Premier's Address Premier Lara Giddings Address on the first day of the new parliamentary year Tuesday 8th March 2011 INTRODUCTION Mr Speaker, today is International Women’s Day – in fact it’s the centenary of this important day, which was first celebrated in Europe in March 1911 as part of the campaign for women to be able to work, vote, hold public office, and not be discriminated against. And it is hard to believe in this day and age that it was only ninety years ago that women were first given the right to stand for election to the Tasmania parliament. From that time, it took fifty-nine years before the first woman minister would be appointed, my former colleague Gill James, and seventy-five years before the appointment of the State’s first female Deputy Premier in the late Sue Napier in 1996. So it is with pride and thanks to the women suffragettes who fought so hard for the right of women to vote and stand for election that I am here today as Tasmania’s first female Premier. It is now just over six weeks since my parliamentary Labor colleagues supported me unanimously into this leadership role. I thank them for the confidence they have shown in me, in what we know are going to be difficult times. I also want to pay tribute to the former Premier, David Bartlett, who had the support and respect of his colleagues throughout his premiership and I am pleased he agreed to remain in the cabinet as my Attorney-General. Having now been in the job, I understand better the impact the role has on your life and on those around you. David, I support your decision and thank you for the years you were Premier of this great State of ours. Natural Disasters Mr Speaker, I will begin today’s address by acknowledging the horrific start to the year we have experienced in Australia and New Zealand through natural disasters. Our thoughts are especially with those people who have lost loved ones. One can hardly begin to imagine what it must have been like during those terrifying days of flooding that saw a baby ripped from the arms of her mother, people being swept from inside their own homes, others being rescued from cars, trees and roof tops by helicopter rescue personnel working in difficult conditions. While thankfully, here in Tasmania, we were spared the shocking toll on life and property that we saw in Queensland, New South Wales and Victoria, communities like Railton in the North East and North West of our state were badly affected by flash flooding, with homes and businesses damaged, bridges and crops washed away and roads destroyed. Local government can be assured that the State and Commonwealth will work in partnership with them to rebuild local infrastructure. Other help is being delivered to individuals, businesses and farmers affected. I am proud of the resilience of our communities, the generosity of Tasmanians in donating to the various flood appeals, and the time and effort given by SES workers, police and staff from a range of government departments on the ground in Queensland and Christchurch to help with the tragic aftermath of the floods, cyclone and earthquake experienced in these regions. On behalf of all Tasmanians, I thank them for their efforts. Principles, Values and Vision Mr Speaker, people look to their leaders for vision, for direction, for an understanding as to what the future may look like. At a time like now, when people are suffering from the increases in the cost of living, from electricity prices to higher interest rates on their mortgage, when businesses are trying to survive against the pressures of a high Australian dollar, shrinkage in domestic spending and lower demand, a vision that does not reflect the harsh realities of the day can be difficult to portray. It is true, we are entering a difficult period for government as we have to make the tough decisions to ensure that our State does not descend into the problems of the past – where we saw spiralling debt, unemployment well in excess of ten per cent, negative population growth and private investment plummeting. But it is also true that we can still rise above today’s pressures to see where we are going and what pathway we are taking to get there. Mr Speaker, I believe in Tasmania. I believe we have a strong future, a future built on the talents of Tasmanians - from the arts to science, to innovative new industries, big and small. A future built on the protection of our natural environment, our clean air, and pure water. A future built on farming and viticulture practices which take our quality food and wine products to the world. A future that produces in our State more world class experiences like MONA, Barnbougle and Sapphire, and builds on our already vibrant arts, heritage and natural attractions. A future which provides our children with an education that sets them up to be positive contributors to this ever changing world. A future that adapts to the ageing population, providing health and community care when you need it, as close to home as possible through the use of new technologies enabled by the investment in optic fibre. A future that accepts difference and encourages tolerance; where all Tasmanians can reach their full potential no matter where they were born, who they are, or what they believe in. A future that keeps what is special about this place now for others to enjoy in years to come. While we are facing some tough challenges, by doing the hard work now we will help to build for better days, days when we can once again invest in a way that helps this vision become an even more certain reality. Mr Speaker, there are many layers to life in Tasmania and all are important. We are home to world class artists, writers and sports