Debate resumed from 12 May 2010.

Mr MIKE BAIRD (Manly) [4.55 p.m.]: I lead for the Opposition in this debate on the Appropriation (Budget Variations) Bill 2010. It is hard not to reflect with some disappointment on the debate we have just concluded in which the Government refused to establish an independent process to take the politics out of costing for community benefit. The Government has rolled over, broken promises and not honoured verbal agreements without a care in the world. It is now asking us to pass this bill. That demonstrates the culture at the core of this State Labor Government. One does not think of this Government when mention is made of fiscal discipline, integrity, honour and basic principles of good faith. This bill is yet another example of the Government's overspending, and not by a small amount. It has blown the budget by $1.48 billion. Every dollar counts as we emerge from the global financial crisis. This Government's $1.48 billion budget blowout is yet another demonstration of its fiscal management skills.

By pursuing such large amounts through this process the Government will be able to continue to spend without the appropriate scrutiny and transparency that is part of the budget process. That is the critical point. Of course, no-one argues that unforeseen circumstances arise that may require additional commitments to be made. However, this Government regularly uses the budget variations process to massage the annual budget. The picture that it presents in the budget is not a true representation of its financial situation. If the allocations in this bill had been included in last year's budget it would not have a projected a $1 billion deficit; it would have been $2 billion or more. The Government has understated the true figures, it has been caught out and the public is onto its game.

The purpose of this bill is to seek additional funds for recurrent services and capital works for 2008-10. I raised concerns with regard to the 2008-09 budget and it is beyond belief that the Government is still trying to tidy it up. This legislation seeks additional funds for recurrent services and capital works for 2008-09 and 2009-10. For the 2009-10 year it seeks a Treasurer's Advance of $347,162,000, funds for recurrent services amounting to $79,720,000 and additional recurrent services amounting to $695 million. For the 2008-09 year—that is, in addition to the amount allocated in last year's budget—the bill seeks a Treasurer's Advance of $222,488,000 and funds for recurrent services amounting to $136,400,000. The total additional amount sought for 2008-10 is $1,480,770,000. That is close enough to $1.5 billion without appropriate scrutiny and transparency.

In the November 2009 half yearly budget review, the Treasurer said the deficit would be around a billion dollars at the halfway mark. We are not sure what the final budget day figure will be, but revenue has increased and so has spending. That has been a long-running trend. The Premier said the figures at the half-year budget review showed the Government had acted responsibly and prudently in cushioning the effect of the global economic crisis, but the truth is really the opposite. The Government is using this bill in an attempt to hide the real deficit by seeking and regularly using additional funds outside the budget process without the usual transparency and scrutiny given to budgets. This bill confirms that the real deficit that should have been reported on budget day is well in excess of that $2 billion.

I will go through every item listed in this bill. Members of the Coalition will talk to portfolio-related items and will scrutinise some of those payments. The Nepean Hospital upgrade is a good example. Schedule 1 to the bill shows the Government needed an additional $29 million for the Nepean Hospital redevelopment. There are two parts to this. Either the Government did not know about this redevelopment—obviously it did—or it is an additional cost blowout. Neither of those scenarios provides any comfort. Putting together a budget and not knowing there is a capital item worth close to $30 million or that there has been a $30 million blowout is an example of costs continuing to blow and no-one being held to account.

The Parliamentary Secretary or the Minister in reply can tell us about those funds. The Minister for Health talked about this redevelopment back in 1997, so why was it not included in the budget? Again it comes back to some of the costing processes we proposed. Rather than having an independent oversight of costings, was this amount shaved for budget purposes—that is, was the Government trying to inflate the bottom line so as not give the true scope of the deficit or, as the project has gone on, have there been overruns? Either way, the true state of New South Wales finances has not been revealed. If it were revealed today it would show that the State Labor Government has a culture of going about its business with a rampant lack of financial discipline.

Unfunded superannuation is particularly interesting. I ask the Parliamentary Secretary to confirm this point. Schedule 1 to the bill reveals that the Government has put $510 million into the pooled fund superannuation scheme. My understanding is that that money is part of the proceeds from the Lotteries sale. I seek confirmation from the Government in that regard. It is important that the Government make contributions towards its unfunded superannuation liability and its ongoing obligations, but the heart of the matter is the way the Government goes about its business. It has ignored unfunded superannuation. Until recently, when it changed its accounting standards, the Government happily used different accounting standards that understated the true extent of its liability, which meant that it was not addressing the problems of tomorrow. That is a classic example of the way in which this State Labor Government goes about its business—forget about tomorrow; spend the money today, and the problems of tomorrow can be dealt with by the next generation.

Time has caught up with the Government. If this $510 million that has gone into the superannuation scheme has come from the sale of NSW Lotteries, that means it is selling capital assets and putting the proceeds into current needs or operating budgets. That is against basic good management practice. The Government can explain what it has done and whether that is the case. There is no doubt that unfunded superannuation is a beacon that shines a light on the State's mismanaged finances, which stands in stark contrast to the Federal Government's and Peter Costello's management of superannuation. They identified the problems in relation to unfunded superannuation liabilities very early and used ongoing budgets to build a fund to match them. Rather than just leave them, they undertook fiscally responsible actions to address them. Either way, this State Labor Government has failed the State in relation to its superannuation.

As outlined in the Premier's favourite book Unlocking Land Values to Finance Urban Infrastructure, which is a fascinating read and which she identified a few weeks ago in an interview, it is contrary to general principles for the Government to take proceeds from the Lotteries sale and put them into capital expenditure. Not all of us would call that our favourite book, but she certainly did. It talks about land sales, but one can replicate land sales with capital sales because it is the same principle. The book warns governments against putting proceeds from land sales or capital sales into operating budgets. The Premier obviously did not get to that part of her favourite book. The public sector can say no, proceeds from the Lotteries sale have been put elsewhere but my understanding is that that is what they have been used for. Again, putting the proceeds of capital sales into recurrent or operating budgets is not sound financial management. If the Premier, the Treasurer or the Parliamentary Secretary can answer that question we will be the happier for it. We look forward to it.

The lack of financial discipline remains a chronic problem. All the items in the bill require questioning, but I will leave it to other members to go through them line by line. Last year the Government spent beyond its budget in the vicinity of about $1.4 billion, and that cannot be blamed on the global financial crisis. For 15 years Labor has been spending well beyond its means. The 2006 Stokes and Vertigan New South Wales Audit of Expenditure and Assets Report commissioned by the Government, found that the Government has been running at about 1 per cent expense growth over revenue growth: It does not have the capacity to operate within itself. An appropriation bill again demonstrates the lack of financial discipline of this State Labor Government. The Auditor-General's report reveals last financial year the Treasurer blew his own expenses by nearly $2 billion, including half a billion dollars he blew in a couple of weeks. If the Treasurer cannot control his own expenses what hope does he have of controlling the overall expenses of this State Labor Government?

In answers that we have submitted Ministers have admitted that they do not check their budgets monthly; that is outsourced to the Department of Premier and Cabinet. How can Ministers be held to account and take control of their own budgets if they are not even checking them or if they are not provided with a budget on an ongoing basis? It is not surprising that we are faced with an appropriation amount that gets up to $1.5 billion hiding more than $2 billion in deficit that should have been reported on budget day. Former New South Wales Treasury Chief Economist, Robert Carling, has been a long-term critic of this practice. He told the Australian:

Some of the things they've done are unfortunate in themselves. They've relied too much on tax increases and revenue raising, and not enough on reducing recurrent expenditure.

Yet again we see that example in this bill. The bill also exposes the Government's wrong priorities. I cannot stress this point enough. At the time of the last budget we were looking to the State Labor Government to provide some form of stimulus by doing something other than relying on the money Kevin gave us. Kevin's money was the Government's tick for its stimulus package, but in reality it did nothing. In the budget the Treasurer proudly introduced the New South Wales Housing Construction Acceleration Plan to much fanfare. It was worth about $64 million and was described by the Premier and the Treasurer as a major economic stimulus.

Despite this the Treasurer said he was shutting down the program in December. He seemed to be overruled by the new Premier. We are not sure what happened but the Government had spent only $12 million out of $64 million as part of its stimulus response. The Coalition said that the stimulus response should be extended and the Government did that. Around March the Treasurer said about $21 million had been spent on its major economic stimulus program. One should not forget the economic forecasts and challenges faced during the global financial crisis. For the Government to put such little effort into a major economic stimulus program shows that the State Labor Government is trying to pretend it is doing something when in fact it is doing very little; indeed it is doing much less than it said it was doing. The bill shows that $2.1 million of the allocated funds were spent on advertising for the Government's housing plan, such as a letter on the letterhead of the New South Wales Office of State Revenue from the Premier that was purported to be a serious policy response. Half a page of the letter was taken up by a photograph of the Premier—it is almost beyond words. The letter states:

Dear Property Buyer,

Congratulations on your recent property purchase. I am pleased the New South Wales Government has been able to help you through your 50 per cent stamp duty discount The important measure is just one of the ways the New South Wales Government is stimulating the New South Wales housing construction sector, supporting jobs and growing the State's $380 billion economy.

