2017 – 18 Budget Estimates

Report No. 42, 55th Parliament Public Works and Utilities Committee August 2017

Public Works and Utilities Committee

Chair Mr Shane King MP, Member for Kallangur Deputy Chair Mr Rob Molhoek MP, Member for Southport Members Mr Matt McEachan MP, Member for Redlands Mr Jason Costigan MP, Member for Whitsunday Ms Joan Pease MP, Member for Lytton Mr Chris Whiting MP, Member for Murrumba

Committee Secretariat

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Web www.parliament.qld.gov.au/pwuc

Acknowledgements

The committee thanks: • Acting Minister for Main Roads, Road Safety and Ports • Acting Minister for Energy, Biofuels and Water Supply, and • Minister for Housing and Public Works and Minister for Sport. The committee also acknowledges the assistance provided by their departmental officers who contributed to the work of the committee during Estimates.

2017 – 18 Budget Estimates

Contents

Chair’s foreword ...... ii

1. Introduction ...... 1 1.3 Other Members participation ...... 1 1.4 Recommendation ...... 2

2. Acting Minister for Main Roads, Road Safety and Ports ...... 3 2.1 Department of Transport and Main Roads...... 3 2.2 Budget highlights ...... 4 2.3 Gold Coast Waterways Authority ...... 6 2.4 Issues raised at the public hearing ...... 7

3. Acting Minister for Energy, Biofuels and Water Supply ...... 8 3.1 Department of Energy and Water Supply ...... 8 3.2 Budget highlights ...... 9 3.3 Issues raised at the public hearing ...... 10

4. Minister for Housing and Public Works and Minister for Sport ...... 11 4.1 Department of Housing and Public Works ...... 11 4.2 Budget highlights ...... 12 4.3 Building and Construction Commission ...... 13 4.4 Residential Tenancies Authority ...... 13 4.5 Issues raised at the public hearing ...... 13 4.6 Department of National Parks, Sport and Racing ...... 14 4.7 Budget highlights ...... 14 4.8 Issues raised at the public hearing ...... 15

Statement of Reservation ...... 16

Public Works and Utilities Committee i 2017 – 18 Budget Estimates

Chair’s foreword

This report presents a summary of the Public Works and Utilities Committee’s examination of the Budget Estimates for the 2017-18 financial year. On behalf of the committee, I thank: • Acting Minister for Main Roads, Road Safety and Ports • Acting Minister for Energy, Biofuels and Water Supply, and • Minister for Housing and Public Works and Minister for Sport. The committee also thanks their departmental officers for their cooperation throughout the process. I also thank the chief executives from the entities covered in the committee’s portfolios for their cooperation throughout the process. I would also like to thank the members of the committee, other participating members, Hansard staff, the attendants and the secretariat.

Mr Shane King MP Chair

August 2017

ii Public Works and Utilities Committee 2017 – 18 Budget Estimates

1. Introduction 1.1 Role of the committee The Public Works and Utilities Committee (the Committee) is a portfolio committee of the Queensland Parliament, which commenced on 27 March 2015 under the Parliament of Queensland Act 2001 and the Standing Rules and Orders of the Legislative Assembly. The committee’s areas of responsibility are: • main roads, road safety, ports, energy, biofuels and water supply, and • housing, public works and sport. On 13 June 2017, the Appropriation Bill 2017 and the estimates for the committee’s areas of responsibility were referred to the committee for investigation and report.1 On 27 July 2017, the committee conducted a public hearing and took evidence about the proposed expenditure from the: • Acting Minister for Main Roads, Road Safety and Ports • Acting Minister for Energy, Biofuels and Water Supply • Minister for Housing and Public Works and Minister for Sport, and • other witnesses from government agencies. A copy of the transcript of the committee’s hearing can be accessed here. 1.2 Aim of this report The committee considered the estimates referred to it by using information contained in: • budget papers • answers to pre-hearing questions on notice • evidence taken at the hearing, and • additional information given in relation to answers. This report summarises the estimates referred to the committee and highlights some of the issues the committee examined. Prior to the public hearing, the committee provided the Acting Minister for Main Roads, Road Safety and Ports, the Acting Minister for Energy, Biofuels and Water Supply, and the Minister for Housing and Public Works and Minister for Sport with questions on notice in relation to the Estimates. Responses to all the questions were received on 28 July 2017. Answers to the committee’s pre-hearing questions on notice, documents tabled during the hearing, answers provided by Ministers after the hearing, and minutes of the committee’s meetings are included in a volume of additional information tabled with this report.

1.3 Other Members participation The committee gave leave for other Members to participate in the hearing. The following Members participated in the hearing: • Mrs Jo-Ann Miller MP, Member for Bundamba

1 Standing Order 177 provides for the automatic referral of the Annual Appropriation Bills to portfolio committees once the Bills have been read a second time.

Public Works and Utilities Committee 1 2017 – 18 Budget Estimates

• Mr Steve Dickson MP, Member for Buderim • Mr Shane Knuth MP, Member for Dalrymple • Mr Andrew Powell MP, Member for Glass House • Mr Michael Hart MP, Member for Burnett • Mr Stephen Bennett Member for Burnett, and • Mr Jon Krause MP, Member for Beaudesert.

1.4 Recommendation Pursuant to Standing Order 187(1), the committee must state whether the proposed expenditures referred to it are agreed to. Recommendation 1

The committee recommends that the proposed expenditure, as detailed in the Appropriation Bill 2017 for the committee’s areas of responsibility, be agreed to by the Legislative Assembly without amendment.