stars that we can all be proud of. We have excellent doctors, nurses, teachers, scientists and academics. But we equally value other Tasmanians; mums and dads; families living in the suburbs and regions: farmers, miners, fishers, foresters, factory workers, clerks, retail workers, social workers. We recognise those who succeed but also value those who are less fortunate. Mr Speaker, as a Labor Premier I will always fight for a community that is fair and equitable, tolerant and compassionate. I will do all I can to protect and create jobs and ensure all Tasmanians share in the benefits of a strong economy. I believe in quality public services that support those most in need and are accessible to all. I will respect, value and nurture our diverse culture, history and natural environment. But we also need to use our natural resources – our minerals, forests, water and farm land – to generate wealth and employment. We should aim to ensure new developments meet high environmental standards and that where possible we add value to our resources and high quality products before we export them. We need industry, tourism and construction to maintain economic growth and provide for the needs of a modern society. But I recognise that tensions can arise between these different values and it is the role of government in consultation with the community to resolve those differences and make decisions – this will at times require compromise from all sides of a debate. THE STATE BUDGET AND THE ECONOMY Mr Speaker, in previous State of the State speeches my predecessors have announced major new policies or initiatives, often with large dollars attached to them. In the current budget circumstances we are in, this is not an approach I will be following. That is not a criticism of those who stood here before me. Paul Lennon was Premier during a period of sustained and unprecedented economic growth, and he announced initiatives in key services such as health and affordable housing. He also helped to turn around a $1.6 billion deficit into a $1 billion savings buffer. David Bartlett was Premier when the GFC hit, and he prudently and deliberately used the surplus created after a decade of Labor’s strong financial management to shield Tasmania’s economy from the worst of the GFC. Now, in the post-GFC world, we are not enjoying the strong revenue growth that we did a few years ago, and we no longer have the surplus to fall back on. As a result, much hard work lies ahead of us to manage the State’s Budget Rather than announcing new spending initiatives, we need to be disciplined and strong to make the tough decisions today that will ensure we can continue to provide the basic services that Tasmanians need now and in the future. My address today will therefore focus on those key decisions that we have to make, as well as the basics that we will prioritise in doing so. As such, I will not be exhaustively listing all of the Government’s plans and priorities for the coming year. Some very important issues such as law reform, carbon, climate change, the NBN and water reform - among others - are therefore subjects for other days and other speeches. Mr Speaker, soon after I became Premier I delivered the Mid Year Financial Report, providing an update on the State Government’s budgetary position. It showed a deterioration in the Government’s fiscal position due to rising costs and falling revenues – including a drop over six years of $1.2 billion in GST and State taxes. And since the Report was prepared Tasmania has lost another $25 million per annum in GST revenue. The single biggest challenge we face as a Government in the coming months is returning the State Budget to a strong and sustainable position in the post-GFC world. I have been upfront and honest about our situation because I believe Tasmanians are entitled to a frank assessment of what we must do to avoid returning to the days of high net debt that we faced in the 1990s. As we emerge from the GFC, it is becoming increasingly clear that the growth in revenues will not be as a strong as it was in the years before. This new reality is being confronted not just in Tasmania but in most other States and Territories. We will rebuild our finances and the savings buffer through a responsible and considered plan which will impose a new level of discipline on public expenditure and deliver long term structural reform. While the plan cannot be delivered in one Budget, that does not mean we should shirk the tough decisions. If we fail to take our own hard decisions now it can only mean that we will have even harder decisions made for us in the future. I have already announced immediate savings of close to $160 million. I have also outlined a public sector productivity strategy to reduce expenses in the public sector by an average of 3% per annum, which will save $200 million per annum by 2014-15. The Government won’t be trapped into looking for quick fixes and it will not be ruling things in or out before this work has been done. Some of it will be done by reducing programs, and some of it will be done by working smarter, so we can be more productive in the way we deliver services. It’s not about reducing the quality of services, it's about getting the basics right and delivering better and more efficient services. The key focus of the reviews will be ceasing or reducing funding programs which: • do not align with Government policy priorities and government responsibilities under formal agreements such as those with the Australian Government; • are inefficient and ineffective; or • duplicate equivalent programs in other agencies. The Government will also be maintaining its commitment to high levels of