The letter contains no details, other than the ways in which the Government is helping and a nice glossy photograph of the Premier. Residents who received the letter thought they were getting a parking ticket, but when they opened the envelope they saw a picture of a smiling Premier. This is an example of how our stimulus money is being spent. This bill was introduced because the Government has overspent on these types of campaigns. How is that in the interests of the people of New South Wales? They can get a photograph of the Premier from her website if they really want one. Why is the Premier's photograph on every one of these letters? Why is stimulus money being used to advertise the Government?

The community regards the State Government with cynicism because it has no financial discipline. It is all about the Government. The stimulus package was not aimed at turning the economy around. The Government made it look like it was trying to do something by sending out a nice glossy photograph, which was a big component of the cost overrun, and we are all supposed to stand and clap. But the truth is we are not clapping. This mail-out is an insight into the culture that is rampant in the Government's financial approach. After 15 years New South Wales taxpayers have had enough.

Other examples of the Government's lack of financial discipline will be revealed in the months to come, including the sale of electricity assets that is underway. Approximately $200 million has already been spent on that sale. The market—bidders, experts and many within government and the public service—has rejected that model. But for some reason the Government is pursuing the sale. No firm timetable has been given as to when the sale will proceed, but up to $200 million has been paid to consultants on that transaction—a transaction that has no support and that will not deliver the necessary reform. In many respects it will leave the State with many of the current risks. I turn now to the CBD metro on which around $500 million has been wasted. A tenant who received $20,000 compensation as part of the CBD metro project said:

This Government couldn't run a bath.

No truer words have been said. Another tenant said:

If I ran my business the way they do, I'd be sacked.

These tenants have received a cheque, but they say it was inflated and did not reflect the compensation that was due. The whole process has been flawed from beginning to end. I understand that the cost is $1 billion, and it has gone well north of that. Someone said that they would not be surprised if, in due course, the amount of money wasted on the CBD metro is so significant that a royal commission is set up to look into what took place and what is being paid out. Such an investigation would be a drag on the State finances for years to come. They are sobering words. It is an example of the way that the State Labor Government deals with money, expenses and due process. It is happy to roll over. I understand that the conservative figure for the project now sits at about $1 billion. The Auditor-General in Total State Sector Accounts for 2008-09 probably summed it up best when he said:

Significant and consistent overruns of budgeted expenditure have occurred at a number of large agencies. Action needs to be taken to better understand and manage these variances.

That advice should be heeded by the entire State Labor Government. The Treasurer should pick up on those words and instil some form of discipline across a Government that is running out of control, is not being held to account for waste—its deficit is much larger than is reported or its surplus is much smaller than is reported—and yet again, as we see with this appropriation bill, is happy to mask the truth by playing the appropriation game: stick it in the back pocket, come into Parliament, well outside the light of budget day and try to pretend all is right. Well, it is not. This is yet another example of how the State Government has lost the trust of the community of New South Wales.

Mr MATT BROWN (Kiama) [5.16 p.m.]: The member for Manly has predictably wheeled out the same lame argument that was wheeled out last year. Once again, the purpose of this longstanding legislation has been discarded in the interests of political pointscoring. The member for Manly ignores the fact that budget variations bills have been used in this Parliament for nearly 20 years. It is a key part of the annual budget process. As members are well aware, an advance is appropriated to the Treasurer for unforeseen and urgent expenditures that could not be forecast at budget time.

Predictably, the Appropriations (Budget Variations) Bill 2010 includes those details of expenditure from the Treasurer's Advance ensuring there is transparency and accountability. That is what the Government is all about—transparency and accountability. It is a process endorsed by the Auditor-General as well as the Legislative Council's General Purpose Standing Committee No. 1. In the interests of this debate, members opposite would clearly deny vital investment in key areas. They would oppose the additional funding for the Government's Keep Them Safe program for child protection. I have heard members opposite argue for further expenditure. They are hypocrites to say the least.

Another additional funding program that the Coalition would oppose is life support equipment for swine flu, as well as emergency drought works for Lake Cargelligo. I would like to see them answer to constituents who want those emergency drought works. Members opposite have gone quiet all of a sudden. In fact, members opposite do not support funding for drought assistance programs across the State, essential firefighting equipment and an autism early outcomes unit.

Mr Jonathan O'Dea: What rubbish!

Mr MATT BROWN: The member for Davidson said, "What rubbish". The member for Manly clearly indicated that the Opposition would not support this bill to make the appropriations for these very important projects that the Government supports. The Appropriation (Budget Variations) Bill 2010 is a key part of the annual budget process. It demonstrates the Government's commitment to deliver high-quality services, while adopting a fiscally responsible approach to budget management.

The bill seeks the Parliament's approval for the payment of additional appropriations in 2009-10 for which no provision was made in the annual Appropriation Act. One could not get more open and transparent than that. These appropriations include an additional contribution of $510 million to the Pooled Fund Superannuation Scheme funded from the proceeds of the NSW Lotteries sale. This will ensure that the impact of the sale is budget neutral on a risk-adjusted basis. The Opposition again typically claims that this is economic mismanagement, but I am afraid the evidence does not support that flimsy argument.

The Government's track record, of which it is proud, is one of encouraging investment, protecting and supporting jobs, delivering a record stimulus package and, importantly, securing the State's triple-A credit rating following the worst year of the financial crisis. That is not bad, if you ask me. We should not forget that earlier this year the member for Manly said the State's triple-A rating sends a very clear signal to the market that things are well managed. I could not agree more. He said to Deborah Cameron on ABC Radio on 15 February:

The AAA is a very important sort of measure. It puts a discipline around Government. It is a very clear signal to the market that things are well managed.

The member for Manly acknowledges that New South Wales finances are well managed. However, members who listened closely to his speech would not have heard that. The fact is that New South Wales is well managed, both financially and economically. In contrast, the Opposition's track record is one of obstructing good policy and talking down New South Wales. Indeed, if there is one thing the Opposition is consistent about, it is talking down this State.

The most recent set of State final demand figures show that growth in private business investment in New South Wales over the past six months led the States by a distance. I will list State by State how much higher the December quarter private business investment was compared with private business investment for the June quarter. In Victoria private business investment was up $580 million, in Western Australia it was down $328 million, in Queensland it was down $1,117 million, and in New South Wales it was up $1,405 million. That is more than $1.4 billion in additional private business investment in New South Wales compared with the figure for the previous six months, but we do not know anything about that from members opposite; they do not want to talk about it. We simply hear from members opposite silly, juvenile comments without any substance whatsoever.

ACTING-SPEAKER (Mr Wayne Merton): Order! The member for Kiama has the call. He does not need the assistance of Opposition members.

[Interruption]

ACTING-SPEAKER (Mr Wayne Merton): Order! Members will behave themselves. The member for Kiama has the call.

Mr MATT BROWN: Mr Acting-Speaker, thank you for that learned ruling. The New South Wales figure for additional private business investment is almost a billion more than that for Victoria, at a time when investment in Queensland and Western Australia is going backwards. Yet Opposition members see this as something to avoid talking about. They should celebrate our strength. Thanks in part to the New South Wales Government's supportive initiatives, the New South Wales unemployment rate is at 5.8 per cent as at April 2010. Since its peak in March last year, the New South Wales unemployment rate has fallen further than that of any other State. On a trend basis, New South Wales employment has grown for 13 consecutive months and the number of full-time jobs in the State has grown for six consecutive months. However, there still remains a lot more work to do, and we are taking decisive action to support jobs in New South Wales. That is why we are investing a massive $65.5 billion in job supporting infrastructure, to support up to 165,000 jobs each year over the four years to 2012-13.

Ms Noreen Hay: That's fantastic.

Mr MATT BROWN: I acknowledge interjection of the member for Wollongong, because it is fantastic. This Government will deliver the full stimulus package as it promised. Yet the Opposition wants the stimulus package rolled back. Members opposite need to ensure they make themselves accountable to their communities.

Mr Geoff Provest: Point of order: I ask you to draw the member for Kiama back to the leave of the bill. This debate is about the Appropriation (Budget Variations) Bill 2010.

ACTING-SPEAKER (Mr Wayne Merton): Order! I am certain that the member for Kiama was making a passing reference. I ask him to return to the leave of the bill.

Mr MATT BROWN: The practice of introducing further appropriation bills has enhanced accountability with regard to the expenditure of public money from the Consolidated Fund. These expenditures, as outlined in the various schedules to the bill, are all important and worthy Government measures. The member for Manly asserted that the Government has not introduced stimulus measures. I can count dozens of them just off the top of my head. I cannot imagine that any member opposite would not spend his or her Community Partnership Program funding—

Mr John Williams: That's one. Give me two.

