South Australian State Budget 2006-2007


The South Australian State Budget for 2006/07 was released on Thursday 21 September 2006.

The budget includes a number of major new public private partnership (PPP) initiatives in education and corrections.  It also contains heavy spending in health and a significant re-shaping of the SA public sector.

The Rann Government delayed the budget from its usual May date because of the March 2006 election, which saw the Rann Government re-elected for its second term and gain a majority for the first time (29 out of 47 Lower House seats).

Treasurer Kevin Foley used the extra time provided to conduct a review of the structure of the State public service.  The related savings this creates will be used to provide for spending in priority areas.

The SA Government remains committed to retaining the Triple A credit rating it regained last term.  For the fifth consecutive year, it has delivered a budget surplus.

The SA economy is recording records highs in employment and record lows in unemployment.

Budget highlights:

  • A $216m plan entitled Education Works that will see up to 17 existing schools and kindergartens in metropolitan Adelaide replaced by six new “super-schools” to be built as PPPs.   $134m has been assigned for the six schools.
  • More than $500m allocated for PPPs in correctional services to build four prisons. This will replace the State’s largest men’s prison, the women’s prison and the existing youth detention centre.
  • A record $640m spending in health, including a $72m GP and Mental Health initiative which involves $44m funding for three 7 day a week GP Plus Health Care Centres in suburban Adelaide, and $20m for 56 new mental health workers to provide services in GP offices and therapy for the young.
  • The Department of Administrative and Information Services will be abolished and a Shared Services Unit will be established to deliver $60m a year in savings from 2009/10 onwards. Almost 1,600 jobs will go from the public sector through natural attrition.

The six new schools are to be located across the north western and northern suburbs of Adelaide specifically; Woodville Gardens / Mansfield Park, Enfield/ Gepps Cross and Smithfield/ Playford North.

Education Minister Jane Lomax Smith will begin a consultation process and no school will be closed without the support of the local communities.  She has stated she believes parents will support the plan because the new consolidated schools will provide state-of-the-art facilities and broader curriculum choices.

Minister Lomax Smith has stated that the Government will continue to employ the teachers, run the schools and control the curriculum. The private sectors will be responsible for building and maintaining the premises.

The aim is to have the new schools open and running by 2011.

These schools could provide “one stop shops” for parents, integrating child-care, kindergarten school, primary and high school, and out-of-school-hours care.

The remainder of the $216m program includes $45m of State delivered major capital works for schools including $25m to establish ten high-tech Trade Schools.


Yatala Prison (SA’s largest men’s prison in the northern suburbs of Adelaide) the adjacent Northfield Women’s Prison and the Magill Youth Detention Centre in the city’s eastern suburbs will be closed in five years.

They will be replaced by a new $315m, 760 bed men’s facility and a new $96m, 150 bed women’s facility – both to be located near Murray Bridge adjacent to the existing Mobilong Prison.  A new youth facility will also be built at Cavan, in the northern suburbs. A new $27m, 80 bed pre-release centre for men and women will also be built at Cavan.

The private sector will own, finance, design, build and maintain the prison infrastructure which will transfer to State ownership after 25 years.  Part of the construction contract will include the provision of buses for prisoners appearing in court and relatives wishing to visit prisoners.

Custodial services will be retained and delivered by the State.

The moves release prime real estate at Northfield and Magill which will be opened for housing.

Public Service restructure

The reform of South Australia’s public service will see information technology, human resources, records management, finance, procurement and payroll functions provided centrally rather than duplicated in each agency.

This Shared Services reform will be overseen by Administrative Services Minister Michael Wright.  It is designed to deliver $25m in savings in 2007/08, $45m in 2008/09 and $60m a year from then on.

The Government remains committed to no forced redundancies.