infrastructure investment that support public and private sector productivity improvement and long-term economic growth. Mr Speaker, it is easy to forget what Tasmanian life was like in the early 1990s when the Budget was in crisis. This was a devastating period for the State: double digit unemployment rates; millions of dollars withdrawn from community services to cover debt payments; and large scale public sector redundancies. Mr Speaker, while I lead this State I will do all I can to ensure we do not return to those dark days. Economic Growth While we face a very real challenge in managing the State Budget, it is important that we do not fall into the trap of talking down the broader Tasmanian economy. In this term of Government it is essential that we set the conditions for long-term economic recovery and provide for another decade of growth. There are encouraging signs of an underlying economic recovery in Tasmania. I acknowledge that it is patchy and uneven, with some sectors and regions still doing it tough. But many important indicators are now pointing in the right direction, and recently we have seen: • Growth in State Final Demand of 3.2%, equal to the national average, and the fastest growth in the December quarter of all States; • Three consecutive quarters of growth in private investment, including over $1 billion of private capital investment recorded in the December quarter alone; • The value of Tasmanian exports growing to $3.2 million over the past year - 15.4% higher in the past six months; • And, most importantly, over 6000 net jobs created since employment growth turned around a little more than a year ago. I am confident that if we continue to maintain the economic recovery we can reach new record employment levels within this term of Government. However, my eyes are not closed to our economic challenges and the Government I lead will continue to take a balanced view of the economy. We are not yet firing on all cylinders and many economic measures are yet to return to pre-GFC levels. By the same token, we should not become so consumed by the macroeconomic data that we lose sight of the enormous contribution of local entrepreneurs. It is difficult to single people out, and there are too many promising and exciting enterprises making their mark in Tasmania to mention them all, but the energy of companies like Harvest Moon in the North-West is inspiring. Last month this local vegetable producer opened a new $5 million broccoli and bean packing facility at Forth, which has lead to the creation of 50 new jobs. Naturally Blue blueberry farm at Lebrina is investing more than $670 000 over four years to improve their infrastructure and increase production, with the company’s workforce during the annual harvest season from January to March to increase from 22 to more than 100 pickers each year. Tamar Valley Dairy last month revealed a $10 million investment in a major expansion of its factory at Invermay in Launceston, with employment to double to nearly 130 staff. And in Hobart, Sentralize is an instant website development company that over the past year has grown from a two person operation to six by taking an innovative approach to value-adding for investors in internet domain names. To sustain growth we need to focus more on productivity and competitiveness to generate a new wave of private sector investments such as those I have mentioned. The evidence is clear that the best thing we can do to provide businesses with the confidence they need to invest and grow jobs is to maintain a sustainable budget position. That is why our budget savings are not just a fiscal strategy, they are an important part of a much broader economic strategy. Mr Speaker, there is understandable concern in the community about the impact our tough budget measures may have on individuals and on services. We will do all we can to minimise that impact. But if we don’t take strong action now the result would be higher taxation and higher debt levels in future that would have far worse consequences for jobs and services. BASIC SERVICES AND KEY PRIORITIES Mr Speaker, I joined the Labor Party more than 20 years ago because I believed in helping people. I still believe that a key role of government is to give people a helping hand, particularly those most in need or least well off. So, for example, I believe public education is critical in helping people to attain the knowledge and skills they need to get a job, with all of the dignity, self respect and independence that employment brings. I believe an efficient public health system is about ensuring everyone has access to safe, high quality health services – not just those who can most afford it. It is about basic things like providing dentures that give people self confidence and sense of worth, or helping them to give up smoking so they can live a longer, healthier life. It is with this philosophy in mind that my Government will go about delivering basic services and working on our key priorities in the coming year. Cost of Living Mr Speaker, I recognise that many Tasmanians are concerned about the cost of living and are facing real pressure on their household finances. The cost of living is a big issue across the nation. It’s second only to health as the most important concern for Australians. Tasmanians have felt the pressure of increases in prices. Interest rates. Food. Electricity. Water. Petrol. The impacts go on. And when a family faces all of these prices coming in at once, we know it can be hard to cope. We also know the pressures can accumulate at certain times of the year or particular events in your life, like starting school, starting a family, being ill, being elderly, leaving