Second Reading

Adjourned debate on second reading.

(Continued from 15 October 2014.)

Mr VAN HOLST PELLEKAAN ( Stuart ) ( 16:01 ):

I advise that I am the lead speaker, but I will not take much of the house’s time. I thank my colleagues for filling in and going first, and they have no doubt ably covered most of the issue. I also direct anybody who has an interest in this issue to the minister’s second reading speech, which is very straightforward, direct, succinct, and explains the issues very well, too. There is no need for me to go over too much of that other than to say again that this is an initiative which the Council of Australian Governments and their Energy Council is looking at doing. With South Australia being the lead state for energy, it is the first to try to implement it, it is something that has been agreed nationally across other states and it is something that the opposition supports. It does seem to be a very positive step forward.

As I heard the member for Flinders mention, it is generally believed that across the range of electricity consumers the very large consumers—while of course their bills are gigantic and they feel, perhaps, the greatest burden—do probably have the greatest capacity to represent themselves. For the very small and possibly the disadvantaged end, while there can never be enough support for people living with disadvantage, there is a range of organisations and services who advocate on their behalf. It was felt that the very large group of people in the middle, essentially households and small businesses, were not getting enough representation, and that to swap from the Consumer Advocacy Panel to Energy Consumers Australia would be a positive move, and that does seem to be the case. Of course, I am sure that people at the larger end and the smaller end would always think that they could do with some more representation, but that logic seems to be pretty sound.

The cost of this scheme is, of course, an important issue. It does not come for free. I had a very positive briefing from the minister’s staff and was assured that, to the best of their knowledge, 65¢ or less would be the cost of the scheme. Their advice was that the average cost per customer represented by the ECA would be approximately 64¢. It is not possible for them to know exactly what it will be, but I think that that is reasonable, and certainly other representatives whom I have spoken to think that is reasonable as well.

Again, there is always a debate: electricity prices are going up and up and the burden of bills is higher and higher all the time. Every little bit does make a difference, but if you stand back and take a look at it, 64 ¢ per year per customer does seem like a very fair cost to have this sort of advocacy done well on your behalf.

That view is supported by the Small Business Commissioner. I wrote to the Small Business Commissioner and received advice from him, and I am sure that the minister and his officers would have received exactly the same advice, that essentially he is supportive of this. He thinks it is good value and he thinks it is a positive move. SACOSS as well came back and said that they were also very supportive of the move.

Both of them said it was not perfect but they did say that they did not have significant suggestions to put forward for trying to improve it and they were very comfortable that the government is on the right track heading this way, as are all other governments across the nation. Of course, that gives the opposition a great deal of comfort as well. They did also both raise, though, not a concern but an interest in the make-up of the board. In the minister’s second reading speech, he said:

Energy Consumers Australia will be established as a company limited by guarantee, governed by a constitution with a … skill-based board comprising of one chair and four directors.

Both SACOSS and the Small Business Commissioner expressed a desire that they—and I am sure they meant them or their organisation—could actually have a role on that board within South Australia.

I did want to ask the minister about this specifically at the committee stage, but when I hunted through the bill, I could not actually find anything specifically about the board, so there is not really a clause to investigate. I ask very directly of the minister whether, in his summing-up remarks, given that it was included in the second reading speech, he would be able to respond to the desire of SACOSS and the Small Business Commissioner to actually play a part themselves in the skill-based board that will advise the statutory body.

Most importantly, their question is: will there be people who have a genuine understanding of small business and a genuine understanding of people who require social services? Will people with that knowledge and with those skills be able to participate actively in the board and have a seat on the board? If the minister is able to comment on that in his summing-up, that would be good because, as I said, there is nothing specifically about it in the bill itself that I could point to during the committee stage.

In terms of the existence of the grants that are here at the moment, the Consumer Advocacy Panel has an overall operating budget of $6.2 million per annum and that includes grants of $2.5 million per annum, which are essentially given to organisations who might advocate for particular groups of customers. That is a very positive thing. I have assurances from the minister and his office that the level of those grants is expected to just roll right on and stay the same, so that ECA will have the same level of grant funding to offer to the broader group of advocates who would like to work in this space, as the CAP currently does. That is very positive.

It does not matter what topic you are dealing with, there is always concern that it might get more expensive over time than is currently forecast or that the grants might start to diminish over time. I have no doubt that the intention is for it to be exactly the same and I also know that the minister would not be in a position to make commitments for years down the track. I just put on record that that is obviously a very understandable and genuine concern that the broader public has.

While 64¢ on average per customer across all customer groups appears to be very fair, you would not want that to start to grow and, while transferring the same level of grant funding that exists at the moment from the Consumer Advocacy Panel to Electricity Consumers Australia seems very fair, they would not want that to start to reduce over time either. They are very important questions and I support those. I accept the fact that the minister probably cannot make any commitments with regard to that at all.

A very important area which I was able to get advice on from the minister’s office in the briefing was with regard to: what classifies as a small business? What is a small business? There are a lot of definitions. Some go by number of employees, some go by turnover, there are a whole range of issues. I was advised that the definition of small business used for this bill would be, essentially, consumers using less than 100 megawatt hours per year.

As I think I heard the member for Flinders say, to give it some context, a household is using six to seven megawatt hours per year, so that gives you some scope of what a small business might be considered to be up to. There is no doubt that, in the context of this particular bill (energy consumption and advocacy), judging a business by its electricity consumption would be a much smarter way to go than by its turnover, its number of employees or any other measure you might use, because that is the core of the issue.

So, I am very comfortable with the bill. I would be grateful, if the minister has the opportunity, to put forward some comments with regard to the broad make-up, which I ask on behalf of those two organisations and the opposition. It may well be, in fact I expect they would have given exactly the same advice and asked the same questions directly to the government. I will finish up with that, Deputy Speaker. The opposition is very pleased to support the bill.