Mr MATT BROWN: There are also huge capital works right across the State. In my electorate of Kiama, the South Coast Correction Centre is one of the most important pieces of infrastructure to assist the local economy during the global financial crisis. We heard a pathetic argument from the member for Manly when he referred to a photo of the Premier on a letter. I have heard of the pot calling the kettle black, but one cannot go to Manly or the North Shore, or to the website of the member for Manly or his paraphernalia, without seeing photo after photo of him. That the member for Manly has the gall to say that the Premier puts her photo on a letter is the height of hypocrisy. It simply demonstrates how pathetic his argument is with regard to this bill. I commend the bill to the House.

Mr JOHN WILLIAMS (Murray-Darling) [5.26 p.m.]: I have been in this place for three years, and once again this reminds me of what the Government is all about in two words: overspend and underperform. The Government seems to be able to do that very, very well. I am waiting for the time—it has to come—when the New South Wales Government will not ask for this funding. I think the bill is a way of not bringing this into the budget. When the Government handed down the budget it knew full well that there was a bit of a way out for it in the future. My greatest concern is that this is in a year when the Government has had some great windfalls, and opportunities to rake a bit of money off the Federal Government—with the stimulus package and the Building the Educational Revolution—to put money into the State coffers, to offset some of its costs. That is a one-off windfall.

We have the opportunity in housing. Once again, the Federal Government tips in the money and the New South Wales Government has an opportunity to rake off a good share of that funding. These windfalls would have offset this $1.4 billion, but that did not happen. What happened to that money? That windfall income is over and above what the Government budgeted for last year, but it has flushed that funding down the drain as well. It is absolutely amazing. During the entire period while all this is happening, we have a Premier who is more focused on running around the countryside having photos taken, putting out a glossy magazine—

Mr Barry Collier: Point of order: I ask you to draw the member for Murray-Darling back to the leave of the bill. This is not about photographs of the Premier or anybody else in the Parliament; it is about the Appropriation (Budget Appropriations) Bill.

ACTING-SPEAKER (Mr Frank Terenzini): Order! I uphold the point of order. The member for Murray-Darling will return to the leave of the bill

Mr JOHN WILLIAMS: You may correct me, Mr Acting-Speaker. That glossy brochure that the Premier put out cost nothing. What did the Government spend on that glossy brochure?

Ms Noreen Hay: Point of order: My point of order relates to the failure of the member for Murray-Darling to deal with the leave of the bill and the fact that the member has taken the opportunity to bandy around criticisms of a Premier who is being photographed out there in this State working—which is what Premiers are supposed to do. The member for Murray-Darling should take his example from the Premier, get out there and do some work himself.

ACTING-SPEAKER (Mr Frank Terenzini): Order! I ask the member for Murray-Darling to return to the leave of the bill.

Mr JOHN WILLIAMS: I still want the member for Wollongong to tell me where the money came from for the glossy brochure. Did that come from outside the Government coffers?? What about the Learjet? Who paid for the Learjet?

Mr Barry Collier: Point of order: The member for Murray-Darling is now talking about Learjets. What next? Will the member for Murray-Darling please return to the leave of the bill?

ACTING-SPEAKER (Mr Frank Terenzini): Order! I again ask the member for Murray-Darling to return to the leave of the bill.

Mr JOHN WILLIAMS: We are talking about a variation in the budget. We are talking about the Treasurer asking for more money. It is as simple as that. The Opposition wants to know where the money went. The Government is making the point of letting the Government know that somewhere along the line these things cost money over and above what was budgeted for. Where did I see in the budget that the Premier was going to do a tour of New South Wales in a Learjet, or have some photographs taken and then send a glossy brochure out to all the constituents? Tell me about that because I need to know.

Mr Barry Collier: Point of order: For the fourth time, I ask the member for Murray-Darling to return to the leave of the bill.

ACTING-SPEAKER (Mr Frank Terenzini): Order! The member for Murray-Darling will return to the leave of the bill.

Mr JOHN WILLIAMS: So we do not need to find another $1.4 billion? Is that what the Government is telling me? This is an absolute fallacy. This is about the Treasurer requesting another $1.4 billion to top the show up. Do you understand that? It is as simple as that! What I am asking is: What about the waste? What about the money the Government has wasted? We have seen the waste from the CBD metro, which could have paid for all the roads in my electorate in bad need of sealing to be sealed—the Government has been lobbied for that for years. The CBD metro was an absolute waste of money and now the Treasurer is seeking a top up. If the Government wants to keep wasting money, the Opposition will continue to make it accountable.

The Opposition wants to know why the Treasurer now wants more money when we have seen money wasted and sent down the drain by the Government. The Opposition has seen windfalls by the Government and the opportunity for the Government to take on revenue that was not accounted for in the last budget. Money has been pouring in, but where is it? Where did that money go? On top of that money, the Government now wants another $1.4 billion. This is an utter and absolute disgrace. We have also seen the rush to a national health reform. In the four years I have been a member of this place the Government has spent its time whining about the GST distribution and the way it was allocated to the States. Then the Government goes and trades it off on a health plan that really has not been costed. No-one really understands the health reform plan. That job has been done too quickly for anyone to really know how it will work.

This Government continually puts its hand up about a shortfall. I want to see the day that this Government, if it is so dammed good at managing the job, does not need extra money and that the budget balances out or in some situations a surplus is achieved. If there was ever going to be a surplus in the budget, this year provided the opportunity. There were so many windfalls for the Government this year, so many opportunities to increase revenue, yet still it is in the same old tired position because every one of those windfalls was wasted. Those windfalls were spent on some crazy notion or in some way to get the Government re-elected. But the fact is that every one of those promotions has done nothing about getting the job done for the people of New South Wales.

The polls have clearly stated that the people of New South Wales are not seeing the benefits of the expenditure by the Government. The money has not been spent in the right place. The job has not been done correctly. If the Government had been done the job correctly the polls would reflect that, but they are not. The Government has continued to waste money and pour money down the drain. The Government continues to return here every year for a top up to the budget. Each year we hear the Treasurer come to this House and tell us what a great budget he has delivered. The budget is then sold in the press as the greatest thing, yet it has never produced a result. In fact, we seem this same old tired situation repeated year after year.

Ms NOREEN HAY (Wollongong—Parliamentary Secretary) [5.35 p.m.]: The contribution of the member for Murray-Darling comes as no surprise. The member for Murray-Darling stood before the House and said that he has been a member of this place for four years. He was elected in 2007 and it is now 2010. I suggest that he go and find his other hand and start counting again. The Appropriation (Budget Variations) Bill 2010 is a key part of the annual budget process.

Mr John Williams: Three budgets!

Ms NOREEN HAY: You said you were here for four years—it is in Hansard.

ACTING-SPEAKER (Mr Frank Terenzini): Order! Members will not engage in debate across the table. The member for Wollongong will be heard in silence.

Ms NOREEN HAY: It demonstrates the Government's commitment to deliver high-quality services, while adopting a fiscally responsible approach to budget management. The bill seeks approval by the Parliament for the payment of additional appropriations in 2009-10 for which no provision was made in the annual Appropriation Act. The Appropriation (Budget Variations) Bill 2010 demonstrates the Government's commitment to high-quality services. As members are well aware, an advance is appropriated to the Treasurer for unforeseen and urgent expenditures that could not be forecast at budget time. This bill includes those details of expenditure from the Treasurer's Advance ensuring that there is transparency and accountability. I suggest the member for Murray-Darling read the bill. He might then be able to fathom what the Treasurer is seeking to do.

This process is endorsed by the Auditor-General and General Purpose Standing Committee No. 1. For the benefit of Opposition members, let me take them through some of the services funded by this year's bill: stage 3A of the Nepean Hospital redevelopment project and Blacktown clinical simulation facility; the Keep Them Safe initiative for child protection; life support equipment related to swine flu; emergency drought works for Lake Cargelligo; the Anzac War Memorial Trust; the Greenhouse Gas Abatement Scheme; an autism early outcomes unit; fire fighting equipment; the Wayside Chapel; drought assistance programs across the State; additional funding towards Commonwealth elective surgery targets; the Yellow Rock Priority Sewerage Program; and funding for community sporting and recreation grants.

The Opposition sat silently when funding to hospitals and health was reduced under the Howard Government. It refused to support the Labor Government when we sought to get the $3 billion that was being ripped off by the Howard Government on the GST distribution. It said not a word. In saying that, I am responding to comments made directly by the member for Murray-Darling, who repeatedly asked about photographs, Learjets and everything except what is dealt with in the bill. I entirely support the comments of the member for Kiama. He said that those opposite continually seek to talk down New South Wales and to dump on the achievements of this Government.

It is unfortunate that in the spirit of cooperation the Opposition does not support this proposal, which will ensure that funding proceeds to worthwhile community organisations. The items in this bill demonstrate the good work undertaken by the Government during the financial year. The unforeseen expenditure shows the commitment the Government has made on behalf of the people of New South Wales to look after the less fortunate among us. That might sound strange to the Opposition. The Government wants to look after those who have struck difficult times. At times, due to mitigating circumstances or unforeseen health issues, people need assistance. This proposal today will ensure that funds flow through and those worthwhile causes get the assistance they need. The practice of introducing further appropriation bills has enhanced accountability of the expenditure of public money from the Consolidated Fund. I commend the bill to the House.

