issues in education include truancy and children coming to school without lunches. Often those children end up on the street, and then they become issues for police and, eventually, community services. We hope that all of these issues can be looked at to find ways to streamline the process and make it work. Among issues that may be brought into line are climate change and environment, which are among the big topics these days. Fixing climate change and the environment is not just about the Minister for the Environment sitting up and saying that it will be done; a lot more work needs to be done. We need to have in play planning people, the Minister for Energy and local government. We need householders to find out where they can get relevant information. We need builders to know how they can build energy efficient houses. We need people to find out how to create alternative energy and pump green energy into the grid. We need these collaborative approaches to make climate change less of an issue. Through our committee’s inquiry into collaborative approaches in government, and finding out how other places in the world make these things work, I hope we can assist this government and other tiers of government, such as local government, to get some real benefit from making these policies work. Another issue that we face is homelessness and housing affordability. We all know it is a huge issue. It has to do with community development and poverty. We must ask how we house affected people, where we house them, what size house they require and whether they need to be re-educated and found new employment opportunities. In a state like ours, in which there are huge employment opportunities, we still see homelessness. We are not able to address the issue because we do not necessarily have interfacing structures in place that will make the desired outcomes possible. The state has wonderful Foundation Housing and community housing, and the people involved in those organisations are doing a marvellous job. Other groups in the community are forming committees to bring agencies and departments together. It may be that through its inquiry the committee can show a way in which the government can benefit by doing such work on a much bigger scale. Communities can benefit a great deal by having such groups come together. For example, the member for Girrawheen has a group in her electorate that has for some time brought together people from the Department of Housing and Works, local school groups, parents and citizens associations, Mercy House and other places to address the issues at an electorate level. This approach is working extremely well. If we can expand that idea, we might make it work for government. We might find out how other governments are making that approach successful. This is a huge task, involving changing cultures in organisations and different departments. Each agency has its own personality and its own way of doing things. We need to find ways to change their cultures that do not threaten any particular agency. That will be of great importance to the question of how to restructure. The question of whether the government chooses to restructure could also be an issue. The government might be quite happy to retain the current approach, and an outcome of this inquiry may be that the way in which the government is doing it is more beneficial. I commend the work that my colleagues on the Community Development and Justice Standing Committee have been doing. I am very pleased that we have undertaken this inquiry into collaborative approaches in government and look forward to what emerges from it. I thank Dr Brian Gordon, who has worked very hard on putting this report together and has helped us to hopefully deliver an excellent outcome with this report.

PETROLEUM AMENDMENT BILL 2007 Introduction and First Reading Bill introduced, on motion by Mr F.M. Logan (Minister for Resources), and read a first time. Explanatory memorandum presented by the minister. Second Reading MR F.M. LOGAN (Cockburn - Minister for Resources) [10.24 am]: I move - That the bill be now read a second time. The Petroleum Amendment Bill 2007 amends the Petroleum Act 1967 to provide for exploration and recovery of geothermal energy. Geothermal energy is a naturally occurring, sustainable source of energy. This bill covers both conventional geothermal energy, which is usually associated with hot geothermal springs and the geothermal energy generated from the energy contained in hot dry rocks or high-heat producing granites located deep below the earth’s surface.

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The key elements of the bill provide for: vesting of Western Australia’s geothermal energy resources in the Crown; legislative coverage for both conventional - hydrothermal - geothermal energy and hot dry rock geothermal energy; secure title for geothermal explorers and producers; coexistence of petroleum and geothermal resource titles; and a mechanism for the collection of geothermal royalties. In order to accommodate geothermal energy exploration and recovery, the title of the Petroleum Act 1967 will be amended to acknowledge the inclusion of the new provisions. The act would be known as the Petroleum and Geothermal Energy Resources Act 2007. This is to ensure that geothermal energy exploration and recovery are recognised in Western Australia as legitimate activities that can attract exploration and investment to the state. The majority of the processes for developing geothermal energy resources are similar to petroleum. In those instances where petroleum and geothermal activities differ, the Petroleum Act 1967 has been amended to accommodate geothermal energy exploration and recovery. Where the act has not been amended, geothermal energy processes will operate in the same manner as petroleum processes and are subject to the same procedures and protocols outlined in the act. Currently, Western Australia and the Northern Territory are the only jurisdictions that have not enacted legislation to regulate geothermal energy resources. South Australia was the first state to enact legislation for geothermal energy, including it in its Petroleum Act 2000. The New South Wales and Tasmanian governments classify geothermal resources as a mineral under the New South Wales Mining Act 1992 and the Tasmanian Mineral Resources Development Act 1995 respectively. Victoria has developed separate legislation for geothermal resources titled the Geothermal Energy Resources Act 2005. Queensland also has separate legislation for geothermal resources called the Geothermal Exploration Act 2004. Notwithstanding the absence of legislation in Western Australia, the Department of Industry and Resources has over the past two years received expressions of interest in title rights from geothermal exploration proponents. These expressions of interest have been held in abeyance by the Department of Industry and Resources as there was no legislative framework by which to equitably allocate and regulate titles to land for the purposes of exploration and recovery of the state’s geothermal resources. In response to this interest, and the need to provide for renewable energy, the government has developed a legislative framework for the commencement of geothermal energy exploration and recovery in Western Australia. In considering the placement of the legislation governing geothermal energy, two main options were examined. These options were to include it in existing legislation - that is, the Petroleum Act 1967 or Mining Act 1978 - or to draft new stand-alone legislation. The argument in favour of amending the Petroleum Act 1967 is based on the following reasons: geothermal energy exploration and recovery processes are similar to petroleum operations; the legislative processes governing petroleum under the Petroleum Act 1967 have widespread industry acceptance; an existing administrative agency - the Department of Industry and Resources - is familiar with the Petroleum Act 1967 and has the expertise best suited to manage geothermal exploration and recovery for the state; South Australia, as the state with the most active geothermal energy industry, utilised its petroleum legislation - the Petroleum Act 2000 - to regulate geothermal energy resources; and although Victoria enacted stand-alone legislation for geothermal resources, its legislation is based on the Victorian Petroleum Act 1998. It could be argued that including geothermal energy provisions in the Petroleum Act 1967 would add another layer of complexity to an already complex statute. It may also be perceived, especially by the petroleum industry, that the petroleum exploration/production effort would be compromised by this inclusion. However, in keeping with Western Australia’s policy of multiple land use, a consultation mechanism to accommodate overlapping titles, similar to the South Australian legislation, has been included in the bill. As outlined, two states, New South Wales and Tasmania, have used their mining legislation for geothermal energy purposes. However, in this state, the Mining Act 1978 option was not as attractive. Although sources of conventional hydrothermal energy exist at shallow depths, geothermal energy resources present in hot dry rocks are at a much deeper depth than minerals extracted in Western Australia - sometimes at depths of up to 5 000 metres. The two resource categories, minerals and geothermal energy, share different geological environments subject to occupational safety issues and drilling regimes. The resources governed by the Mining Act 1978 are also not subject to high pressure blowouts as experienced in the petroleum industry. The other option, stand-alone legislation, is considered costly and time consuming to develop and would require replicating many of the existing petroleum provisions. It would require more resources than would be the case to amend the existing Petroleum Act 1967 (WA) to achieve the same outcome. The key elements of the bill required to accommodate geothermal provisions in the Petroleum Act 1967 are as follows. The bill vests ownership of geothermal energy resources and geothermal energy with the Crown. A provision has also been included to ensure that the right to recover geothermal energy does not entitle proponents to petroleum discoveries. This also applies to petroleum proponents in respect of geothermal resource discoveries. Each resource category with petroleum and geothermal energy will have a separate title for the

[ASSEMBLY - Thursday, 16 August 2007] 4217 activity undertaken. If proponents discover petroleum under a geothermal licence, they are not entitled to that resource and must report the discovery to the minister within a disclosed period. The petroleum legislation currently provides that compensation is not payable for any gold, minerals or petroleum known, or supposed, to be on or under the land. The bill extends this provision to provide that no compensation is payable for geothermal energy. Vesting of the state’s geothermal energy resources with the Crown allows the state to authorise exploration and recovery of the resource by the grant of permits to explore, retention leases and production licences. The bill provides for a full range of geothermal energy titles, as currently applies for petroleum exploration and recovery. These new geothermal energy titles will follow the same commonwealth Native Title Act 1993 process as currently applies to petroleum titles; that is, all geothermal energy title applications will be put to the NTA future act process to ensure that all titles are validly granted. The bill ensures that small-scale geothermal operations, such as those operating at Challenge Stadium and ECU Joondalup, are not subject to the act. Amendments allow for new provisions to exclude small-scale geothermal operations from the operation of this legislation, and that regulations may prescribe whether or not a geothermal operation is for a commercial purpose. In the petroleum industry, the term “pool” is used to explain “the naturally occurring discrete accumulation of petroleum”. This term does not apply to geothermal resources and the term “geothermal resources area” is used as the equivalent of “pool” when referring to geothermal energy resources. The term “geothermal resources area” represents a contiguous accumulation of permeable rock containing geothermal resources. Petroleum and geothermal resource operations are likely to target different geological strata and can generally co-exist over the same area without affecting each other. Therefore, a new provision has been included as division 3A in the bill to ensure that petroleum titles and geothermal titles may subsist in respect of the same blocks. This is based on the existing provisions of the Petroleum Act 1967 covering the grant of access authorities and the South Australian model. The new division provides that a title for geothermal energy may overlap a petroleum title and vice versa. It allows for the concept of multipurpose land use by providing that the minister must write to the registered holder of the first title, allowing at least one month’s notice and take into account any matters that the person wishes the minister to consider before a new title is granted. This process is a consultation mechanism rather than a right to veto an application. Petroleum titles can already co-exist with mineral tenements governed by the Mining Act 1978. As geothermal energy titles will be granted under the Petroleum Act 1967, the existing Mining Act 1978 provisions that allow for a dispute resolution mechanism via the Warden’s Court for mineral and petroleum titles will be extended to include geothermal energy titles. It is proposed that the competitive bid or tender processes currently provided for in the Petroleum Act 1967 for the award of petroleum titles will apply to geothermal energy resources. That is, there will be two releases of acreage a year with a nominated closing date so that all bids for acreage can be evaluated at the same time to ensure a suitable applicant with the best work program is awarded a title. South Australia, the leading jurisdiction in geothermal resource exploration, commenced with an over-the-counter application process, similar to the minerals industry. However, the tender process is to be implemented in South Australia in the future to manage the increasing demand. The release of acreage provisions in the act allows for either a release of discrete areas - that is, a nominated number of blocks packaged as an area - or a whole-of- basin or whole-of-state release of vacant acreage. It will also enable over-the-counter applications in particular circumstances. The range of options will enable release of acreage strategies to be tailored to cover all circumstances and, in this regard, the act is sufficiently flexible. Amendments to the maximum allowable area will provide that the size of geothermal resource exploration permits, compared to petroleum exploration permits, will be smaller. The permits for geothermal resources will be a maximum of 160 graticular blocks - one graticular block equals 80 square kilometres - compared to 400 graticular blocks for petroleum. The reasoning for this is based on recommendations from South Australia. South Australia started with licence areas of seven graticular blocks, or about 500 square kilometres, and is now offering areas up to 130 graticular blocks or about 10 000 square kilometres, because it was discovered that the initial offering was too small. Western Australia chose 160 blocks because of the unknown prospectivity of geothermal energy and the need for flexibility at this stage. It also conveniently caters for the size reduction requirements of renewals in the Petroleum Act 1967. Application fees and charges for the new geothermal energy titles will be the same as for existing petroleum titles. Turning to the subject of royalties, of the five states that have legislation in place to govern geothermal energy exploration and production, two have instigated a royalty rate. South Australia has a royalty rate of 2.5 per cent, whereas NSW maintains the royalty rate of four per cent charged on other minerals. In Western Australia, it is proposed that a royalty rate of 2.5 per cent will apply. This reflects the renewable energy status of geothermal resources and will be competitive with South Australia’s royalty rate. It is worth noting that petroleum royalties are currently 10 per cent. It is likely that geothermal energy will be sold based on the value per energy unit - gigajoules. This is similar to gas production, which is also based on energy, as gigajoules, sold. Even though

4218 [ASSEMBLY - Thursday, 16 August 2007] the act will simply require the value at the well-head to be ascertained, a separate agreement would be put into place, as is currently done for petroleum projects, that will define the calculation of “gross value”, “post well- head deductions” and the final “well-head value”. The value of the energy sold, measured at the well-head, will be the gross value. From this gross value, post well-head deductions would be applied to get back to the well- head value on which the geothermal royalty is calculated. It is also the view that, as a matter of policy, once the bill has been passed, and if the blocks are taken up and explorers are successful in their search for viable geothermal energy and its extraction occurs for the production of what will ultimately be electricity, the royalties paid by the proponents will be paid to the state and fed into the low-energy emissions fund that has been established by the Premier as part of the climate change statement. I simply put it on the record now, for the purposes of the second reading debate, that it is the government’s intention that any royalty that is extracted for the purposes of the geothermal bill will be paid into the low energy emissions fund until such time as the government determines otherwise. Water is a vital component in the production of geothermal resources as well as being a scarce resource in Western Australia. The bill provides that the use or taking of water for the purposes of any operations carried out under the authority of a permit, drilling reservation, access authority, special prospecting authority, lease or licence is subject to the Rights in Water and Irrigation Act 1914. Further provisions also clarify that holding a geothermal energy title does not confer rights in relation to water because, as I mentioned, this matter is dealt with in the Rights in Water and Irrigation Act 1914. The bill provides for the nomination of geothermal energy blocks as a “location”. A location provides the mechanism for the transition from an exploration permit or drilling reservation to a retention lease or production licence following the discovery of petroleum. The graticular blocks that cover the discovery are nominated as the “location”. The amendments provide for the location provisions to be extended to cover geothermal energy resource discoveries. However, the primary and secondary licence system used for petroleum titles and by which override royalty rates are established is not necessary for the minimalist geothermal royalty regime. Reporting of data for geophysical, drilling and geological activities is a requirement under the existing legislation for petroleum operations. The current requirements will be extended to geothermal energy activities as will the subsequent release of open-file data and reports. The two main purposes of reporting are to supply government with detailed evidence that approved work programs have been carried out satisfactorily and to pass on to other interested groups the results of such exploration and production to further the search for petroleum and geothermal energy in the most economic and expeditious manner. The existing provisions for the registration of transfers of interests and dealings in petroleum titles will also be extended to the new geothermal energy titles. Geothermal energy operations will be covered by the same occupational safety and health regime as currently applies to petroleum operations under the Petroleum Act 1967. The amendments in this bill to the Petroleum Act 1967 also provide for the introduction of the Petroleum Legislation Amendment and Repeal Act 2005 part 2 provisions. Part 2 of the Petroleum Legislation Amendment and Repeal Act 2005 provides for a comprehensive occupational safety and health regime for the Petroleum Act 1967. Part 2 of the amendment act will commence when the regulations required for its implementation are completed. As for petroleum work commitments, the monitoring of the work program for geothermal energy exploration titles will be enforced to ensure that there is no real-estating of geothermal energy acreage. Like petroleum exploration permits, geothermal exploration permits will be granted for an initial six-year term, conditional with an agreed work program to be carried out on a year-by-year basis. Failure to undertake the agreed work program, unless varied by mutual consent, will result in cancellation of the title. A further provision in the bill inserts a new clause to provide for a geothermal energy recovery development plan. The geothermal energy recovery development plan requires the geothermal licensee to submit to the minister, for approval, a plan outlining how the geothermal energy resources will be recovered. The geothermal energy recovery development plan will include information that will be required by the regulations. The required information will include seismic risk analysis addressing the potential for a seismic event caused by induced fracturing of the subsurface rock. The minister may direct a variation of the geothermal energy recovery development plan prior to approval, but only after the geothermal licensee has been given the chance to confer with the minister on any proposed direction. The minister may also direct a licensee to vary an approved geothermal energy recovery development plan for the purpose of securing the more effective recovery of geothermal energy, but again, only after allowing the licensee an opportunity to confer with the minister. This new section also allows for the licensee to apply to the minister for the variation of an approved geothermal energy recovery development plan should circumstances change. The change in the title of the Petroleum Act 1967 to the Petroleum and Geothermal Energy Resources Act 1967 has also required consequential amendments to many other statutes as there are numerous references to the Petroleum Act 1967 across the state’s legislation. These changes are covered in part 3 of the bill.

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This bill heralds a new era in resources development for Western Australia. The geothermal energy amendments to the Petroleum Act 1967 establish a sound framework within which a new energy industry can commence exploration and recovery of geothermal energy resources. I commend the bill to the house. Debate adjourned, on motion by Mr T.R. Sprigg. JOINT STANDING COMMITTEE ON AUDIT Appointment - Motion MR E.S. RIPPER (Belmont - Treasurer) [10.46 am]: I move - (1) That in accordance with section 64 of the Economic Regulation Authority Act 2003, the Joint Standing Committee on Audit be appointed to undertake the required legislative review. (2) That the Legislative Council be invited to pass a similar resolution. Section 64 of the Economic Regulation Authority Act 2003 provides - (1) A Joint Standing Committee of both Houses of Parliament appointed for the purposes of this section must carry out a review of the operation and effectiveness of this Act as soon as is practicable after the expiry of 2 years from the commencement of this section and thereafter at 5 yearly intervals. (2) In the course of that review the Joint Standing Committee must consider and have regard to - (a) the effectiveness of the operations of the Authority; (b) the need for the continuation of the functions of the Authority; and (c) any other matters that appear to the Joint Standing Committee to be relevant to the operation and effectiveness of this Act. (3) The Joint Standing Committee must prepare a report based on the review and, as soon as is practicable after the report is prepared, must cause it to be laid before each House of Parliament. A number of courses of action are open to the government and to the Parliament to comply with section 64 of the legislation. It would be possible, for example, for the two houses of Parliament to agree on a joint standing committee specifically established for the purpose of review of the Economic Regulation Authority. My view is, and I think it is the view of other members of Parliament, that we already have enough committees. I also have the view, and I think it is shared by other members of Parliament, that there are practical difficulties in establishing more joint standing committees, particularly because of the need for cooperation between the houses and the administrative arrangements that are required. An answer to those issues, while still meeting the requirements of the Economic Regulation Authority Act 2003, is to use a joint standing committee arrangement that is already in existence or proposed. We have such a joint standing committee arrangement proposed flowing from the Auditor General Act and the Financial Management Act which were passed by the Parliament at the end of last year. The Auditor General Act and the Financial Management Act require the establishment of a joint committee of audit for certain purposes under those pieces of legislation. If the government’s suggestion is accepted, that joint committee of audit will essentially consist of members of the Public Accounts Committee of this house and members of the Standing Committee on Estimates and Financial Operations of the other house, chaired by the Chair of the Public Accounts Committee. This house has passed a motion to that effect and that motion is awaiting consideration by the Legislative Council. The proposal I am putting to the house today is that the Joint Standing Committee on Audit be the joint committee that conducts the review of the Economic Regulation Authority Act 2003 required under section 64 of that act. I believe that will have a number of advantages. First, it will not require the houses of Parliament to establish yet another joint standing committee arrangement. The second advantage is that the people conducting the review will be those who have complementary committee responsibilities. It seems to me that the members of the Public Accounts Committee and the Standing Committee on Estimates and Financial Operations are the right members of Parliament to conduct a parliamentary review of the Economic Regulation Authority Act 2003. I indicated to the house - I am sure members of this house will be aware - that when we passed the motion to establish the Joint Standing Committee on Audit there may need to be negotiations in the upper house and that there may be some differences of opinion on the construction of the joint committee on audit. That matter is currently before the upper house. I intend that this house, if I can get support, pass this motion and the two issues can be resolved together in the upper house. I appreciate that we have been postponing this motion for some time. I hope, member for Cottesloe, that the opposition was aware that this motion was coming on for substantive debate today.

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Mr C.J. Barnett: No; it is on the notice paper. Mr E.S. RIPPER: If there is a difficulty, we could adjourn the debate after my remarks and deal with it the first day we come back. Mr C.J. Barnett: You don’t want us to delay it but that might be a fair thing to do. Mr M.W. Trenorden: Would you mind letting me have a say before you adjourn the debate? Mr E.S. RIPPER: Okay. We will have a speech from the member for Avon. At that stage if the opposition moves an adjournment to next Tuesday, I would be happy to support that. Mr C.J. Barnett: Okay, that’s a deal. Mr E.S. RIPPER: I think I have outlined the arguments sufficiently. We are required to have a parliamentary review. This is the most efficient way to organise a parliamentary review, and it will have the right members of Parliament with the right complementary responsibilities on the team. Mr C.J. Barnett: I just ask: why didn’t you proceed with the Public Accounts Committee taking this action? Mr E.S. RIPPER: The legislation requires a joint committee of both houses of Parliament. Mr C.J. Barnett: Okay. Mr E.S. RIPPER: I am therefore bound by that legislation. Finally, I put on the record my own view that the Economic Regulation Authority has been successful in its operations. I believe a very credible and substantial organisation has been established successfully. I thank Lyndon Rowe, the Chairman of the Economic Regulation Authority, and the other member at the moment, Steve Edwell, for their contributions to the success of the Economic Regulation Authority. I also thank two people who are no longer members but who have played a very important role in the operations of the Economic Regulation Authority: firstly, His Excellency the Governor, Dr Kenneth Comninos Michael, AC, who was a very important member initially of the Economic Regulation Authority; and, secondly, Mr Chris Field, who has left the Economic Regulation Authority to be the state’s Ombudsman. I place on record my sincere thanks to His Excellency the Governor and Mr Chris Field for the work that they have done to make the Economic Regulation Authority the success that it is, and I also extend those thanks to Lyndon Rowe and Steve Edwell, the current members of the authority. MR M.W. TRENORDEN (Avon) [10.54 am]: I thank the Treasurer for the opportunity to speak on this motion. I have a significant interest in the operation of the Economic Regulation Authority. I agree with the Treasurer’s words about the competency of the people and so forth. However, I point out to the Treasurer, as he knows extremely well, that this is a new and evolving area. If the Treasurer looks back at the debate he will see that at the time the legislation was passed I said, and I say now, that it is unequivocally true that until he introduced a bill last year, the operation of Auditors General under the Financial Administration and Audit Act had not changed for 20 years or longer. However, Auditors General Australia-wide have evolved to a different operation of audit under that old audit act. Regulators are now evolving under a new act and the role for regulators continues to evolve. Those regulators have conversations at times about having an Australian regulator. I do not believe that will occur, but the pressures are on about moving to a common Australian regulator which would perform the task for all of Australia. It is definitely true - I do not say this as a negative - that the Economic Regulation Authority is talking to other offices about the role of regulator. In many cases an Australia-wide regulator would take away from the Treasurer and away from this house some of the decisions on economic activity in this state. Again, I am not saying that should not happen but it should be closely looked at. Yesterday I attended a briefing by a company involved in the Oakajee port in the mid-west. One question the company cannot answer from its investors, the Treasurer or other ministers about its proposals for Oakajee is the role that the regulator will play in access and pricing. It is therefore a very significant issue. Frankly, I would love to be a member of the committee proposed in the motion. I also point out that the Standing Committee on Procedure and Privileges at the moment has probably three years’ work ahead of it, which must be finished by June! I am not sure that I have time to be a member of the new committee but I would give my right arm to be on it. I therefore do not disagree with the Treasurer’s selection process. There is absolutely nothing wrong with a new audit committee conducting the review, but I would be interested in the scope of the inquiry and who will be brought into it. I just hope that the group of people on the new committee, which will include members of the Public Accounts Committee - I am not trying to denigrate members of that committee - take this matter very seriously. Although the Economic Regulation Authority is independent, it is a quasi-agency that has a significant opportunity to slightly change the direction of economic activity in this state; therefore, the new committee must be conducted seriously. I hope the new committee will be conducted by people who have an understanding of “regulator”. I would argue that I am one of those people. I am unsure of the understanding by the members of the Public Accounts Committee and upper house members of “regulator”. All I am doing is pleading in an apolitical way - if I could ever say that - that it be done well. Any decision on access and pricing