home, finding work. The sad reality is that there’s a limit to what the State government can do about it – we can’t control interest rates, petrol prices, the cost of food or the level of Centrelink benefits and Commonwealth taxes. But we are listening and where we can influence the cost of living we will act. We are not going to throw our hands up in the air and say “it’s all too hard” or “it’s not our problem”. That’s why we’re the first State Government in Australia to develop a cost of living strategy to do what we can to support people who are doing it tough. We also face unique challenges in Tasmania. Our average weekly wages are below other states and territories, and more than a third of Tasmanian households are on low incomes, reliant on Commonwealth pensions and allowances. That is why one of our key responses is building a strong economy that creates jobs across our diverse populations and places. Jobs which build skills and increase the incomes of Tasmanians. We can also control State Government service delivery. Much of what government does through health, education, housing, transport is about the ‘social wage’ which supports all Tasmanians having access to the basics of life and reduces cost of living pressures. The Government currently provides more than $330 million each year in concessions, subsidies and rebates that go directly to ease costs for needy Tasmanians. Good services, good jobs and strong support will make our people and places resilient to the continuing price shocks. But there is no better buffer than a strong economy. We have a responsibility to be good economic managers. We also have a responsibility to support our citizens. Tasmanians want to know that the government is living within its means and investing in the future. I have just received and tabled the interim report on the Cost of Living prepared by the Social Inclusion Commissioner, Professor David Adams. In the main this Report provides advice to the Parliament on a proposed electricity concession in the context of an emerging broader Cost of Living Strategy, which Professor Adams will complete by June this year. It is important to wait for the Social Inclusion Commissioner’s final findings before we consider a full range of short and long term actions that will make a difference in peoples’ lives. But I believe there are some modest steps we can take now in direct response to particular recommendations in the interim report. 1. A basic goods and services emergency relief fund will be considered through the 2011/12 Budget planning process. 2. In the upcoming Budget the Government will also consider investing in energy efficiency measures to reduce bills, especially for low income earners. 3. I have written to the Secretary of DPaC seeking advice on introducing a bill smoothing policy to help Tasmanians reduce the shock of large quarterly, bi-annual or annual bills by spreading the cost across monthly or fortnightly instalments. 4. I have asked Treasury to revisit the 2008 Review of Concessions to update data with a cost of living focus so we can better target our concessions to those most in need. 5. The Government will support the establishment of a Select Parliamentary Committee on the cost of living. I believe it should commence after the June Report is complete, if it is agreed further Parliamentaryexamination is required. 6. I have written to the Prime Minister asking her to consider including the cost of living on the COAG agenda. 7. Inregard to an Essential Services Commissioner, I have asked Treasury to provide advice on the possibility of existing bodies, such as the Economic Regulator, extending their roles to consider affordability when setting prices, in order to avoid expenditure on more bureaucracy at a time of limited resources. 8. Finally, I announce today that I have appointed Rebecca White to be the Parliamentary Secretary for Cost of Living, reporting directly to me as Premier. Mr Speaker, when times are tough, as they are right now with the State Budget, it is even more important that we focus on the basics. We must be good economic managers, provide quality essential services and provide support and opportunities for Tasmanians while managing within our budget - just as any Tasmanian family needs to do. So what are we doing to ensure that we get the basics right? To ensure we provide the best services we can to support all Tasmanians in these tough times? Health In health, we are currently undertaking a massive health infrastructure agenda that will not only produce better facilities for patients and staff but will also create jobs in the construction phase. We’re spending, or have planned, three quarters of a billion dollars on projects across the State – including at the Royal Hobart Hospital, the LGH, the North West Regional Hospital and the Mersey. This investment will bring great benefits to people who use these services and those who deliver them. But we aren’t just building better hospitals. We are also developing a Wellbeing Strategy because we want to help people improve their health so they have less need for a hospital in the first place. Every effort we can make to promote health and wellbeing and prevent chronic disease will help Tasmanians to live longer, healthier, more fulfilling lives while reducing demand for costly care in our hospitals and other parts of the health system. The same factors that help individuals live a healthier life also build the health, wealth, safety and vitality of families and communities. This Government will put health and wellbeing front and centre by basing our decisions on sound evidence, having a targeted approach and supporting those who are most in need. Tasmania