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2. Acting Minister for Main Roads, Road Safety and Ports The Acting Minister for Main Roads, Road Safety and Ports has responsibility for the portfolio areas of main roads, road safety and ports within the Department of Transport and Main Roads (DTMR)2 and includes the following statutory bodies which report to the Acting Minister and Government Owned Corporations (GOCs): • Far North Queensland Ports Corporation Limited (Trading as Ports North) • Gladstone Ports Corporation Limited • North Queensland Bulk Ports Corporation Limited • Port of Townsville Corporation Limited, and • Gold Coast Waterways Authority.3 2.1 Department of Transport and Main Roads The Acting Minister for Main Roads, Road Safety and Ports’ primary ministerial responsibilities in relation to main roads, road safety and ports include: land transport and safety, main roads, marine infrastructure – project delivery, maritime, personalised transport, and ports.4 The DTMR has five service areas: • transport system investment, planning and programming • transport infrastructure management and delivery • transport safety and regulation • customer experience, and • passenger transport services.5 The following table compares the appropriations for DTMR for 2016-17 and 2017-18.

Appropriations Budget - 2016-17 Est. Actual - 2016-17 Vote - 2017-18 $’000 $’000 $’000

Controlled Items

departmental services 5,218,430 4,955,116 5,063,420

equity adjustment 1,411,276 1,517,552 1,349,391

Administered Items 83,750 .. 18,250

Vote 6,713,456 6,472,668 6,431,061 Source: Appropriation Bill 2017, Schedule 2, p 12.

2 The Acting Minister for Main Roads, Road Safety and Ports and the Deputy Premier, Minister for Transport and Minister for Infrastructure and Planning are jointly responsible for the DTMR. 3 State Budget 2017-18, Capital Statement – Budget Paper No. 3, pp 119 -123. 4 , Government Responsibilities, Administrative Arrangements Order (No. 2) 2017, p 22. 5 State Budget 2017-18, Service Delivery Statements, DTMR, p 1.

Public Works and Utilities Committee 3 2017 – 18 Budget Estimates

In 2017-18, DTMR will administer funds on behalf of the Government for: • vehicle registration $1.748 billion, and • transport and traffic fees $412.7 million.6 2.2 Budget highlights 2017-18 budget highlights within DTMR (main roads, road safety and ports) include: • the 10 year Queensland Cycling Strategy and two year Action Plan to guide and prioritise actions that encourage more cycling • working with local governments that have formed 17 Regional Roads and Transport Groups across Queensland under the Roads and Transport Alliance • completing the $100.4 million Boundary Road Interchange Upgrade • completing the $58 million Southern Access corridor stage 2 (Roberts Rd to Foster Rd) • progressing delivery of the $160.7 million Commonwealth Games Upgrade Package • progressing works to improve the safety and operation of the Warrego Highway at Minden • progressing works on delivery of the five year $260.5 million Queensland and Australian Government funded Cape York Regional Package • continuing works on the $929.3 million Bruce Highway project (Caloundra Road – Sunshine Motorway) • continuing works on the $1.6 billion Queensland and Australian Government funded Toowoomba Second Range Crossing project • continuing works on the $1.143 billion Queensland and Australian Government funded Gateway Upgrade North project • as part of the $635 million Warrego Highway Upgrade Program, commence works on the Dalby Eastern and Western approaches to Dalby on the Warrego Highway • commence construction on the $497.8 million Mackay Ring Road (stage 1) project • commence construction on the $400 million Ipswich Motorway Upgrade (Rocklea to Darra Stage 1 project) • improve road safety by delivering initiatives in the Qld Road Safety Action Plan 2017-19 • delivering over $150 million in safety treatments annually through the Targeted Road Safety Program • continuing to invest in innovate safety treatments and intelligent transport systems • continuing to mature our data collection and validation processes • continuing to advance rail safety outcomes through rail research and national partnership activities, leading the Queensland Level Crossing Safety Strategy, managing rail safety projects and chairing the National Level Crossing Safety Committee • continuing to encourage and foster safety as a core value and culture within the Queensland regulated shipping sector

6 State Budget 2017-18, Service Delivery Statements, DTMR, p 20.

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• continuing to deliver marine safety and ship-sourced pollution prevention outcomes including transitioning responsibility for the regulation of domestic commercial vessels to the Australian Maritime Safety Authority • contributing to the development and planning of Queensland waters through the implementation of the Reef 2050 Plan • continuing to build organisational capability in regard to understanding customer expectation, meeting these expectations and measuring customer expectations • improving existing online services from a customer perspective • delivering the Mobile Compliance Information System, and • introducing additional online services such as expanding on the ability to email notices and provide electronic reminders to customers as well as enabling customers to apply for their disability parking permit online.7 2017-18 total capital purchases for DTMR are $3.885 billion, including capital grants of $237.4 million. Capital works program highlights for DTMR (main roads, road safety and ports) in 2017-18 include: • $252.5 million to construct the Toowoomba Second Range Crossing, providing a bypass route to the north of Toowoomba, from the Warrego Highway at Helidon to the Gore Highway at Athol, at a total cost of $1.606 billion in partnership with the Australian Government • $236.3 million towards widening the Gateway Motorway North to six lanes, south of Nudgee, at a total cost of $1.143 billion, in partnership with the Australian Government • $120 million to duplicate the Bruce Highway from four to six lanes, Caloundra Road to the Sunshine Motorway, at a total estimated cost of $929.3 million, in partnership with the Australian Government • $70 million to construct Mackay Ring Road (Stage 1), at a total estimated cost of $497.8 million, in partnership with the Australian Government • $44.4 million to duplicate from two to four lanes, a section of the Warrego Highway, Charlton to Kingsthorpe, at a total cost of $160 million, in partnership with the Australian Government • $40 million to widen the Bruce Highway (Cooroy to Curra) to four lanes between Traveston Road and Keefton Road, Gympie (Section C), at a total cost of $384.2 million, in partnership with the Australian Government • $39.7 million to complete upgrading of various Gold Coast roads in preparation for the Commonwealth Games, at a total cost of $160.7 million • $36.4 million to realign the Peak Downs Highway at Eton Range, at a total cost of $189.2 million, in partnership with the Australian Government • $36 million to construct additional lanes at Oxley Road-Suscatand Street, Ipswich Motorway, Rocklea to Darra (Stage 1), at a total cost of $400 million, in partnership with the Australian Government • $18.6 million to construct additional lanes on the Pacific Motorway between Mudgeeraba and Varsity Lakes, in partnership with the Australian Government • $18.3 million to widen Warrego Highway to four lanes at Dalby eastern access, at a total cost of $56 million, in partnership with the Australian Government