[ASSEMBLY - Thursday, 16 August 2007] 4221 that is made now will affect this state for 20 years or more. Although the establishment of this new committee is a requirement of the act, I am sure the Treasurer has not moved the motion lightly. I am not accusing him of that at all; I am just saying that I am nervous about it. I want to have input into this process, as I would like to hear from other regulators. As the Treasurer is probably aware, I would like to go east and hear about the significant issues in the gas industry and about the range of other decisions that have been made by regulators. A lot of decisions about rail services and port issues in the eastern states and other issues that will affect this state have been made by regulators. I make the plea to the Treasurer that the establishment of this new committee be done well. I am not volunteering as a member of the committee, as I am not sure that I have the time, but I would love to be on that group. Debate adjourned, on motion by Mr T.R. Sprigg. STATE SUPERANNUATION AMENDMENT BILL 2007 Second Reading Resumed from 15 August. MR M.W. TRENORDEN (Avon) [11.00 am]: I am fascinated by this bill. This bill is the most significant superannuation bill that has come before this house in the past 50 years, or more. Mr C.J. Barnett: You would know, member for Avon! Mr M.W. TRENORDEN: Yes! However, I am a bit nervous about what this bill will do for people like the member for Nedlands, for obvious reasons. Members need to understand that this bill is about the privatisation of state superannuation. In saying that, I say up-front that the National Party, and Max Trenorden, are not opposed to this bill. However, I want to make sure that all members understand what the government is doing in this bill. I want to make sure also that any person outside this chamber who has an interest in this bill also understands this bill. I will commence my address by going through the 2005-06 annual report of the Government Employees Superannuation Board, now known as GESB. I want to talk in particular about liability. The report states at page 50 - An unfunded employer liability exists in relation to the employer share of pension benefits and the pre- transfer service liability for those employees who transferred to the contributory lump sum scheme (Gold State Super). The liability has been recognised by provision in the Statement of Net Assets at the present value of the future payments, by application of actuarial factors provided for this purpose. The liabilities under these schemes are calculated separately for each scheme annually by GESB’s actuary, Mercer Human Resource Consulting Pty Ltd, using the projected unit credit method. That is a bit of gobbledygook, but it is a direct quote from the report. What it means is that a certain formula is used to calculate unfunded superannuation liability. Page 56 of the report deals with credit risk. It states that one part of GESB’s exposure to credit risk is - The full amount of the foreign currency it pays when settling a forward exchange contract, should the counterparty not pay the currency amount it is committed to deliver to the Fund; That is another bit of gobbledygook. What it means is that another liability of the state superannuation fund is exposure to fluctuations in foreign currencies. That is certainly clear from the events that are unfolding in the United States. The report goes on to say that interest rate swap contracts are also a part of that process. That is clear also from the events that are unfolding in the United States. Mr E.S. Ripper: Who would have thought that some dodgy home loans in the United States could affect the superannuation benefits of people in Western Australia, but that is a possibility! Mr M.W. TRENORDEN: Yes. I have made the point that we are not opposed to this bill. However, I need to raise some issues that I believe are fundamental to our consideration of the privatisation of state superannuation. The report goes on to say that there is also a credit risk in relation to futures contracts. Members should keep clearly in their minds that what is happening in the United States right now is happening in our state superannuation fund. I am not saying there is a crisis, or that the situation will get out of control. I am confident that the board has the situation under control, and that although there will be losses for the fund in that process, as there will be losses everywhere, the losses will not be substantial. The point I am making is that the funds in GESB are affected by the activities that are taking place elsewhere in the world. As the Treasurer would know very well - although I notice it is not in any of the papers that accompany this bill - in 2006, the recoup by Treasury to the GESB unfunded superannuation liability was $58.176 million. In other words, in that year, Treasury had to put better than $58 million into GESB so that it could meet its requirements. That is not unusual; all the state governments do that for their superannuation funds. However, I believe that is part of the motivation for this bill, because at some time in the future, when a component of state superannuation is privatised, that portion of the fund that represents the superannuation entitlements of most Western Australian

4222 [ASSEMBLY - Thursday, 16 August 2007] public servants will have no attachment to the state whatsoever but will be private. That will mean also that no state guarantee will apply to that new entity. I will return to that matter later. I am not sure that all state government employees understand that. I am not saying that the privatisation of state superannuation is a bad thing. I am saying that state government employees need to understand that at some time in the future, when the Treasurer’s role in state superannuation expires under this bill, the state superannuation fund will be run by a private mutual society, in the same way that AMP and National Mutual used to be private mutual companies. That is, it will be run by its members. Frankly, nothing is wrong with that type of structure. Some members may know that in a past life, I was an AMP agent. I sold a lot of superannuation. However, I also watched AMP blow billions of dollars of superannuation, and other funds, by purchasing a company in the United Kingdom called Pearl Insurance. The reason that deal went wrong is, as I said when I was talking about credit risk, the fluctuations in the exchange rate between the United Kingdom and Australia. That caused enormous problems for AMP, because Pearl failed to meet its financial requirements in the United Kingdom, so AMP, its Australian parent company, had to pump money into that company. The point I am making is that there is a risk in running a superannuation company. In the future, many Western Australian public servants will be part of a private superannuation scheme. That scheme will no longer be run by GESB, because that entity will no longer exist. The bill does not say exactly how long that process will take. However, within a certain period, GESB will become a stand-alone private company operating in Western Australia. Members need to understand that. To personalise it, Mr Speaker, in a few years you and I will be in a superannuation scheme that is controlled by the state and that has behind it the security of state, and we will be doing very nicely, thank you very much. However, the member for Nedlands will be in the new privatised superannuation fund. Ms S.E. Walker: No, I will not. Mr M.W. TRENORDEN: Perhaps not. Perhaps I should not be picking on the member for Nedlands - Ms S.E. Walker: No - do not pick on me! Mr M.W. TRENORDEN: The member for Swan Hills - Ms J.A. Radisich: I knew you were going to pick on me next. Mr M.W. TRENORDEN: I am just saying that newer members will be in a privatised scheme. I am not saying that they should panic about that but they need to understand that point. Pages 61 and 62 of the GESB annual report shows that in 2006 the total unfunded liabilities of the funds under its control - three funds in particular - amounted to $5.77 billion. The reserves of the superannuation fund at that time were $734 million. That also needs to be kept in context. I am going to run out of time, so I had better keep bowling along. Page 64 of the same report has a section on Gold State Super, and it states that contributions are unfunded. It goes on further but it just makes that point. I say to the member for Nedlands that the report indicates that the West State Super scheme is unfunded, and that the pension scheme, which is not a major scheme, is unfunded in part. On page 74, under “Gold State Super scheme”, the report shows the present value of defined benefit obligations at the end of the year, stating - These defined benefit obligations are wholly unfunded, such that there are no assets. The employer contributes, as required, to meet the benefits paid. It goes on to talk about the three funds that are unfunded in the super scheme. Page 76, under the heading “Interest Bearing Loans and Borrowings”, reads - The Term Loan from Western Australian Treasury Corporation commenced on 30 May 2001 and was incurred to enable the balances on West State super members’ accounts at 1 July 2001 to be fully funded from an investment perspective. . . . The loan is unsecured and is repayable in quarterly instalments over 20 years. It bears an interest rate of approximately 6.7 per cent. As at 30 June 2006, the market value of the loan was just short of $564 million, with a premium of just under $11 million, representing the difference in present value between the interest rate the loan was fixed at and the interest rates applicable on 30 June 2006. Treasury supplied this loan to assist the board to meet its obligations. I am not trying to tell anyone that the board will not meet its liabilities, because it will - that is clearly what it is put there to do. We also need to consider that at the time the Superannuation Consultative Group was put in place, one of its objectives was to look at the implications of current or proposed state policy for public sector superannuation arrangements, such as the impact of the state’s unfunded superannuation liability. Under “Activities of Group”, it states - The primary agenda items for the meetings held by the Superannuation Discussion Group during 2005/06 included reviewing proposals for introducing new products and services by GESB such as financial advice, impact of choice for members . . ., catastrophe risk insurance, and the issues surrounding unfunded superannuation liabilities.

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The point is that this is not an easy game. At the time organisations such as AMP, which were meant to operate sophisticated super schemes, lost somewhere between $5 billion and $10 billion virtually overnight. This is not to be taken lightly. Again I emphasise that I am not saying this to put fear into anyone; I am trying to point out what we are talking about. I have a publication in front of me courtesy of the Parliamentary Library. I apologise to Hansard for yesterday’s effort. I have a head cold and a blocked ear and I may not be all that easy to pick up. It is all here in front of me, so the Hansard reporters can pick it up without using my own words. Mr C.J. Barnett: No more difficult than usual. Mr M.W. TRENORDEN: I had a speech yesterday that someone in Hansard struggled with. I am absolutely certain that it was not their fault; it would have been my fault. I have a head cold so perhaps Hansard may not be picking me up all that well. I have a document entitled “Unfunded Superannuation, Accrual Accounting and Public Sector Liabilities.” It is an old document, dated 1998. Under the heading “Public Superannuation Liabilities and Debt”, it states - The size of the combined liabilities makes this an important issue. It says that at approximately $108 billion, the combined liabilities are the same size as around one-third of all the funds held around the country. That was in 1998. I suggest that might have changed a little but not a lot. Under the section entitled “Superannuation Liability Management”, it states - The Commonwealth Actuary has noted that the unfunded nature of the liabilities should not be a concern. We agree if the comments were only in connection with the ability of the government to pay them when due. The whole point of the unfunded liabilities in our state superannuation is that the state will meet them. Mr Speaker, you and I are very comfortable. Section 4, “The Issue of Unfunded Superannuation Liabilities”, states that the unfunded provisions provide flexibility for governments. I do not have time to run through all this material. It outlines that governments’ future choices would then be limited because of the unfunded liability of this state. In 2006, the government put in $58 million to meet the requirements of its members who need those funds in retirement. I repeat that in 2006, $58 million went out of Treasury into members’ benefits. If superannuation was fully funded, that $58 million would not have to be paid out. I will return to the bill. The process I just went through was meant to be by way of background. I thank the board members - who are sitting behind me - for the briefing. It was very good. They answered all the questions I asked. I also point out that there is some variation in the unfunded liability figures. I used the figures in the annual report. The figures given to me by the briefing people puts the unfunded liabilities at about $4.5 billion. I am not really interested in the $5.7 billion or the $4.5 billion, because they are actuarial projections. The exact figure is not of great consequence. The fact is that there is at least $4.5 billion of unfunded liabilities in superannuation in this state. On page 4, the briefing note refers to the establishment of GESB MutualCo. That means that the new entity, the new part of the scheme, will be a mutual organisation. Therefore, the benefits of the super fund will be owned by the members. The briefing note refers to the Treasurer’s transitional powers. It is very interesting that the Treasurer has transitional powers. We will talk about that in much greater detail when we go through the bill in consideration in detail. Those powers will remain in force for some time. The bill mentions a period of three years, but it does not tie it up, does it? Mr E.S. Ripper: They should be interpreted as reserve powers. Mr M.W. TRENORDEN: No, I am not interpreting them. As I said, Treasurer, I am not opposing the bill. I am just trying to explain what the bill actually does. I agree that they are reserve powers. They make the Treasurer of the day a significant player in superannuation for a period. There are transfer orders. Obviously, as a section of the state superannuation activity goes private, there will be a requirement for that to happen. Some years ago I was lucky enough to go to China, not on the state, I might add, but on a donation from industry. One of the people I went with was from the Commonwealth Bank. A very senior person from the Commonwealth Bank told me that when the Commonwealth Bank, which was an Australian government agency, became a private agency, it took 10 years to change the culture inside the bank from that of an agency to that of a private banking institution. I make that point, again not to create any fear. However, there will be a transitional process. Members of the state public service drift on and off the current superannuation board because it is a public entity. The employees of the new entity will be professional, full-time employees, which I cannot say is a bad thing. Because of my interest in the process, I indicate that back in the 1980s when I was associated with the AMP Society, the AMP valued a particular fund once a week. In the AMP at that time, staff members were hopping in and out of that fund as it went up and down. That caused quite a stir, as members would understand. Those

4224 [ASSEMBLY - Thursday, 16 August 2007] members who have been reading the articles in the press will understand that that also happened in GESB last year, or maybe the year before. However, I certainly read about that activity in the press some time last year. Therefore, a new professional body which is managed more tightly and which is established precisely to deal with superannuation activities, arguably, is not a bad thing. I will move on through the briefing notes. When GESB MutualCo is born, as I said before, it will look like the old AMP and the old National Mutual. It will be a private fund. The membership of the GESB Superannuation TrustCo board must meet the Superannuation Industry (Supervision) Act equal representation requirements. I am not necessarily saying that this is a terrible thing, but what will happen is that half those people will come from the union movement in Western Australia, and the union movement would represent a small proportion of the people who are actually in the fund. I have a concern about that. I checked this with the board, because I am not familiar with this area. However, the briefing people told me that anyone who goes onto the board must meet particular requirements. Mr E.S. Ripper: He or she must be a fit and proper person. Mr M.W. TRENORDEN: I understand that. However, it still worries me that for all those employees out there, three members of the board will come from unions. I will leave that up in the air. If it were up to me, I would not do that. However, I say, first of all, that this is an absolutely critical issue, for all the reasons I tried to outline 20 minutes ago. This is an organisation that is subject to very substantial risk. Right now, executives of superannuation funds - some of these super funds have to invest $300 million a week - are sitting in board rooms throughout Australia feeling terrified, because they do not want a one, two, three or four per cent dip in earning rates for their funds. They must look into their crystal balls and decide in which direction they should go. Therefore, I am not sure that taking three of the six members of the board from the union movement is good management policy. I suspect that it has more to do with the Treasurer’s friendly alliances than good management. Mr C.J. Barnett: Can I just say, member for Avon, that you make a very good point. There is nothing wrong with having a union representative, but it should not be prescribed. There should be people who have the skill necessary to look after these funds. Mr M.W. TRENORDEN: Yes. At some time in the future when this body becomes a fully privatised mutual organisation, it can decide for itself who it will put on the board, which is fine. However, I make the point that in the beginning, because this is being done through a Labor administration, there will be union involvement on the board. That is not necessarily a bad thing. I am running out of time. However, I have always believed that the best people to represent people in workers’ compensation matters are not the lawyers but the union representatives. They go along and do that task far better than the legal profession. I believe that we need to know what is happening. I will go on to the last bit, which is about choice. Why has this bill come to this place? The answer is that it is because the federal government has significantly changed the superannuation rules in recent years. One of the things that has happened is that choice has been introduced. All individuals now have a choice about where to place their superannuation funds. Even though members opposite argued very strongly at the time that it should not happen, I do not think that Mr Rudd will argue that there should not be choice in superannuation, because the retirement moneys of individuals are so critical to those individuals that they should be able to make a personal decision about what they will do with them. I would be surprised if members in this place have not been approached - because I have been regularly approached - by individuals in the current schemes saying that they are very disappointed because they cannot take their money out of their current scheme and put it with their other money, so that they have the greater funds and fewer charges argument. Alternatively, they may say the opposite. They may say, “I’ve been a public servant for 10 years. I’m now working in the private sector. I want to keep contributing to my old scheme.” They are both very important issues. The bottom line or the basis of this argument is that if we do not pass this bill, the state administration of superannuation will be in trouble, because it will not be able to compete in the marketplace, and it will not be able to offer members the required benefits in the process. That is the situation. Somewhere in this document is a graph dealing with the management. I reiterate that those unfunded liabilities will stay with the state. My superannuation and your superannuation, Mr Speaker, will stay with the state. Defined benefit schemes are now closed off, and people who are in those schemes will stay there. Somewhere in my information - I will not dig around for it - is a graph that shows the unfunded liability to the state. According to the graph, the unfunded liability is close to peaking, but it will exist into the future. I will not give the names of the people who provided me with this publication because I think they are lunatics; they tell me that the world will end tomorrow. If that happens - Mr M.P. Whitely: They might be taking your advice and exaggerating! Mr M.W. TRENORDEN: They might be exaggerating.

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If that happens, Mr Speaker, you and I will be out on a boat, fishing, because our funds are guaranteed. Some members will be in the big, brave world of private enterprise. I make that point to members. We have treated new members very badly. I put it to the people behind me that to ensure equity, responsibility should be taken for both their representation and the representation for people in the new funds scheme. [Continued on page 4230.] MINISTER FOR HEALTH - KNOWLEDGE OF FREEDOM OF INFORMATION APPLICATION Standing Orders Suspension - Motion MR P.D. OMODEI (Warren-Blackwood - Leader of the Opposition) [11.31 am] - without notice: I move - That so much of standing orders be suspended so as to debate the following motion - That this house calls on the Minister for Health to immediately explain why he misled the Parliament with his claims that he had no knowledge of freedom of information applications from the office of the Leader of the Opposition regarding emails between Brian Burke and Neale Fong until it was raised in debate on 21 June 2007, when evidence has emerged that the minister was aware of these freedom of information applications. The Minister for Health has repeatedly denied that he had any knowledge of the FOI application from the office of the Leader of the Opposition about emails between Brian Burke and Neale Fong until he was informed by the opposition during debate on 21 June 2007. The office of the Leader of the Opposition has initiated a further FOI request to the minister about the handling of the original Burke-Fong FOI and his knowledge of that request. The new FOI has identified correspondence showing that it was likely that the Minister for Health knew about the FOI application prior to being told in Parliament, and that the minister may have removed reference to the FOI from his ministerial statement. In line with seeking a suspension of standing orders so that the minister can explain himself on this issue, I will go through information giving a timeline of events as they occurred. On 11 June a draft response to a question on notice about emails between Brian Burke and Neale Fong was sent to the minister’s office by the Health Department. It included a specific section entitled “Minister to note”, which outlined the fact that the department had received an FOI application from the opposition on this matter. It is claimed that this was the first knowledge the minister’s office had about the FOI application. According to parliamentary statements, only the minister’s chief of staff was aware of this information, and he did not inform the minister about the FOI application even though the draft response included a section entitled “Minister to note”. Anyone who has served as a government minister will know that when an FOI application is received, it is a very serious matter. I will now outline a chronology of events. At 4.23 pm on 20 June the minister’s chief of staff emailed the Director General of the Department of the Premier and Cabinet, Mr Mal Wauchope, with a draft ministerial statement. Mr J.A. McGinty: Sorry; what was that date? Mr P.D. OMODEI: 20 June 2007. At 4.24 pm the minister’s chief of staff emailed Neale Fong with a draft ministerial statement attached. According to my notes, the email stated - “I am sending this to MFH (Minister for Health) for his consideration” At 4.26 pm the chief of staff sent an email to the minister, through Dawnia Chiu, with a draft ministerial statement attached. According to my notes, the email stated - “can you have a look at this and tell me if it is OK”. This is a very important point. According to my notes, the draft ministerial statement that was sent to all three people - Mal Wauchope, Neale Fong and the minister - included this line - “When providing me with the information in estimates on 23 May 2007, Dr Fong was relying on information provided to him, as a result of a Freedom of Information application by the Leader of the Opposition, received on 2 April 2007”. At 6.09 pm, Neale Fong replied to the minister’s chief of staff and made no request to remove the section relating to the freedom of information application. At 7.58 am on 21 June - the date on which the debate took place - the minister’s chief of staff emailed Neale Fong. According to my notes, the email stated - “revised draft ministerial statement that is being faxed to Jim this morning” The revised statement made no reference to the freedom of information application from the Leader of the Opposition. In Parliament, at 9.14 am, the Minister for Health delivered a ministerial statement in which there was no reference to the freedom of information application from the Leader of the Opposition.

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At approximately 10.00 am, during debate on a suspension of standing orders, the member for Dawesville stated - The opposition initiated an FOI request - The Minister for Health interrupted by saying - I didn’t know that. On 28 June - one week later - in the Legislative Council, the minister representing the Minister for Health stated - The Minister for Health confirms that he was unaware of the FOI application by the Leader of the Opposition until being told by the opposition on 21 June 2007. The opposition seeks to suspend standing orders to allow the minister to answer the following questions. Did the minister’s chief of staff inform him of the FOI application when the original draft response to the Leader of the Opposition’s parliamentary question was sent to the minister’s officer on 11 June, including a section entitled “Minister to note”, referring to the FOI? How did the minister respond to the email and draft ministerial statement from his chief of staff, which specifically mentioned the FOI from the office of the Leader of the Opposition? Did he read this statement? If he had read the statement, he would have had to have known about the FOI. Who removed the reference to the Leader of the Opposition’s FOI application in the time between the original draft ministerial statement being sent to Neale Fong, Mal Wauchope and the Minister for Health on 20 June, and the revised version being delivered by the minister the following day? It clearly was not Neale Fong. It almost certainly was not Mal Wauchope. This leaves only the Minister for Health. Did the Minister for Health deliberately mislead Parliament with his comments and answers to questions on 21 June and 28 June, in which he denied any knowledge of the opposition’s FOI application? This is a very important matter. On 11 June there was a draft reply from the health department - The SPEAKER: I have allowed some six minutes for the Leader of the Opposition to go through what he will probably repeat if this motion is successful. It is appropriate, given the nature of the motion, for the Leader of the Opposition to have delivered parts of his speech, but he should now go to the reasons for suspending standing orders rather than the matters that the minister may or may not have done. Mr P.D. OMODEI: Clearly, Mr Speaker, we have ruled out both Mal Wauchope and Neale Fong. The only other people who had access to that documentation were the minister and his staff. It is now up to the minister to stand and explain why he misled the house. DR K.D. HAMES (Dawesville) [11.39 am]: There are very few comments I can add to what the Leader of the Opposition has already said in getting to the heart of why we need to suspend standing orders, rather than the debate itself. However, I can safely make a couple of comments. The first comes directly from the statement made by the minister in the house on 21 June. It reads as follows - I am aware of the paramount importance this house places on accurate information, and for this reason I have taken the earliest opportunity to correct this error through a ministerial statement. The opposition is taking its earliest opportunity to bring to the attention of this house the fact that it has very strong evidence that suggests that the Minister for Health has misled the house. We have heard the details of how that occurred and the things that the minister has stated. However, during a previous debate on this matter, the Minister for Health looked at me and said, “I did not know.” The minister’s chief of staff sent an email to the minister via Dawnia Chiu, who works very closely with the minister on all issues. She made the decision; it was not the chief of staff, otherwise he would not have sent that email in the first place. It was not Neale Fong, because nothing came back in his response to the suggested ministerial statement that said in any way that he believed that the reference to the freedom of information application should be removed from the ministerial statement. That leaves Dawnia Chiu as the only possible person, other than the minister, who could have removed the FOI reference from the ministerial statement. Why would she do that? That Dawnia Chiu removed that part of the ministerial statement off her own bat and without notifying the minister beggars belief. The government must give the house an opportunity to debate this issue. If the minister is stating that it was Dawnia’s responsibility, he should state why and he should explain why the reference was removed in the first place. It seems nonsensical. What is the harm in the minister telling us that he knew about it because of a freedom of information application, and that is why he stood up in the house when he did? The minister had the reference to the FOI application removed because of his sense of the play and of being able to stand up and deny all knowledge of a freedom of information application. The minister wanted to say that he had just learnt about the information, that he misled Parliament accidentally during the estimates hearings and that he wanted to put things right. The minister wanted to get up and say, “Sorry, we got it wrong”, and not give any credit whatsoever to the opposition, which has dug up and teased out this information about the minister and Neale Fong. We still do not know what was contained in the emails. The government owes it to this house to give the opposition time to debate this issue and to give the minister a chance to properly defend his actions.

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MR J.A. McGINTY (Fremantle - Minister for Health) [11.44 am]: I have received no notice of this motion, so I will do my best to address this matter raised by the Leader of the Opposition. The Leader of the Opposition has sought to suspend standing orders. I wish to address the reasons that I do not believe that that is necessary. In doing that, I will be able, in the same way that the Leader of the Opposition asked three questions, to provide very succinct answers. That will be done during my argument as to why standing orders do not need to be suspended. Point of Order Mr M.W. TRENORDEN: I have been a member of this chamber for 21 years and I have never seen this procedure carried out in this house in a deliberative manner. Either the motion to suspend standing orders is accepted, which will give the Minister for Health an opportunity to provide an explanation, or it is rejected. Mr J.C. KOBELKE: The member for Avon is being vexatious. Several members interjected. The SPEAKER: Order, members! Mr J.C. KOBELKE: Again, opposition members show no respect for the proceedings of the house. It is a well-established practice that although members must address the procedural matter during a debate to suspend standing orders, between two and five minutes are usually given to a member to outline why the substantive issue is relevant. The Leader of the Opposition was given that opportunity. The Minister for Health is trying to explain why the government will not accept a suspension of standing orders. He has been on his feet for fewer than 30 seconds. There is clearly no point of order. Mr C.J. BARNETT: The member for Avon made a very good point. This will not be a long debate. The Minister for Health said that although he does not agree that we should suspend standing orders, he is happy to debate the issue. If the minister is happy to debate the issue, let us suspend standing orders so that we can have a brief debate to resolve the matter. Mr M.W. TRENORDEN: The point I was trying to make is that the motion that the opposition wants to debate is a very serious issue. Ministers are not often directly challenged in this manner. Several members interjected. Mr M.W. TRENORDEN: There is spurious activity and there is serious activity. This issue involves serious activity. The government is in a position to tell the people that this matter was decided during informal debate, which is totally inappropriate. The SPEAKER: The member for Avon’s suggestion about what should and should not be debated in a motion to suspend standing orders is correct. However, what the Leader of the Opposition said during the debate on his motion to suspend standing orders did not touch on why standing orders should be suspended. He merely summarised what he would say in the substantive debate. He was followed by the member for Dawesville, who briefly touched on the reasons that standing orders should be suspended. It is appropriate and fair that the Minister for Health be given some latitude, as is always the case during these types of motions. The minister was given a brief chance to debate the motion to suspend standing orders. The leeway that is always given to members will be given to the Minister for Health. Debate Resumed Mr J.A. McGINTY: The wording of the motion to be moved by the Leader of the Opposition is quite different from the language used by the Leader of the Opposition when he addressed the matter before the house. The language that he used to address the matter was far more accurate than the language contained in the motion that the opposition wants to debate. The motion that the Leader of the Opposition has foreshadowed as the reason to suspend standing orders contains an allegation that I misled Parliament and that I was aware of the freedom of information application. It is very interesting that when he addressed this matter, the language was suddenly radically different. He said that it was “likely” that I knew. Mr T. Buswell: Did you see the draft report? Mr J.A. McGINTY: I ask the member for Vasse to listen to me, because I am quoting what the Leader of the Opposition said. He said that it was “likely” that I knew and that I “may have” removed information from the ministerial statement. That language is far more temperate and balanced. He can mount a case, I think, based on what he put forward. Mr P.D. Omodei interjected. Mr J.A. McGINTY: Of course it is. As I did by way of interjection - Mr P.D. Omodei interjected.