has also signed up to the national health reforms because they will deliver more resources and better health and hospital services for Tasmanians. These reforms will secure a sustainable funding base for Tasmanian health services into the future, along with greater local control, greater efficiency and improved responsiveness for our health system. We look forward to working in close collaboration with the Commonwealth and other State and Territory Governments in working out the full details of the new national agreement by 1 July this year. This year will also see legislation introduced to Parliament to establish our three local hospital networks, which will become fully operational by 1 July 2012. Education Mr Speaker, every child has the right to the very best start in life and education is one of the key basic services my Government is prioritising so we can give our children a good start, so we can help build a strong economy, and so we can ensure young Tasmanians are ready to get a good job. Our schools are achieving important improvements in outcomes for our students. We are building on the great foundations laid for the future in early years education, literacy and numeracy, improving post-year 10 qualifications and training, and enhancing second chance learning for adults. Our refined post-year 10 reforms are ensuring all students have access to learning pathways geared towards fulfilling and meaningful employment. That is how we are increasing Tasmania’s retention and attainment rates. We are renewing our Secondary schools by extending into them our ‘Raising the Bar, Closing the Gap’ literacy and numeracy program. We are also working towards giving high school staff and students, like those in our primary schools, the best learning facilities and environments we can provide. And we are continuing to renew the education profession through scholarship programs in partnership with the University of Tasmania that support the development and recruitment of high quality graduates to schools. Children and Young People Mr Speaker, there are still too many children and young people in Tasmania who experience the heartbreaking effects of poverty, poor educational outcomes, and limited life opportunities. Childhood development, education, health and well-being, employment, housing, crime and security and social inclusion outcomes are interrelated and influence one another. These challenges cannot be met by individual sectors working in isolation - a collaborative approach is needed to harness the expertise that rests in many areas. The natural connections between the Police, Education and Children’s portfolios enable us to develop a whole of government Agenda for Children and Young People. We are doing this through a whole of government response that allows issues affecting children and young people to be harmonised across departments. We are looking into areas such as early childhood care and education, youth justice, child protection, children and young people’s participation. We are finding the gaps, setting outcomes and taking the actions we need to take. For example, by the end of this year, we will have Child and Family Centres up and running around the State enacting the change we seek. We are bringing government and non-government agencies together to provide targeted, collaborative services for vulnerable children and young people. Human Services Mr Speaker, our Human Services are often the front line when it comes to giving a helping hand to those most in need. We will continue to prioritise and invest in basic services in this area. For example, through an extra $4 million allocation over four years, we are reforming the Community Equipment Scheme to deliver a fairer, simpler and more efficient service to Tasmanians living with a disability. In the past two months, we have allocated $640 000 to clear the category one waiting list for necessary equipment and assistive technology. The Minister for Human Services will next month table the new Disability Services Bill that will for the first time recognise the specific needs of children with disabilities and set out the clear roles and responsibilities of government and service providers to deliver the highest quality care to Tasmanians living with a disability. Providing public and affordable housing is another of the key ways in which the State Government gives a helping hand and addresses the cost of living for needy Tasmanians. We have a $1.8 billion housing portfolio that houses around 24 000 vulnerable and low income Tasmanians, but we recognise the need for affordable housing is growing. Since January 2009, working with the Commonwealth, we have built 675 new homes across Tasmania and we’re on track to have built 1400 new homes by the middle of next year. We have met the target of halving the number of Tasmanians sleeping rough in December last year, and there are five new homelessness facilities underway across Tasmania, funded from State, Commonwealth and private sources. Planning Mr Speaker, reforming Tasmania’s fragmented and often dysfunctional planning system is one of the critical measures we must take to stimulate private sector investment and facilitate sustainable development and economic growth. My Government remains committed to finalising our regional land use strategy program and delivering new planning schemes to all Councils in the State. We will also put in place a new statewide planning template to ensure consistent and standard development provisions support the new planning schemes. This year will see the Government’s commitment to the current planning reform agenda deliver a number of positive outcomes, laying the foundation for a