Mr GEOFF PROVEST (Tweed) [5.40 p.m.]: The purpose of the Appropriation (Budget Variations) Bill 2010 is to appropriate additional amounts for recurrent services and capital works in the 2009-10 and 2008-09 budgets. For 2009-10, in addition to the combined $440 million that was provided for in the mini-budget, the amounts requested are Treasurer's Advance $347 million, recurrent services $79 million, and additional recurrent services $695 million. For 2008-09, the amount requested for the Treasurer's Advance is $222 million, and recurrent services, capital works $136 million. That adds up to a grand total for 2008-09 and 2009-10 of $1,480,770,000, which is a significant amount of money.

The Government has overspent its budget again. As a result, it has been forced to request approval from the Parliament for additional funding. The fact that departments require this level of additional funding beyond their original budget indicates ongoing financial mismanagement by each of the respective Ministers. The lack of financial discipline is worrying, as it is a recurring trend. Last year the Appropriation (Budget Variations) Bill 2009 showed that, once again, the Government spent beyond its budget in the vicinity of $1.4 billion. This is a matter of concern. The communities of the State's 93 electorates are looking for an increase in the level of services—more police, better roads, and improvements to schools and hospitals. As members know, I often raise in this House the lack of police numbers in the Tweed.

In schedule 1 on page 18 of the bill, under the heading "NSW Police Force", it states, "Funding for above strength officer numbers—$26 million". Whoever writes these budgets is not in touch with reality. The Opposition is in touch with reality because we talk to the local people. Whenever I have raised the issue of police numbers in the Tweed, I am told by the Minister for the Police that we are over strength and have more police than we need. In the cold reality of day, our hardworking men and women and families have to wait from 20 minutes to three or four hours for a police response. The Police Association of New South Wales claims that we need another 20 police on the beat. Yet the official line is that we are over strength, and schedule 1, page 18 of the bill, shows that $26 million has to gone to fund above strength officer numbers. Obviously, there is a major flaw in the financial budget. Those police are needed. They should not be called "above strength".

Page 27 of the bill, under the heading "Land and Management Property Authority", refers to the Tweed River Entrance sand bypass project. Since its inception, the project has cost the New South Wales taxpayer in the vicinity of $55 million to $65 million. The project was meant to keep the Tweed River free of sand, but it is not working. There is a great deal of dissatisfaction from the boating community and the surfing community. It has virtually destroyed the famous D-Bah—Duranbah—which is listed in the top five surfing locations in Australia. The project is not working, yet another $791,000 is being churned into this bottomless pit. The failure to rein in expenditure cannot be blamed on the global financial crisis. I have heard that many times from a variety of Premiers. I have been in this House for just over three years and I have already gone through three Premiers. This practice was occurring before the global financial crisis.

As the shadow Treasurer, the member for Manly, said, the Government's own inquiry, the New South Wales audit of assets and expenditure report in 2006, shows examples of poor financial discipline. There was $500 million scrapped on the metro and $200 million has been spent so far on the sale of the State's electricity assets. That $500 million, which was reported and analysed in the Daily Telegraph some months ago, could have provided another 1,000 extra police, 900 extra nurses, 800 extra teachers, 140 extra buses, or an upgrade of the helicopter in the Police air wing. The list goes on. On many occasions in the House I have referred to the shortage of police numbers in the Tweed. Another 1,000 police would have made an enormous difference throughout the State. Once again, it would seem there is gross financial mismanagement. The budgets do not match reality. The budget is here, reality is there, and there is a big gap in between.

Every parliamentary session the Government says it got it wrong and asks for another $1.4 billion. It says it will get it right next time. As the shadow Treasurer said, it is a recurring process. New South Wales has many great small businesses. If small business owners ran their businesses in the same way as the Government does, they would not be in business. It is not the Government's money, and it is not the Treasury's money. It is the taxpayers' money, the hardworking people of New South Wales. This bill endorses the gross financial mismanagement of the Government. The hardworking people of New South Wales know that their money is being frittered away and not being spent on the delivery of services. They are very upset. In my electorate and on the streets of Sydney the taxpayer is extremely upset about the grossly inept financial management of the running of this State.

I am particularly concerned about the bill referring to "above strength" police officers. We do not have above strength police numbers. Obviously, the allocation of police officers has been done on a political basis. The electorates on the north coast—Tweed, Lismore and Port Stephens—want more police. But they are not being allocated in the budget. The former Minister for Police told me that it was not his problem because the Treasury never gives him enough money. The needs of the people must come first, particularly in relation to areas such as policing. Once again, I am and always will be 100 per cent for the Tweed.

Ms CHERIE BURTON (Kogarah) [5.48 p.m.]: That was a bizarre contribution from the member for Tweed. As a relatively new member, he would not understand that when the Coalition was in government it cut budgets. This Government has consistently increased its budgets in all portfolio areas. The member talked about the non-delivery of services in his area. That says more about him as a local member. In the electorate of Kogarah for the last 11 years that I have been the local member, we have had a brand-new police station and lifts in 23 railway stations at a cost of $6 million each. All of my schools have received a new school hall or gymnasium, one school has been completely redeveloped and another is undergoing a complete redevelopment.

At the hospital we have built a brand-new mental health unit and a brand-new psychiatric ward. We have built the toll-free M5 East. Back in 1999 when I first ran for the seat of Kogarah the Coalition was saying that it would put a toll on the M5. It was this Government that was able to deliver the M5 on time and on budget to make my electorate a much better place to live. There are no longer trucks back-to-back from the Grand Parade to Kingsgrove. To say that in the past this Government has had mismanagement and has not delivered for the community is absolutely ridiculous.

We acknowledge that there is always more work to do and there are always more services that will be needed but, for the information of the member for Tweed, government is not like running a business. We have to care for the needy and the disadvantaged; it is very, very different. Therefore, unforeseen things happen and that is why—

[Interruption]

At the end of the day, there is no cutting of budgets. Members on the other side of the House cannot say the former Coalition Government did not cut a budget, did not run down a hospital or did not close a hospital. Look at Howard. In 11 years he ripped the guts out of all of the budgets. In my time as Minister for Housing he took $850 million out of the Housing budget. What Opposition members have said is absolutely ridiculous. The Opposition disagrees that we needed $29 million for the Nepean Hospital development and the Blacktown clinical simulation facility; $13 million for elective surgery; $22 million for drought assistance programs; and $1.24 million for an autism early outcomes unit. To say that those things are a waste of money and that we should cut back on funding for them is ludicrous.

This bill is a long-standing legislative measure that ensures an annual appropriation to the Treasurer's Advance to cater for unforeseen and urgent expenditures that could not have been forecast at budget time. We are running a State and these things can happen every year. We do not know where things will go wrong or where things will happen. This Government is able to address those issues and fund those necessary resources. These expenditures, as outlined in black and white in the various schedules of this bill, and described by my colleagues today in this place, are all important and worthwhile Government measures.

Members opposite know full well that the Appropriation (Budget Variations) Bill 2010 is a key part of the annual budget process. It demonstrates the Government's commitment to transparent reporting and accountability to the Parliament. It is not always possible to see Parliament's authority in advance for unforeseen and urgent expenditure. The bill sets out the many and varied ways that the Government is investing in the State's future. It is imperative that governments remain accountable for their spending and that budget processes remain transparent. The practice of seeking parliamentary approval for supplementary funding has become an integral part of the annual budget process and is endorsed by the Auditor-General as well as the Legislative Council's General Purpose Standing Committee No. 1.

As it stands, the bill provides an account to Parliament on how the 2008-09 Treasurer's Advance has been applied towards recurrent and capital expenditure. The bill seeks appropriations of around $347 million in adjustments to the Treasurer's Advance, and I outlined what projects that includes. They are very important projects that require that funding and costs be set out in black and white in the bill. Furthermore, in accordance with the Government's commitment to use part of the NSW Lotteries transaction proceeds to strengthen the State's balance sheet, $510 million has been allocated as additional super contributions.

The additional 2009-10 funding has the objective of reducing the employer contribution growth rate and is an economically responsible way of managing the funds made available from the Lotteries transaction. This is the best long-term investment for the State. What it means is that we will be $75 million better off over the next 10 years and $620 million better off over the next 20 years by taking this decision. That is because we expect a higher return—about an extra 2 per cent a year—by taking this path and putting the proceeds of the billion-dollar transaction to their best use.

The transparency of this budget process and the accountability of the Government for its commitment lie in stark contrast to that of the Opposition. The last time the Coalition was in government it cut funding, and the last time the New South Wales Coalition's Federal colleagues were in power they slashed and burned. This Government has acted swiftly to protect jobs and encourage investment in New South Wales during the worst of the global financial crisis. While the Government has remained open and transparent about its policies, its expenditures and its plans for the future, the Opposition has provided the public with precious little information about how it intends to fund its extravagant promises. The Opposition says it will fix the problems of the world; there will be no additional taxes and no additional ways to generate income. However, will it be able to fund anything anybody wants?