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Mr J.A. McGINTY: I provided them to the Leader of the Opposition. Mr P.D. Omodei: You knew about it; you misled the Parliament. Withdrawal of Remark The SPEAKER: Order, members! Clearly, the Leader of the Opposition knows that what he said is unparliamentary. I ask him to withdraw that comment. Mr P.D. OMODEI: I withdraw. Debate Resumed Mr J.A. McGINTY: The Leader of the Opposition said that three questions need to be answered. The first was whether my chief of staff informed me on 11 June of the document that arrived from the Department of Health. The answer is no. Mr T. Buswell: What about after 11 June and before 20 June? Mr J.A. McGINTY: No. The simple answer is no. Several members interjected. The SPEAKER: Order, members! This is a very serious issue. The house listened in complete silence when the Leader of the Opposition and the member for Dawesville argued their reasons that standing orders be suspended. I ask members to give the same sort of respect to the Minister for Health. Mr J.A. McGINTY: That information came in and, as I have stated previously to this house, there is nothing new about it. My chief of staff handled the correspondence between him and the Department of Health without reference to me. Mr P.D. Omodei: Even though there was a note on the bottom saying “Minister to note”? Mr J.A. McGINTY: It was a draft document. The Leader of the Opposition has a copy. Mr P.D. Omodei: The ministerial document reads “Minister to note”. Mr J.A. McGINTY: Does it have my notation on it? No. Mr P.D. Omodei: You never saw it? Mr J.A. McGINTY: No, not until after 21 June. Did the Leader of the Opposition see the Corruption and Crime Commission report that his chief of staff leaked? Mr P.D. Omodei: We are talking about your situation. Mr J.A. McGINTY: I am just saying that what is good enough for the goose is good enough for the gander. It is a simple matter. The Leader of the Opposition has a graphic example with the Corruption and Crime Commission document that came into his office and that his chief of staff leaked. The Leader of the Opposition claimed he had no knowledge of that. I believed him. Mr T. Buswell: What a nonsense statement. Mr P.D. Omodei: It is rubbish. I did say that I saw it. Mr T. Buswell: He stood up in the Parliament and said so. Mr P.D. Omodei: This is not about that issue, but if you wanted to debate that issue, let us debate it again. I said quite plainly, both in this house and at the CCC, that I had seen the document. Mr J.A. McGINTY: I am sorry: I will rephrase that. The Leader of the Opposition had no knowledge that his chief of staff had leaked it to the media. I believed that. Several members interjected. The SPEAKER: Order! Mr J.A. McGINTY: The answer to that question is a categorical no. That is the answer to that question. Mr P.D. Omodei: Why do you think we launched the FOI? The SPEAKER: Order, Leader of the Opposition! Mr J.A. McGINTY: The preparation of the brief ministerial statement was done on 20 and 21 June, I think it was. Mr T. Buswell: Just before we got the FOI document, wasn’t it? Mr J.A. McGINTY: I have no knowledge of that.

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Mr T. Buswell: Rubbish! Mr J.A. McGINTY: The trouble with opposition members is that they do not believe the truth when it is being told to them. I cannot help that. Mr P.D. Omodei: Who took the quote out? Mr J.A. McGINTY: Let me say this: I am going to answer the question very briefly by way of addressing why standing orders should not be suspended on this occasion because there is simply nothing in the issue that has been raised by the opposition. If I may deal with the issue, the member for Dawesville has made the suggestion that my health policy officer, Dawnia Chiu, had some involvement in this matter. To the best of my knowledge she did not. Mr T. Buswell: It was sent to her. Mr J.A. McGINTY: I gave that document to the Deputy Leader of the Opposition. Dr K.D. Hames: We have a copy of it. It says that it is from Danny Cloghan to Dawnia Chiu and reads, “Jim, I know you are just having fun up there. Can you have a look at this and tell me if it is okay?” That is to Dawnia. Mr J.A. McGINTY: As I have said, to the best of my knowledge the member for Dawesville has made the allegation that she is possibly the person who altered that document. To the best of my knowledge that document was written, edited, modified and presented to me by my chief of staff. That is how it happened. Several members interjected. The SPEAKER: Order! Dr K.D. Hames: He sent it to - The SPEAKER: Order! I do not know what part of “do not interject” the member for Dawesville does not understand, but he must not interject constantly, as he is doing. Mr J.A. McGINTY: The question has now been narrowed down to a suggestion by the Leader of the Opposition that in the 12 hours prior to the statement being made to the Parliament on the 21st, I had knowledge of the FOI request. I had no knowledge of the FOI request. Mr T. Buswell: Did you review the draft ministerial statement on the afternoon of the 20th when it was emailed to you here? Mr J.A. McGINTY: Opposition members gave me no notice that this matter was coming on. Mr T. Buswell: Did you? Mr J.A. McGINTY: All I can tell members opposite is my best recollection of what occurred on 20 and 21 June. I have a recollection of seeing a ministerial statement. Do not ask me which draft or preparation of that ministerial statement it was, because, frankly, opposition members did not have the decency to tell me this matter was coming on. I could have gone back in order to address those issues. Mr P.D. Omodei: You saw it then. Mr J.A. McGINTY: I saw a draft document - Mr T. Buswell: On the 20th. Mr J.A. McGINTY: I cannot remember whether it was the 20th or the morning of the 21st. Mr T. Buswell: It was sent to you on the 20th. Mr J.A. McGINTY: I know that I saw a draft on the 21st at 9.15 in the morning prior to my making the statement to the Parliament. Mr P.D. Omodei: Who took the paragraph out minister? That’s shown here in black and white. Mr J.A. McGINTY: My chief of staff dealt with this matter without reference to me prior to the 20th and the 21st. An email came late in the afternoon, I think; I am not sure at exactly what time. Mr T. Buswell: It was 4.26 pm. Mr J.A. McGINTY: It was 4.26 on the afternoon of 20 June. It was sent to me. I cannot remember off the top of my head exactly when I read that email. This was in the 12 hours prior to my making that statement. Mr T. Buswell: Did you edit that draft? Mr J.A. McGINTY: The document was subject to some editing and changing by my chief of staff. I read out to the Parliament on the morning of the 21st the documents that he drafted for me. There is nothing more that I can say. In these circumstances I do not think that there is any reason to suspend standing orders. Frankly, there

4230 [ASSEMBLY - Thursday, 16 August 2007] is nothing more that I can add to the debate. Given the allegation by the Leader of the Opposition that it is likely that I knew, I have told the Parliament that I did not. As to the statement that I may have removed information from the ministerial statement, I have already said that my chief of staff drafted the ministerial statement. MR M.W. TRENORDEN (Avon) [11.57 am]: Having no knowledge of what the Liberal Party or the opposition is putting forward and just having listened to the minister, there is absolutely no way that I understand at all what is happening here today and, unless we have some reasonable process through some debate, nor will anybody else understand what is happening. This is a private little conversation between the minister and the Liberal Party, which is totally unacceptable. The minister’s explanation may be absolutely correct, but I cannot judge that on today’s debate. Mr J.N. Hyde: Justify why you should. Mr T.G. Stephens: You have made serious allegations. The SPEAKER: Order! Mr R.F. Johnson: You are running scared. The SPEAKER: Order! Mr M.W. TRENORDEN: I would just point out to those government backbenchers that if they were being accountable, they would have immediately agreed to this debate so that people such as I, members of the National Party and Independents, who have no idea what is going on here, could at least have some glimpse of what this debate is about. After this motion gets knocked back, government backbenchers will claim that this matter has been cleared. It has not. Point of Order Mr P.D. OMODEI: I am more than happy to adjourn the debate for the minister to have some time to check on how that paragraph was removed from the document. The SPEAKER: The question is that standing orders be suspended. Debate Resumed Debate adjourned until a later stage of the sitting, on motion by Mr R.F. Johnson. [Continued on page 4248.] STATE SUPERANNUATION AMENDMENT BILL 2007 Second Reading Resumed from an earlier stage of the sitting. MS S.E. WALKER (Nedlands) [11.58 am]: I rise to add some comments on the State Superannuation Amendment Bill 2007. Several members interjected. The SPEAKER: Order! I know everyone is very interested in talking to each other, but the member for Nedlands has the call. I am sure she wishes to be heard by all in the chamber. Ms S.E. WALKER: Thank you, Mr Speaker. The bill is significant for the 280 000 public sector employees who will be affected by it. It involves the Government Employees Superannuation Board. The bill is important because it affects the largest Western Australian-based superannuation fund, which currently provides superannuation retirement funds to its members. The board has operated since 1948 and has administered superannuation for Western Australian public servants. As at 30 June 2006 it managed $6.8 billion in funds. It provides financial security for over a quarter of the workforce in Western Australia. It was described in its annual report as a member-based organisation. It operates under the State Superannuation Act 2000. Its assets are managed by GESB’s investment team, which develops investment strategies implemented by a range of national and international fund managers. I thought when I was looking at this bill that it was important to see the categories of schemes, because the 280 000 members, some of whom are no longer with the scheme because they have moved out of the public sector, still have their funds managed by this scheme. I would like to know, when we get to consideration in detail, how many members will be left in the new state superannuation board and how many members there will be in MutualCo. I think that question is important. What is of concern to me and why I decided to look at this bill is that, as I understand it, all those members of GESB currently have their superannuation funds guaranteed by the state. I would like to know how many of the members will no longer have their funds guaranteed by the state when this bill is passed. This is a very important issue for this chamber because the decision it is making will affect the financial security of a quarter of the Western Australian workforce.

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Mr E.S. Ripper: It is a very important decision and a large number of Western Australian households are involved. Ms S.E. WALKER: Thank you, Treasurer. I do not know how many members on the government side of the house have spoken on this bill or what their thoughts are on it. I have found the Government Employees Superannuation Board to be a most professional board. It is very helpful to its members and it is an excellent organisation. I thank GESB for putting out in a very simple form a two-page chart that any member can look at to understand what will happen to those funds. The Treasurer might be able to tell me now how many members will be in the State Superannuation Board scheme and how many members will be in the proposed GESB MutualCo scheme. Does the Treasurer know the answer? Mr E.S. Ripper: If you keep speaking, I will give you the answer. Ms S.E. WALKER: There are 280 000 members at the moment. I considered the big picture to ascertain exactly what the State Superannuation Act does and the categories of members in this scheme. The current categories of superannuation investment products include - it is contained in the latest GESB annual report 2005/2006 - West State Super, a market linked accumulation scheme. When the member for Vasse briefed us on this bill, he said this scheme was now closed. Mr E.S. Ripper: Member, I have the figures: Gold State Super, 55 286 members; Pension Scheme, 372 contributors and 9 750 recipients; and Provident Account, five members. Those are the schemes that will be under the State Superannuation Board. GESB Super Pty Ltd will manage West State Super, 249 439 members; GESB Super, 3 092 members; retirement income products, 931 members; retirement access 1 901 members; and term allocated pension, 68 members. Ms S.E. WALKER: They are interesting figures because they indicate that the Gold State Superannuation funds will remain under the Treasurer’s control - when I say “the Treasurer’s control” I mean whoever the minister is at the time overseeing the State Superannuation Board - and the people in those funds will continue to have their funds guaranteed. Mr E.S. Ripper: Yes, they are defined benefit schemes and the state bears the risk of delivering on those defined benefits. Ms S.E. WALKER: Okay. Out of the 280 000 members, that applies to about 65 000. The Treasurer’s second reading speech refers to 280 000 members. On the figures the Treasurer just gave me, if GESB MutualCo has 250 000 members, I am not sure that the figures add up. Mr E.S. Ripper: Some members can be members of two schemes. Ms S.E. WALKER: Alright. Those members in the new GESB MutualCo scheme will lose the state guarantee for their funds. Mr E.S. Ripper: There will be no change to the guarantee arrangements. At the moment, most of the members in West State Super have a guarantee on only the account balance that was applicable in 2001 and that guarantee will continue. Ms S.E. WALKER: Therefore, has not there been any guarantee for the contributions they have made since 2001? Mr E.S. Ripper: They have taken the investment risk since 2001. Ms S.E. WALKER: Is that by choice? Do they have a choice whether to take the investment risk? Mr E.S. Ripper: That was the arrangement that was entered into in 2001. Ms S.E. WALKER: Have all the members of West State Super been exposed since 2001? Mr E.S. Ripper: That is part of the rationale for this change. Ms S.E. WALKER: I understand that. I am trying to work out whether any members of GESB will lose the state guarantee for their superannuation fund. Mr E.S. Ripper: That is a very important question and it was also raised by the member for Avon in his contribution to the debate. There is no change to those specific guarantee arrangements. Ms S.E. WALKER: What about the non-specific guarantee arrangements? Mr E.S. Ripper: Perhaps I will leave that explanation for my response to the second reading debate rather than give it by interjection. There are some complexities here. People would be concerned about the practical value of any guarantee arrangements. In terms of the practical value of any guarantee arrangements there is no change. Ms S.E. WALKER: I will be looking at that very closely in consideration in detail. Not because I am in West State Super, but as members of Parliament we have an obligation and duty when dealing with funds of this

4232 [ASSEMBLY - Thursday, 16 August 2007] amount and the financial security of people’s futures to ensure that we do it properly and the Treasurer is looking after them. Mr E.S. Ripper: I agree with you. The principle that has governed this entire reform is the best interest of the members. Ms S.E. WALKER: I will consider the bill from the perspective of my electorate. The superannuation investment products include West State Super, a market linked accumulation scheme; Gold State Super, a defined benefit scheme, now closed to new members and I understand it has been for a while; Pension Scheme, now closed to new members; Judges and Parliamentary Pension Scheme; and the retirement products that GESB currently manages - for example, the retirement income allocated pension, retirement income term allocation pension and the retirement access, a rollover fund. The annual report acknowledges at page 4 that - GESB plays an important part in the financial futures of approximately a quarter of working Western Australians by providing members with good value superannuation and related products. It is because it plays such an important part in the financial future of Western Australians and involves an enormous amount of money and a quarter of the workforce that I have taken the time to try to understand whether their rights or safety is being eroded in any way. The effect of this bill is to apparently bring Western Australia’s public sector employees into line with those groups of workers who already have a choice in where their contributions go in the super scheme. The Treasurer tells us in his second reading speech that the feedback from GESB contributors has indicated strong support for the change. I do not know whether that feedback is on the GESB website. The Treasurer also said that GESB members want their family members to access the scheme and that former GESB contributors wish to direct their current super payments to the scheme. The Treasurer advised members that this feedback is supported by research that fund members considered it was important to them to have the right to choose into which super fund their employees contributions are made. I ask the Treasurer whether that research has been made public. Mr E.S. Ripper: I will have to seek advice on that. Ms S.E. WALKER: Thank you, because I would like to see it. Additionally, public sector agencies have indicated - I thought this was interesting and I would like to know which public sector agencies have said this - that lack of choice impacts on the attractiveness of the state public sector as an employer. Is that true, Treasurer? Mr E.S. Ripper: I think modern industry standard superannuation arrangements are part of the package that prospective and current employees would consider. It is a disadvantage for employees to feel that they are locked into a particular set of superannuation provider arrangements and they have no choice. Ms S.E. WALKER: And their funds are immobilised. Mr E.S. Ripper: I think people do value choice. Ms S.E. WALKER: Added to that is the push by the commonwealth to encourage Australian workers who have more than one superannuation account to consolidate their accounts into one account. I think the Treasurer said in his second reading speech that the average length of employment in the Western Australian public sector is seven years. If a young person ceases employment in the public sector, that person’s superannuation funds will remain in GESB until the person reaches legal retirement age, or is eligible to access those funds under certain other criteria. Will this bill allow people to take their superannuation funds out of GESB and place them in another fund? Mr E.S. Ripper: That will be the case for members of an accumulation fund. Members of a defined benefit fund will not be able to do that. Ms S.E. WALKER: So, members of Gold State and the pension fund will not be able to do that? Mr E.S. Ripper: That is right; they will not be able to do that. However, members of an accumulation fund will be able to do that. I must add, however, that members will need to think carefully about that, and take advice, I suggest, before they make that choice. Ms S.E. WALKER: Absolutely. All members need to know about the security that attaches to their funds, and what is happening with their funds. The problem is that I do not think all members understand that. I certainly have not received any advice that this bill was to come before the Parliament, apart from my knowledge as a member of Parliament. I do not think people have been informed about this bill. I am not worried so much about myself. I am worried about other people. In a debate last year, I mentioned some statistics that show that many people are not taking sufficient interest in their financial security. There is actually a commonwealth report on that matter. I am just wondering what GESB has done to inform people about this bill. I am not making any criticism of GESB. As I have said, I have always found GESB to be an excellent organisation. As I understand it, choice of superannuation fund already applies to members who are not in Gold State or the pension scheme, because those are defined schemes. Members of a defined scheme will continue to be protected

[ASSEMBLY - Thursday, 16 August 2007] 4233 by a government guarantee. However, when this bill is proclaimed, the majority of the Western Australian public sector workforce will be able to choose to transfer their funds to another superannuation account. In fact, this bill will affect the superannuation funds of one-quarter of the total Western Australian workforce. I am not sure whether it was the Treasurer or the member for Vasse who said that an amount of $8.7 billion is currently invested in GESB. Page 4 of the 2005-06 annual report indicates that at that time, the figure was $6.85 billion. I obviously support this bill, because it will benefit many members of GESB. The members of GESB are already falling behind members of the superannuation funds that are held by the two other tiers of government - the commonwealth government and local government - because in 2006, the commonwealth government introduced legislation to give those members the right to place their superannuation funds in a fund of their choice. As I have said, we are talking about funds of between $7 billion and $8.7 billion - or one-quarter of the superannuation funds of the Western Australian workforce - and the future financial security of about 280 000 members of GESB. [Member’s time extended.] Ms S.E. WALKER: I turn now to the organisational structure of GESB, as outlined at page 35 of the 2005-06 annual report. Over the head of every person in that structure is the Minister for Government Enterprises, who at the moment is the Treasurer. Mr T. Buswell: It is someone closely associated with the Treasurer. It is not actually the Treasurer. Mr E.S. Ripper: I was the Minister for Government Enterprises but I am not anymore. Ms S.E. WALKER: The government keeps chopping and changing - or sacking - its ministers, so I do not know who is the minister for what from one day to the next! It is very confusing for us on this side of the house. Mr T. Buswell: The Minister for Government Enterprises is now the former Minister for Education. The ACTING SPEAKER (Mr P.B. Watson): Order! The member for Vasse entered into what was a very good debate, and he is waffling on and talking about things that have nothing to do with that debate. The member should either sit there and enjoy what he is doing, or go outside, and let us get on with the debate. Ms S.E. WALKER: I was having a very enjoyable conversation with the Treasurer, Mr Acting Speaker! Mr E.S. Ripper: Yes - until we were rudely interrupted! Ms S.E. WALKER: The Minister for Government Enterprises - whoever that may be - is overseeing this very important fund for one-quarter of the Western Australian workforce. Under the bill, GESB will be split into two camps - the Parliamentary Superannuation Board and the State Superannuation Board. I presume that the Parliamentary Superannuation Board will still be overseen by the Minister for Government Enterprises. I always wince when I think of the pension entitlements that we have lost! The Parliamentary Superannuation Board will be a statutory board responsible for the defined benefit schemes; that is, Gold State and the pension scheme. The funds of the remaining about 255 000 members will be controlled by the membership. The members will do that under the auspices of the new mutual company, which will be responsible for the administration and investment of those funds. The member for Avon raised the important point that, under the proposed new regulations, three union members will be appointed to the board of the mutual company. I have not been able to find that in the bill. Dr J.M. Woollard: At the moment, the union representation is from UnionsWA. I believe that, under the new scheme, any union will be eligible to nominate for representation on the board. I would be very concerned if the representation continues to be from UnionsWA, because it does not cover the whole breadth of the workers who will be covered by this bill. Ms S.E. WALKER: I am not sure why union members need to feature as directors of the board. That led me to look at the composition of the current board, and the qualification of the people on that board. Two of the current eight board members are members of a union. Most of the members of the board have extensive financial and commercial qualifications. The annual report states that Michele Dolin has had a career in financial services, and that as a finance sector executive she has held a number of senior executive appointments with leading financial institutions. She was appointed a general manager with Challenge Bank in 1989, and she later held general manager positions with Westpac and BankWest. I contrast that board member with union member Neil Saxton. The report states that Mr Saxton currently works as a lead organiser in the WA branch of the LHMU. I am not into what these union acronyms stand for. Mr T. Buswell: Liquor, Hospitality and Miscellaneous Union. Ms S.E. WALKER: I thank the member but I was having a bit of a go at someone. The annual report states - His role in the Union is within the health sector covering both public and private employees. Mr Saxton is Secretary of the Ambulance Employees Australia, WA Branch (a national section of the LHMU).

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I am not quite sure why he is on the board. He has a diploma of business and an advanced diploma of financial services. Mr R.C. Kucera interjected. Ms S.E. WALKER: The member for Yokine can get up and speak later. I have actually put a lot of time and thought into my speech. If he has any thoughts on the bill, I invite him to get up and share them. Two of the eight members of the board are union members. I say to the Attorney General that I wonder whether it is correct - sorry, I am so used to talking to the Attorney General. I say to the Treasurer that I wonder whether it is correct - Mr A.D. McRae: He’s always on your mind. Ms S.E. WALKER: Not really. He is on the public’s mind most of the time because they want to know how they will get rid of him at the next election. Will the Treasurer make it mandatory for union members to be on the board, being responsible for the administration and investment of GESB MutualCo, which will contain the majority of current members that are hived off from the current scheme? Mr A.D. McRae: Are you opposed to unions being represented on the board? Ms S.E. WALKER: I am just wondering why they are. Mr A.D. McRae: Are you opposed to it? Ms S.E. WALKER: I have an open mind. I am just wondering why they are. I am actually probably opposed to it. There are some real thugs in the union. I would be very disturbed if they were to be on the board. Perhaps I would be disturbed if the member for Riverton was on the board because we might get some leaked reports coming out for all we know. People need to be honest and have integrity if they sit on that board because they are managing $8.7 billion in funds. Mr A.D. McRae interjected. Ms S.E. WALKER: It would be really good if the member for Riverton did not interrupt me. I have taken a bit of time to look into this area because I am concerned about it. It is a really enormous organisational structural shift. It affects one-quarter of the workforce. It affects 280 000 members and it affects the financial security of many Western Australians. I will be listening to the second reading debate and the consideration in detail stage with interest. DR J.M. WOOLLARD (Alfred Cove) [12.22 pm]: I have had a briefing on the State Superannuation Amendment Bill 2007. I thank the government for the briefing. It is a very complex issue. I appreciate that the reason behind this bill coming before the house is because the Government Employees Superannuation Board faces regulatory, industry and scale risks. The current framework does not differentiate between defined benefit and market linked moneys. The superannuation industry is rapidly evolving. I know from the briefing that GESB has outgrown its regulatory structure. It is currently managing over $8 billion in superannuation funds for 25 per cent of working Western Australians. The environment for superannuation is very complex. This bill results from changes to commonwealth legislation in 2005. I know that the government and officers from the Department of Treasury and Finance have been looking at this legislation for two years. It has been implemented in some other states. I think it is already in New South Wales, Victoria and the Northern Territory and it is currently being considered by South Australia and Queensland. It is very complex. The superannuation industry is changing rapidly. GESB has said that it requires flexibility to respond to changes in the market and to changes that it had to introduce because of commonwealth legislation. I know from the briefing that GESB is already competing with the private sector and that without these changes, it will be very difficult for GESB to continue to play an active role in the marketplace. The amendment bill recommends that membership restrictions be removed and GESB be subject to public offer. I appreciate that members can keep contributing to GESB after they leave the WA public sector. I had a bit of concern during the briefing in that because GESB comes under this government umbrella and reports to the minister at the moment, maybe there should be a bit more security for members. The new structure was explained to me. During the briefing I asked for a copy of the principles of the constitution. I have not been supplied with a copy of that. I know it is a draft document but I think it would be useful for members to look at, particularly when we are almost privatising superannuation, to ensure that the security commitment that is being given by this government is reflected in those principles. I accept that these changes are being made because of the changes to the commonwealth legislation, because the Auditor General asked for a review of the regulatory framework and because of the viability of GESB in its current format. As an employer, the government will be able to keep pace with changes in the superannuation environment. This will help the government attract and retain a high quality workforce. In relation to attracting