more efficient and effective planning system into the future. Economic Development Plan Another approach we are taking to facilitate economic growth is the development of an Economic Development Plan. Currently, various sectors within Tasmania’s economy are providing input into the development of the Plan, with the formal launch date expected in the middle of 2011. The Plan is a 10 year vision which aims to improve the prosperity of all Tasmanians through sustainable development. More specifically, its four main goals are to: • Support and Grow Business; • Maximise Tasmania’s Economic Potential in Key Sectors; • Improve the Social and Environmental Sustainability of the Economy; and • Support and Grow Communities within Regions. But we are not sitting on our hands while the Strategy is developed. Across Tasmania, the Department of Economic Development is working with businesses like Harvest Moon to provide the advice and support they need to grow and provide new jobs. Forestry Mr Speaker, I also want to speak today about one other issue that is vital to the future of Tasmania, both economically and socially, and to how we see ourselves as a community. Tasmania has for many years been torn by a divisive debate over the use of our forests. I know only too well from travelling around Tasmania and, in particular throughout the Huon Valley in my own electorate, that Tasmanians want to see an end to the conflict. It is not just ordinary Tasmanians who feel this way. The forestry industry and the environmental movement are seeking to reach agreement which could bring an end to the forest wars and see an old industry transition into one we might all be proud of in the 21st Century. This process has not been one the Government chose to embark on. But we recognise that in many ways it is unavoidable and driven by circumstances beyond our control, such as falling demand for woodchips and decisions by Gunns that have the potential to change the industry forever. The Government also recognises that we have to support and respond to the work being progressed by the signatories to the Statement of Principles. I commend each of the participants for staying with the process, which has not been easy for either side. I recognise that tough decisions need to be made on both sides if we are to have any chance of reaching an agreement. This means a settlement between the parties will not be easy. This process is a once-in-a-lifetime opportunity to end a conflict that has bitterly divided the State for far too long. It is a conflict which has had significant impacts on family owned sawmills, the good people who work within those mills, the contractor workforce who supply those mills and the many communities which rely on those mills. Protecting our environment for all to enjoy now and into the future while maintaining a vibrant and innovative forestry industry, including appropriate large-scale downstream processing facilities, is what matters. It’s all about achieving the right balance. Forestry Tasmania has been working towards the implementation of a moratorium for some time and the Government supports this work continuing. Similarly, the Government stands by its commitment to Tasmania’s family-owned sawmills to provide for ongoing resource security. We are expecting an interim progress report very soon from Bill Kelty on the progress made by industry and environmental groups in relation to taking the Statement of Forest Principles forward. While I cannot pre-empt that report, I remain hopeful that it will assist in the identification of a way forward which recognises the needs of the environment groups and industry. If that is the case, the Government will be supportive of the development of a Transition Plan that will include industry and regulatory changes arising from the Statement of Principles process and any agreement reached. But I am realistic enough to understand that the process might fail. If we can get to this next phase, a wider level of community engagement and involvement will be important in helping Tasmanians to understand and contribute to the proposed changes. Working with the Greens - Minority Government Finally, Mr Speaker, at the last election Tasmanians did not give any one party a majority – they voted for minority government and asked us as a Parliament to make it work. While people may not like all decisions taken by government, Tasmanians do not want another election – they want the people they elected last year to provide stable and disciplined government until 2014. That is something only Labor and the Greens were prepared to step up to the plate to provide and, more importantly, that is what we are delivering. Mr Speaker, the mechanism for decision making agreed by the former Premier and the leader of the Greens, Mr McKim, enables both parties to stay true to their own policies and values without destabilising the government. At times we agree totally with each other; other times, we compromise to reach a consensus outcome. Where we cannot agree, the parliament is the place for the debate to occur, as it did last year for example on the Betfair legislation. I will continue to work constructively and cooperatively with my Greens colleagues in Cabinet, and with all parties and independents in both Houses of Parliament to achieve the best outcomes for Tasmanians. Conclusion Mr Speaker, these are difficult and challenging times. We have tough decisions to make on our budget, on our economy, and on our environment. The test we face as Members of Parliament and as Tasmanians is whether we can set vested interests aside and be strong enough to make the difficult but responsible decisions required for Tasmania’s future.