The Opposition's laziness, ineptitude and inability to understand how to run the State has led this side of the House to get up and argue for the need for this bill to pass this House. The Opposition's commitments are all over the shop. The Opposition is committing everything to everyone and I think the community is a wake-up to it. The Opposition does not have any coherent policies; it does not provide an alternative because it thinks it is just going to fall over the line at the next election and it does not have to do anything.

Mr Brad Hazzard: You'll be very lucky to be there.

Ms CHERIE BURTON: We will see.

Mr Brad Hazzard: You will be very, very lucky.

Ms CHERIE BURTON: I think that is said every four years, and I am still here.

ACTING-SPEAKER (Mr Frank Terenzini): Order! The member for Wakehurst will have an opportunity to contribute to the debate. The member for Kogarah will be heard in silence.

Ms CHERIE BURTON: We should just wait until the election. The only people arrogant enough to try to forecast the outcome of the next election are members on the other side of the House.

Mr Brad Hazzard: We are forecasting your seat.

Ms CHERIE BURTON: I think you have made your point. Let us just wait and see.

ACTING-SPEAKER (Mr Frank Terenzini): Order! The member for Wakehurst should take the advice of the member for Kogarah. The member for Kogarah will be heard in silence.

Ms CHERIE BURTON: As usual, they are just lazy interjections designed to try to distract me from my speech. I am hitting a nerve here. It exposes the ineptitude and laziness of the other side. Members of the Coalition think they will wake up on the Sunday following the election and they will be in government. The people of New South Wales will demand more than just slippers and wet hair at two o'clock in the afternoon after they have just had their noon shower to look at the other side as an alternative government. There is a long way to go yet. While this Government still has a lot of work to do, we also have a lot to be proud of. This bill is presented to ensure that both Parliament and the people of New South Wales have the opportunity to scrutinise government expenditure. It is about finding an appropriate balance between accountability and flexibility in public finance management. I commend the bill to the House.

Mr JONATHAN O'DEA (Davidson) [5.58 p.m.]: The Government has yet again overspent its budget, this time by more than $1.4 billion. As a result, the Government has been forced to request approval from this Parliament for additional funding. It indicates ongoing financial mismanagement by an incompetent Labor Government. The comments made by previous speakers warrant rebuttal, and I will briefly rebut them before making a few points. The member for Kogarah outlined expenditure on a number of projects in her electorate. I look forward to some money being spent in my electorate when the Coalition is elected to govern next year.

Some of the measures in this bill do have merit. However, they should have been budgeted for in the normal budgetary process. That is the main point the Coalition is making: Where there is appropriate expenditure the Government should budget for it. Like the member for Kogarah and others, the member for Kiama suggested that budget variation bills are part of the normal, everyday, expected, routine process of government. They are not. One need go back only as far as 2007 to find a financial year in which no budget variation bill was introduced. This lazy Government is now relying on budget variation bills. That is not acceptable and it is not standard. What happened in 2007 so that the Government did not need to patch up its shoddy budgetary process?

ACTING-SPEAKER (Mr Frank Terenzini): Order! Government members will remain silent.

Mr JONATHAN O'DEA: It was the only full financial year in which the Hon. Michael Costa was Treasurer. As much as members opposite might not like the namesake of the Minister for Water, and as much as they forced him out of Parliament, he did understand budget management and the importance of spending only the funds available. Unfortunately, this Government now does not understand that basic principle. That is little wonder when it has no member on the front bench or the back bench who has any experience of running a substantial private sector business or a public company. I am happy for members opposite to give me the names of just two Government members who have that sort of experience. I do not think there is even one, but I am happy to be corrected.

The member for Kiama spoke about employment. However, he led with his chin because for 54 of the past 55 months the unemployment rate in this State has been higher than the Australian average. We now have the highest level of unemployment of any Australian mainland State. That is not something of which members opposite should be proud. According to the Government's own figures, in addition to the $500 million we lost on the CBD metro, we lost at least 2,000 jobs.

Despite the Government saying that there would be no redundancies last year as a result of the global financial crisis, this bill indicates that there have been unbudgeted redundancy payments. As the bill shows, the Department of Attorney General and Justice, the Department of Human Services, the Department of Education and Training and other departments have had to make redundancy payments. This Government has broken its promise not to make public servants redundant, but it wonders why this State's unemployment rate is the highest of any mainland State and it has consistently trended above the Australian average. We have hung on to our triple-A rating but, with a more than $1.4 billion budget variation and a very shaky electricity asset sales process, it will not be long before the rating agencies question it.

After more than 15 years of hard Labor this State does not suffer from a lack of revenue; it suffers from a lack of confidence in how this Government manages available resources and delivers basic public services to the long-suffering residents of New South Wales. The people of New South Wales are entitled to ask why the Government has consistently—with the exception of 2007 under the stewardship of Treasurer Michael Costa—failed to properly monitor and control expenditure. The Government's appropriation bills reflect its financial mismanagement and its attempt to avoid the scrutiny that attaches to the normal budgetary process. This appropriation bill seeks a variation of more than $1.4 billion. That cannot be called a small miscalculation; it represents substantial financial mismanagement.

The Government has adopted either a deliberately misleading or a sloppy approach to the budgetary process. It has either misled the public and this Parliament about its intended expenditure knowing that it could legislate its way free of more intense scrutiny or it was very sloppy in calculating the expenditure required to honour its promises and to provide services in the first place. Either way, that is a very poor reflection on an already underperforming New South Wales Labor Government. It is as stale after four four-year terms as a four-day-old piece of toast. I suspect that that is what members will be after the next election—burnt, stale toast. This State requires a greater focus on proper financial management, disciplined spending and a genuine commitment to eliminating waste and mismanagement; that is, it needs a new government that budgets more effectively than this Government has.

The Government should not have to come to Parliament bowl in hand begging for more money from the people of New South Wales. During this term of government it has been revealed that members opposite have wasted $18 billion. That is a huge amount; it is equivalent to about one-third of the annual New South Wales budget. The waste includes $113,000 spent on artwork grants by Communities NSW. I will not detail the amount, but huge amounts have been wasted by the Department of Education and Training in its management of Building the Education Revolution projects. There is a big question mark about exactly how much has been wasted.

A 17 November 2009 media release indicated that salary overpayments had been made by the Department of Human Services; a 15 April 2009 media release indicated an almost $500 million blowout on the Royal North Shore Hospital redevelopment; and volume 6 of the Auditor-General's 2009 report indicated salary overpayments of $1.6 million in Industry and Investment NSW. It is also estimated that the parliamentary recall for the electricity privatisation legislation cost $1 million. The Hon. Ian Macdonald spent $150,000 on entertainment in 2009 and the unnecessary desalination plant cost approximately $1.9 billion. Excessive overtime payments of $40 million made by the Department of Justice were revealed in volume 8 of the Auditor-General's 2009 report and the 2008 report indicated a JusticeLink blowout of $17.9 million.

In multiple departments there has been rental for luxurious offices at a cost of $200 million. In planning and local government, according to a media release of 15 December 2009, there is unleased property of $3 million and the Wollongong council corruption in 2009 cost $1 million. In the Department of Premier and Cabinet there is the buyout of 30 Clarence Street Sydney after the CBD metro was already to be canned, costing almost $25 million. There is the Davina Langton payout, again, of $100,000. According to the Auditor-General's performance audits for 2007 and 2009 there is government advertising of $100 million in each year. Excessive rent for the Governor Macquarie Tower was estimated by the Sydney Morning Herald of 14 April 2009 at $20 million. The Graeme Wedderburn payout cost $135,000. The Labor by-elections in 2008—Iemma, Watkins, Meagher—cost $1 million.

According to a media release of 24 September 2009 media management cost $1 million. Office refits cost $780,000. Overexpenditure occurred on the Parliament House gatehouse, which cost $1.6 million. Private jet travel by the Premier into drought-affected areas, which has been ably and appropriately highlighted by the member for Murray-Darling, cost at least $31,000. The cost of public servants employed post the staff freeze was $20 million, contrary to the Premier's guidelines. There is the super department restructure cost of $15 million. The cost of having unattached public servants was $46 million per annum, and we still see them. That was reported in the Sydney Morning Herald in 2009. Unjustified travel by Minister Tripodi, as reported in the Daily Telegraph of 12 May 2009, cost $290,000. Unnecessary parking spaces at Governor Macquarie Tower during 2009 cost $1.4 million. In the transport and infrastructure portfolio there was the CityRail corruption in 2009 costing $28 million. The Cronulla branch line blowout cost $238 million.

Mr Barry Collier: It also blew out in 1939. You people did nothing about the duplication. The member for Cronulla just complained.