7 State Budget 2017-18, Service Delivery Statements, DTMR, pp 4 - 7, 10, and 12.

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• $16 million to seal sections of the Kennedy Developmental Road between Hughenden and The Lynd (Hann Highway), at a total cost of $50 million, in partnership with the Australian Government, and • $10 million to upgrade the Pacific Motorway/ Gateway Motorway Merge, in partnership with the Australian Government.8 2017-18 capital grants program highlights for DTMR (main roads, road safety and ports) include: • $70 million of infrastructure development grants to local governments, including Aboriginal and Torres Strait Islander community assistance, and • $21.4 million towards development of cycle network throughout Queensland.9 Estimated concessions for DTMR (main roads, road safety and ports) in 2017-18 include:

• Rail Network and Infrastructure Planning Funding $564.8 million • Vehicle and boat registration concessions $167.3 million • Livestock and Regional Freight Contracts $33.8 million • Other transport concessions (Regional Queensland) and taxi subsidies $26.3 million • Commercial ship registration and licensing $4.4 million • Practical Driving Test $3.2 million.10

2.3 Gold Coast Waterways Authority The Gold Coast Waterways Authority is a statutory body established by the Gold Coast Waterways Authority Act 2012, the vision is to provide ‘… a waterways network and facilities that are sustainably managed to support an appropriate balance between recreational, tourism, environmental and economic aspirations and objectives’.11 The budget comparison for 2016-17 and 2017-18 for the Gold Coast Waterways Authority is below.

2016-17 Budget 2016-17 Est. Act 2017-18 Budget Agency $’000 $’000 $’000

Gold Coast Waterways Authority 10,645 11,575 11,674

Source: State Budget 2017-18, Service Delivery Statements, DTMR, p 46. In 2017-18, the Gold Coast Waterways Authority has allocated $8.3 million to improve management of, and provide better access to, the Gold Coast waterways, canals and rivers. Capital program highlights include: • $5.5 million to improve access and safety by dredging navigation channels, and to improve accessibility and quality of waterways information, and • $630,000 to provide boating infrastructure such as boat ramps, pontoons and to implement the Surfers Riverside Masterplan.12

8 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p 119-120. 9 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p 120. 10 State Budget 2017-18, Budget Strategy and outlook, Budget Paper No. 2, p 203. 11 State Budget 2017-18, Service Delivery Statements, DTMR, p 43. 12 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p121

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2.4 Issues raised at the public hearing Issues raised at the public hearing by the committee and participating Members in relation to main roads, road safety and ports include: • 2017-18 to 2020-21 Queensland Transport and Roads Investment Program that will deliver approximately $21 billion transport and road infrastructure investment, including $400 million to rebuild affected roads across the state damaged by Cyclone Debbie and associated flooding • the Transport Infrastructure Development Scheme • the Queensland cycling infrastructure investment strategy • delivery of initiatives to ease congestion on Queensland roads • motorway upgrade projects, including the Pacific Motorway-Gateway Motorway merge upgrade and Ipswich Motorway upgrade • meeting targets set by the Queensland Charter for Local Content and the Queensland Government Building and Construction Training Policy for local content and training requirements of government contracts • delivery of initiatives in the Queensland Road Safety Strategy • update on the installation of the flashing light school zone program at Queensland schools • the Co-Lab program • initiatives taken by the Queensland Government to address road safety for motorcyclists • the taxi industry assistance package • reinstating the Taxi Subsidy Scheme for National Disability Insurance Agency participants • Taxi Security Camera download notifications • compliance activity in relation to the regulation of ride-sharing services • charging stations for electric vehicles • $60 million to the cost of the Cairns Shipping Development Project, subject to Commonwealth and state government Environmental Impact Statement and business case approvals • the Townsville Port Expansion Project • implementation of the joint Queensland-federal government Reef 2050 Plan including the Maintenance Dredging Strategy for World Heritage Area Ports • update on the tender for the update to the ReefVTS project (reef vessel tracking system), and • the $18 million Clump Point boat ramp construction project.

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3. Acting Minister for Energy, Biofuels and Water Supply The Acting Minister for Energy, Biofuels and Water Supply has responsibility for the portfolio areas of energy, biofuels and water supply within the Department of Energy and Water Supply (DEWS), which includes the following statutory bodies reporting to the Acting Minister and GOCs: • CS Energy Limited (CS Energy) • Energy Queensland Limited (Energy Queensland) • Energy and Water Ombudsman Queensland • Powerlink Queensland (Powerlink) • Stanwell Corporation Limited (Stanwell Corporation) • SunWater Limited (SunWater) • Seqwater • Mount Isa Water Board (MIWB), and • Gladstone Area Water Board (GAWB). 3.1 Department of Energy and Water Supply The DEWS has two service areas: • Energy – responsible for ensuring Queensland’s energy sector is efficient, equitable and sustainable and contributes to an adaptive, resilient energy sector that powers consumer value and choice, and Queensland’s economic growth and prosperity.13 • Water supply – responsible for implementing water sector reform to ensure the delivery of safe, reliable and cost effective water supplies and the safety of referable dams, and to plan for water supply security and flood mitigation.14 The following table compares the total appropriations for DEWS for 2016-17 and 2017-18.