[ASSEMBLY - Thursday, 16 August 2007] 4235 and retaining employees, I asked during the briefing about the differences in the percentages of superannuation paid. I believe University of Western Australia employees get 17 per cent paid into superannuation while commonwealth public servants get 15.4 per cent. We are behind the eight ball in many ways. If we are going to help the super scheme survive, we need to make these changes. I believe we should be looking at the percentages. Members of Parliament get 11 per cent paid into their superannuation scheme. We were given a choice of super schemes several years ago. It is only right that this bill is now before Parliament to give other public sector employees a choice. I have not had the opportunity to discuss this with public sector employees but I have been told that this is what they are asking for. They want choice. They want to be able to consolidate their superannuation and avoid multiple fees. In fact, it makes sense that they want to consolidate. Why should they pay for two superannuation accounts, with all the charges involved, when everything can go into one account? I would like to have seen the principles for the constitution. I thank the departmental staff who gave me the briefing and supplied me with the extra notes. I could not see the principles in the papers in the package. If they were there, I missed them. I am being told that they were in that package. I obviously missed them. I apologise for that. It is a very complex issue. I certainly look forward to the consideration in detail stage. I hope that we will go through many of these clauses at length, so that, as members, we will have a good understanding of this bill when it goes through the house, and we will be able to discuss it with people from the public sector and explain why this legislation has in fact been introduced for their benefit. When we look at the principles, we will be able to assure them that there are safeguards in place with GESB MutualCo and the state government. In fact, these safeguards have been built into the changes. I am told that the new structure will come under a company limited by guarantee and that the draft constitution will in fact ensure that the safeguards that are already in place for members will remain for people who move into the new scheme. I support this legislation in principle and look forward to the consideration in detail stage. MR E.S. RIPPER (Belmont - Treasurer) [12.32 pm]: I thank members of this house for their support of this legislation. I say at the outset that a number of objectives guided the government in the development of this reform. Most members of the Australian workforce now have access to choice of superannuation fund. GESB is a good organisation, but there is a limit to what can be achieved in keeping an organisation up to best-practice standards in an industry if that organisation, in effect, has a monopoly. With the best will in the world, the best leadership at chief executive officer level and the best leadership at ministerial level, even if all those things were to be continuously applicable to GESB throughout its life, in my view, we would not get the same result that we would get if an organisation faced day-to-day competitive pressure. If members have the capacity to leave the organisation and go to another organisation, that imposes a day-to-day pressure on the organisation to perform at its best and to deliver excellent service. I thought that was a strong argument for Western Australian public servants to have choice of their superannuation fund. Mr M.W. Trenorden: I have a blocked ear. Can the Treasurer speak a little louder, because I cannot quite hear him? I would appreciate that. Mr E.S. RIPPER: It is not usually the case, particularly at question time, that people ask me to speak up. However, I will do that. I was particularly of that inclination because I was aware that in recent years GESB has been through a process of seeking to map its offerings against industry standards. Where GESB has fallen behind industry standards, it has been seeking to improve its offerings to match industry standards. Therefore, some years ago there was a situation in which GESB, arguably, was not meeting industry standards in a number of respects. Even though everyone in this government, in the public service and in the previous government would have wanted public service superannuation to be equivalent to industry standards across the workforce, in certain respects GESB had fallen behind and was in a mode whereby it needed to reform and catch up. We want to avoid that sort of thing happening in the future. Choice of fund provides that pressure for excellence on a day-to-day, month-to-month, year-to-year and decade-to-decade basis. The second concern that I had was that regulation of what was becoming a very large organisation, with large funds under management, was conducted on a boutique basis by the Department of Treasury and Finance. I have a lot of regard for the Department of Treasury and Finance, but it is not its core business to regulate superannuation funds. I was concerned that to get the critical mass of regulatory expertise and experience, we would need to significantly increase the resources in the Department of Treasury and Finance available for the regulation of GESB or we would need to find another solution. There are commonwealth bodies that are charged with the regulation of the superannuation industry in Australia. They have the critical mass of talent. The regulation of the superannuation industry is their core business. They have the expertise and they have the experience. It seemed to me that it would be of benefit if we could make arrangements for GESB to be regulated by the core superannuation regulatory authorities in this country, not by a boutique operation in the Department

4236 [ASSEMBLY - Thursday, 16 August 2007] of Treasury and Finance in this state. I started from those two objectives: providing choice to Western Australian public servants for their superannuation arrangements - Dr J.M. Woollard: It is also flexibility, isn’t it? If you look at the nursing industry, if nurses work at several different hospitals at the moment, they pay super into different accounts for their employment. This legislation will give them the opportunity to have one super account. Mr E.S. RIPPER: There are a number of reasons that choice would be attractive to people. One reason is that they may have their own views on the standards of different superannuation organisations. Another reason is that they may prefer to have all their superannuation with one organisation as a matter of convenience. Choice was the first consideration. The second consideration was the adequacy and sustainability of regulation of a large and growing financial organisation into the future. The structure of GESB proposed in the reform really was not the first consideration. It was a consequential consideration once we had decided that we needed to move towards choice and we needed to move towards commonwealth regulation. It particularly arose because giving public servants the choice to move out of GESB and not giving other people the choice to move into GESB would have been a recipe for the long-term decline of GESB and the deterioration of its offering for those people who chose to remain within GESB. Therefore, we wanted to offer people choice, but not a Clayton’s choice, whereby in the end the only benefit would be for people to move out rather than for people to move in. A lot of thought has been given to this reform within GESB. There has been a lot of consultation with the various stakeholders. There has been a lot of thought given to this reform within the Department of Treasury and Finance. There are three elements to this reform. They are the interests of members, the best arrangements for GESB, and the interests of the state and how it should be protected. We have a responsibility to not only our employees, but also the public of Western Australia generally. I believe it is a very significant reform package. This reform has the potential to affect a quarter of a million Western Australian households. We had to think about the reform carefully because of the large number of Western Australian households that could be affected and because of the significance of the issues to those households, bearing in mind that we are dealing with arrangements affecting people’s retirement incomes. It has been thought about carefully and I believe that a good package of reforms is embodied in this legislation. I am pleased that the opposition has participated in the briefings and that after considering the information that has been provided - Dr J.M. Woollard: And the Independents! Mr E.S. RIPPER: Yes. I am pleased that after considering the information that has been available, the opposition and the Independents have decided to support the legislation. Mr T. Buswell: The member for Avon previously alluded to the fact that some people view this as the privatisation of GESB. What is your esteemed view on that? Mr E.S. RIPPER: My view, esteemed or otherwise, is that that is not an accurate description of what is proposed. The objective of the exercise was to provide public servants with meaningful choice when organising their superannuation arrangements, to give people the practical choice of continuing with an organisation that will be best set up for success, and to provide a system that would comply with commonwealth regulations for public service superannuation arrangements. The model that is been embodied in this legislation emerged from the best application of those principles. The model gives - it does not sell - the organisation to the members. If the government were to sell GESB to a private organisation, I would regard that as privatisation. However, the government is not selling GESB to a private organisation. The government is, through these arrangements, giving GESB to the members. Mr T. Buswell: It is privatisation. Mr E.S. RIPPER: I think it is well known that privatisation is a political rather than a commercial or accounting concept. The opposition can make ideological and philosophical points about what this bill does or does not represent. I do not regard what we are doing as the privatisation of GESB. If we were looking for a technical term, it would be called the mutualisation of GESB. These debates do not matter. Is it a good proposal in the interests of GESB members and the state or is it not a good proposal? The answer is that whatever it is called, it is a good proposal for GESB members and the state. Mr M.W. Trenorden: You have a smile on your face and so do I. However, I remind you of a speech you gave about 10 years ago about disability services. You said that “global speak” was not part of your history. This is privatisation! Mr E.S. RIPPER: I think it is unfair of the member for Avon to refer to speeches that I might have made 10 years ago! That is an unfair tactic. I object to that tactic. Let us not waste time on what is essentially a political argument. We must consider the substance of the issue; namely, what is in the best interests of members and what is in the best interests of the state. This model is in the best interests of GESB members and the state.

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There is one set of benefits that I have not mentioned. As an employer of 100 000 people, the public service is competing in a difficult labour market in which there are shortages of skilled and unskilled labour across the board. We must compete with the private sector and it is therefore important that we offer an attractive employment package to people who are thinking about moving into, or leaving, the public sector. Modern flexible superannuation arrangements giving a measure of authority and control back to the individual employee are part of the positive employment package that we must offer public sector employees in this very competitive market. Mr R.F. Johnson: Given your description of the operation, it sounds as though you will rephrase the description of the organisation to a financial mutual benefit society. Mr E.S. RIPPER: There is a reason that one of the organisations will be called GESB MutualCo. Mr R.F. Johnson: I am not arguing with the Treasurer. That is basically the principle that the government is adopting. You are turning it into a mutual society. There have been many of those in years gone by. That is my interpretation of the bill. Mr E.S. RIPPER: It is a complex set of reforms. The debate has come down to what single word can be applied. All single words would struggle to cover the complexities of the reform. I reject the notion that the word “privatisation” is the applicable word. If members are looking for a single word, “mutualisation” is the best description of the model that is being adopted. Mr R.F. Johnson: It is a bit like the old cooperative. Mr E.S. RIPPER: Exactly. The model was the secondary consideration. The main objectives were choice and commonwealth regulation. This model is the outcome of that. It is my understanding that if we want to comply with commonwealth regulations, we must comply with commonwealth requirements. Commonwealth requirements do not allow a ministerial power of direction to GESB or a strategic development plan that is signed off by the minister and Treasurer, which is what happens with government trading enterprises in this state. We cannot move to commonwealth regulations while maintaining the existing model for government trading enterprises generally. One important issue emerged from the debate and I need to put it on the record. I refer to the question of guarantee. It is important that I put these words on the record insofar as the guarantee arrangements that relate to West State Super members. It is proposed that the minimum benefit guarantee will continue for West State Super members. That part of the bill and page 30 of the explanatory memorandum show this by specific reference to the guarantee. The minimum benefit guarantee covers balances as at 2001, which was indexed forward of consumer price index plus two per cent when member choice was introduced. However, it does not cover the investment returns on these account balances. The section 31 guarantee of benefits will remain for the defined benefit scheme members, given the unfunded nature of the schemes. As the schemes moving to GESB MutualCo are fully funded, this guarantee is no longer required. That is our formal statement of the guarantee arrangements as they relate to West State Super members. That issue was raised by the members for Avon, Nedlands and Alfred Cove. Dr J.M. Woollard: I have since had an opportunity to look at the principles. My query earlier was about the “privatisation” and the proposed protections that the government is saying will be incorporated in the draft constitution. It states that GESB MutualCo will need to be converted from a company limited by guarantee to a company limited by shares and that that will require an amendment to the proposed constitution, which would then come under the Constitutions Act. At the moment it is not a full privatisation, but it leaves open the door for a privatisation if that is what members desire. Mr E.S. RIPPER: I have said that in effect we are giving the Government Employees Superannuation Board to its members, and members will ultimately have control over what they do with the organisation. There are safeguards. Debate interrupted, pursuant to standing orders. [Continued on page 4248.] NOISY SCRUB BIRDS - GULL ROCK Statement by Member for Albany MR P.B. WATSON (Albany - Parliamentary Secretary) [12.50 pm]: I recently had the opportunity to help release noisy scrub birds in the Gull Rock area. Six male birds were captured in the Manypeaks area and were released as a pilot program to test whether the birds can survive in a new environment. A large number of birds in the Manypeaks area were wiped out due to bushfires. The Department of Environment and Conservation does a great job in our region. Some of the people involved were DEC workers and dedicated volunteers. Among those present were, from DEC, Alan Danks, Wes Manson, Cam Tiller, Josie Dean, Sarah Comer, Allan

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Burbridge, and Ranger Paul Cory; from the science division’s western ground parrot program, Mike Barth and Dave Chemello; from the Mt Martin Reserve Community Working Group, Hazel Dempster and Val Davies; and from Gull Rock National Park Community Working Group, Ray Garstone and Janet McArtney; Abby Berryman, a PhD candidate on the subject of noisy scrub bird vocalisations at Murdoch University; from the South Coast Threatened Birds Recovery Team, Anne Bondin, Allan B, Alan D, Sarah C and Cam T; volunteers Fred Bondin, Jade Geddes, and Mike and Shane Hall; and from South Coast NRM, Louise Hillman, Brett Sorrensen, Kristina Flemming and Wendy Cooke. Very few people have seen the noisy scrub bird. On the day, someone with a very fast camera got a photo of me actually releasing one of the birds. After we released the birds and were walking away, we could hear them singing. CROSS DRESS FOR RED CROSS DAY Statement by Member for Serpentine-Jarrahdale MR A.J. SIMPSON (Serpentine-Jarrahdale) [12.52 pm]: I take the opportunity to inform my colleagues of the fine work performed by the Red Cross. Some members will know that the member for Carine and the member for Swan Hills joined me this morning in helping to sponsor Cross Dress for Red Cross day. This event provides us with an opportunity to help raise funds for the Red Cross so it can continue its great work in helping the disadvantaged. Last year I participated in the first Cross Dress for Red Cross day with Glen Jakovich and many others; it was a great success. I have high hopes that this year will be even better. The high point of the day will be the King and Queen of Cross Dress for Red Cross Corporate Pageant, which will be held at The Deen in Northbridge. I am lucky enough - or unlucky, as the case may be - to have been asked to be one of the judges for the event, in which two people will be crowned king and queen for the day. I urge all members to participate in this fun and very different way of helping those less fortunate than us. If members are unable to participate or are too chicken to try something a little different, they can still support the Red Cross by donating to the cause. I suggest that those interested in finding out more about this good cause visit the website at www.redcross.org.au/crossdress. GREENWOOD SENIOR HIGH SCHOOL - MUSIC PROGRAM TOUR Statement by Member for Kingsley MRS J. HUGHES (Kingsley) [12.53 pm]: Greenwood Senior High School students recently returned from a tour of the United Kingdom through the school’s music program. Forty-six students, staff and parents flew to Worcester in the UK and were hosted by Nicola Daw, the area director of Worcestershire Youth Music, which is a music service within the Worcester City Council. The Greenwood Senior High School music students were guest presenters at the Worcester Centre and performed at two concerts for local primary and high schools and also for the general public. The students performed songs representing their Australian heritage and background, including choir performances of traditional Aussie songs and a medley of Australian TV show theme songs, accompanied by a slide show of Australian landscapes. I was very pleased to have attended a winter-warmer concert held after their return to celebrate and share their talents with the school and the wider community. The variety of the performance was of a very high standard and was enjoyed by all. I extend special congratulations to Greenwood Senior High School and staff - namely, Sheila Randall, teacher in charge; Greg Bowdell, vocational education and training coordinator and official paperwork coordinator; Russell King, conductor and instrumental teacher; Jeremy Davies, instrumental rock teacher; and Grace Burnside, piano accompanist and teacher. Other pivotal people were Jill Cole-Bowen, president of the committee; Deborah Jones, committee member; Caroline Welch, committee member, whose sister is the United Kingdom contact and teacher; and Stephanie Rogers, travel agent and parent. Other accompanying parents were Kylie Davies, Peta Korb, Michael Korb and Liz Weston. VIETNAM WAR VETERANS Statement by Member for Moore MR G. SNOOK (Moore) [12.55 pm]: Today I rise to acknowledge our Vietnam War veterans. This Saturday, 18 August, marks the forty-first anniversary of the Battle of Long Tan. The tradition of recognising this battle, which claimed the lives of 18 young Australians and is now etched in the annals of Australia’s military history, has been extended to be known as Vietnam Veterans Day. On a regular basis, I continue to meet Vietnam veterans who, as a result of changed community attitudes that now proudly recognise our Vietnam veterans, are coming to terms with their personal problems, the majority of which have resulted from the disgraceful reaction they received from sections of the public and the media at the time of their return from service. The demonising of our diggers at that time was a shame that the nation now recognises. Sadly, so many of our returned diggers, a large number of whom were conscripts, have lived their lives with the legacy of the rejection they received: but not any more; it is great to meet more and more Vietnam veterans who are standing out proudly in our communities. It must be remembered that we as a community, and particularly we in this place as members of Parliament, should appropriately on this day pay our respect to our Vietnam veterans, not in any way to suggest glorification of war or to debate the rights or wrongs of our participation in the conflict but, moreover, to simply

[ASSEMBLY - Thursday, 16 August 2007] 4239 acknowledge their service to our nation and to recognise the personal trauma that many of them have suffered over the past 41 years. On Saturday, if members see a Vietnam veteran, they should go up to him and say, “Good on you, mate. We are proud of you and we thank you.” KENT STREET SENIOR HIGH SCHOOL - TEENAGE PERSPECTIVE EXPO Statement by Member for Victoria Park MR B.S. WYATT (Victoria Park) [12.56 pm]: I rise this afternoon to congratulate Ms Dorothy Roe and the students of the English academic extension unit class at Kent Street Senior High School who today had their Unity in Community, Teenage Perspective Expo. This is something with which I have been working with year 10 students at Kent Street high school for a period of time and has involved the engagement of those students in the community. Ms Roe asked students to research a topic they thought was important to the local community and then to liaise with community groups and local organisations to gain a valuable perspective on that particular issue. The students were asked to prepare a feature article on their topic. Due to the enthusiasm and energy of Ms Roe, the project blossomed beyond initial expectations. Of their own initiative, the students extended the original aim of the project to include an open day, which is today, to showcase their efforts, which they organised themselves. They were fortunate enough to have the attendance of the Minister for Education and Training, Hon Mark McGowan, who opened the event this morning at Kent Street Senior High School. I make particular mention of Shae Councillor, Chernoh Bah, Kalina Ridley, Callum Ross, Juliana Scillipoti, Regan O’Brien and Dyllan How, who shared their experience with all the students this morning at a ceremony to open the expo in a very moving way. I also congratulate the Town of Victoria Park, which supported the expo strongly by way of a grant and ongoing support for the students. WESTERN AUSTRALIAN COLLEGE OF AGRICULTURE, MORAWA Statement by Member for Greenough MR G. WOODHAMS (Greenough) [12.58 pm]: In rising to talk this afternoon, I endorse the comments made by the member for Moore, because I think that acknowledging the contribution of our soldiers in Vietnam, and particularly acknowledging the forty-first anniversary of the Battle of Long Tan, is particularly important. Quite often we overlook the contribution of the veterans. The member for Moore made a very strong point, and it is one that I endorse this morning. I thank the member for Moore for making those comments. This Saturday is also the open day of the Western Australian College of Agriculture at Morawa, which is a very important educational institution in my electorate of Greenough. The College of Agriculture at Morawa does not work in isolation; it has marvellous cooperation from the Shire of Morawa and Morawa District High School. I acknowledge the work done by Gavin Treasure, who is the chief executive officer of the Shire of Morawa; the Principal of Morawa District High School, Darren Tinley; and the Principal of the College of Agriculture, Craig Chadwick. These three people are working together in a cooperative manner to help the Morawa community, which has many struggles, to go forward. That is the proactive work that these people undertake. Although they come from different sectors of the community, they have engaged and created a Morawa educational association, which is certainly involving that community. Sitting suspended from 1.00 to 2.00 pm QUESTIONS WITHOUT NOTICE SURGERY WAITLIST 367. Dr K.D. HAMES to the Minister for Health: I refer to the minister’s claims that the surgery waitlist continues to fall and the implication that this is because more surgeries are being performed. (1) Given that since the government came to power in 2001 at least 41 223 people have been removed from the surgery waiting list without having any surgery, how can the minister in good conscience continue to create this false impression and deceive the people of Western Australia? (2) Can the minister guarantee that those patients who have been removed because they no longer require surgery, or have been victims of a ruthless culling campaign like the one the opposition exposed yesterday in relation to orthopaedic outpatients at Royal Perth Hospital, will be given an opportunity to be reinstated if they still need surgery? Mr J.A. McGINTY replied: (1)-(2) I will deal with the final question first - the so-called ruthless culling campaign. Two thousand patients who had outpatient appointments organised in the orthopaedic clinic of Royal Perth Hospital were written to and asked whether they still required the appointment with an orthopaedic specialist. Three hundred people - 30 per cent of those who have responded to date - have written back that they no longer require their appointments. When 300 people say that for a variety of reasons they no longer

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wish to have their appointments, I would have thought it made eminent sense to make sure that the lists are up to date and that people who are listed as waiting for a specialist appointment do in fact want that appointment, rather than retain a bloated list of people who demonstrably do not want an appointment with a specialist and no longer wish to proceed. I made the point yesterday that, in our experience, approximately the same proportion of people, when given a date for their elective surgery, turned around when faced with the scalpel and said that they no longer wished to have the surgery. It surprised me that patients who had been given a date for surgery within the next month or two said that they no longer wished to proceed and wanted their names taken off the list. It happens at both levels. Mr T. Buswell: Where is the data you are talking about? Mr J.A. McGINTY: It is produced regularly; I can give the member copy of it this afternoon if he would like. Firstly, 30 per cent of people who have been placed on lists to see specialists in outpatient clinics, when asked if they still wanted their appointments, responded that they wanted their names taken off the list. They volunteered to do that; they were under no coercion. There was no culling; it was simply a matter of keeping the lists up to date. Secondly, when confronted with the actual offer of surgery on a particular date at a particular hospital, about 30 per cent of people in the various studies that have been done turned around and said that they no longer wished to have that surgery, even though they were on the list and scheduled for it. There has scarcely been a culling of the list. I go back to the point I made yesterday during question time: 22 000 Western Australians were waiting an average of five months for elective surgery during the time of the previous coalition government. The figure is now under about 12 800 - just over half the number under that previous government. The government has made it a priority. Not only are there fewer people on the list, but they are not waiting five months as they did when the Liberal Party was in power; they are waiting three months. We still need to do a lot more. I would like to drive that figure down to fewer than 10 000. I want to make sure that everybody on the list gets their surgery within clinically acceptable times. We are very close to achieving that, and we will continue to push for it. Several members interjected. The SPEAKER: I call to order the member for Roe and the Deputy Leader of the Opposition. FIRST HOME BUYERS - STAMP DUTY THRESHOLD 368. Mr B.S. WYATT to the Treasurer: Can the Treasurer inform the house of the impact of the state government’s budget announcement of a doubling of the first home buyers’ stamp duty threshold? Mr E.S. RIPPER replied: The latest figures for home buyer financial approvals show that first home buyers are indeed the big winners from the budget tax measures. To remind the house of what those measures are, the stamp duty exemption threshold was doubled from $250 000 to $500 000 for a home, and from $150 000 to $300 000 for vacant land. That means that the first home buyer purchasing a $500 000 property is now making a saving of $20 700. These are the most generous stamp duty exemptions for first home buyers in the nation, and first home buyers are responding. The latest bank figures show a dramatic increase in first home buyer activity, with the proportion of total financial approvals improving from 20 per cent to 24 per cent in the June quarter of 2007. There has also been a significant increase in first home owner grant applications since the release of the budget. Applications for the grant totalled 1 345 in May, 1 514 in June and 1 834 in July 2007. That is to be compared with the monthly average of 1 059 over the first 10 months of 2006-07, and the monthly average of 1 437 since the beginning of the first home owner grant. Since it was elected, the government has provided 107 000 first home owner grants, totalling more than $805 million. An opposition member: Who pays for that? Mr E.S. RIPPER: The taxpayers of Western Australia pay for that, my friend. The state government has also provided stamp duty exemptions or concessions to 32 500 first home buyers, totalling more than $170 million, since the introduction of the first home buyer stamp duty exemptions in 2004. That is getting close to a total of $1 billion in state government assistance for first home buyers since the government was elected in 2001. We doubled the stamp duty exemption thresholds at a time when housing market indicators suggested some moderation of activity in the housing market from the very strong levels experienced, particularly in 2006. That meant that there was less likelihood of the benefit being swallowed up by those selling houses and getting higher prices rather than going to the people who need it - first home buyers. However, what the government is doing for first home buyers is only one of its measures to address the pressures that people are experiencing in the housing market. Other measures include the $300 million First Start shared equity home loan scheme; land tax and metropolitan improvement tax reforms, which will reduce pressure on rent; and $417 million over the next four years for increased investment in public and community housing and

[ASSEMBLY - Thursday, 16 August 2007] 4241 assistance for people trying to get into the rental market. Stamp duty exemption for first home buyers was the centrepiece of this year’s budget, and these figures show that the government’s strategy is working. Mr P.D. OMODEI: I take the opportunity on behalf of the member for Dawesville to acknowledge the students from Falcon Primary School in the public gallery today. HOSPITAL EMERGENCY DEPARTMENT STAFF – VIOLENCE BY PATIENTS 369. Mr P.D. OMODEI to the Minister for Health: I refer to claims by the Australian Medical Association that doctors and nurses in emergency departments in Western Australian public hospitals are taking self-defence courses because of the rising incidence of violence towards them by patients due to an increase in illicit drug use. (1) What is the minister doing to protect these hospital emergency department staff against drug-fuelled, violent and abusive patients? (2) Does the minister acknowledge that the Carpenter government’s soft approach to illicit drug use has set the wrong example for youth and is a major factor in the increase in violence against hospital staff? Mr J.A. McGINTY replied: (1)-(2) Of course we do not have a soft approach to drugs policy. Another thing that I must say is that I do not believe I have ever seen anyone, after having smoked marijuana, turn violent on hospital emergency department staff. Several members interjected. Mr J.A. McGINTY: The state has a very significant problem of amphetamine abuse. It was one that was recently addressed in the amphetamine summit, which was opened by the Premier and jointly chaired by the Commissioner of Police and the Director of Health. The summit examined ways, both from a health and law enforcement perspective, on how we could better respond to this issue. A number of important recommendations were made at that summit. Marijuana use remains unlawful. Anyone caught with marijuana faces penalties. The only distinction that has been made is whether it is to be a criminal offence to be carried with young, perhaps experimental, users for the rest of their lives, compromising their ability to gain employment and their ability to travel. Is that what members opposite want? Do they really want to return to the days when minor cannabis possession was a criminal offence? Several members interjected. Mr J.A. McGINTY: Do members opposite want to turn it back to being a criminal offence? Mr C.J. Barnett: Every single thing has come to pass. Mr J.A. McGINTY: Do members opposite want to turn it back to being a criminal offence? They will not answer, will they? That is because, frankly, they cannot. Mr C.J. Barnett: Drug trafficking, amphetamines - everything you were warned of has come to pass. The SPEAKER: I call the member for Cottesloe to order for the first time! Mr J.A. McGINTY: We are all aware of the links between drug abuse and mental health issues in particular. We are all aware that cannabis is a dangerous drug. We are all aware that amphetamine use is a current scourge affecting a very large number of young people. The question is: what is the appropriate penalty for somebody caught using cannabis perhaps experimentally? That is the question. It must remain an offence. It remains unlawful. The punishment for dealing with it is prescribed by the law. Several members interjected. Mr J.A. McGINTY: When I threw open the question to members opposite about whether they really wanted to make it a criminal offence so that people would have a criminal offence for the rest of their lives, there was no answer from them. That is the critical question. Do members opposite really want to make cannabis possession a criminal offence? Members opposite cannot and will not answer it. Mr C.J. Barnett: I will. Mr J.A. McGINTY: Come on! Members should put up their hands if they want it to be a criminal offence. Nobody. Not one. There is the answer to the question. Dr J.M. Woollard interjected. Dr S.C. Thomas interjected. The SPEAKER: I call the members for Alfred Cove and Capel to order!