Mr JONATHAN O'DEA: It blew out on your watch. The difference between the New South Wales and Victorian grants from the Federal budget due to poor submissions on rail and metro cost $3.4 billion. The Epping to Chatswood/Parramatta rail link blowout cost $1 billion. The Great Western Highway budget blowout cost $1.5 billion. The Iron Cove Bridge duplication blowout cost $100 million. The north-west bus transit way blowout cost $120 million. The north-west rail line blowout, comparing the Action to Transport 2010 and the Metropolitan Transport Plan, cost $6.35 billion. The outer suburban carriages budget blowout, detailed in a media release of 24 March 2010, cost $745 million. The Pacific Highway dual carriageway upgrade blowout cost $1.5 billion. The Parramatta bus/rail interchange blowout cost $125 million. The disparity between cost and value of the Queanbeyan government service centre, according to the 2009 Auditor-General's Report, volume 6, cost $10 million.

The Roads and Traffic Authority move from the central business district to North Sydney, detailed in the Daily Telegraph of 13 April 2009, cost $23 million. The station refit due to oversized trains, reported in the Daily Telegraph of 19 May 2008, cost $20 million. The current expenditure on the cancelled CBD metro project is at least half a billion dollars. According to an Opposition freedom of information inquiry of 17 October 2009, taxis for rail workers from 2007 to 2010 cost $4.2 million. Taxi fares for stranded commuters from 2007 to 2009 cost $90,000. The Tcard project blowout cost $100 million. Again, according to the Auditor-General, the IT licence system blowout cost $23 million. Uncollected fines in the year 2008-09 cost the Treasury $62.4 million. I could keep on going but the items I have mentioned total over $18 billion. It is little wonder that this Government has to come cap in hand for more money. And it has the audacity to tax us more for marine craft, vehicle registrations and property transactions. It mismanages our money. It is bad and it has to stop.

Mr BRAD HAZZARD (Wakehurst) [6.13 p.m.]: I want to add a few words in relation to the Appropriation (Budget Variations) Bill 2010. I listened intently to Government members arguing energetically and vociferously that such a variation bill is entirely normal practice and utterly acceptable. It is extremely disturbing for the people of New South Wales that current Labor members think that a budget variation bill is acceptable. Indeed, they argue with almost no reservations and no embarrassment that it is normal. It is neither normal nor acceptable practice for a government to conduct itself in this way. It certainly has become the practice under a succession of State Labor leaders. That certainly was not the case when I first came into this place.

It is extremely worrying because how you manage a budget is eventually how you deliver services to the people of New South Wales. That is the reason, hopefully, that members on both sides come into this place—to ensure that services are delivered appropriately to the people of New South Wales. I was not intending to say anything on this bill until I heard what was going on in the Chamber with some Labor members of Parliament. I consider them colleagues but they are on the other side and I think they are very wrong on this. While I was listening to them talk and arguing the unarguable I was listening to the news. I saw it reporting that our roads are jammed and that people are fed up and are leaving Sydney because the Government is not managing the budget and ensuring that the roads we need are being delivered.

Immediately after that I heard a new concept that in all my years in Parliament I have never heard in the context of Sydney public transport. It was the train crush. People on the trains in Sydney in peak hour were saying that the Government should be embarrassed about what they are going through each day during the so-called peak hour, which they also pointed out has become peak hours. Some of these things are inevitable if population increases of the sort that have happened, and we expect to happen continue, but only in circumstances where a government fails to recognise that the infrastructure needs of our city and State are changing and fails to budget appropriately for those infrastructure needs.

This bill makes a budget variation in the sum of roughly $1.4 billion. If we need to consider whether this variation is based on a normal process or a competency process one only needs to consider that two of the major expenditures of waste in this recent period have been $500 million that was spent on a CBD metro that the Government knew in its heart right from the word go was never going to be delivered—and certainly members of the Liberal and National parties and many in the business community were saying was not a sensible outcome—and the Government wasting $200 million trying to sell electricity assets. The $700 million was in two areas, so roughly one half of all the variations contained in this bill have been wasted on just two projects. That is a massive level of incompetence.

It is time that some members who were elected in more recent years reconsidered what they say in this place to justify the unjustifiable. It is for sound reasons that we have an open and transparent process that has developed over many years with regard to the budget. I acknowledge that there are limitations but there are efforts to have a budget process that can be investigated, challenged and looked at. With these now regular appropriation budget variation bills none of that happens. They enable governments to hide the truth.

A few years ago the Sydney Morning Herald ran a series of articles called the State of Secrecy. Nothing has changed; it is just that we do not talk about it now because it has become the accepted way of doing business in this State. I say to Government members that I do not know what will happen next year. I dread the thought that we might actually see them back in government, because if they think such bills are a normal and accepted practice of running government, they certainly are not. When I hear about the failings of infrastructure in this State I have a dread that unless the budget is approached in a far more professional manner than it is currently approached then the Government will have no capacity to deliver infrastructure in its remaining period. Indeed, any government that adopted similar processes may have problems in delivering infrastructure. We need to get the budget processes right.

Finally, I add another brief comment: this approach to lumbering the community with these add-ons along the way, with little explanation, is fundamentally unacceptable. I do acknowledge that there are some essentially critical and good things that the money will be spent on, particularly the $29 million for Nepean hospital and expenditure on other hospitals and public services. However, that should have been part of what the Government determined at the commencement of the period, not so late into the period. When I hear members opposite lecture the Opposition about how they have reduced State debt and done wonderful things for the State I wonder why we do not have an amazing capacity to deliver infrastructure. Then I remember that when Nick Greiner and the Coalition left government each of the major government trading enterprises, including EnergyAustralia, Country Energy, Integral Energy, TransGrid and many more, had either nil debt or next to no debt. Now, some 16 years later, we have billions of dollars of debt that has been transferred from the immediate obviousness of the budget documents to the off-budget sector, that is, to those State government enterprises.

To the Labor members of Parliament who do not recollect that or do not know anything about it I say that the circumstances have certainly changed since Labor came to office. I am not saying that Labor governments do not do some good things—the member for Hawkesbury expresses concern at that statement—occasionally even Labor gets it right, but in managing the budget and economy of this State and maximising capacity to deliver services to the people of this State, Labor has been a disaster. Also, unfortunately, we now have a Treasurer who cannot count and a Premier who does not know that the Treasurer cannot count.

Mr THOMAS GEORGE (Lismore) [6.23 p.m.]: I speak on the Appropriation (Budget Variations) Bill 2010. The objects of this bill are as follows:

(a) to set out the recurrent services and capital works and services for which the "Advance to the Treasurer" appropriation was expended in the 2009-2010 and 2008-2009 years, and to make the necessary adjustments to the appropriation for each of those years,

(b) to appropriate the following amounts from the Consolidated Fund for recurrent services that were required by the exigencies of Government in accordance with section 22 (1) of the Pubic Finance and Audit Act 1983:

(i) in relation to the 2009-2010 year—$79,720,000,
(ii) in relation to the 2008-2009 year—$136,400,000,

(c) to appropriate an additional amount of $695,000,000 from the Consolidated Fund for certain recurrent services and capital works and services for the 2009-2010 year.

Various members have bandied many figures and made other comments on the bill. Each and every one of us has to run a budget in our lives and, sadly, when we overrun our personal budgets we cannot go somewhere and say, "Could you just top it up for me?" However, it has become the accepted practice in Parliament. I believe it shows a lack of financial discipline. Indeed, this recurring trend of the Government is worrying. Last year the Appropriation (Budget Variations) Bill 2009 showed that the Government was in the vicinity of $1.4 billion over budget.

I have difficulty explaining to my constituents why the Government requires additional money when it does not fulfil the promises that it makes. I well remember getting leave from Parliament to travel up to Lismore with the then Parliamentary Secretary for Health, the member for Kogarah. She briefed the community on the building of the hospital. Stage one was to be a mental health unit, stage two was to be a cancer unit and stage three was to be the rebuilding of the hospital. Stage one has been completed, stage two is underway, with the building almost complete and services to commence in about a month's time, but there is no plan for stage three.

Perhaps this project should be included in next year's budget variations bill. I note that other programs have been included in the bill: it appears that may be the quickest way for the hospital to be rebuilt. The Government again has overspent its budget and as result has been forced to request approval from the Parliament for additional funding. The fact that departments require this level of additional funding beyond original budget amounts indicates ongoing financial mismanagement by each of the respective Ministers.

I cannot believe that some of these items were missed during the normal budget process. For example, how could the Metropolitan Water Plan review be overlooked? Has that just come to light since the mini-budget was announced? The bill refers to "Rental payments to the State Property Authority resulting from restructure of office properties". Any businesses that are undergoing restructuring must be included in the budget for the next year. Has the Government only included it because this has just happened in the last month? Page 28 of the bill shows an allocation for a major symphony concert at Parramatta Park that is an annual event, so why was this item not included in the budget? I accept that additional amounts are reasonable.

