LaPaglia's character...

You're right, Cayres1234, re: the quote, but the film is vague about the exact nature of the father/daughter relationship. When the brother returns and first sees his sister, he asks her if she's let their father see much, and she minimalizes the issue. Their dialogue suggests they share an awareness that the father has some sort of inappropriate sexual interest, or at least arousal, in his daughter. And while the context strongly implies the inclination hasn't been acted on, we can't really be sure. Perhaps the daughter is keeping the extent of the truth from her brother.

In a later kitchen scene, the father hugs his daughter strongly, even forcefully, for an uncomfortably long time. She doesn't respond because he's trapped her arms within his own. Later, after he has come to a somewhat clearer understanding of his personal difficulties, he speaks to her while sitting on his bed, and awkwardly apologizes for (I paraphrase) inappropriately seeking too much reliance from her. I think the context here is much clearer and suggests that the sexual urge has remained essentially latent. The whole thing remains foggy, like so much of this film. That isn't always a negative, but there are a number of narrative developments here that don't seem sufficiently connected to the main arc of the story, and that can leave the film feeling disjointed.