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HOSPITAL EMERGENCY DEPARTMENT STAFF – VIOLENCE BY PATIENTS 370. Mr P.D. OMODEI to the Minister for Health: By way of a supplementary question, I will repeat the first part of the question. What is the minister doing to protect hospital emergency department staff against drug-fuelled, violent and abusive patients? Mr J.A. McGINTY replied: I can refer immediately to the policy of zero tolerance that is taken in emergency departments. If the Leader of the Opposition attends a hospital emergency department he will see posters everywhere saying that no tolerance will be given to anybody who engages in violent behaviour against staff. That is the first issue. The second issue is that I have often intervened myself to urge members of staff who have been the victims of assault to lay charges. I have given an undertaking that not only will an assault charge be laid carrying the standard assault penalty, but also an assault charge against a public officer will be laid. If my memory serves me correctly the penalty for anyone who assaults a nurse or a doctor in an emergency department is 10 years’ imprisonment. The third measure that immediately springs to mind that we have taken was to improve the level of security in terms of security guards, security grilles and things of that nature, which have been installed in emergency departments in recent years and have gone a significant part of the way towards creating a safer work environment. Mr C.J. Barnett: Drugs is the problem, isn’t it, in emergency departments? Mr J.A. McGINTY: Of course it is. I make the point that when it comes to violence, bullying and intimidation against nurses, I would hope every member of this place would be of one mind and would have nothing to do with people who are bullies and who go out of their way to wreak havoc, whether it be in an emergency department or any other place in the workplace. I hope no member of this place would have anything to do with anyone who engages in that sort of behaviour. The SPEAKER: I call to order the members for Roe, Cottesloe and Murray. LEADER OF NATIONAL PARTY - ATTACK ON DEPUTY POLICE COMMISSIONER CHRIS DAWSON 371. Mr M.P. WHITELY to the Minister for Police and Emergency Services: What is the minister’s response to the extraordinary personal attack on Deputy Police Commissioner Chris Dawson by the Leader of the National Party last night? Mr J.C. KOBELKE replied: I was quite appalled last night that the Leader of the National Party sought to launch an extraordinary personal attack on Deputy Commissioner Dawson. Clearly it was not only me who sprang to the defence of Deputy Commissioner Dawson. Mr P.D. Omodei interjected. The SPEAKER: I call the Leader of the Opposition to order for the first time. Mr J.C. KOBELKE: The members for Murray and Wagin also indicated that they had respect for Mr Dawson. Therefore, it really said something about the Leader of the National Party when he launched into a personal attack that was in no way whatsoever justifiable. It seems that the National Party is heading for irrelevance. The member for Avon just a week ago called people to civil disobedience and now there is a personal attack on a senior law officer who is respected in the community and whom I have found to be a man of considerable ability and integrity. Mr D.T. Redman interjected. Mr J.C. KOBELKE: Pardon? Mr D.T. Redman: Spell “consult”. Mr J.C. KOBELKE: The point is that at a time when members of the National Party are heading for irrelevance they cannot see the difference between having a concern about a matter and dealing with it without making a personal attack on a senior officer. Mr G. Woodhams interjected. The SPEAKER: I call the member for Greenough to order for the first time. Mr G. Woodhams interjected.

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The SPEAKER: I call the member for Greenough to order for the second time. Mr G. Woodhams interjected. The SPEAKER: I call the member for Greenough to order for the third and final time. Mr J.C. KOBELKE: Clearly there are issues of concern to people in country towns, but their interests are not served by simply going right over the top and mounting a personal attack on a very fine officer. As the member for Wagin indicated in taking up the debate, there is very strong feeling, but he was able to mount the case on behalf of his constituents without entering into the gutter and making personal attacks. It is certainly not befitting of the Leader of the National Party, or any party, to come into this place and make a personal attack on a senior police officer so that the Leader of the National Party can get some media out of it when there is no basis to the claim whatsoever. COUNTRY POLICE STATION CLOSURES 372. Mr T.K. WALDRON to the Minister for Police and Emergency Services: I refer to the minister’s comments in this house yesterday during the debate on country police stations, suggesting that three-man police stations are highly preferable to two-man police stations, and my recollection that the minister said it was a simple fact of numbers. Are all two-man police stations in country Western Australia now under threat of closure? Mr J.C. KOBELKE replied: No. COUNTRY POLICE STATION CLOSURES 373. Mr T.K. WALDRON to the Minister for Police and Emergency Services: By way of a supplementary question, if the Commissioner of Police comes to the minister requesting further closures of two-man police station, will the minister oppose his request? Mr J.C. KOBELKE replied: I do not expect that the commissioner will come to me suggesting that he is taking any such action. As I have already said in the debate, the commissioner has told me that, having done this review, he believes there will be no further review in the foreseeable future of police stations that meet operational levels. As was clearly indicated in the debate, most of the police stations closed were one-officer stations. In the past two to three years they had been expanded to two-officer stations, not on the basis of need because there clearly was not the need or demand in those areas, but simply on the basis of the occupational health and safety provisions that this government applied to police. The opposition was eight years in government. It did not care for police officers. It would not take the step to make sure that occupational health and safety provisions applied to police. We did it, we provided the extra police, and that is why we now have two-officer stations and not one-officer stations. Mr M.J. Cowper interjected. The SPEAKER: I call the member for Murray to order for the third time. I now give the call to the member for Albany. Mr M.J. Birney interjected. The SPEAKER: Order, member for Kalgoorlie! BUSSELTON JETTY 374. Mr P.B. WATSON to the Minister for South West: Is the member running for the leadership? I have never heard him talk so much in his life. Mr M.J. Cowper interjected. The SPEAKER: I warn the member for Murray that he has had three warnings. He should not make silly comments, otherwise he will leave this place. Mr P.B. WATSON: I thank the minister for outlining yesterday the state government’s commitment to the iconic Busselton jetty. Is the minister aware of any other views on this project? Mr M. McGOWAN replied: I thank the member for the question. Indeed, I am aware of other views. Yesterday I outlined to the house that the state government has a comprehensive plan to fix Busselton’s jetty and to revitalise the town centre and foreshore of Busselton. It involves up to $50 million worth of public investment in that area, plus tens of millions of dollars of investment in residential development, tourism facilities and cafes and restaurants in Busselton. Any objective observer would say that the area near the foreshore is somewhat dilapidated and needs

4244 [ASSEMBLY - Thursday, 16 August 2007] some rejuvenation. The beachfront and the town centre will be joined. However, I have been opposed throughout this process by the member for Vasse. I have been gobsmacked by his opposition to this proposal. Several members interjected. Mr M. McGOWAN: He has publicly opposed this proposal without having had a briefing. He has been offered two briefings, but he has not taken up the opportunity. Mr T. Buswell: Who offered one? Mr M. McGOWAN: The member’s office was called twice. I am aware of the views he had back in 2001. He said that the beachfront was practically divorced from the main street. He strongly supported a cafe strip. An article quotes him as saying - “The beachfront ambience does not flow through to the town,” he said. “The town centre is sadly lacking energy, especially in the afternoon. There is no vibrancy.” Mr T. Buswell: I am very happy for you to develop the beachfront. Mr M. McGOWAN: The member is very happy? Mr T. Buswell: I just don’t support the rape and pillage of the rest of the town to put money into the Treasurer’s fat pockets. Mr M. McGOWAN: Without a briefing, the member does not actually understand. This is an integrated proposal. I am also aware of other views on this issue, as the member for Albany has asked me. I am aware of the view of a good Liberal. The former member for Vasse, Mr Bernie Masters, is a good bloke. What did Mr Bernie Masters say about this issue? He wrote a letter to the newspaper because he felt so strongly about it. It states - If Mr Buswell wants . . . Mark McGowan to take the jetty’s funding needs seriously, he should start by admitting that, for the six years he was on council, including two as shire president, he showed virtually no interest in making sure the jetty structure was well maintained. Instead, he happily basked in the reflected glory from the opening of the underwater observatory in 2003, just as his predecessor was happy to share the accolades ...... Until Mr Buswell apologies for his past indifference towards the long-term future of the jetty, his anger at the government’s reasonable response should be treated with disdain. Mr E.S. Ripper: Minister, I know who you should get to brief the member for Vasse. Who do you think should brief the member for Vasse? Mr M. McGOWAN: Please tell me. Mr E.S. Ripper: Noel Crichton-Browne, and where should the briefing occur? Mr M. McGOWAN: In the car park! That is the view of a good Liberal. I have heard two views. The view of that good Liberal is that it is a good proposal and that the member should apologise. Will the member apologise? No. Will he go to a briefing? No, he will not. This shows a trend of the member. He flip-flops on important issues. People might have forgotten that he shafted the member for Kalgoorlie and the former member for Vasse. He did bad things to the member for Dawesville - Several members interjected. Mr M. McGOWAN: He did the same thing to the member for Carine. They are both respected members of Parliament and should have had the opportunity to become deputy leader. Unfortunately, the member for Vasse just shafts everyone. MULTANOVA SPEED CAMERAS 375. Mr J.E. McGRATH to the Minister for Police and Emergency Services: I refer to the WA Police sending Multanova speed cameras into regional Western Australia under the banner of addressing road safety issues. At the time, the reason given for this move was that the higher number of fatal accidents on country roads needed to be addressed with the placement of speed cameras in these areas. (1) Despite the fact that as at 14 August there had been 91 fatal road crashes in country Western Australia and 52 in the metropolitan area, why have Multanovas been pulled back into the metropolitan area as of this week?

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(2) Can the minister confirm that during this same period, the backlog of speed camera infringements required to be processed had coincidentally been significantly reduced from a three to six-month wait to virtually no backlog at all? Mr J.C. KOBELKE replied: (1)-(2) I will answer the second part of the question first. I know that the backlog has been reduced. The implication in the question was that that was due simply to shifting Multanovas from the city to the country, and I cannot confirm that. As the member has quite rightly pointed out, there have been a large number of fatalities on country roads. The police have operational procedures for locating speed cameras, and I understand that they were revisited to determine whether there should be a greater effort in country areas. That was done for a limited period and now the speed cameras have been brought back to the metropolitan area. I am yet to see a report on that, but, anecdotally, I understand that it had an impact in country areas. Initially, a very large number of people were caught speeding. This is only anecdotal information I gathered from talking to an officer; I have not received a formal report. About the same number of infringement notices were issued to drivers on country roads as were issued to drivers on city roads. Even though more vehicles drove past Multanovas on city roads, there was a much higher hit rate of drivers exceeding the speed limit on country roads. I understand that the number of infringement notices issued initially was quite high. That number then trailed off, which one might interpret as meaning that locating Multanovas in country areas had an educational effect. It did change behaviour. People were conscious of being caught speeding and therefore ameliorated the speed at which they drove. That seemed to have an effect. However, of course the police want to cover roads in both metropolitan and country areas. I concur with the implication in the question. I understand that a number of those Multanovas have been relocated for operation in the city area. MULTANOVA SPEED CAMERAS 376. Mr J.E. McGRATH to the Minister for Police and Emergency Services: As a supplementary question, can the minister categorically deny that this plan had nothing to do with road safety and was in fact a cynical plan to cut the massive backlog of infringements that had been causing him and his government so much embarrassment? Mr J.C. KOBELKE replied: I deny that absolutely. The situation is that the police are about enforcing road safety. They are making a tremendous effort at it. Under the current commissioner, a range of officers have been swapped to the traffic enforcement group, and a new operational group has been set up and officers have been assigned to it and cars have been purchased. The police are putting a much larger effort into having a visible presence on the roads. That has now been extended to country highways. Locating Multanovas in country areas is a very proactive way of making sure that our roads are safer. I have confidence that the police are doing that to ensure that our roads are safer and not, as the member has implied, simply to try to fix up some book work. COMMONWEALTH STATE/TERRITORY DISABILITY AGREEMENT 377. Mr P.W. ANDREWS to the Minister for Disability Services: Can the minister inform the house of the current status of negotiations regarding the Commonwealth State/Territory Disability Agreement? Ms S.M. McHALE replied: I thank the member for Southern River for his question. This morning I paid tribute to Barry MacKinnon for his leadership of the Disability Services Commission over the past 13 years. At the function on Monday, Barry acknowledged the efforts of both Liberal and Labor state governments during his leadership. He particularly congratulated the state Labor effort over the past five years. However, in contrast he lamented the parlous effort of the commonwealth government in response to the needs of people with disabilities. It is very interesting that a statesman such as Barry MacKinnon would pass observations on the appalling efforts of the commonwealth government. That is the state of negotiations. They are very disappointing. We entered into negotiations in good faith late last year and in earnest in March this year. I was hopeful that the commonwealth would genuinely work with the states and territories to improve the lives of people with disabilities. Throughout the process, Western Australia has done what the commonwealth has asked. Indeed, on 27 June we submitted a bid to the commonwealth government for matching funding. We put on the table an offer of $55 million in new money recurrent, which would have accumulated to $156 million. We put that on the table before the federal minister unilaterally withdrew the offer to the other states. We reaffirmed this offer in writing on 27 July. I must inform members that despite continual phone calls, we are still waiting for a

4246 [ASSEMBLY - Thursday, 16 August 2007] response from the commonwealth government. On 25 July, the commonwealth minister gave a commitment to all jurisdictions that he would provide written advice about the ageing carers initiative. We have commended that $1.7 billion disability assistance program, but we are still waiting for a response. The minister gave a commitment that he would inform jurisdictions of how this would be working by 31 July. The commonwealth government has imposed arbitrary deadlines on states and territories after the fact and has coupled this with making announcements on the run. This is not what Western Australia wants or what people with disabilities want. We have a very clear and unambiguous plan to address unmet need and growth. We put an offer on the table of $55 million. That has not yet been responded to. That is not acceptable to people with disabilities, who have been ignored by the commonwealth government in all but the critical months leading up to the federal election. The Prime Minister thinks that people with disabilities can be bought off with a meagre $1 000 and a few empty promises. That is not what people with disabilities want. We need a response to our matching funding, we need details of how the commonwealth will purportedly support aged carers and we need a genuine commitment from the commonwealth government rather than the empty promises that we have had so far. MEMBER FOR COLLIE-WELLINGTON - DRINK-DRIVING OFFENCE 378. Mr R.F. JOHNSON to the Minister for Police and Emergency Services: Mr Speaker, I seek your indulgence in allowing me to acknowledge the year 11 political and legal studies students and teachers from Frederick Irwin Anglican School and senior residents from Settlers Lakeside Village in Ravenswood, both in the Murray electorate, who are here today. I refer to the member for Collie-Wellington’s serious drink-driving offence. (1) Did the police commissioner or any senior police officer report this offence to the minister; and, if yes, on what date? If so, did the minister or any of his staff then report the offence to the Premier or to any of his staff? Mr P.B. Watson interjected. Mr R.F. JOHNSON: This is serious, my friend. My question continues - If yes, on what date? (2) Was the delay between the time the minister and/or the Premier found out about the member’s offence and the time he made his statement to Parliament yesterday designed to avoid embarrassment to the Carpenter government as it debated the Road Traffic Amendment Bill (No. 2) 2007, which deals with road safety and drink driving? Mr J.C. KOBELKE replied: (1)-(2) The conspiracy theory contained within the question indicates why the opposition has a problem in getting any traction in the electorate: it simply does not deal with the issues. Was I informed of this matter by the police? The answer is no. Did I then inform the Premier of something that I did not know? No. Therefore, the further question is irrelevant. RENEWABLE ENERGY TECHNOLOGIES - INTERNATIONAL INTEREST 379. Mrs J. HUGHES to the Minister for Energy: Has any international interest been shown in Western Australia’s rapidly expanding suite of renewable energy technologies? Mr F.M. LOGAN replied: I thank the member for Kingsley for that question. I can answer in the affirmative. Since the disaggregation of Western Power last year and the establishment of the wholesale energy market, I have spoken often in this place about the interest that has been shown by private companies in generating and selling power into the grid, including renewable energy companies that are coming to or emerging out of the industry in Western Australia. A significant amount of research and development is also being undertaken in this area. Members would know - they will have seen it on television - that WA company SeaPower Pacific Pty Ltd is trying to bring to commercial endeavour the wave energy machines that it has off Fremantle. Members will also know of Verve Energy’s multilayered, integrated wood processing plant at Narrogin and, of course, of the work being done by a professor at Murdoch University in extracting hydrogen from blue-green algae. These are all terrific Western Australian technologies that are close to commercialisation. Members will have heard the announcement yesterday that a consortium is looking to build a 40-megawatt biomass power plant at Bridgetown. This is another example of a renewable energy company that wishes to sell into the grid. In the north west, there is significant interest in the establishment of large-scale solar-power plants that would sell into the north west integrated system.

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It does not come as much surprise that people around the world are interested in what we are doing in Western Australia, particularly as renewable energy and biofuels represent one of the four key pillars of the beyond-the- boom strategy. CNBC, a large business channel network that is broadcast across the United States, Asia and Europe, sent representatives from its Singapore office to Western Australia last weekend to take up the story of research and development in Western Australia and also of the new market that is being created in Western Australia. They were particularly interested in the work of Verve Energy at Rottnest, with its world-first wind- diesel technology. This switching technology can be quickly turned from wind to diesel to allow for some base- load power. When the electricity is not being consumed on Rottnest, it is used to power the desalination plant, which allows the gathering of water on Rottnest for holidaymakers. It is fantastic, small-scale, world-first technology. That gives members some idea of what is being done in Western Australia. There is international interest in what is being done. However, it is a pity that the sort of enthusiasm shown by international business news channels is not shared by the commonwealth government. Unfortunately, I found out today that the commonwealth government - which, as we know, was a late and partial convert to the issue of climate change - is now frustrating the endeavours of states and territories. I will explain. At the Council of Australian Governments meeting in April 2007, all Australian governments agreed to an arrangement for reporting greenhouse gas emissions. Yesterday, the commonwealth introduced legislation that would require all companies that emit more than 25 kilotonnes of greenhouse gases each year to report those emissions to the commonwealth. Closer examination of the legislation that was introduced into the commonwealth Parliament in Canberra yesterday indicated that it may not be possible for states to manage greenhouse gas emissions or to monitor their performance in reducing greenhouse gas emissions. In fact, the new legislation almost entirely fetters the ability of the Western Australian government, for example, to require Western Australian companies to report greenhouse gas emissions to it or the public for any purpose. Of course, the effect of this new legislation is that it will stop state governments from introducing measures to reduce greenhouse gas emissions by particular companies or organisations by monitoring greenhouse gas emissions. This is just another example of the commonwealth using its corporation powers to interfere with state government legislation and policies. MEMBER FOR COLLIE-WELLINGTON – DRINK-DRIVING OFFENCE 380. Mr T. BUSWELL to the Premier: (1) When did the Premier or his office receive notification of the member for Collie-Wellington’s drink- driving offence and from whom was that notification received? (2) I refer to the $1 000 donation provided by the member for Collie-Wellington to Collie RoadWise following his drink-driving offence. Can the Premier confirm whether the donation came from the member’s taxpayer-funded electoral allowance or from his personal account? Point of Order Mr M.P. MURRAY: As I am the subject of the question, I would like to give a personal explanation. The SPEAKER: I will give the member the opportunity at the completion of question time. Questions without Notice Resumed The SPEAKER: The last part of the question does not fall within the province of the Premier. However, the first part of the question does. Mr A.J. CARPENTER replied: I answered the question yesterday. The member for Collie-Wellington informed me on Tuesday morning. On Monday evening I was told that there was a rumour about that the member for Collie-Wellington had a .05 offence some weeks before. It was a rumour. I spoke to the member for Collie-Wellington directly after caucus on Tuesday morning in my office and he told me what had happened. I reported that to the Parliament yesterday. Mr C.J. Barnett: Did he come to you? Mr A.J. CARPENTER: He came down to my office immediately after. Mr C.J. Barnett: Did you go to him or did he come to you? Mr A.J. CARPENTER: I gave that information to the house yesterday. I faithfully described what had happened. The SPEAKER: That completes question time. MEMBER FOR COLLIE-WELLINGTON Donation to Collie RoadWise - Personal Explanation MR M.P. MURRAY (Collie-Wellington - Parliamentary Secretary) [2.41 pm] - by leave: I thank the house for the opportunity. I refer to the $1 000. I will furnish my bank statements to show that it came out of my personal account transferred across to my cheque account.

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I will also make another little statement. There are some people on the other side who should not drive home after too many red wines, because I will be informing the police. Several members interjected. The SPEAKER: Order, members! Clearly, the last part - Mr C.J. Barnett interjected. The SPEAKER: Can the member for Cottesloe not see me standing? Member for Collie-Wellington, clearly the last part of that statement is not part of the personal explanation. We now move to orders of the day. Several members interjected. The SPEAKER: Members, the level of noise means that we cannot even put a question because everyone wants to have their little say about whatever they want to say. We want to proceed with the business of this house. If members want to comment, they should comment elsewhere. Mr C.J. Barnett interjected. The SPEAKER: Order! I call the member for Cottesloe to order for the third time. The question is that order of the day 1 be taken.

STATE SUPERANNUATION AMENDMENT BILL 2007 Second Reading Resumed from an earlier stage of the sitting. Point of Order Mr C.J. BARNETT: During the morning session we had a debate to suspend standing orders, which was postponed. My understanding of the postponement was that it would resume immediately following question time. The SPEAKER: That may be the member’s understanding but it was adjourned to a later stage of today’s sitting. Mr C.J. Barnett interjected. The SPEAKER: I am just telling the member what the situation is. I do not want a debate. We are now moving to orders of the day. If the member wants the suspension of standing orders to come on, it is simply a matter of moving it. Mr C.J. BARNETT: I move - That debate resume on the motion to suspend standing orders. Several members interjected. The SPEAKER: Order! We must first adjourn debate on the order of the day and then reinstitute the motion for the suspension of standing orders. Adjournment of Debate Mr C.J. BARNETT: I move - That the debate be adjourned until a later stage of the sitting. Question put and passed. [Continued on next page.]