The bill also refers to the upgrade of the emergency department of Port Macquarie Base Hospital. The decision on that upgrade should have been known at the time of the last budget. Did something break down overnight and need to be fixed the next day? For years many hospitals have been deteriorating but the Government has done nothing. The failure to rein in expenditure cannot be blamed on the global financial crisis, as this was the practice before the global financial crisis. It was identified in the Government's own inquiry in 2006 entitled "New South Wales Audit of Expenditure and Assets Report" by Vertigan and Stokes. This is a reflection of the Government's poor financial discipline, a point members on this side of the House have sought to make. For the New South Wales Government to ask for a further $1.4 billion in funding simply emphasises its poor financial discipline. I thank the House for the opportunity to speak to the Appropriation (Budget Variations) Bill 2010.

Mr RAY WILLIAMS (Hawkesbury) [6.30 p.m.]: I will make a brief contribution to debate on the Appropriation (Budget Variations) Bill 2010. I will pick up from the member for Lismore's comments in relation to why the House is debating the bill. It is because of the failure of the Government, and particularly the Treasurer, to be able to balance their books. That is it, end of story. This is a typical bill that we need to debate after every budget because the Government cannot balance its books. As the member for Lismore correctly pointed out, we as families or we as businesses do not have the opportunity to simply say, "Can you please top up the bank balance with another $1.4 billion, because we have run over budget, we have not been able to manage our finances." The point that needs to be made here is that the people of New South Wales continually ask, "Where is the money going?" The people of this State continue to be hit in the hip pocket. Whether it is through electricity price increases or increases in the cost of car registration, they always seem to be picking up the pieces of the New South Wales Government's failures. But they would like to know where the money is going.

I raise an issue that was brought to my attention by a family in Rouse Hill. It is an average family with two young children, both currently going to school. They raised with me the current cost of the yearly budget. It is virtually a snapshot of the cost of living for many of the people across New South Wales. The cost of living to this family currently is $74,000 per year. I thought that was an extraordinary amount of money, especially given the current basic wage, which I think is below that amount. One starts to ask oneself: How do families across New South Wales survive and how do they balance their own budget? It must be very difficult for them. Within the budget of this Rouse Hill family there was nothing extraordinary. There was no extravagance, certainly no spending that one would look at and say, "This family could rein in." They were not going out; they were not having nights out. I recall that a figure of some $500 per week was quoted for the cost of their mortgage. I think that would represent a mortgage of about $300,000 to $350,000, depending on the interest rate, which is certainly not a large mortgage by any means. I would think that would be the average mortgage at this time.

The family went on to say that they were paying registration, insurance and a green slip on only one vehicle. The husband has the benefit of having a company vehicle, and therefore they are only paying for one vehicle. In itself, that is quite out of the ordinary in Rouse Hill; most families in Rouse Hill would be two-car families because of the lack of public transport in the area and they are hit hard with the costs associated with the running of their vehicles. The Rouse Hill family I have referred to went on to refer to the cost of insurance premiums for their vehicle. Then came the shock of the cost of electricity. They are currently paying an average of $700 per quarter for electricity. Those bills have almost doubled in the past three to four years, which is a significant increase. The cost of water bills has also increased significantly. At $700 a quarter, this is where families really start to wonder how they are going to make ends meet. These costs go up and they add considerably to the families' budgets.

I had a look at the Rouse Hill family's budget. The family had only costed $1,000 for holidays this year for all four family members. They have even gone to the extent of having a camping holiday. It was the cheapest holiday they could afford; they could still take the children away and enjoy themselves for a couple of weeks, and the entire cost of that holiday was a mere $1,000, which is certainly not extravagant. The family listed the cost of presents. As I said, this family had gone into detail to ensure they highlighted all the costs they were incurring. They costed birthday and Christmas presents at around $2,500. When I first looked at that I thought that it was a lot to spend on birthday and Christmas presents. But when one takes into account that the two children would have birthday and Christmas presents, mum and dad would probably have a birthday and Christmas present between them, and presents would be bought for the extended family, $2,500 becomes a realistic figure and certainly not an extravagant figure.

When one looks at all the insurance costs, registration costs, electricity and water costs, the cost of the mortgage—which is probably the most significant cost each week—one comes up with a total of $74,000, which is the current total budget for this family that lives in Rouse Hill. The family also has to pay council rates and other costs associated with the cost of living. But that is an extraordinary amount of money. This average family in Rouse Hill is paying dearly. But what is happening with their money? People are saying to me, "What is the Government actually doing with our money?" People get extremely upset when they see things like the inner-city metro, which has been flagged as major infrastructure at the cost of around $500 million, but not a shovel-full of dirt was turned on the project. When governments waste that sort of money, we will see the cost of family budgets increase to cover those costs. But we should never inflict those costs for waste. That is where this Government has failed.

Over the past 15 years the Government has failed to manage its finances appropriately, to implement the infrastructure that these people, especially those who live in Rouse Hill, need. The Government has wasted money on projects such as the Tcard, the geotechnical works and environmental assessment regarding the North West Rail Link—a project that has been scrapped, then re-announced, then scrapped again. The Government has spent a lot of money on its advertising campaigns—to tell us it was going to give us a North West Rail Link, then it was not going to give us a North West Rail Link, and then advertised it once again. Who can ever forget the photos on our television screens of Vic Larusso flying around in a helicopter, spruiking the benefits of a North West Rail Link? All those projects have been lost to those people, yet the people of Rouse Hill continue to pay through the nose for money that is wasted by the State Government.

I raise another issue regarding infrastructure about which I have asked questions in this House in the past. I refer to the North Richmond Bridge. This is a piece of infrastructure that is needed right now. We have traffic jams for hours on end in the morning and afternoon for the people who travel from my electorate, through North Richmond and across the North Richmond bridge. The Government has allowed development to take place in that area, and it also now proposes to allow another potentially 2,000 blocks of land to be developed in the North Richmond area. That area cannot sustain the traffic that is there already. That traffic travels through the Londonderry electorate. However, the member for Londonderry has done absolutely nothing to raise the importance of that issue—

Mr Barry Collier: Point of order: I understand the member for Hawkesbury is talking about an area in his electorate, but it is beyond the scope of the bill to criticise another member of this place. He should do so by way of substantive motion. I ask you to direct the member to return to the leave of the bill.

ACTING-SPEAKER (Ms Diane Beamer): Order! The member for Hawkesbury will return to the leave of the bill.

Mr RAY WILLIAMS: The point I was making is that no funding has been set aside for that important infrastructure. The North Richmond Bridge is not in my electorate; as I said, it is in the Londonderry electorate. The need for that infrastructure is absolutely vital for that community at this time. However, all the good people of my electorate as far up as Bilpin, Berambing, East Kurrajong, Comleroy, Tennyson and Blaxlands Ridge, need to utilise that piece of road and that bridge. If the Government had not wasted so much of its money and financial opportunities, the money could have been found and those people would now be driving across a four-lane bridge, which also would have opened up opportunity for further development. The proposal for an additional 2,000 homes in that area is unacceptable while the North Richmond Bridge needs upgrading.

Ms KATRINA HODGKINSON (Burrinjuck) [6.40 p.m.]: I follow many members from this side of the House to contribute to the Appropriation (Budget Variations) Bill 2010. I read with some shock that the total amount for recurrent services and capital works in 2008-09 and 2009-10 will be in excess of $1.4 billion. For the Government to overspend its budget by that amount and, as a result, be forced to seek approval for additional funding above and beyond the original budgeted amounts demonstrates ongoing financial mismanagement by the respective Ministers in this place. As the shadow Treasurer and member for Manly has said, the lack of financial management in this place is really worrying. It is a recurring trend: Variations have been required in successive budgets, which demonstrates that the Government is spending beyond its means.

This year the Government has overspent again; it needs another $1.4 billion outside of the budget process. Examples have been given this evening of that poor financial discipline, including the $500 million wasted on the scrapped CBD metro and $200 million spent so far on trying to sell the electricity assets. It is very worrying that so much taxpayers' money is being wasted in this way. Some of the relief packages contained in this bill could easily have been budgeted for, such as the drought assistance measures—which we would encourage—and transport subsidies. Some others are a little worrying and I ask the Parliamentary Secretary in reply to give us more information about them. For instance, the number of rental payments to the State Property Authority from the various government departments that are listed in the bill is worrying. What does "Rental payments to State Property Authority resulting from restructure of office properties" in the amount of $335,000 to the State Emergency Service relate to? Which properties? Where are they?

Mr Barry Collier: Which page are you referring to?

Ms KATRINA HODGKINSON: I am referring to page 26 of the bill. Under the Department of Human Services the grant for the Keep Them Safe program is needed. I imagine the $3 million grant to the Jenolan Caves Reserve Trust, including essential safety upgrades, is also needed. The Jenolan Caves are a great tourist destination close to my electorate. It is interesting that under the Premier, and Minister for the Arts, the recurrent services appear to be almost totally for Sydney-based arts projects, and once again not so much for the many disciplines under arts for rural communities, which are so desperately in need of additional funding. I recently met with the Cowra Art Society, which is pleading with the Government for more thespian visits and other performing arts concerts, ballets and cultural experiences in the Cowra area. That group would appreciate any support it can get from the Government. The bill does not appear to provide a lot for rural artistic endeavours—once again it is Sydney, Sydney, Sydney.