Appropriations Budget - 2016-17 Est. Actual - 2016-17 Vote - 2017-18 $’000 $’000 $’000

Controlled Items

departmental services 57,167 57,867 83,846

equity adjustment … … …

Administered Items 583,828 1,436,905 508,174

Vote 640,995 1,494,772 592,020

Source: Appropriation Bill 2017, Schedule 2, p 8.

In 2017-18, DEWS will administer funds on behalf of the Government for: • electricity related Community Service Obligations (CSO) payments estimated at $490.7 million • water related CSO payments to SunWater and Seqwater estimated at $11.2 million, and • 21 non-commercial water assets including water supply dams and weirs with recurrent spending of $9.7 million.15

13 State Budget 2017-18, Service Delivery Statements, DEWS, p 3. 14 State Budget 2017-18, Service Delivery Statements, DEWS, p 6. 15 State Budget 2017-18, Service Delivery Statements, DEWS, p 9.

8 Public Works and Utilities Committee 2017 – 18 Budget Estimates

3.2 Budget highlights The key budget priorities for the energy service area in 2017-18 include: • implementation of the $1.16 billion Powering Queensland Plan, including:

o $771 million electricity affordability package for the cost of the Solar Bonus Scheme, and

o $386 million for the Powering North Queensland Plan to strengthen and diversify the north’s energy supply and establish an Energy Security Taskforce • support for the growth in biofuels and bio-manufacturing industries by delivering a biofuels public awareness campaign and implementing a regulatory framework • implementation of the Government’s response to the Renewable Energy Expert Panel on a 50% renewable target by 2030, including a reverse auction for up to 400 megawatts of renewable energy • support for the Government’s ‘A Solar Future’ commitments, with the implementation of the 1 Million Solar Rooftops policy and Solar 150 reverse auction, including implementation of projects related to Solar for Community Housing and Solar in Schools • delivery of a support package for Regional Business Customers and a digital metering package targeting vulnerable customers in regional Queensland, and • influencing national policy outcomes through the Council of Australian Governments Energy Council, putting forward proposals to progress Queensland’s interests and maximise benefits of national investment in Queensland.16 The key budget priorities for the water supply service area in 2017-18 include: • develop a response to the State Infrastructure Plan regarding water supply infrastructure, and • transition SunWater’s irrigation channels for Eton, Emerald, St George and Theodore to Local Management Arrangements if agreement is reached with customers.17 2017-18 total capital program for the energy and water supply portfolio areas is $2.063 billion.18 The capital works programs for associated entities in 2017-18 include: • CS Energy $ 93.6 million • Stanwell $149.1 million • Energy Queensland $ 1.412 billion • Powerlink $196.5 million • SunWater $ 48.7 million • GAWB $ 27.1 million • MIWB $ 17.2 million • Seqwater $118.5 million.19

16 State Budget 2017-18, Service Delivery Statements, DEWS, p 2. 17 State Budget 2017-18, Service Delivery Statements, DEWS, p 6. 18 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p 45. 19 State Budget 2017-18, Capital Statement – Budget Paper No. 3, pp 45 – 50.

Public Works and Utilities Committee 9 2017 – 18 Budget Estimates

Estimated concessions for DEWS in 2017-18 include:

• Energy Queensland – Uniform Tariff Policy (excluding Isolated Systems) $441.1 million • Powering Queensland Plan – Electricity Affordability Package $268 million • Energy Queensland – Uniform Tariff Policy for Isolated Systems $47.1 million • Drought Relief Arrangements $6.3 million • Origin Energy – Uniform Tariff Policy $2.5 million • Cloncurry Pipeline Water Supply Subsidy $6.0 million • SunWater Rural Irrigation Water Price Subsidy $3.1 million • Seqwater Rural Irrigation Water Price Subsidy $2.1 million.20 3.3 Issues raised at the public hearing Issues raised at the public hearing by the committee and participating Members in relation to DEWS include: • $1.16 billion Powering Queensland Plan – electricity prices • assistance to vulnerable energy consumers • electricity disconnection and reconnection fee • impact on energy costs to downstream industrial customers as a result of the potential closure of the New Acland coalmine • direction under the Electricity Act 1994 by the Government to Stanwell • bringing Swanbank E back on line to increase supply and reduce volatility in the Queensland wholesale market • Ergon Energy’s radio communication safety upgrade capital works program • assistance provided by Energy Queensland to the Tully coastguard • $7.8 million through Powerlink to replace electricity transmission towers in Central and North Queensland damaged during Tropical Cyclone Debbie • security procedures in place at Stanwell’s power station • investment in the renewable energy sector in Queensland with 17 large-scale projects either commenced or committed to since January 2016 • implementation of the Government’s response to the Renewable Energy Expert Panel on a 50 percent renewable target by 2030 • the Solar Bonus Scheme feed-in tariff • the Biofuels mandate • publicising the first Queensland bulk water opportunities statement to enable better use of available water, and to guide decisions about investment in new bulk water infrastructure • $225 million to implement the findings of the Townsville Water Security Taskforce as part of the Townsville City Deal, and • the number of apprentices employed in Queensland’s energy and water GOCs under the apprentice program.

20 State Budget 2017-18, Budget Strategy and outlook, Budget Paper No. 2, p 195.

10 Public Works and Utilities Committee 2017 – 18 Budget Estimates

4. Minister for Housing and Public Works and Minister for Sport The Minister for Housing and Public Works and Minister for Sport has responsibility for the Department of Housing and Public Works (DHPW) which includes the following statutory bodies reporting to the Minister and the commercialised business units: • Queensland Building and Construction Commission (QBCC) • Residential Tenancies Authority (RTA) • Building and Asset Services, and • QFleet.21 The Minister for Housing and Public Works and Minister for Sport also has responsibility for the sport portfolio within the Department of National Parks, Sport and Racing (DNPSR).22 4.1 Department of Housing and Public Works The DHPW has three service areas: • housing and homelessness services • government accommodation and building policy services, and • procurement services.23 The following table compares the appropriations for DHPW for 2016-17 and 2017-18.