MINISTER FOR HEALTH - KNOWLEDGE OF FREEDOM OF INFORMATION APPLICATION Standing Orders Suspension - Motion Resumed from an earlier stage of the sitting. The SPEAKER: Order! The question before the house is that standing orders be suspended. If I hear a dissenting voice, I will need to divide the house. All those in favour say aye. Against say no. I hear a dissenting voice. I call a division. Division taken with the following result -

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Ayes (22)

Mr C.J. Barnett Mr M.J. Cowper Mr J.E. McGrath Ms S.E. Walker Mr D.F. Barron-Sullivan Mr J.H.D. Day Mr P.D. Omodei Mr G.A. Woodhams Mr M.J. Birney Mr B.J. Grylls Mr G. Snook Dr J.M. Woollard Mr T.R. Buswell Dr K.D. Hames Dr S.C. Thomas Mr T.R. Sprigg (Teller) Mr G.M. Castrilli Ms K. Hodson-Thomas Mr M.W. Trenorden Dr E. Constable Mr R.F. Johnson Mr T.K. Waldron

Noes (28)

Mr P.W. Andrews Mr J.C. Kobelke Mrs C.A. Martin Mr E.S. Ripper Mr A.J. Carpenter Mr R.C. Kucera Mr M.P. Murray Mr T.G. Stephens Mr J.B. D’Orazio Mr F.M. Logan Mr A.P. O’Gorman Mr D.A. Templeman Dr J.M. Edwards Mr J.A. McGinty Mr P. Papalia Mr P.B. Watson Mrs D.J. Guise Mr M. McGowan Mr J.R. Quigley Mr M.P. Whitely Mrs J. Hughes Ms S.M. McHale Ms M.M. Quirk Mr B.S. Wyatt Mr J.N. Hyde Mr A.D. McRae Ms J.A. Radisich Mr S.R. Hill (Teller)

Pairs

Dr G.G. Jacobs Ms A.J.G. MacTiernan Mr A.J. Simpson Mrs M.H. Roberts Absolute majority not achieved; question thus negatived. The SPEAKER: Just before I give the call to the Leader of the House, I remind members that they are not supposed to go through that passageway when crossing the floor of the house. I say that just for those members who have forgotten; I am sure that a couple have. STATE SUPERANNUATION AMENDMENT BILL 2007 Second Reading Resumed from an earlier stage of the sitting. MR E.S. RIPPER (Belmont - Treasurer) [2.50 pm]: Before the lunch break I was responding to a debate in the house on these changes to the superannuation arrangements. I was asked what consultation and communication there had been on the bill, and I have some information for the house. As part of a broader consultation with stakeholders, I made an announcement in January 2007 about this reform program. Communication was provided to Government Employees Superannuation Board members by GESB on the possible introduction of choice and a proposal for GESB to become commonwealth-regulated and a member-owned mutual. Broader consultation was carried out jointly by the Department of Treasury and Finance and GESB. The stakeholders consulted include GESB members; key government agencies, including the Department of Consumer and Employment Protection, the Department of the Premier and Cabinet, the State Solicitor’s Office, the Office of Shared Services and the Office of the Auditor General. Ms S.E. Walker: Excuse me, I appreciate that you have provided that information. Without any criticism of GESB, did GESB send the notices only to the people who are in schemes other than the Gold State Super and pension scheme? Mr E.S. RIPPER: I think the question is: was GESB’s communication with GESB members restricted to those people in the accumulation schemes or was it also to those members in the defined benefit schemes? Ms S.E. Walker: Was it to everyone? Mr E.S. RIPPER: I think the answer is that GESB communicated with all members of GESB. The other groups consulted were the director generals, chief executive officers and senior executive officers of government agencies that employ the majority of active GESB members; employer representatives of government agencies; human resources managers and payroll staff; unions, including UnionsWA, the State School Teachers’ Union of WA, the Health Services Union of Western Australia, the Western Australian Police Union, the Liquor, Hospitality and Miscellaneous Union, the Community and Public Sector Union-Civil Service Association of WA, the Prison Officers Union, the Rail Tram and Bus Union and the Australian Nursing Federation; and GESB employees. In March 2007, GESB members were consulted and invited to submit their view on choice via their six-monthly member statements, member magazines, the GESB website and email. More than 230 emails were received from members indicating their overwhelming support for choice. Members’ reaction has been overwhelmingly

4250 [ASSEMBLY - Thursday, 16 August 2007] positive and has indicated significant support for the proposal, with the majority of respondents being former public sector employees wanting to direct their superannuation guaranteed payments to GESB or to understand how family members can join. This feedback supports previous research that indicated that four in five West State Super members consider it important to have the right to choose a superannuation fund into which their employer contributions are paid. A survey conducted with GESB members in March 2006 showed that the majority of former public sector employees are likely to either definitely or probably invest their employer contributions with GESB, and indicated that over one in two former public sector employees would move back to GESB either definitely or probably, if they could. Strong support for choice has been received from stakeholders, particularly members. Their reaction is represented by the following comments from members, which, according to my notes, state - Great idea, especially if I can contribute super from a private employer so I don’t have to have more than 1 super fund. I think all Australians should have choice of superannuation fund … it is ridiculous that most Australians have choice but a few don’t, namely State public servants. I look forward to this day as GESB is such a good performer. I live in hope that some day soon GESB will be the only fund I need to have. Where are we going from now with consultation? GESB members will receive their next six-monthly member reports and statements by the end of August. This communication informs members of the State Superannuation Amendment Bill 2007 and what it will mean for them as members. Employers and unions will continue to be consulted on the development of educational materials and information for their employees and members. There will also be a significant period of time, probably 12 months, between the passage of this legislation and the actual commencement of the new arrangements. During that time, the Department of Consumer and Employment Protection, the Department of Treasury and Finance and GESB will be working together on an education strategy to inform and educate Western Australian public sector employees and employers ahead of the introduction of choice. The aims of this program are to inform and educate employees ahead of the introduction of the choice of fund to enable them to make an informed choice, provide training and education to employers on their compliance obligations in a choice environment, and assist employers in meeting their ongoing administrative and compliance obligations after the choice of fund is introduced. The program is planned to run over an 18-month period covering the 12 months before, and the six months after, choice is introduced. It is important that we educate members about their rights and responsibilities in a choice environment. A comprehensive education strategy for employees, as well as a strong regulatory regime, will help minimise the risk of members being exposed to so-called mis-selling after choice is introduced. Mis-selling may arise if employees access some form of financial advice through a financial adviser or planner and are encouraged to change super funds as a result of the commissioned-based incentives that exist between financial planners and some of the large retail funds. The program will be developed in consultation with employers and unions. It will educate Western Australian public sector employees on what choice of fund means for them; educate employees to enable them to make an informed decision; and provide service and information materials to assist employees, including a helpline, information and education seminars and sessions, publications and promotional materials, and a website. The program will educate employers on their responsibilities and obligations in offering choice of fund to their employees; enable them to comply with the commonwealth choice compliance framework; assist employers to develop administration systems and processes to implement choice; advise employers on the necessary record- keeping requirements; assist employers with queries, including a helpline, information and education seminars and sessions, publications and promotional materials, and a website; and inform employers about GESB’s role as the default fund for members. This has been a thoroughly researched and designed reform program with a strong emphasis on continuing consultation with stakeholders. Obviously, good research, good preparation, good consultation and good information are essential for the success of a reform program like this one. I have confidence that GESB has been working very hard, as has the Department of Treasury and Finance, to give this program of reform the best possible chance of succeeding. I thank members of this house for the support they have expressed for the legislation. I look forward to seeing, sometime next year, a choice of superannuation fund being available to a quarter of a million households that are now denied their choice of their GESB superannuation arrangements. Question put and passed. Bill read a second time.

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Consideration in Detail Clause 1: Short title - Mr T. BUSWELL: I thank the Deputy Speaker for giving me this opportunity to discuss this most important clause in the bill. The short title of the bill is the State Superannuation Amendment Act. I know that the Treasurer thinks that this is a matter of semantics, but I am of the view that because this is clearly a bill for the privatisation of the Government Employees Superannuation Board by this Treasurer, who has so ardently and stridently opposed any form of privatisation every time he has taken a breath in this house, the bill should include the word “privatisation” in the short title. Perhaps it could be called the “GESB privatisation bill” or something to that effect. We would like to see the title of the bill more accurately reflect what is happening. I do not care how the Treasurer and his vast spin machine attempt to manipulate what is happening; as I said yesterday, GESB is being privatised. I again quote from the Australian Macquarie Dictionary, which gives two definitions of privatisation. The first definition is to change the status of land, industries, services etc from that of state to private ownership. Mr C.J. Barnett: It sounds like privatisation. Mr T. BUSWELL: It sounds like it, looks like it, smells like it and I reckon that when it is all done and dusted, that is what will be happening. The Treasurer said that this was not a privatisation but a mutualisation. I put it to the Treasurer that with the creation of MutualCo, the Treasurer is, in effect, transferring ownership from the state government to private industry. That is exactly what is being done. Each of the shareholders in MutualCo, who are currently employees of the Western Australian public sector, will suddenly become, by virtue of these changes, holders of an interest each in the company. They will own the assets and ultimately control the direction of the company. The bill explicitly prohibits this new entity from using the word “government” or expressing a link with the government. The bill also puts in place a mechanism - it is a good mechanism - to make sure that the new employees of the new entity are not employees of the state. I do not understand how the Treasurer can say that this is not privatisation, because that is what it is. I told the Treasurer yesterday that he should not be embarrassed by it. We know that the Treasurer is a reformist. He supports seven-day trading but had his proverbial backside kicked the length and breadth of the Acting Premier’s office in January when he ran that reformist flag up the pole. Mr E.S. Ripper: I think that you had similar problems on that issue. Mr T. BUSWELL: The bruises that adorn my buttocks are somewhat less severe and less intense than those that cover the Treasurer’s following the introduction of that issue into the public domain in January when, as Acting Premier, he was running the show. Maybe if the Treasurer was running the show instead of the Premier, we would have proper reform and he could embrace what he is doing to GESB, because what this bill does to GESB is good. Other benefits could accrue to other areas of government because of the Treasurer’s new reforming zeal. Good on the Treasurer for embracing this new reform agenda! Do not be embarrassed. He should put the word “privatisation” in the title of the bill so that everyone will know what he is up to. As I said yesterday, some of the Treasurer’s federal counterparts also had that zeal. They privatised the Commonwealth Bank and Qantas. They are great Australian institutions. Nobody could say that either the Commonwealth Bank or Qantas is worse off for that experience. They have gone from strength to strength. If members analyse the experience of the privatisation of the Commonwealth Bank and Qantas, they will find that following their privatisation the organisations have improved and developed well beyond what they would have done if they had remained public entities. I suspect that will happen to GESB as well. There is a lot of capacity for excellence in GESB, and the Treasurer’s newly found privatisation agenda will unlock that. Please, Treasurer, do not be embarrassed by that. Have the heart to stick it in the short title. Mr C.J. BARNETT: I do not intend to speak much on this bill but I congratulate the Treasurer for this privatisation. The Deputy Leader of the Opposition is exactly correct. At last the Treasurer has followed the lead of the Hawke and Keating governments of the 1980s. When the Treasurer was in power in the early 1990s, he was looking at privatising SGIO and BankWest but when the election came along, he suddenly hated privatisation. Clearly this is privatisation. Why be ashamed of it? Be proud of it as a modern Labor Treasurer, like some others who have embraced privatisation. When the Government Employees Superannuation Board is privatised and this bill comes into effect in 12 months’ time, will GESB wander around saying that it is a sort of government or sort of private organisation? No. It will say that it is clearly a private sector organisation that looks after its contributors of superannuation and is investing the money appropriately, as it should be doing. I am sure that it will do it very well, as it has done up to now. Why will the Treasurer not admit it? This is economic rationalism. I support it. I am proud to say that I privatised AlintaGas and the Dampier to Bunbury pipeline. I have written a book about it and about the Labor Party’s failures; it is very interesting. Mr E.S. Ripper: Has anyone bought the book? Mr C.J. BARNETT: I hope that the Treasurer does. Why is the Treasurer not proud of it? Why does he sit there and pretend that he is not privatising it? We would love to hear from the Treasurer’s advisers about how

4252 [ASSEMBLY - Thursday, 16 August 2007] they see it. They will not be allowed to speak, as is quite proper, but I am sure that if they had the opportunity to speak, they would make it clear that this is privatisation. When they are in the marketplace and are trying to attract contributors and to promote the investment portfolio, they will talk about this as the former government’s superannuation fund that is now a private superannuation fund. They will not say in the marketplace that it is a sort of dodgy half-government and half-private outfit. They will say that it is fully private, and they will sing the Treasurer’s praises for having the courage, as a Labor Treasurer, to privatise it. Why does the Treasurer not take his moment of glory now and say, “Yes, it’s me, the secret privatiser of the Labor Party; I am doing it”? Why does the Treasurer not do that? Mr M.W. TRENORDEN: There is another reason the Treasurer should be proud of his privatisation zeal in this case as well. I asked the Treasurer’s advisers in the briefing about the disasters of the previous Labor administration that have only just filtered out of GESB. Members must remember that they were sensational times when Australian Labor Party ministers were running up and down St Georges Terrace flinging cheques everywhere on a daily basis. Julian Grill was as busy as a one-armed wallpaper hanger running cheques up and down St Georges Terrace. How can we forget Central Park? For some time the state superannuation was really secure because the only asset it had was property, which was thrown at them by a corrupt Burke administration. One of the things the Treasurer can be proud of is that he can now say that that cannot happen in the future. Under a corporatised body, those sorts of pressures that were brought to bear by a corrupt administration not that long ago will be a thing of the past. The superannuation funds will not be embarrassed by having highly disproportionate property holdings and shareholdings. There were some very interesting share transactions going on at that time. I asked that question yesterday, or whenever the briefing occurred, because I think it is important to know the answer as we move to the new entity and new regulation. As the Treasurer outlined in his second reading speech, the funds now comply with the normal process for the administration of superannuation funds. The minister should be proud of that. Privatise it, and it cannot happen in the future. Mr T. BUSWELL: I move - Page 2, line 3 - To delete the words following “the”, and substitute - Superannuation (Privatisation) Amendment Act 2007 Mr E.S. RIPPER: One of the problems of an opposition in decline is that it seeks to re-fight old battles. How the wounds from the debates of 1999, 2000 and 2004 must still sting the opposition! I was in opposition once, and in our dog days we kept returning to the same old fights that we had already lost. We were beaten again, and then we went back and were beaten yet again. We started to progress only when we took on new fights that were more advantageous for us. I can remember the debate on the Alinta privatisation, and I do not recall that the word “privatisation” was included in the title of the bill. In fact, my recollection is that the title of the bill referred to the word “sale” or “disposal”. It certainly did not use the term “privatisation”. Let us go back to that Alinta privatisation. Did the member for Cottesloe, as the then minister, give Alinta to its customers? No, he did not. He sold most of it to a United States firm and floated the rest on the stock market. Mr C.J. Barnett: Only 45 per cent was sold to the US firm. How many shareholders were there? There were 117 000. Mr E.S. RIPPER: Were they all customers of Alinta? Mr C.J. Barnett: Pretty well; 90 per cent of them were Western Australians, and so would have been customers of Alinta. Mr E.S. RIPPER: There are two big differences between the Alinta privatisation and what is proposed here. Firstly, Alinta was sold, not given and, secondly, it was not transferred to its customers; it was transferred - as the former leader of the Liberal Party reminds me - 45 per cent to an American firm, with the remainder floated on the stock market. No consideration is being transferred here. GESB has 250 000 members, and it is being transferred to those members, who will not have to pay. The government is not making a cent out of this issue. Mr T. Buswell: You’d better make sure of that. Mr E.S. RIPPER: Does the Deputy Leader of the Opposition believe that the government will profit out of this? Mr T. Buswell: Make sure the reserves are transferred over appropriately. Mr E.S. RIPPER: Of course the reserves will be transferred appropriately. Mr T. Buswell: They will be; we’ll be watching. Mr E.S. RIPPER: They will be anyway, whether or not the opposition is watching, because transferring the reserves appropriately is the right thing to do. This is not about government profit; this is about the best interests of the members.

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Mr T. Buswell: What happens if the actuary’s advice indicates that the amount to be transferred over is less than the balance of the reserve? What happens to the amount that is left over? Mr E.S. RIPPER: I do not think that is the issue. The state retains responsibility for the defined benefit schemes. Mr T. Buswell: I understand that. Mr E.S. RIPPER: Right, so some reserves will be applicable to the schemes for which the state retains responsibility. There are some schemes for which the state has no continuing responsibility, and there are reserves applicable to those. It will not be a question of there being something left over after the reserves have been transferred to support the accumulation schemes; it will be a question of properly, fairly and rationally dividing the reserves between those that are applicable to the defined benefit schemes and those that are applicable to the accumulation schemes. There will not be any surplus in the reserves; the reserves will be divided as they should be. This is a good reform. Of course, the opposition can have a little political game if it wants, and I am happy to indulge it with 10 or 15 minutes of parliamentary ping-pong. Mr C.J. Barnett: How gracious of you! Mr E.S. RIPPER: We can have half an hour or an hour of parliamentary ping-pong if the opposition wishes, but when we have finished that, we can get on with what we all appear to agree is a good reform for a quarter of a million Western Australians. Mr C.J. Barnett: We support the privatisation. Mr E.S. RIPPER: If the opposition needs to think of it in those ideological terms in order to bring itself to support a Labor government initiative, it can do that. I describe it as a mutualisation. We are not selling or giving it to third parties; we are giving it to the members. Mr M.W. TRENORDEN: The Treasurer’s statement is simply not true. The facts are that the government is not giving it at all. The fund members will pay for this transfer. Mr E.S. Ripper: So, as Treasurer, will I get some sort of consideration in the consolidated account for the transfer of GESB? Mr M.W. TRENORDEN: No, but the members will pay for it. The Treasurer knows that they will. The cost of the transfer is not coming out of the Treasurer’s pocket; it is coming out of GESB’s pocket. The Treasurer cannot look us in the eye and say that he is giving it away. Mr E.S. Ripper: I am not selling it. Mr M.W. TRENORDEN: No, but the Treasurer is making GESB pay for it, because GESB is supplying all the funds for this transaction. How much money, in real terms, is going into Treasury as a result of this transfer? Mr E.S. Ripper: Well, none. Mr M.W. TRENORDEN: Funny about that! One of the things I am worried about here is that we do not know what that figure is. I asked during the briefing what the costs are. I was told, quite rightly, that naming is not a big expense, and transferring assets may or may not be a big expense. I am not sure about that. However, we are still not being told how much expense will be incurred. I have been informed - and I accept the advice - about where that money is coming from, but it is still part of the pool of GESB. GESB is paying for this process, not the Treasurer. The Treasurer cannot say he is giving it away. There is a cost process here, and we will pass this bill today without any knowledge of that cost process. Is that responsible? I have told the Treasurer that the Nationals will support this bill, but there are some concerns about it. There are a range of costings that are just not available. Mr T. BUSWELL: In support of the amendment, I will very quickly deal with the points the Treasurer has raised about the technicalities of this obvious privatisation. We have given him an opportunity to come out of the closet as a privatiser or a privateer in the vein of Jack Sparrow of The Pirates of the Caribbean. He could be a great “privatiseer” as the Buccaneer of Belmont! Firstly, the Treasurer talks about the fact that this bill will create a mutualisation. The facts are that a GESB mutual is being transferred from state government control to the control of a company that is limited by guarantee under the Corporations Act, as opposed to one that has a shareholding structure. This asset is being transferred from the state to a company that is registered and operates under corporations law in Australia. Granted, it is a company that is limited by guarantee. However, I have seen nothing in any definition of privatisation that says the asset must be transferred to a company with a particular ownership structure. The other issue the Treasurer raised is that it is being gifted, not sold. As the member for Avon pointed out, there may well be some costs involved -

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Mr M.W. Trenorden interjected. Mr T. BUSWELL: I accept that. Whether it is given or sold, does not alter the fact that the asset is being transferred. The Australian Macquarie Dictionary definition of privatise is as follows - To change the status of . . . from that of state to private . . . . That is exactly what is happening here. The third point about whether it is being transferred to existing customers is irrelevant. The assets are being transferred - rightly so in my view - to the private sector. Our well thought out amendment to the short title is something the Treasurer should give consideration to. Dr J.M. WOOLLARD: I think the member for Vasse should change the date in his amendment to 2008. I think the transition period is one year, is it not Treasurer, from when the act is gazetted? Mr E.S. Ripper: Yes. Dr J.M. WOOLLARD: I believe that it will be at least one year before - Mr E.S. RIPPER: Just to make it clear, it is one year before choice is operational. Obviously, a lot of changes must be made during that period in order to get to the point at which choice is applicable. It becomes operational one year after the legislation, although changes will be made along the way. Dr J.M. WOOLLARD: Can there be a meeting of members during that transition period and can there be a proposed amendment to the constitution? Once this bill is passed in the upper house and has been gazetted, can a meeting be called immediately to amend the constitution to change this from a company limited by guarantee to a company limited by shares? Mr E.S. RIPPER: I think we are moving on from the title of the bill with that last set of questions, so it might be more appropriate to debate that question when we get to the relevant clause. Nevertheless, to clarify some of the remarks I made by interjection, once the legislation is proclaimed, GESB will become public offer. Choice will not be available to public sector employees until a year after the passage of the legislation. Dr J.M. Woollard: In which case, it will be at least one year before choice can be a company limited by guarantee? Have I got this wrong? Mr E.S. RIPPER: I think the member has. I suggest that we get on with the debate once we have played a bit of ping-pong. Dr J.M. Woollard: It is the issue of privatisation I am not quite sure about. I know there is the ability for this body to be privatised, but I am querying when that option will become available. The amendment moved by the Deputy Leader of the Opposition seeks to change the title to include privatisation by 2007. My comments are relevant because I do not know whether this amendment has legs at the moment. I am not sure that it can happen in 2007. Mr E.S. RIPPER: I can confirm to the house that it does not have the numbers, but legs is an issue that is in the eye of the beholder! Mr C.J. Barnett: No-one ever said that the opposition was legless! Mr E.S. RIPPER: I could have done so; I am sorry that I missed that opportunity! There are mechanisms in the legislation that, with a sufficiently large number of members, will be able to change the model. Equally, there are strong safeguards giving the Treasurer a veto for at least three years on changes that are important. Dr J.M. Woollard: Is it three years? I was asking how long the transition was. Mr E.S. RIPPER: The Treasurer at that time will have the capacity to extend the three-year period, so a pretty serious set of safeguards will prevent precipitate or unwise change to superannuation arrangements. I think those safeguards and that long period during which those safeguards could apply will give people confidence that this will be a stable set of arrangements. Dr J.M. Woollard: In fact, you are saying that there will not be privatisation before 2010 at a minimum? Mr E.S. RIPPER: I would not support privatisation. I cannot see why the members would get an advantage from demutualising GESB. I do not have a crystal ball. Mr T. Buswell: Did you have shares in National Mutual? Mr E.S. RIPPER: I am aware of those changes. Mr T. Buswell: That is not necessarily a bad thing, if that happens down the track. Mr E.S. RIPPER: Opinions may vary on that. That is very much a hypothetical situation. If I were the Treasurer, I would exercise a veto on demutualisation.

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The other issue I want to take up is the question of the costs. I am advised that the costs are being met from GESB reserves, not from member accounts. Obviously, some reserves are applicable to the accumulation funds. We cannot have those reserves skinnier than is required. The only reserves that can be affected are those that relate to the defined benefit schemes in which the state has an obligation to deliver the benefit and meet the gap between what is available in the fund in the reserves and what must be paid out. Ultimately, the cost comes back to the state. Dr J.M. Woollard: Is the Treasurer saying that any sum of money for setting up this scheme will not come from members’ administration fees? Mr E.S. RIPPER: That is right. Amendment put and a division taken with the following result - Ayes (23)

Mr C.J. Barnett Mr M.J. Cowper Mr J.E. McGrath Mr T.K. Waldron Mr D.F. Barron-Sullivan Mr J.H.D. Day Mr P.D. Omodei Ms S.E. Walker Mr M.J. Birney Mr B.J. Grylls Mr A.J. Simpson Mr G.A. Woodhams Mr T.R. Buswell Dr K.D. Hames Mr G. Snook Dr J.M. Woollard Mr G.M. Castrilli Dr G.G. Jacobs Dr S.C. Thomas Mr T.R. Sprigg (Teller) Dr E. Constable Mr R.F. Johnson Mr M.W. Trenorden Noes (26)

Mr P.W. Andrews Mr R.C. Kucera Mr A.P. O’Gorman Mr D.A. Templeman Mr A.J. Carpenter Mr F.M. Logan Mr P. Papalia Mr P.B. Watson Mr J.B. D’Orazio Mr M. McGowan Mr J.R. Quigley Mr M.P. Whitely Dr J.M. Edwards Ms S.M. McHale Ms M.M. Quirk Mr B.S. Wyatt Mrs J. Hughes Mr A.D. McRae Ms J.A. Radisich Mr S.R. Hill (Teller) Mr J.N. Hyde Mrs C.A. Martin Mr E.S. Ripper Mr J.C. Kobelke Mr M.P. Murray Mr T.G. Stephens

Pairs

Mr D.T. Redman Ms A.J.G. MacTiernan Ms K. Hodson-Thomas Mrs M.H. Roberts Amendment thus negatived. Clause put and passed. The DEPUTY SPEAKER: Would the member for Vasse like to indicate to me which clause he wants to go to? Mr T. Buswell: I would, Madam Deputy Speaker, if I could find the bill. Obviously one of the government members who sat in my seat tried to sabotage my efforts to scrutinise this bill! We are going onto clause 2. The DEPUTY SPEAKER: The member for Vasse should take his seat while I put the question and then he can seek the call. Clause 2: Commencement - Mr T. BUSWELL: Could the Treasurer provide a brief overview of the reasons and rationale behind the staggered commencement dates of this bill? It is important that people understand the reason for the staggered nature of the commencement dates. I do not need too much detail but it is for my information. Mr E.S. RIPPER: Briefly, it is necessary to establish the entities, then it is necessary to transfer the assets, and then it is possible to offer choice to members. Clause put and passed. Clauses 3 to 13 put and passed. Clause 14: Section 38 amended - Mr T. BUSWELL: Again very quickly, I understand that this clause makes some amendments to section 38 of the State Superannuation Act 2000 which deals with regulations. I am particularly interested in proposed new subsection (3). Could the Treasurer explain to me the implications or the practical application of proposed new subsection (3)(b)? It states “reduce, or have the same effect as reducing” and it relates to the West State Super scheme. Could the Treasurer give me a quick overview? Mr E.S. RIPPER: I think I can understand why the Deputy Leader of the Opposition asked why there would be a multiplying factor, because the West State Super scheme is an accumulation scheme. However, the insurance aspect of West State has a multiplying factor. There is a defined benefit aspect to the insurance section of the

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West State scheme. I am advised that, in effect, we are just shifting about this provision in the legislation while retaining it. Clause put and passed. Clause 15 put and passed. Clause 16: Parts 4 and 5 inserted - Mr E.S. RIPPER: I move - Page 21, after line 7 - To insert - (3) The use of the terms “West State” or “Gold State” in relation to the superannuation schemes referred to in section 29(1)(a) and (b), or divisions of GESB Superannuation that replace those schemes, does not contravene subsection (1). This amendment has arisen following discussions with parliamentary counsel. Obviously the legislative scheme prevents GESB trading in a way that implies that there is some sort of government authority, government legitimation or government guarantee behind those schemes that does not apply to competitive superannuation schemes. However, it is obviously important for members that GESB continue to call its West State Super scheme West State and its Gold State Super scheme Gold State so that there is no confusion for members. This therefore preserves the prohibition on GESB implying that it has a government guarantee while allowing it to maintain its brands. Amendment put and passed. Mr E.S. RIPPER: I move - Page 21, after line 26 - To insert - 51A. Notice of exercise of veto to be tabled If the Treasurer exercises a power under a veto provision, as defined in section 51, the Treasurer must, within 14 days after the power is exercised - (a) give written notice to MutualCo confirming the exercise of the power; and (b) cause a copy of the notice to be laid before each House of Parliament or dealt with under section 78. This amendment arises from briefings and consultations that have occurred with non-government members of Parliament. A concern that resulted from those briefings was that there appeared to be a lack of process or accountability around the Treasurer’s exercise of a veto. This amendment is the government’s response, which is broadly similar to the provisions that relate to a direction that a minister might give a government trading enterprise. Given that the amendment is broadly similar to those provisions and answers the concerns of the opposition and other members, I hope it will be supported. Mr T. BUSWELL: It appears to me that this is an amendment that the opposition would support. The Treasurer has rightly identified that the opposition raised the issue. This bill generates an important responsibility for the Treasurer in that the Treasurer of the day will become a special member of GESB MutualCo and will have a range of powers that can have a significant influence on the operation and/or direction of GESB MutualCo; for example, powers associated with changes to the constitution and powers associated with the capacity to purchase or sell subsidiary companies and to borrow capital. The Treasurer will have significant capacity with those veto powers to influence the direction of GESB MutualCo. I support the Treasurer having those veto powers in the first instance, although I will talk a little about the three-year review. It is appropriate. I appreciate that the opposition’s concern was picked up and that when the Treasurer uses those veto provisions, the Parliament will be informed of their use. I thank the Treasurer for moving the amendment. I see no reason that the opposition should not support it. Madam Deputy Speaker, to assist in my contemplations of the bill, and perhaps for the information of other members, can you confirm that clause 16 runs to page 44, where clause 17 commences? The DEPUTY SPEAKER: Yes. Mr T. BUSWELL: It may be worthwhile drawing to the attention of other members who have an interest in the bill that a number of factors they have raised are covered in this clause. I would hate for them to sit by without giving it due and proper consideration. Mr E.S. Ripper: I thank you for the trouble you have just caused! Mr T. BUSWELL: I am here only to help lubricate the processes of good government! The opposition supports the amendment. Amendment put and passed.

