The Hon. R.A. SIMMS (11:34): I rise to indicate my opposition to this bill. I consider it to be poorly thought through and something that poses significant risks to councils. The bill responds to a community title development at 1700 South Road, O'Halloran Hill, in the electorate of Davenport. Felmeri Homes went into liquidation in July 2023 before finishing the homes and the common infrastructure, including the common driveway and stormwater works.
The bill gives the highway commissioner the power to step in and undertake prescribed works on residential developments on approval from the Minister for Infrastructure and Transport. It further allows the commissioner to recover the costs of these works from the relevant developer or any other person who is, in the opinion of the minister, responsible for undertaking the development, which can include any related body corporate.
However—this is the area that is of concern to the Greens, and I note the comments raised by the Hon. Ben Hood—costs can also be recovered by council if it is the relevant authority for the development under the Planning, Development and Infrastructure Act 2016 or the Development Act 1993 and provided the development on the land is for residential purposes. Higher rates will then be incurred for late payments.
The bill also restricts the relevant council from passing on these costs to ratepayers by restricting recovery through a rate charge, levy, fee or other mechanism. It will therefore inevitably result in service cuts at a local council level, as they are required to carry the can for these developments that go wrong. City of Marion Mayor Kris Hanna said in a statement that the problem does not lie with the council planning approval but rather with the builder:
It is a driveway on private land which is uncompleted, not a public road. Council can't spend ratepayers' money to improve private property.
I must say I am inclined to agree with Mayor Hanna. Enacting a broad-ranging ability of the state government to impose financial impositions on councils sounds to me like cost shifting rather than consumer protection from the Malinauskas government.
The Greens, some time ago now, when we saw a series of builders collapsing in South Australia, advocated for the establishment of a public builder. This public builder could build public housing at the scale that is required, because we know there is a significant backlog in that regard, but it could also step in and complete construction of properties in circumstances where a developer goes bust.
I must say, I have a huge amount of sympathy for people in those positions. It must be an absolute nightmare to lose your life savings and to be in a situation where you have an unfinished home, it is not something that you can take possession of, and there is no end in sight in terms of getting it completed. The Greens' proposal meant that the public builder could step in and do that work and then the state would have equity in that home that could be paid down over time.
This is a model that has worked well during the financial crisis in places like the United Kingdom. It has also worked in countries like Singapore. That would be a sensible approach to getting this crisis under control and providing certainty to those home owners who are left high and dry when a developer goes belly up. Instead, what we have seen from the Malinauskas government is a poorly thought through populist brain fart that does not actually do anything to address the fundamental issues at work.
I understand this was the thought bubble of the previous minister. We have a new minister now, and I congratulate her on her elevation. I hope that our new transport minister, bringing the wisdom that she does, will look at this with fresh eyes and conclude that this is not an appropriate solution to this problem, because we know that it has been poorly thought through and it seems more about trying to get highway headlines rather than trying to address the fundamental problems that are endemic in our construction system.
So I encourage the new minister to think again.
I recognise that the government has already announced changes to ensure that people building a home are better protected. I note the former Treasurer and the Minister for Consumer and Business Affairs completed a joint review into building indemnity insurance to enhance protection for consumers and to support the building industry.
In July 2025, changes were announced that increased maximum insurance payouts to $25,000 if a builder fails to deliver a finished home. Under the reforms that came into effect on 1 October, the policy limit for all QBE policies—which represent the majority of the SA market—will increase from $150,000 to $250,000. The 66 per cent increase will see home builders receive up to $100,000 more in the event that their home is not completed. I recognise that this is an important step in the right direction. It is worth noting, however, that the average premium for a new build or renovation valued between $500,000 to $750,000 will increase from $2,251 to $2,814—a difference of $563 or 0.1 per cent of the value of the build.
The state government has also said it intends to update the regulations and will make it mandatory for all insurance to provide the increased cover to better protect all people building or renovating their home. That is all progress in the right direction, but if we are serious about dealing with the issue of incomplete homes, if we are serious about providing certainty to those who have invested in a new home but who are caught high and dry when a private developer goes under, then we do need to have a public builder.
Part of the reason we have this housing crisis is that the private sector has not been able to deliver the housing we need at scale. The Malinauskas government has brought back the Housing Trust—would a rose by any other name smell so sweet? It has been a change in name only: they have not restored the mission of the Housing Trust. That is why the Greens have been urging them to do so, to bring back the Housing Trust not just in name but in mission.
Re-establish it as a public builder that can build the housing we need at scale, and that can provide certainty to people who have invested in new houses but who find themselves in the invidious position of the private sector failing them. This highways bill is really not the answer, and I think all members of this place should think very, very carefully about this proposal and the implications it has for local councils.
Make no mistake, if this bill goes into effect and we see the collapse of private builders, we will see councils being stung with huge bills, and that will result in the slash and burn of public services. That is what this will do. It is very poor policy.