Appropriations Budget - 2016-17 Est. Actual - 2016-17 Vote - 2017-18 $’000 $’000 $’000

Controlled Items

departmental services 757,704 685,829 709,455

equity adjustment 259 92,936 180,146

Administered Items 3,553 3,508 3,510

Vote 761,516 782,273 893,111

Source: Appropriation Bill 2017, Schedule 2, p. 9.

In 2017-18, the DHPW will administer funds on behalf of the Government for: • revenue from the collection of fees for the Building and Development Dispute Resolution Tribunal appeals, and • the accreditation of residential service units and retirement villages by House and Homelessness Services.24

21 State Budget 2017-18, Service Delivery Statements, DHPW, pp 1-2. 22 The Minister for Housing and Public Works and Minister for Sport; the Minister for Environment and Heritage Protection and Minister for National Parks and the Great Barrier Reef; and the Minister for Employment and Industrial Relations, Minister for Racing and Minister for Multicultural Affairs share responsibility for DNPSR. 23 State Budget 2017-18, Service Delivery Statements, DHPW, p 1. 24 State Budget 2017-18, Service Delivery Statements, DHPW, p 14.

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4.2 Budget highlights The key budget priorities for DHPW in 2017-18 include: • the roll-out of the ten-year $1.620 billion Queensland Housing Strategy program • under the Queensland Housing Strategy, reforming services to become person-centred, holistic and assist Queenslanders on pathways to independence • as part of the Queensland Housing Strategy, delivering the Housing Construction Jobs Program • delivering reforms arising from the Queensland Building Plan, including delivering a suite of measures to help address security of payment for subcontractors, including establishing project bank accounts, and working with other agencies towards advancing green star ratings for government-owned buildings • collaboratively working with the Australian Government, states and territories, industry and relevant regulators to address issues relating to non-conforming building products • implementing revised procurement practices arising from the Queensland Government Procurement Interdepartmental Committee and recommendations from the Queensland Audit Office performance audit on Strategic procurement (Report 1: 2016-17) in partnership with Queensland Government agencies • implementing a Brisbane central business district and Fringe Area Government Office Accommodation Strategy 2015-2025 • commencing a targeted and accelerated four-year capital, maintenance and upgrade program to deliver safe and secure government employee housing in regional and remote locations across the state, including Aboriginal and Torres Strait Islander communities.25 In 2017-18, total capital purchases for DHPW portfolio, including its statutory bodies, are $446.3 million with capital grants of $109.1 million. Capital purchases include the QBCC expenditure of $879,000 and the RTA expenditure of $160,000. 2017-18 capital grants program highlights for the DHPW include: • $65.8 million for social housing in Aboriginal and Torres Strait Islander communities to deliver 26 dwellings, upgrade existing social housing and undertake infrastructure development including upgrades to progress the transfer of social housing for home ownership on Aboriginal and Torres Strait Islander land, and • $43.2 million to delivery 18 social housing dwellings and upgrade existing social housing.26 Estimated concessions for DHPW in 2017-18 include:

• Government managed housing rental rebate $376.8 million • National Rental Affordability Scheme $28.4 million • Home Assist Secure $19.0 million • Non-residential buildings – subsidised rents $5.6 million • Rental Bond Loans $1.2 million.27

25 State Budget 2017-18, Service Delivery Statements, DHPW, p 3. 26 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p 65-66. 27 State Budget 2017-18, Budget Strategy and Outlook – Budget Paper No. 2, p 198.

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4.3 Queensland Building and Construction Commission The QBCC regulates the building industry in Queensland.28 The budget comparison for 2016-17 and 2017-18 for the QBCC is shown below.

2016-17 Budget 2016-17 Est. Act 2017-18 Budget Agency $’000 $’000 $’000 Queensland Building and 237,153 240,704 207,097 Construction Commission Source: State Budget 2017-18, Service Delivery Statements, DHPW, p 40. 4.4 Residential Tenancies Authority The RTA administers the Residential Tenancies and Rooming Accommodation Act 2008, which regulates the residential rental sector in Queensland.29 The budget comparison for 2016-17 and 2017- 18 for the RTA is shown below.

2016-17 Budget 2016-17 Est. Act 2017-18 Budget Agency $’000 $’000 $’000 Residential Tenancies Authority 26,558 30,275 27,639 Source: State Budget 2017-18, Service Delivery Statements, DHPW, p 49. In 2017-18, the RTA intends to: • complete the myRTA system which comprises a fully integrated bond management, CRM and finance system, and • return to normalised capital expenditure levels which comprises the maintenance of the RTA’s existing systems and equipment.30 4.5 Issues raised at the public hearing Issues raised at the public hearing by the committee and participating Members in relation to DWPW include: • $1.8 billion Housing Strategy, including the $1.6 billion Housing Construction Jobs Program • expansion of the Dignity First Fund to provide services, such as haircuts, dignity packs and food, to people who are homeless • capital maintenance and upgrade program for government employee housing • the National Partnership Agreement on Remote Indigenous Housing • the Queensland Building Plan • the Home Warranty Insurance Scheme • providing support for Queenslanders affected by Cyclone Debbie through assessing and repairing essential facilities like schools, hospitals and public housing, and assisting with emergency housing • nonconforming building products • security of payment for subcontractors • procurement strategy reforms

28 State Budget 2017-18, Service Delivery Statements, DHPW, p 36. 29 State Budget 2017-18, Service Delivery Statements, DHPW, p 46. 30 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p 66.