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Mr T. BUSWELL: I will try not to jump around in debating the clause, but I want to talk about the issue of costs, which was raised by the member for Avon and subsequently the member for Alfred Cove. The Treasurer indicated earlier that there will not be an impact on costs. I understand that the legislation is such that it will not impact on the accumulated investment income of the members of GESB. That would be the last thing they would want at the moment with the stock market performing in the way it is. However, I am assured that, through wise investments, my GESB returns will not be impacted on to the full extent by the form of the Australian stock market in recent days. If my recollection is correct, the Treasurer indicated earlier that it would be funded from reserves. Mr E.S. Ripper: That’s right. Mr T. BUSWELL: This gets back to the point I raised earlier. As the Treasurer rightly pointed out, at the moment some of the reserves of GESB exist to provide reserve backing to the defined benefit scheme and some exist to provide for a range of contingencies for the accumulation schemes. I have a list of some of GESB’s reserves. For example, the West State Super minimum benefit guarantee reserve is $7 million and the general reserve is $63.6 million. I have also noted some fund reserves. One is an operational risk reserve of $77.4 million and another is a government services reserve of $28.6 million. I am interested to know which of those reserves will be responsible for funding the transfer and administration costs and any compliance costs associated with this bill. Mr E.S. RIPPER: The particular reserve that will be and has been drawn upon for the cost of this reform is the government services reserve, which, as at 30 June 2006, stood at $28.6 million. I am advised that, counting what has been spent so far and what is expected to be spent on the reform, the cost will amount to about $3 million. Mr T. BUSWELL: I understand that when the reserves, which I assume are the minimum benefit guarantee reserve, the general reserve, the operational risk reserve and the government services reserve - the Treasurer can let me know if it is only part of those - are transferred from GESB to GESB MutualCo, the actuary will look at the situation and, at the time of transfer, will tell the Treasurer how much should be transferred over in each of those reserves. That is my understanding of the basic process. The bill creates an obligation on the Treasurer to ensure that the amounts transferred are at least the amount determined by the actuary. What will happen if the amounts in those reserves are greater than that recommended by the actuary? Will those funds stay in GESB as we now know it and therefore be transferred to the state superannuation board or whatever entity it might be, will they go back to consolidated revenue, or will they go over to GESB as a balance above the amount recommended by the actuary? How will those reserves that are over and above the minimum amount that the actuary determines must be transferred, particularly those reserves that belong to the accumulation scheme, be treated? Mr E.S. RIPPER: This is one of the most important aspects of the reform implementation process. Some matters still need to be worked through by the people involved in implementing the reform before we can reach definite conclusions about the exact destination of some of the dollars. I can say this: the reserves will go either to the State Superannuation Board or to GESB MutualCo or its subsidiaries. It is a question of dividing the reserves between superannuation entities and not a question of there being some surplus that will be passed to the consolidated fund. No money will go to the consolidated fund as a result of this exercise. The money will go to the State Superannuation Board or to GESB MutualCo or one of its subsidiaries. Mr T. Buswell: Of the reserves I mentioned before, which ones specifically relate to the accumulation scheme? Mr E.S. RIPPER: I will seek advice on that. Mr T. BUSWELL: I accept the point that the Treasurer has made; that is, that the reserves - Mr M.W. Trenorden: Sorry, member for Vasse; I have been a bit distracted. What clause are we on? Mr T. BUSWELL: We are on the last page of the bill! The DEPUTY SPEAKER: We are on clause 16. Mr T. BUSWELL: We had a quiet conversation. We said that while the member for Avon was half asleep and had his deaf ear to us, we would just deal with the whole thing en bloc. Mr M.W. Trenorden: I am very pleased with the detailed examination you have done of the bill! Mr E.S. Ripper: We sent the member for Cottesloe to distract you! The DEPUTY SPEAKER: We are dealing with clause 16, member for Avon; I would not lead you astray, unlike the member for Vasse! Mr M.W. Trenorden: Thank you. Mr T. BUSWELL: I will make my point again. I am interested in making sure that the reserve funds that currently belong, if I can use that term, to the members of the accumulation scheme move over in their entirety

4258 [ASSEMBLY - Thursday, 16 August 2007] to GESB MutualCo as part of this process. I accept what the Treasurer said; that is, that the combined mass of the two entities will either go to GESB MutualCo or stay with the State Superannuation Board. My view is that if those reserves have been generated over time by investment activities or management fees or whatever we want to call it - that is, the profits associated with the activities of members of the accumulation scheme - those moneys should go with them, even if that is above what the actuary determines is a minimum requirement. If we do not do that but instead leave it in the State Superannuation Board, effectively the state, in one way or another, will be generating funds that it is not otherwise entitled to from this process. Mr E.S. RIPPER: Perhaps the Deputy Leader of the Opposition could again provide the exact question that he is asking. Mr T. Buswell: I want to make sure that the total value of the reserves that are associated with the accumulation scheme - the West State Super minimum benefit guaranteed reserve and general reserve etc - is transferred across to GESB MutualCo as part of this process, even if those reserves are over and above the amount that the actuary determines is the acceptable minimum. Mr E.S. RIPPER: The reserves will be allocated fairly according to the risks that the different parties bear. Where the members bear the risk, they will have the reserves. Where the state bears the risk or the matter relates to state obligations that could occur in the future, the reserves will be with the State Superannuation Board. Some of this is still to be worked through. What I can say is that the state will not be making a profit on this. The reserves will be divided fairly and according to rational considerations of the purpose of the reserves and where they are best located. I can indicate what GESB’s reserves were at 30 June 2006. The pension scheme had an investment fluctuation reserve of $21 million and an expenses reserve of $12.6 million. Mr T. Buswell: Is that associated with the defined benefits schemes? Mr E.S. RIPPER: That is right. Gold State Super had an investment fluctuation reserve of $375 million, an expenses reserve of $85 million and a recoupment shortfall reserve of $50 million. Mr T. Buswell: Are they defined benefit reserves? Mr E.S. RIPPER: That is right. West State Super had two reserves associated with it, including a minimum benefit guarantee reserve of $7 million, which acts like a defined benefit obligation to the state. That relates to the state guarantee that applies to the 2001 account balance indexed at CPI plus two per cent, which was the position as we shifted to member investment choice. The fourth set of reserves is the operational risk reserve of $77.4 million. The government services reserve of - Mr T. Buswell: Are they associated with market accumulated or defined benefit? You have also missed one; you missed the West State Super general reserve. Mr E.S. RIPPER: I am sorry. I was talking about the West State Super reserve. There is the minimum benefit guarantee reserve of $7 million, which, as I said, relates to the state’s defined benefit-like obligation to guarantee those 2001 account balances plus CPI plus two per cent. There is also a West State Super general reserve of $63.6 million and then there are fund reserves - an operational risk reserve of $77.4 million and a government services reserve of $28.6 million. I think the member was going to go on to ask me whether those reserves relate to particular funds. I will seek some advice on that. Mr T. Buswell: Defined benefit or accumulation. Mr E.S. RIPPER: I am advised that they are general; they do not relate to particular funds. I repeat that the guiding principle of this reform is the best interests of members. I must also take into account the interests of taxpayers - the citizens of the state as a whole. We must fairly divide the reserves between the interests of members of the public as a whole and of members of the various funds in GESB. Mr M.W. TRENORDEN: Could the Treasurer explain the other process of exactly how GESB currently runs its operational funds? It charges a fee on members’ accounts to raise funds but also attracts funds through its own investment processes. How big is that fund? Am I correct in assuming that that is the full proportion of the operational funds of GESB? Is there a formula to transfer that? Mr E.S. RIPPER: This takes us into quite a complicated area. I have been trying to make sure that I have got the right advice. GESB revenue comes from fees charged to members. Some of the reserves have also been built up because investment earnings have been greater than the defined benefit obligation that GESB is required to meet. The surplus has been put into the reserves. There will be a rigorous process to properly allocate the reserves between the State Superannuation Board and GESB MutualCo and its subsidiaries. That process will be overseen by the Auditor General, which is the accountability part of it. The other accountability mechanism is that the reserve allocation will be published in the transfer order. People will be able to see how the reserves have been allocated and they will have the assurance that the Auditor General has been looking over our shoulder at the work that has been done.

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Mr M.W. TRENORDEN: That brings back an old debate, Treasurer. Is the Treasurer going to resource the Auditor General to do that? It is a function over and above his normal processes. We had that debate only a few months ago. Nevertheless, the Treasurer has made the point and I am sure he will. I now make the point to the Treasurer that we are taking this on trust. It is very remarkable; in fact, if the Treasurer were sitting where I am now or where the member for Cottesloe is sitting, and that answer was given during another debate, I do not know whether it would be accepted. I am not having a go at the Treasurer. We have a good feeling towards this bill. However, our responsibility goes to a little more than that. We have circumstances in which some staff members will be transferred to the new entity. They have an option for a period to go with it. I think they have 12 months to decide whether to go back to the old system. The Treasurer has a complicated formula for all these funds. I have to say that GESB’s performance in recent years has been outstanding; it has been a really good performance. However, we are not talking about peanuts. We are not talking about insignificant amounts of money. The Treasurer’s answer tells me that I will find out about it after it happens. Normally, in this place that is not a good enough answer. I suspect that we will let the Treasurer get away with it. I hope that some time in the future we do not regret it. Mr T. BUSWELL: I have some substantive concerns along the lines raised by the member for Avon concerning the matter of reserves. The Treasurer has just said that he needs to weigh up the benefits of broader taxpayers versus the benefits of the members of GESB. That did little to soothe my concerns. In fact, I was so worried I had to go out and get a bit of cheese from the afternoon tea repository before it closed at four o’clock. I am concerned. Mr C.J. Barnett: All the vanilla slices had been eaten, had they? Mr T. BUSWELL: Yes. I did not get there before government members, who take all the good stuff! Mr P. Papalia interjected. Mr T. BUSWELL: I have warned the member for Peel before about interjecting. I have a couple of beauties lined up for him. I will wait for a far more heated debate; I have some real pearlers in my back drawer. This is my concern: the reserves that are linked to the accumulation funds - and I suspect a large part of the general reserves - were accumulated over time based on the investment activity and fee-paying activity of the members of the accumulation fund. I want to make sure that we are doing the right thing on behalf of those members when those funds are transferred and that their asset is protected, for want of a better term. The Treasurer has basically said in his statement that he has an obligation to meet the requirements determined by the actuary; that is not within doubt. There will be money over and above what the actuary determines and the reserve balance on the day. The Treasurer is saying that he has to look after the needs of the taxpayers of the state. In other words, there is a need to keep as much money as possible with the State Superannuation Board to help meet the unfunded liability that the member for Avon talked about before. I have some significant concerns about the process. I do not say that to cast any doubts on the quality of the people who are involved in moving this forward - not at all. Some of them are sitting with the Treasurer today. The Treasurer talks about “fair”. That was the word he used; a fair allocation. I find that when we discuss matters affecting taxpayers in this state the Treasurer’s definition of fair, my definition of fair and the definition of fair of the average punter in the street are poles apart. I do not think there is much we can do with that today in this house. However, I will be having a long talk to my colleagues in the other place to see if they can look at this issue in more detail. I will not talk about it any more. I just want to let the Treasurer know that I am not satisfied with what he has said and I do not think the member for Avon is satisfied with what he has said, although far be it from me to speak on his behalf. I will be having serious discussions with my colleagues in the other place about this particular matter because they have a better capacity to explore these issues. The Treasurer may well recall that when the Financial Management Bill went through he laughed aside some of the objections and concerns we had. Guess what? They came back. The Treasurer was not happy about it but they came back and we had our way. The Treasurer needs better answers. That is what I am trying to say. The Treasurer has between now and when the bill goes through the other place to get better answers. I am not comfortable with what the Treasurer is telling us. However, I will not hold up Parliament for the afternoon talking in circles on this issue because the point has been made. Mr M.W. TRENORDEN: I have to say that it is not acceptable that only the Auditor General reports on this process. As the Treasurer knows extremely well, the Auditor General has a particular function to play in the accounts of the state. There is a person sitting at the table who would be more qualified to comment on this than the Auditor General. The responsibility of the Auditor General will be to look at the function of this bill and tell us whether those functions have occurred correctly. He will not know about the peripheral issues of the transfer of those funds. The Department of Treasury and Finance would go a lot closer to answering those questions than would the Auditor General. However, the Treasurer just pointed out that the Department of Treasury and Finance is not an expert in superannuation funds either. It concerns me that the Auditor General will not necessarily answer the questions that the member for Vasse has asked. The Auditor General will say that he has looked at the process and that he sees no discrepancies in it.

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Mr T. Buswell: Where does it say that in the bill? Mr M.W. TRENORDEN: It is not in the bill. Mr T. Buswell: How do you know that the Auditor General will look at it? Mr M.W. TRENORDEN: It is not in the bill. Mr T. Buswell: The Auditor General will not be the auditor of MutualCo. Mr M.W. TRENORDEN: Not when it is completed; it will be done by PricewaterhouseCoopers and so forth. Mr T. Buswell: I am worried that it will pass through even those. Mr M.W. TRENORDEN: An auditor will do the job of an auditor. We are not speaking about whether these things will be done functionally and correctly. I would almost trust the minister’s advisors to do that. The question the member for Vasse has asked is whether the arguments about the fairness of those funds will be relayed clearly to us. That is nowhere near the role of an auditor. We are doing more than just taking the Treasurer on trust. I know and accept the motivation behind this bill. However, we are going through the passage of this bill with very scant information. Mr E.S. RIPPER: I have been reflecting on the contributions of members as the debate has proceeded. This is a serious issue. We are talking about quite substantial sums of money and a complex issue that must be resolved regarding the allocation of the money that is to be reserved for the State Superannuation Board or MutualCo and its subsidiaries. I will tell members what I think should happen. I should table in Parliament the actuary’s advice and the transfer order that I ultimately sign. Members will then be able to see whether there is any difference between what the actuary puts forward and what I ultimately decide. I have said that the Auditor General would have oversight of this. It is a little unclear to me exactly whether the Auditor General will be providing a report on this. Therefore, I undertake to discuss with the Auditor General how the outcomes of his oversight will be made available to members of Parliament. Mr M.W. Trenorden: Will any particular skills be brought into that process of the Auditor General on this issue? They would have to be unrelated skills. I appreciate the Treasurer’s openness and his attempt to deal with this. What he is saying is correct. We are debating this matter so that not just members of Parliament can look at it; there is a raft of industry people who should have the right to look at it as well. They have skills well beyond those of the member of Vasse and me. Mr T. Buswell: Steady! Mr E.S. RIPPER: The member for Nedlands could well also be part of the accountability operation. The commitments I have given demonstrate that I have listened to the arguments put forward by the opposition. The actuary’s report and transfer orders will be tabled and I will discuss with the Auditor General whether we will advise either this house or the upper house, depending on when I get the background, about how the Auditor General’s oversight will be reported to the public and the Parliament. The accounts of the State Superannuation Board of GESB are currently audited; a process is already in place. Mr M.W. Trenorden: We are not worried so much about the audit. We are more concerned about being clear about the process. Before you sit down, Treasurer, other members have a great interest in the other house, but I do not have a huge interest in it. I would like the Treasurer, if he can, to report back to this house about the Auditor General. Mr E.S. RIPPER: If the debate on this bill is concluded, which I hope it will be because I would not mind it being concluded this afternoon if we have a chance of doing that, I will make a brief ministerial statement on the outcome of my discussions with the Auditor General. Mr C.J. Barnett: Will you also table the material that you offered to table at the time? Mr E.S. RIPPER: Yes, I will table the material at the time. The actuary’s report and transfer orders will be tabled at the time and I will make a brief ministerial statement on how the Auditor General’s oversight will be reported to the Parliament and the public. Mr T. BUSWELL: I thank the Treasurer very much for giving those undertakings, which are of assistance, and for taking our concerns on board. I think we can leave the transfer of assets behind. I will move on to another point that I and a couple of other members touched on in the second reading debate. I refer to the appointment of directors, one of whom is sitting with the minister today. She is doing a sterling job and my comments are not a reflection on her. As I understand it, in the first instance, MutualCo will have a number of directors who will be appointed directly by the Treasurer. There is no obligation on the Treasurer to utilise the shared representation model, which is the old model of appointing to the board three employees and three employers, or however that works. I am seeking clarification from the Treasurer about the processes involved in the appointment of the

[ASSEMBLY - Thursday, 16 August 2007] 4261 directors of MutualCo and TrustCo. As I understand it, the directors of TrustCo will be appointed using the equal representation model. Therefore, the old arrangement that existed with UnionsWA will remain. It will nominate three members. I understand that UnionsWA, through the wonderful democratic processes of the trade union movement in Western Australia, which is always open and accountable and which has delivered us fantastic members of Parliament on the government benches, will deliver two or three representatives to TrustCo. One representative will be from the State School Teachers’ Union of WA, another will be from the missos and the third will be from whichever union is the most powerful at the time. As a former State School Teachers’ Union of WA advocate, the Treasurer probably has an interest in seeing that that arrangement is maintained. My colleagues and I are interested to know exactly what arrangements will apply to the appointment of directors of MutualCo and TrustCo. As I understand it, after the first year of its operation the members of MutualCo will elect the directors on the recommendation of the board. I await the Treasurer’s guidance. Mr E.S. RIPPER: I did not rise to the exulted position of advocate; I was merely an organiser of the State School Teachers’ Union of WA. Mr T. Buswell: Were you there when Shelley Archer got the turf? Mr E.S. RIPPER: My employment was not coterminous with hers. Mr T. Buswell: You are lucky then, from what I understand. Mr E.S. RIPPER: I will not be tempted to divert from the important exercise of getting this legislation through this afternoon. The board of MutualCo is planned to comprise between seven and nine directors, including the chief executive officer of GESB. There are planned to be some common directors between MutualCo and TrustCo but the majority of MutualCo directors must be independent of TrustCo and vice versa. The remaining positions will be filled ahead of the transfer. It is important to have a robust and transparent process. I will take very seriously my role to appoint the inaugural directors because I am conscious that that will set the foundation of the organisation for a long time into the future because of the role that the directors will have in organising their replacements. As the new superannuation organisations must meet commonwealth regulatory requirements, the directors will need to meet a fit and proper and good fame and character test. That covers matters such as propriety, bankruptcy, criminal convictions, disqualification from certain professions - I assume it would be any profession - and so on. The test will also cover a person’s fitness. People will have to have suitable qualifications and substantial experience and training in investments, superannuation and wealth management, finance, risk and compliance, and corporate governance. The requirements on individuals to be appointed to these positions will be quite significant. I will be thinking about what skill set is required on the board and I will take great care to appoint competent people. “Competent, competent, competent” will be the guidelines for the appointment to these boards. It is envisaged that the process will include a call for input and expressions of interests from stakeholders; the engagement of an independent board search consultant to source potential additional candidates; the formation of a short-listing panel comprising the chief executive officer of the Government Employees Superannuation Board and other suitably qualified people, including the board search consultant, to review candidates and prepare a short list for my consideration. It is my intention to appoint the chair of GESB MutualCo ahead of the remaining positions so that the chair can then participate in the selection panel to fill the other positions. We intend to go about this very important exercise in a serious and rigorous way, and all appointees will have to meet very stringent tests for fit and proper appointees. Mr T.R. SPRIGG: On the same theme, it seems to me that the special membership category - which obviously will be the Treasurer - has fairly outrageous veto powers. Proposed section 43(3)(c) states - while there is a special member, the special member will have a power to veto the exercise by the company or the directors of its or their power - (i) to alter the constitution of the company; or (ii) to appoint a person as a director of the company; or (iii) to remove all of the directors of the company within any 12 month period; or (iv) to form, acquire or dispose of a subsidiary after the transfer time; or (v) as a holding company of TrustCo, to vote in favour of a resolution to alter the constitution of TrustCo; or (vi) to raise capital or borrow money; . . . We all trust the Treasurer; he will not always be in this position when all this happens.

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Mr J.E. McGrath: Speak for yourself! Mr T.R. SPRIGG: We hope he is not, I suppose! These seem to be very strong veto powers for the special member - the Treasurer. WA Inc and the misappropriation of government funds is only too recent in our minds, although I am not saying the Treasurer was involved. These are extraordinary powers. Can the Treasurer provide some reasons for the unusual strength of these special membership powers? Mr E.S. RIPPER: We are moving into a new set of arrangements that will potentially affect retirement incomes in a quarter of a million households in Western Australia. People want to know that any change will be ordered and gradual and that there will not be any sudden deviation from the direction of the reform program that has been outlined. The Treasurer’s veto powers are reserve powers. I do not expect them to be required, but they are there in case there is some sort of unexpected development in this organisation that would take it well away from the expectations given to a quarter of a million households when this reform scheme was proposed. Mr T.R. Sprigg: By interjection, can the Treasurer give us an example of the sort of extraordinary circumstances in which he might have to intervene? I cannot think of one other than misappropriation. Mr E.S. RIPPER: It is hard to imagine that these things would actually occur, but what would happen if a determined, well-organised group managed to gain control of organisation meetings and sought to rapidly move the organisation to a demutualised situation? It would be quite contrary to what people were given to expect when the reform went through Parliament. We want to make this change and keep it stable. Ultimately, members will have full control of the organisation and will be able to take it in the direction they wish to. Given the importance of the issues and the significance of retirement income, we thought we would include these safeguards. I have moved an amendment and will move another that provides for transparency in the exercise of the Treasurer’s powers, if they are exercised. Notice of any exercise of powers will be required to be tabled in the house. The Parliament can then hold the Treasurer accountable. The Treasurer currently has a lot of powers with regard to GESB. It is a government organisation; the Treasurer or a responsible government minister exercises the normal powers that a government minister has with any government organisation. In fact, there will ultimately be no ministerial power over GESB. Mr C.J. Barnett: When it’s privatised. Mr E.S. RIPPER: When it is mutualised. Dr J.M. WOOLLARD: This is a very long clause. The Treasurer in his second reading speech stated - There is also support from public sector agencies to implement choice as the lack of choice impacts the attractiveness of the state public sector as an employer. Further on, the Treasurer stated - It will be important to educate employees and employers about their rights and responsibilities in a choice environment. The Department of Treasury and Finance, the Department of Consumer and Employment Protection and GESB will implement an education strategy to inform and educate WA public sector employees and employers ahead of the introduction of choice. I think that is very important. I know that when a similar bill was debated in the federal Parliament, the federal Labor Party was concerned about the low levels of financial literacy in the community, which were related to inadequate financial literacy education programs. The federal Labor Party sought an assurance from the federal government that adequate information about fees and commissions would be provided to employees. The federal Labor Party also sought to debate administrative and compliance burdens on small businesses. I have read clause 16, and although there will be reviews and the Treasurer will ask about information that has been given to some members of the company, how much money is the government planning to set aside in the budget for education of employees to ensure that they are able to assume responsibility and have a full understanding of their superannuation and retirement savings? Mr E.S. RIPPER: The program is still being worked up, but it is envisaged that it will cost approximately $500 000. Dr J.M. Woollard: Will the $500 000 be spent over the next three years? Mr E.S. RIPPER: As I recall, I indicated earlier that there would be an 18-month education program; 12 months in the lead-up to choice and six months afterwards. As a result of legislation previously passed in Parliament, there is now a financial advisory service associated with GESB, so people can seek professional financial advice related to GESB services. Dr J.M. Woollard: So, $500 000 is to be set aside for an 18-month program - Mr E.S. RIPPER: We envisage a program of around $500 000. It has not been determined yet.