The bill contains several examples of government departments that have made rental payments to the State Property Authority resulting from the restructure of office properties, which are worth multimillions of dollars. We need an explanation from the Government as to where those offices are to be relocated. The bill will have a stimulatory effect on the economy, but once again we have seen the Government unable to rein in its spending and unable to budget properly. I ask the Parliamentary Secretary to explain how $2,309 is to be spent in this Chamber for the replacement of the Legislative Assembly broadcast system and office equipment. That is a lot of money and I would be interested to know about the breakdown of that amount. This bill is a clear example of the Government's failure to monitor spending and I, as so many members on this side of the Chamber have done, condemn the Government for its lack of expenditure control.

Mr WAYNE MERTON (Baulkham Hills) [6.47 p.m.]: I speak to the Appropriation (Budget Variations) Bill 2010. Unfortunately, the Government has had to come back to the Parliament, which seems to be a regular occurrence, to seek a further advance to balance the books, as it were. This has happened on many occasions during my time in this House and until there is a change in government I guess this regular event will continue. Tonight we are being asked to approve something like $1.48 billion outside of the budget process—a substantial sum of money in anyone's language. That $1.48 billion, assuming it is not opposed by the Coalition—and I understand that to be the situation—will be passed by the House without having to go through the regular budget process and, I would suggest, with a reduced level of accountability.

The people of north-western Sydney are very concerned about the overall waste of this Government. In 1998 the people of north-western Sydney were promised the North West Rail Link. It is now the year 2010. If that link were going to open, the first train would be pulling into Castle Hill railway station within the next seven months. The reality is that not one sod of earth has been turned, not one sleeper has been laid, and the rail link will not operate. We are now promised a rail link that will start in something like 2017 and be completed some years later.

The Government has wasted $500 million on the ill-founded dream of creating a CBD metro. It is one of the reasons we are debating this bill. It was an unwanted child, tragically not even supported by many of the council areas through which the metro was to pass. It was unwanted and unloved by residents. Yet the Government, with an almost obsessive zeal and determination, proceeded with the planning of the metro. The metro faced a similar fate as the North West Rail Link and was scrapped. Someone has to pick up the tab and pay compensation to the many people whose lives were placed in a state of irregularity, possibly permanently, and those who suffered because of the Government's decision. People were forced to move out of their premises and re-establish their businesses elsewhere.

This wilful neglect on the part of the Government was of its own making. There was no consultation. The Government was obsessed. It cared little about what people thought. It has now cost the State $500 million, and that is probably not the end of the story. That is the figure we are aware of at the moment. Probably additional bills will be introduced for more money. At the moment it is $500 million, half a billion dollars, one-third of the amount for which the Government is seeking approval. One-third of the amount sought, $500 million, was lost on the CBD metro. Another failing of this Government was the $200 million spent so far on the sale of the State's electricity assets—another loss. Those two figures, $200 million for the sale of the State's electricity assets and $500 million wasted on the scrapped CBD metro, represent 50 per cent of the amount for which the Government is seeking approval.

The Government enters into proposals without any proper consideration and as if there is no tomorrow. It acts as though the day of paying for these projects will never come. Of course, it has come. That is why the Government comes back year after year seeking more money. If the Government were a corporation it would be bankrupt. It would be in liquidation and would have had a receiver appointed some time ago. The Government is living on credit. Very much like its federal masters, it is living on borrowed money. It shows no accountability and it comes back to the Parliament asking for money to prop it up.

While some of the projects are admirable, one has to query why they were not taken into account in the initial planning of the budgetary estimates. The Opposition is not opposed to funding for worthwhile projects. We are pleased with the additional funding for the Nepean Hospital project and the Blacktown clinical simulation facility, as well as the allocation of funding for front-line firefighting services. However, that is not the point. The point is that the Government has not properly planned its projects. There has been economic mismanagement on the part of the Government. Unfortunately, if the Government is returned to power next March, this will happen again, and it will continue to happen. There must be accountability. When the budget is brought before the Parliament, to the best of the Government's efforts it should spell out the whole picture. If it happens once it can be considered an accident. If it happens often, it is neglect, ineptitude and a lack of accountability.

Mr BARRY COLLIER (Miranda—Parliamentary Secretary) [6.54 p.m.], in reply: I thank the members representing the electorates of Manly, Kiama, Murray Darling, Wollongong, Tweed, Kogarah, Davidson, Wakehurst, Lismore, Burrinjuck and Baulkham Hills who spoke in this debate. Each year, through the appropriation bill, the Parliament makes an advance available to Treasury to meet unforeseen expenditures. This bill gives the Parliament the opportunity to scrutinise payments, as details do not appear in the original budget. However, I am advised by the Treasury that the amounts in the Treasurer's Advance component do appear in the budget. This bill reports on how these funds are spent. The figures are incorporated into the budget, so far as the Treasurer's Advance component is concerned. We are exercising transparency and accountability in the budget. If we add to this the $500 million spent on superannuation, this comprises the bulk of expenditure that we are debating tonight.

It is important to note that this practice has been endorsed by the Auditor-General, as well as the Legislative Council's General Purpose Standing Committee No. 1 in its report on appropriation processes. In addition to the Treasurer's Advance, the bill has been compiled to satisfy the statutory provisions relating to section 22 of the Public Finance and Audit Act 1983. The Treasurer may, with the approval of the Governor, determine that amounts shall be paid for contingencies of the Government from the Consolidated Fund in anticipation of appropriations by the Parliament. This is not out of the ordinary. It is a key part of the budgetary process. As members are aware, it is not always possible to seek Parliament's authority in advance for unforeseen and urgent expenditure. Provisions have been established for such situations. The member for Manly seems to believe that the Government has a crystal ball and can foresee everything. Not many people saw the global financial crisis coming, except perhaps some unscrupulous bankers in New York.

Since its introduction on 1 July 2009 the Housing Construction Acceleration Plan has provided important stimulus to the New South Wales housing and construction sector. So far, more than 3,300 New South Wales home buyers, investors and empty nesters have taken advantage of the scheme, purchasing newly constructed properties worth more than $1.4 billion. The scheme has put more than $25 million worth of stamp duty back into people's pockets and, more importantly, it has stimulated $1 billion worth of jobs supporting construction activity—jobs for builders, plumbers, architects and more. As the member for Manly well knows, the building and construction industry has a huge multiplier effect. It is a leading sector of the Australian economy. The member for Manly said that the economy should be run like a business. That is not possible. The member well knows the concept of the paradox of thrift. Keynesian economics demonstrates you cannot run an economy like you do a business.

The member for Murray-Darling seems to have a surplus mentality. I also say to him that an economy cannot be run like a business. The member for Hawkesbury and the member for Davidson want a balanced budget all the time. If we followed that idea we would follow depression economics, which Keynes overturned in the 1930s. This State has a longstanding commitment to fully funded superannuation liabilities by 2030. This commitment is incorporated in the Fiscal Responsibility Act. In response to the member for Manly, the $510 million of the unfunded superannuation is the proceeds of the NSW Lotteries sale. We are applying the proceeds of the NSW Lotteries transaction to superannuation because it is the best long-term investment for the State. It has a high return; it is as simple as that. The bottom line is we are putting the proceeds to their best and most sensible use. It is sound economic management at its most straightforward. On average, we expect to earn 2 per cent more a year. We will be $75 million better off over the next 10 years and $620 million better off over the next 20 years by taking this decision, going down this path and putting the proceeds of the $1 billion transaction to its best use. It is another example of strong economic management by this Government.

The member for Murray-Darling asked what the money has been spent on. I draw his attention to schedules 1 and 2 to the bill. In response to the member for Murray-Darling, the Commonwealth's Nation Building funding was stipulated for specific programs, mainly housing and education. It was, indeed, a great stimulus. That money cannot be redirected into emergency drought assistance or some of the important measures identified in the bill, such as, child safety, emergency services and health care. The money in this bill is set aside for unforeseen and urgent funding. It is supported by legislation that has been adhered to by both parties for nearly 20 years. It is important to understand that the superannuation allocation is a large percentage of the appropriation, $510 million. This could not be budgeted for because the sale of NSW Lotteries had not been completed at the time of the budget. Business asset sales are not figured into the budget until after the completion of transactions.

In relation to the queries from the member for Burrinjuck about expenditure in the Arts, the State Emergency Service and the housing sector, at this stage, with all due respect, I can only refer the member to the Ministers responsible and ask that she seek their advice on those issues. The bill demonstrates this Government's commitment to high-quality services. The bill is part of the annual budget process and confirms our fiscally responsible approach to budget management. The bill has been compiled to satisfy the statutory provisions relating to section 22 of the Public Finance and Audit Act 1983. I commend the bill to the House.

Question—That this bill be now agreed to in principle—put and resolved in the affirmative.

Motion agreed to.

Bill agreed to in principle.


Bill declared passed and transmitted to the Legislative Council with a message seeking its concurrence in the bill.