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• Home Assist Secure pilot program • My Home Awards for gardens, and • new smoke alarm laws in public housing. 4.6 Department of National Parks, Sport and Racing The Minister for Housing and Public Works and Minister for Sport has responsibility for the area of sport within DNPSR. The DNPSR has three service areas including: • national parks • sport and recreation, and • racing.31 The following table compares the appropriations for the DNPSR for 2016-17 and 2017-18.

Budget - 2016-17 Est. - 2017-18 Vote - 2017-18 Appropriations $’000 $’000 $’000

Controlled Items

departmental services 343,549 281,243 354,265

equity adjustment (32,256) (13,470) 6,780

Administered Items 67,606 64,290 31,819

Vote 378,899 332,063 392,864

Source: Appropriation Bill 2017, Schedule 2, p 10. In 2017-18, the DNPSR will administer funds on behalf of the Government for the operations of Stadiums Queensland to support the maintenance and operation of its international standard sporting and entertainment facilities.32 4.7 Budget highlights Key budget priorities in 2017-18 for DNPSR’s service area of sport include: • $20.6 million over four years to support Stadiums Queensland and enhance management of the State's premier sporting facilities • $64.3 million to support grassroots sport and recreation participation • $10.8 million in 2017-18 of the three-year $32 million State Development Program • $4.9 million in 2017-18 under the Indigenous Community Sport and Recreation Program and the Torres Strait Community Sport and Recreation Program • $15 million over two years from 2017-18 to deliver female friendly change facilities, including an additional $2 million in new funding, and • support Queensland athletes through the Queensland Academy of Sport in their preparations for the GC2018.33

31 State Budget 2017-18, Service Delivery Statements, DNPSR, p 1. 32 State Budget 2017-18, Service Delivery Statements, DNSPR, p 10. 33 State Budget 2017-18, Service Delivery Statements, DNSPR, p 5.

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Capital grants program highlights for the DNPSR’s service area of sport include: • $41.1 million under the Get Playing and Get Playing Plus programs and other various grants to provide funding for new or upgraded sport and recreation facility projects to help Queenslanders become involved in sport and active recreation, and • $2 million in 2017-18 toward a grants program for female friendly change facilities.34 4.8 Issues raised at the public hearing Issues raised at the public hearing by the committee and participating Members in relation to the DNPSR’s service area of sport include: • $125.5 million Get in the Game initiatives to support sport and recreation at the grassroots • launch of the QAS4Schools program (in partnership with the Department of Education and Training) • the Nature Play Queensland program • the Sport and Recreation Disaster Recovery Program • funding programs to support community sport and active recreation needs • the State Netball Centre project • female-friendly change facilities, and • the Young Athletes Travel Subsidy.

34 State Budget 2017-18, Capital Statement – Budget Paper No. 3, p 82.

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Statement of Reservation

16 Public Works and Utilities Committee Rob Molhoek MP MEMBER FOR SOUTHPORT

Shop 2, 24 Musgrave Avenue, PUBLIC WORKS AND UTILITIES COMMITTEE Chim Park Old 4215 PO Box903 STATEMENT OF RESERVATION Southport BC Qld 4215 p 07 5600 1100 E [email protected]

The LNP Members of the Public Works and Utilities Committee wish to make the following Statement of Reservation regarding the examination of the Budget Estimates for the 2017- 18 financial year and the portfolio areas of Main Roads, Road Safety and Ports, Energy and Water Supply, Housing and Public Works, and Sports.

The Palaszczuk Labor Government promised a jobs bonanza but instead has given Queensland a jobs crisis and a budget con job.

The details exposed in the Palaszczuk Labor Government's budget proves that Queensland is facing higher unemployment, higher costs of living, fewer projects started and delivered, and more and more job-stifling red tape under Labor.

Queensland is stagnating, the community is crying out for leadership and we have a government stuck in neutral.

Labor's softly, softly approach is failing Queenslanders, doing nothing is not working, and the economy is hurting.

Families and businesses are paying more through higher taxes, sky rocketing electricity prices, increased living costs and much needed infrastructure across Queensland is not being built.

Instead of leading the way in job creation and job security, Queensland is falling behind the other states. Labor has failed to meet its own employment projections, meaning 80,000 fewer jobs will be created over the next three years. Youth unemployment is out of control - above 20% in many parts of Queensland and up to 50% in the Outback Region.

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f /RobMolhoekMP .»/Molhoek www.robmolhoek.com.au Approach to the proceedings:

The LNP members felt that the Ministers treated the proceedings as an irritant which inconvenienced them. They resorted to measures which undermined the integrity of being able to examine Departmental performances. Tactics used included employing time wasting and delaying strategies tb shield Ministers and departmental officers from questioning; answering on behalf of departmental officers who were clearly capable of answering; and debating the issues under examination rather than answering questions.

Main Roads, Road Safety and Ports:

With the absence of beleaguered Labor Minister Mark Bailey the LNP Members of the committee did not have high hopes for informative answers from Acting Ministers who have been dropped into a portfolio with a week notice.

The Acting Main Roads Minister Steven Miles is in denial if he thinks the issues associated with Labor's Rail Fail has not affected congestion. Especially when the SOS shows that the department has not met the target for the reliability and productivity of Queensland's road network.

Yet under questioning in the hearing today Acting Main Roads Minister Steven Miles could not answer why the government had failed to meet these targets.

In the morning peak 22 per cent of our roads have unreliable travel times, while in the evening 28 per cent of our road network is unreliable. In the evenings 33 per cent of our roads are classified as unproductive - this is impacting on small businesses and commuters alike.

The only explanation for the worsening congestion is that the Palaszczuk Labor Government has cut roads funding this year at a time when our train system is in crisis.