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Dr J.M. Woollard: Will there be any review? I am concerned that $500 000 might not be sufficient. When will it be reviewed? According to the bill, there will be no review for three years. When will there be a review to ensure that members - Point of Order Ms S.E. WALKER: I cannot hear what the member is saying because of the conversations that are taking place. The ACTING SPEAKER (Mrs J. Hughes): Thank you, member for Nedlands. It is not a point of order, but I ask members to be mindful that discussion is taking place in consideration in detail. Mr R.C. KUCERA: On that point of order, perhaps it would help if the member spoke more directly into the microphone. It is difficult to hear over this side as well. It is not coming through the speaker over here. Debate Resumed Dr J.M. WOOLLARD: I appreciate that the Treasurer will allocate $500 000 to an education campaign for employees, and it is envisaged at the moment that it will last for 18 months. What review will be done of that educational program? Will 18 months be sufficient? Although the Treasurer says that public sector employees want choice, I remind him again that the federal Labor Party position was one of concern about financial literacy in the community. Will $500 000 be enough for the number of people the Treasurer said are involved in GESB? Mr E.S. RIPPER: GESB has been talking to its members about choice for some time already, and will continue to talk to them. We are allowing 12 months between the passage of this bill and the introduction of choice, and there will be a period of six months after that during which education will continue to take place. At the end of that 18-month period, GESB will, of course, review the outcomes for members’ understanding of the changes. Let us not forget that, in the end, members will have the right to move to and from GESB. That is a very powerful mechanism indeed. If members, through any misunderstanding, are unwisely moving away from GESB, GESB will have a very powerful incentive to make sure that those members are properly advised. If members are unwisely staying with GESB when they should be moving, competitor funds will have a powerful incentive to educate them in alternative directions. We are moving to an environment in which organisations will have powerful incentives to deliver information to members or potential members. Mr T. BUSWELL: I have a question relating to the review of the Treasurer’s special membership of GESB. Who will conduct the review at the completion of three years? The bill lays out that the Treasurer will conduct the review, and sets out what the Treasurer must have regard to. The granting of veto powers to the Treasurer is quite significant. The Treasurer made an interesting observation earlier, using the unusual example in which the members of GESB rise up as one and decide to demutualise. That may or may not happen, but the Treasurer said that it would not happen under his watch. That is fine; the organisation is already privatised. Could it be argued, and should it be argued, that this review be conducted by somebody independent - for example, the Auditor General or another person independent of the Treasurer - so that when the review comes back to the house or goes to the government for consideration, it is not clouded by views such as that expressed earlier by the Treasurer? His view was that he needs to maintain some form of control over where the entity is headed. It may be that after three years, things are going so well - I certainly hope this happens - that there is no valid or rational reason that a good independent analysis could ascertain for the Treasurer maintaining that special membership. I have a concern that if the Treasurer, or the Treasurer of the day, were conducting the review, he would be highly unlikely to give up his special membership, even if that were in the best interests of everybody, simply because of some attachment he may have formed to that special membership or, as the Treasurer indicated earlier, a strong desire to prevent certain things from happening. In the drafting of the bill, was any consideration given to entrusting that review to an independent person? It is still a government decision; it is fair and reasonable that it be a government decision. I am talking about the stage at which the review is conducted, so at least we can sit down as a Parliament and say that an independent person who is an expert in the field has conducted the review, and it is our determination that the Treasurer should cease to be a special member. If the government of the day says that it will take the point on board, but decides to keep the veto powers in place, that is its political decision. I suppose I am trying to separate a proper review from a political process. I am not denying the government of the day the right to have that political process, but was any consideration given to separating that process from the review process? Does the Treasurer have any advice from other states in which a similar process has occurred? Who conducted those reviews? Mr E.S. RIPPER: The statement I made about demutualisation was not an indication of a personal prejudice that I would apply. It was merely a statement to give people confidence that what we are proposing to do with this bill will actually happen. It is important when dealing with such a sensitive issue, so many people and such a big reform, that people know that things will be as explained to them and will not become something different within a very short period. That is why I made the statement that I would veto demutualisation in the first three years if I were Treasurer.

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The Treasurer will not personally do the review; he will commission somebody to do it, and the report is to be tabled in Parliament in any case. The Parliament can hold the Treasurer accountable for whom he chooses to do the review, the quality of the report and the Treasurer’s response to it. In theory, it could be provided that somebody else do the report, such as the Auditor General, the Economic Regulation Authority or the Public Accounts Committee, but the important point is that it will not be done by the Treasurer personally and it will be tabled in Parliament. Mr M.W. TRENORDEN: It has just occurred to me that I should be declaring an interest, because I have roughly $30 000 in GESB myself, and here I am arguing about its regulation. Mr T. Buswell: That would be your weekly pension! Mr M.W. TRENORDEN: Exactly! Mr E.S. Ripper: If we weighted the membership by superannuation entitlements, we would not have any votes! Mr M.W. TRENORDEN: Exactly. I actually went to a local government meeting once at which a motion against Telstra was moved, and no-one could vote because everyone was a Telstra shareholder! The vote could not take place. I will put to the Treasurer another point about which I am very concerned. I will not make a federal case out of this, but the documents are pretty light on for information about the operational manner of the mutual company and the trust company. The structure indicates where they all sit in the process, but the bill is silent on how the administration will actually work. I am curious about why that is the case. The reasons, the structures and the purposes of those bodies are included in the bill, but the administrative functions are not. I find that a little difficult. I can only presume that, in developing this process, very learned people have looked at the requirements of the federal bodies and what is needed to meet them. I presume that when these bodies are finally elected, they will establish their own procedures to a large degree. Again I say that, as in relation to the investment process, we would not find that acceptable in other bills. That is a vacuum in this bill. Again, we are taking on trust the people around the Treasurer. I am, frankly, not all that unhappy to do that. However, I am making the point that our role in opposition is to scrutinise bills and raise these issues. I asked some questions of the advisers when we had the briefing. I do not want to delay the process, but I can point out a couple of circumstances that, in the normal procedures of superannuation companies, will raise question marks about what happens to the mutual board and the trustee company. Those questions cannot be answered until the companies start to operate. It is a bit like the asset situation. We must take the Treasurer on trust. I am not sure that we should be doing that. Mr E.S. RIPPER: One important point is perhaps being ignored in the debate; that is, we are shifting this whole set of arrangements to commonwealth regulation, except for the defined benefit schemes for which the state has the liability and the regulatory responsibility. The fairly stringent commonwealth superannuation regulatory scheme will step in. It is not the case that the Treasurer will be responsible for the regulation of GESB MutualCo and GESB TrustCo. That will be the commonwealth government’s responsibility, just as it is responsible for regulating all the other superannuation schemes in the country. In addition to the commonwealth regulation, on the structural questions, the Treasurer will have some reserve powers that have been designed to deal with the most serious risks that could potentially arise. We will have commonwealth regulation plus the reserve powers of the Treasurer if someone proposes a radical change to the arrangements. If, in the member for Avon’s view, the operation of West Scheme, Hester or the schemes that operate in the building industry and so on are satisfactorily regulated under the commonwealth arrangements, he should be comfortable with what is proposed for GESB MutualCo and GESB TrustCo. Mr M.W. TRENORDEN: The minister is correct, but he is ignoring the basic premise of what we are doing here. We are moving a range of superannuation benefits from the state’s control to a private entity. Mr E.S. Ripper: It will be a member entity that will be regulated by the commonwealth. Mr M.W. TRENORDEN: That is right. People have hundreds of thousands of dollars in this fund, and we are asking them to trust our management of this process because of all this regulation. That does not mean it will be well managed. If the Treasurer were considering investing a quarter of a million dollars in a share fund tomorrow, he would want to know about the management of that fund. I agree with the Treasurer about the prudential requirements of the federal government and of the state. I am not arguing about that. They exist. However, we cannot look our constituency in the face and say we know that the government’s model is a good model because it is in the bill; we have a description of it. In fact, we have no description. Mr E.S. RIPPER: In the end, the operations of the fund will be disciplined by two mechanisms. The first is commonwealth regulation, which is what applies to superannuation funds generally. In my view, that commonwealth regulation is likely to be more robust than what the state can ultimately offer because the commonwealth regulators do that regulation as their core business, having achieved a critical threshold and critical mass of regulatory experience and talent. The second mechanism that will regulate the performance of

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GESB MutualCo and GESB TrustCo is the mechanism of choice. If something goes wrong with these funds or organisations and they stop performing, people will walk. That will be a very powerful deterrent to any poor behaviour or poor management in GESB. That is the ultimate discipline - any member can walk and go to another fund if he so chooses. Mr M.W. TRENORDEN: I will make one last point. I did not go to the effort of making a speech for nebulous reasons. Management of superannuation funds is critical. I have no problem whatsoever with the regulatory processes that have been outlined; I accept them totally. However, we are asking the members of the superannuation fund to take management on trust. I do not say that lightly, because in my speech I said that when the commonwealth bank changed from an agency to a fully privatised bank, the cultural change took 10 years. I am not saying that I am terrified that the management that will move across to this new entity will fail; I am saying that we are taking that on trust and that is not good enough. Clause, as amended, put and passed. Clauses 17 to 51 put and passed. Clause 52: Section 29 amended - Mr T. BUSWELL: I would like a brief explanation from the Treasurer, without too much Canberra bashing, about the processes that have unfolded in his communications with the federal Treasury with a view to transferring West State from a non-taxed superannuation fund to a taxed superannuation fund. I understand that the vast majority of part 5 of this bill contains three different options, one of which will apply, depending on how the federal Treasury responds. I understand that information is fairly much locked in now, given that the federal government will not support GESB’s arguments about transferring a transmission mechanism to take West State super from a non-taxed to a taxed fund. The Treasurer knows Mr Costello has had a hard week so I am sure the Treasurer will go easy on him. A vicious attack will destroy him! Mr E.S. RIPPER: I am reflecting on how to describe a relatively complex issue. Mr T. Buswell: Simply, will do. Mr E.S. RIPPER: Some members of West State Super may find it to their advantage to transfer to a taxed fund. A lot of members of West State Super will find that it will not be to their advantage to transfer to any taxed fund under existing commonwealth arrangements. That will limit the practical availability of choice to those people because, no matter how good the performance of a rival tax fund might be, the competitive advantage with which West State Super starts as an untaxed fund for some members will mean that they will not find it in their interest to transfer. It will be better for those members in that it will give them practical access to choice and it will be better from the point of view of the administration of GESB MutualCo and GESB TrustCo if West State Super members are transferred in bulk to the GESB scheme; in other words, transferred from the untaxed West State Super scheme to the taxed GESB scheme. However, to do that would involve detriment to the benefits of a significant proportion - the majority - of West State Super members. We could not in good conscience transfer their benefits in there if there were to be detriment to their benefits, as it would be contrary to our agreement with the commonwealth not to make changes to superannuation that would reduce members’ benefits. We did some modelling, which showed that we could, with commonwealth cooperation and some consideration given to not applying the contributions tax to the in globo transfer of members to the new scheme, have beneficial impacts ultimately on commonwealth revenue while not undermining the benefits of members. Unfortunately, we have not been able to convince the commonwealth of the merits of that proposal. I have had a long telephone conversation with Peter Costello, I have written to Peter Costello on two occasions, and the Under Treasurer has written to and had conversations with Ken Henry, the commonwealth Secretary to the Treasury. We have therefore made a significant effort to persuade the commonwealth on this matter. However, I received a letter from Peter Costello of 26 June in which he said - While I understand that you are keen for our Departments to resolve their differences over the costing of your proposal, I stress that my concern with your proposal is not related to the cost to revenue. My concern is one of equity. The object of our superannuation reform is that where contributions are taxed on the way in, they are tax free on the way out. Where they are tax free on the way in, they are subject to tax on the way out. There is no category that is tax free at both ends. If the Government created such a new category, naturally all other classes would want the same treatment. I recommend you allow existing members of WSS to elect to migrate their accounts to GESB Super, paying the contributions tax and getting the benefit of tax free payments. Those who would not benefit from such a scheme could elect to stay under the current system.

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The unfortunate fact is that the overwhelming majority of West State Super members falls into the category covered by that last sentence - “Those who would not benefit from such a scheme could elect to stay under the current system.” The practical choice will be a bit limited for those people, unless we can get some commonwealth consideration. That is the matter as it stands at the moment. I am always hopeful that there might be a last-minute change of heart. I am hopeful that the new Treasurer next year - whether it is a Liberal or Labor Treasurer, I think there will be a new Treasurer next year - might be prepared to take a fresh look at this issue. Mr T. Buswell: Are you resigning? Mr E.S. RIPPER: A new federal Treasurer. MR M.W. TRENORDEN: I want to make a couple of final points before this clause progresses, and I will not make these points lightly. As was pointed out in the briefing the other day, this is the third biggest lump of superannuation funds in the nation. The Government Employees Superannuation Board is one of the really competent organisations in Western Australia. I cannot recall how many billions of dollars are under the management of GESB, but the Treasurer said that about a quarter of a million families are affected. I am not sure that we as an opposition have done justice to this bill. The member for Vasse and I have done the best we can. I do appreciate the concessions that the Treasurer gave; they are important concessions. However, I continue to feel a little hollow in that a bill of this significance, which has the capacity to have a very substantial impact on a lot of Western Australians, will pass through this house in such a short period. I also say in this statement that I have confidence in the new and activated GESB; its performance in recent years has been very good. I have confidence that it will mature into a professionally operated superannuation fund. However, I point out that they are not our concerns. Our concerns are to make sure that we have examined this bill as best we can for the benefit of Western Australians. I will sit down now a little unsure - I do not speak for the member for Vasse and others - that we have done that. Clause put and passed. Clauses 53 to 70 put and passed. Clause 71: Part 4A inserted – Mr E.S. RIPPER: I move - Page 79, after line 10 - To insert - 75GA. Notice of refusal of approval to be tabled If the Treasurer refuses to approve the doing of something which, under the governing rules, cannot be done without the Treasurer’s approval, the Treasurer must - (a) give written notice of the refusal to the TrustCo; and (b) cause a copy of the notice to be laid before each House of Parliament or dealt with under section 78 within 14 days after it is given to TrustCo. This is the second part of the package that I said was put by the government to the house in response to non- government members’ issues raised during our briefings. Amendment put and passed. Clause, as amended, put and passed. Clauses 72 to 89 put and passed. Title put and passed. ADJOURNMENT OF THE HOUSE MR J.C. KOBELKE (Balcatta - Leader of the House) [4.57 pm]: I move - That the house at its rising adjourn until 2.00 pm on Tuesday, 28 August. I will use the opportunity in moving this special adjournment to advise members that the government has a legislative program of between 30 and 40 bills that we want passed before we rise in November. I have discussed with members on this side and members on the other side whether we should sit an additional week or extend the hours we sit on the program weeks. The general consensus is that we should try to get through the government’s business in the 10 weeks that we have. For that reason, in the two weeks’ sitting when we come back it is my intention that we will sit Tuesday and Wednesday evening until roughly 11.00 pm. I hope we can make considerable progress on the bills on the notice paper so that we need not continue them in the following

[ASSEMBLY - Thursday, 16 August 2007] 4267 weeks. However, I give notice today to those members to whom I have not spoken directly that we will be sitting Tuesday and Wednesday evenings for the next two sitting weeks when we resume. MR C.J. BARNETT (Cottesloe) [4.58 pm]: I just make the observation that it is up to the government to run the house as it wishes. However, it is a peculiar situation, and it is worth placing on the record, that we have just had a seven-week break, we have come back for one week and we are going off for a week. If the government were serious about progressing its legislative program, I suggest we would sit next week, perhaps have a week’s break and then sit another three weeks. If the government has problems with its legislative program, it is essentially of its own making, as the house is not sitting enough. Question put and passed. House adjourned at 4.59 pm ______

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QUESTIONS ON NOTICE

Questions and answers are as supplied to Hansard.

STATE ADMINISTRATIVE TRIBUNAL DECISION IN RELATION TO ADVERTISING SIGNAGE ON TELEPHONE BOOTHS 2369. Mr J.N. Hyde to the Minister for Planning and Infrastructure The recent State Administrative Tribunal (SAT) decision which backed my and the community’s submissions against allowing phone booth advertising is an important win against private companies like Telstra misusing their privileges under the Telecommunications Act 1997 (Cth). Does the Minister envisage or propose any State legislative amendments that can ensure the SAT decision can apply to all local government areas in Western Australia? Ms A.J.G. MacTIERNAN replied: I understand the matter referred to is that of Adbooth Pty Ltd and the City of Perth ([2007] WASAT 76), decided by the State Administrative Tribunal (SAT) on 2 April 2007. I am advised that an application for leave to appeal SAT's decision to the Supreme Court is to be heard on 29 August 2007. Accordingly, while I recognise the importance of this issue, it is premature for me to make any statement concerning the wider applicability of the decision and whether the decision might lead to any changes in relevant State policies or legislation, including subsidiary legislation such as the "Model Scheme Text". I note also that Telstra is a telecommunications carrier - as are Vodafone and Optus - for purposes of the (Cth) Telecommunications Act 1997, and the Federal Minister for Telecommunications has responsibility for the administration of that Act. I have asked the Department for Planning and Infrastructure to monitor this matter and keep me informed. HOMESWEST - VACANT PROPERTIES 2381. Mr T.R. Buswell to the Minister for Housing and Works As at 31 March 2007, what was the number of vacant Homeswest houses across Western Australia? Mrs M.H. ROBERTS replied: The Department of Housing and Works advises 610 of which 105 were in the process of being reallocated, 5 were under vacated maintenance, and the remainder were unfit for occupation at the time. The 2007 Report on Government Services found that Western Australian had the lowest average turnaround time; that is the lowest time taken to reoccupy public housing stock. SOUTH METROPOLITAN POLICE DISTRICT - STAFFING 2487. Dr J.M. Woollard to the Minister for Police and Emergency Services With regard to the South Metropolitan Police District, can the Minister advise - (a) how many full-time equivalent police officers were employed in the district for each of the following years - (i) 2001; (ii) 2002; (iii) 2003; (iv) 2004; (v) 2005; (vi) 2006; and (vii) 2007; (b) what was the average staffing for the Palmyra Police Station, the Murdoch Police Station and the Fremantle Police Station for the years listed in question (a); (c) what specific hours are the Palmyra Police Station, the Murdoch Police Station and the Fremantle Police Station manned each day; (d) what is the current ratio of police officers to population for the South Metropolitan Police District and how does that ratio compare with the North Metropolitan Police District;

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(e) given that the Kennedy Royal Commission Final Report identified several areas of policing as not meeting the community’s expectations for basic policing services, including call-taking, response times and tackling volume crimes such as burglary, anti-social behaviour, assaults and disorderly conduct, what specific measures have been implemented at the Palmyra Police Station, the Murdoch Police Station and the Fremantle Police Station under the new Frontline First Program; (f) what are the current average response times for the South Metropolitan Police District for all categories of reported crime; (g) is the police station at Garden City Shopping Centre in Booragoon still operational and, if so, what hours is it open, how many staff are working from that office and what policing issues do they respond to; and (h) what plans have been put in place, or are being considered for, the Palmyra Police Station, the Murdoch Police Station and the Fremantle Police Station to respond to additional crime issues as a result of the upcoming opening of the new Perth to Mandurah rail line? Mr J.C. KOBELKE replied: (a) The actual full time equivalents (FTE) for the South Metropolitan District for the years 2001 to 2007 are outlined below.

SOUTH Police Officer Actual Aboriginal Police Total Actual METROPOLITAN Strength (FTE) 1 Liaison Officer Actual Strength (FTE) 1 DISTRICT as at date Strength (FTE) 1 30 June 2001 381 4 385 30 June 2002 373 6 379 30 June 2003 371 4 375 30 June 2004 372 6 378 30 June 2005 376 7 383 30 June 2006 374 3 377 30 June 2007 365 3 368 1 Actual Strength (FTEs) includes employees on leave without pay. This figure does not include officers in training at the Police Academy. Over the time period covered in the above table the allocation of FTE to individual Districts and between Regions has been regularly reviewed to ensure the maximisation of available Police Officer FTE. In addition, there have been a number of structural and boundary reviews. As a result, the actual strength for the South Metropolitan District may vary from year to year. As at 31 May 2007 there are 188 FTE undergoing Police Officer training at the WA Police Academy. (b) Due to operational sensitivities specific information relating to staffing levels of individual police stations is not released. Resources are principally allocated at a District level and District Superintendents deploy these resources within their District to provide the best possible policing service to meet operational requirements and the varying needs of the community. (c) The South Metropolitan District has officers available 24 hours a day to attend to tasks, supported by other units within the Western Australia Police, such as Regional Operations Group, Major Incident Group and other specialist units. Palmyra and Murdoch Police stations are open to the public between 8 am and 4 pm, Monday to Friday. However, there is also a communications button at the front door of each station, which gives access to Police Communications, who can, subject to the urgency of the complaint, call tasking vehicles to the station. Fremantle Police Station is open to the public at all times. (d) The table below shows the Estimated Resident Population as at June 2006, Police Officer Actual Strength as at 31 May 2007, and Police Officer to Population Ratio by District (Police Officer : persons) for South Metropolitan District and Combined Metropolitan Police Districts. There is no North Metropolitan Police District; the overall figures have been added for comparison. District Estimated Police Officer Police Officer to

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Resident Actual Strength Population Ratio Population (FTE) South Metropolitan District 323,673 368.0 1:880 Metropolitan Districts 1,494,740 1,899.0 1:787

The Estimated Resident Population (ERP) for WA Police Districts has been derived from Local Government Area (LGA) ERP published in Australian Bureau of Statistics, Regional Population Growth 2005-06 (ABS Cat No. 3218.0) based on a "best fit" of police district boundaries to LGA boundaries. The population estimates relate to usual residents and do not reflect the fluctuations caused at various times by "visitors" associated with entertainment, employment, recreation, shopping and tourism. (e) WA Police have centrally located resources such as the Regional Operations Group, the Traffic Enforcement Group and the Major Incident Group that are tasked to support Districts as required. The number of police officers allocated to a District is not an absolute indicator of WA Police's ability to respond to demand for police services. The Police Metropolitan Radio Network and Police Assistance Centre are further examples of initiatives impacting positively on service delivery and improvement to resource deployment. Frontline First Initiatives in the South Metropolitan District During the past 12 months, South Metropolitan District has actively pursued the Frontline First philosophy aimed at creating a safer and more secure Western Australia. This is done primarily from a District perspective. Changes have been made to rostering practises to enable more police to be on the street. Additionally there has been movement of staff across the District to respond to areas of concern. Police have been focussing on dealing with volume crime and anti-social behaviour. Flexibility has been a major component of the change. There are a range of operational tactics that have been implemented to better deter and respond to incidents of volume crime and anti-social behaviour. During the past 12 months1, there has been a significant decrease of 7.9% in total property related crime2 in the District. This equates to 2,597 less reported offences. Significantly reported burglary offences have decreased by 9.6%. The clearance rate for property related crime across the District is 20.9% up from 18.4% last year. For the entire District, offences against the person are up by 8.7% when compared with last year. This is primarily due to an increase in reported domestic related assaults (54% of the 358 additional offences against the person in 2006-07 were domestic related assaults). Fremantle Police Station As a response to anti-social behaviour, Fremantle Police have implemented a CBD Team that addresses issues of anti-social behaviour and street crime in the Fremantle CBD. This has transposed into a net reduction in reported assaults in the Fremantle Sub-District (9.1% reduction in 2006-07). Total property offences are down by 6.2%. Significantly, burglaries are down by 27%. Total property crime clearance rates have increased from 14.4% to 15.5%. Palmyra Police Station Additional staff has been placed at Palmyra, which includes detectives seconded from Fremantle. Total property offences are down by 2.7%. Significantly, burglaries are down by 13.8% and robberies are down by 40%. Murdoch Police Station Total property offences are down by 7.7%. Significantly, burglaries are down by 5.8% and robberies are down by 20.5%. Total property crime clearance rates have increased from 16.5% to 20.4%. (f) For the June Quarter 2007 the average response times for the South Metropolitan Police District are: § Priority 1 and 2 tasks is 9 minutes § Priority 3 tasks is 23 minutes

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(g) The Garden City Police Post is operational and is manned from Murdoch Police Station. The Police Post is open from 8.00am to 4.00pm on Monday, Tuesday, Wednesday and Friday and from 2.00pm to 10.00pm on Thursday. Garden City Police Post staffs are responsible for proactive patrols of the shopping centre and responding to crime issues within the shopping centre. (h) The Southern Rail Transit Unit has been established to monitor and respond to crime issues that may arise as the result of the Perth to Mandurah Rail Line. The unit consists of 50 staff and will be based in Rockingham. These 50 officers are additional to those in the South Metropolitan District. Officers from the Southern Rail Transit Unit and South Metropolitan District can mutually assist with crime on the rail line or areas that are adjacent.

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