The Palaszczuk Labor Government can try to spin the figures any way they like but the numbers don't lie when you compare what was spent in the TMR capital statement in 2016- 17 and what is budgeted in 2017-18.

2017-18 Budget Roads Funding

Capital 16-17 17-18 Difference Statement District $ $ $ Central West 38,631 ,000 39,276,000 645,000 Darling Downs 564,378,000 430, 178,000 -134,200,000 Far North 136,766,000 102, 137 ,000 -34,629,000 Fitzroy 126,607,000 99,892,000 -26,715,000 Mackay- 176,211 ,000 160,000,000 -16,21 1,000 Whitsunday Metropolitan 761,090,000 727,588,000 -33,502,000 North Coast 299,209,000 236,134 ,000 -63,075,000 Northern 160,051 ,000 142,378,000 -17 ,673,000 North West 72,177 ,000 56,968,000 -15,209,000 South West 41 ,834,000 34,060,000 -7,774,000

2 South Coast 328,251,000 359,221,000 30,970,000 Wide Bay Burnett 220,515,000 135,567,000 -84,948,000 Total 2,925, 720,000 2,523,399,000 -402,321,000

The committee also heard about the money wasted by the Palaszczuk Labor Government in dredging the site at the Port of Bundaberg to hold the HMAS Tobruk for preparation before sinking. The dredging "in the order of $350,000" was undertaken before Maritime Safety Queensland consulted with the port authority, the harbourmaster and local industry. The site was subsequently found to have safety issues and the Tobruk will now be housed as a different berth while being prepared.

The Acting Minister justified this mishap by saying that the site "needed to be dredged at some point".

The Member for Glass House questioned the CEO of the Gladstone Ports Corporation about when the site would have been required to be dredged if the works had not been brought forward for the Tobruk.

Mr POWELL: At this point I will call Mr O'Sullivan back to the table. Mr O'Sullivan, I think the minister said that the dredging that did occur at the port of Bundaberg will ultimately be needed. When?

Mr O'Sullivan: The area that is being dredged is looking at future expansion of the marina part of the port. Currently discussions are underway with a consortium of companies looking at investing into the port, including a large-scale investment on the foreshore and also an investment into expanding the marina. In terms of time frames, they will depend on the successful conclusion of those negotiations because part of those explanations is around establishing time frames for the development. At this stage, until those negotiations are done I do not have a firm date for those.

Mr POWELL: I am not trying to be obtuse here, but are we talking months or years?

Mr O'Sullivan: The program would be staged over a number of years. The expansion of the marina may occur either as part of stage 1 in the next couple of years or as part of stage 2. That is part of the negotiations around what the priority developments are in that area.

Mr POWELL: Has any work been done by the Port of Gladstone on the rate of refill of that dredging and therefore whether by the time those negotiations are concluded what has been dredged will be filled up again by what is coming down the river?

Mr O'Sullivan: I am unaware if that was part of the review, and I would take it on notice to look at the hydrographic information that was collected at the time. I am not aware if that was part of the calculations.

While the CEO was happy to take the question about the hydrographic information on notice, it is disappointing the Minister refused to do so and it was ruled out of order.

The issues surrounding the argument that the dredging at Port of Bundaberg would have been required regardless of the HMAS Tobruk is clearly linked to the operations of the port run by Gladstone Ports Corporation.

3 Energy and Water Supply:

The Government hides behind claims of commercial in confidence to avoid proper scrutiny of Government owned Generators like Stanwell, which have been accused by many Queenslanders of using their market power to 'game' and drive up wholesale electricity prices.

ACCC Chairman Rod Sims has also publically stated that he believes State owned generators have been using market power to drive up wholesale electricity prices.

It is disappointing that Labor members of the Committee also tried to stop the LNP from asking questions to the CEO of the Stanwell, despite Stanwell being a billion dollar business which is 100% owned by Queenslanders, and whose financial statements are aggregated in the Non-Financial Public Sector accounts in the State Budget.

The 2017/18 Budget Papers show the earning from government owned generators in 2016/17 more than doubled. The Treasurer was not forthcoming about when he first knew about the massive increase in earnings from the government owned generators. Importantly this doubling of earning has seen Queenslanders suffer under an unprecedented spike in wholesale electricity costs. In fact, during the first five months of 2017, Queensland electricity consumers paid the highest wholesale prices in the National Electricity Market, 30% above the average price.

The Government's direction to Stanwell to alter its bidding practices is a clear admission of guilt that they have been using their market power controlling 30% of the installed generation to drive up wholesale electricity prices. In fact on the day the direction was announced, wholesale energy contracts saw the biggest single-day drop price drop in 10 years.

Under LNP questioning the Palaszczuk Government was also forced to concede there are no formal protections in place to ensure electricity retailers pass through the subsidy provided to their network costs under the Powering Queensland Plan by way of the removal of solar rebate scheme costs from 2017 to 2020. This is an embarrassing admission and shows the reckless way in which Labor treats taxpayer funds. The Palaszczuk Government also admitted that when the 3 year period finishes electricity prices will increase by the cost of the solar feed in tariff, all else being equal.

Housing and Public Works:

No one can have any confidence in the management of the Department of Housing and Public Works following the lack of clear and meaningful answers given by Minister Mick de Brenni at Estimates. Sadly the Minster failed to answer on a whole range of important issues, including:

Public Health & Safety: The Minister's unbelievable and arrogant dismissals of questions related to public health and safety related to the potential fire risk of external aluminium cladding on public and private buildings across Queensland that have been identified in the wake of the London Grenfell Tower tragedy. The Minister refused to release a list he apparently has of more than 40 buildings in Queensland with potentially dangerous cladding.

The LNP was very concerned by the Minister de Brenni's cavalier attitude and will continue to pressure the Minister and the Palaszczuk Labor government to properly act to deal in a timely and effective manner with this important issue.

4 Departmental Leadership: Confidence in the leadership at the Department of Housing and Public Works which has taken a dive under the Palaszczuk Labor Government as plainly shown by the Working for Queensland survey, the government's own survey of staff in the Department that found key indicators associated with integrity, management behavior and development commitment have declined at DHPW.

Minister Mick de Brenni claimed no knowledge of his Department's own survey and has arrogantly dismissed the findings. Given this attitude by the Minister the obvious questions really needs to be asked, what was the cost (ultimately to taxpayers) of the conducting the survey and why would anyone bother given the very arrogant and dismissive response of the Minister.

Procurement Services: Again the Minister's unbelievable and arrogant dismissals of questions related to staff cuts in the Procurement Services section of his department when budget papers clearly show that staff numbers have been slashed from 111 in 2014-15 to 59 in 2015-16 and with only marginal increase since, despite the very damning Auditor-General's report of the failure in the Department - a report and findings also arrogantly dismissed by Minister de Brenni as all the fault of the previous government, when he has been at the helm for the best part of three years. The facts show that the Minister has gutted Procurement Services - a key section in the Department that's supposed to be responsible for co-ordinating purchases and supplies across departments and government and delivering value-for-money.

Licensed Plumbers: Other key concerns were the Minister's poor explanation of what's planned with regulations that could well see all metal roofs in Queensland having to be installed by licensed plumbers with a huge potential increase in home and commercial building costs.

Sub-contractor Payments: For the very poor explanations from the Minster, it's plain that the Palaszczuk Labor government is failing to deal properly with the important issue of payments for building contractors and sub-contractors, even with projects that are being directly overseen by the Department of Housing and Public Works, with the Minister failing to provide clear details to the Estimates hearing.

Queensland Housing Strategy: In spite of all the hype and the Minister's lack lustre sales pitch, Minister Mick de Brenni was unconvincing in his attempts to explain just what new or additional funding was really being made available to support Labor's shiny bauble $1 .8b or is it $1.6b 10 year funding of the Queensland Housing Strategy. Whilst he provided a long-winded sales pitch on the project he failed to clearly explain how it would be funded, nor was he able to clearly state if this was all new money or just a re-packaging and re-branding of existing programs and spending. Even after further questioning of both the Minister and Director General the committee was no clearer as the Minister and Director General's answers appear to contradict each other.

Mr Molhoek: This is effectively a $1.8 billion increase over this rolling program; correct?

Mr de Brenni: No, they are the same thing.

Followed some time later by the following comments from the Director General;

Mr Molhoek: What you are saying is that the money foreshadowed is essentially new money on top of the rolling program notwithstanding timing differences?

5 Ms Carroll: On top of the existing budget, and that is what is identified in the budget papers the additional money on top of the existing budget.

Labor's big shiny Queensland Housing Strategy may look good on paper but it's clear neither the Minister or Department have really worked through the detail, nor are they able to articulate if this will actually result in more housing for vulnerable Queenslanders. Clearly the Palaszczuk Labor government is failing to take housing in Queensland seriously.

Strangely, the Minister seemed keen to avoid questions about the management of venues controlled by Stadiums Queensland, specifically the Gabba. Earlier this year, Queenslanders witnessed several debacles from the Minister in relation to events being hosted at the Gabba. Firstly, there was an article from the front page of the Courier Mail on 16 March 2017with the Minister referring to drop-in pitches. That was followed by a stinging rebuke from Labor Senator for Queensland, Anthony Chisholm, calling for the idea to be 'knocked on the head'. The Minister wouldn't answer the Committee whether he had received any calls from the Senator about a drop-in wicket at the Gabba - a crazy suggestion.

The Minister also seemed quite uncomfortable talking about the debacle of the Women's AFL Grand Final in March 2017 and the fact that despite saying that it would be played at the Gabba, there was then an embarrassing back-down when it had to be shifted to Metricon Stadium at the Gold Coast.

In relation to the proposed new community hub of the Brisbane Lions in Springfield, which would require a $15 million commitment from the Queensland Government, the Minister was very non-committal about the proposal and whether the Government would commit any future funds. Instead of playing straight with the Committee and telling it one way or another, it seems the Minister wants us all to stay tuned for a possible pre-election announcement! The new State Netball Centre has also been delayed, which is extremely disappointing. This project was announced by the former LNP Government in 2015 - it will be now nearly 4 years from start to finish for this project, assuming there are no further delays, which could never be assumed for any project under the stewardship of this do-nothing Government.

Conclusion

Queenslanders deserve better.

A Tim Nicholls led Liberal-National government will Build a Better Queensland. The LNP's Plan will create jobs, support small business, invest in education to raise standards, and we will provide better services for families and retirees.

We will restore business confidence and get investment flowing to create jobs throughout all of Queensland.

An LNP Government will reduce the risk to our economic security by focusing on six drivers to strengthen and diversify the Queensland economy. The six drivers are:

• Tourism • Agriculture • Resources

6 • Construction and Manufacturing and • Services, Science and Technology and • Education

Without a strong economy, Governments can't provide better services in our hospitals, a better education for our children or invest in new technology and equipment to help police protect our communities.

An economy can't grow if it's weighed down by high costs and one of the biggest costs is electricity. We'll make sure that Queensland's energy security is not put at risk and that we don't end up like South Australia with blackouts and industry shutting up shop. A 50% renewable energy target in Queensland will mean higher prices and we won't stand for it.

The LNP is committed to leading a government that is better for Queensland. More government isn't the answer to our problems - better government is.

The LNP will be a common sense Government which listens. plans and acts to build a better Queensland.

Only by Building a Better Queensland - will we deliver the jobs needed and restart our economy.

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Rob Molhoek MP Deputy Chair Member for Southport ~\~\~~7

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