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Legislative Assembly for the ACT: 1995 Week 8 Hansard (24 October) . . Page.. 1913..


COMPETITION POLICY REFORM BILL 1995

Debate resumed from 24 August 1995, on motion by Mr De Domenico:

That this Bill be agreed to in principle.

MR WOOD (10.35): In 1991, the Commonwealth and the States and Territories agreed to consider a national approach to ensure greater competition in the Australian market. As a result, Professor Fred Hilmer was commissioned to conduct a review of competition, and he reported in August 1993. There has been widespread debate of this report, with the Council of Australian Governments progressing this debate over a considerable period. Finally, in April this year COAG agreed to implement the new national competition policy as defined in this complementary legislation. The former Labor Government of the ACT participated in that process during its term of office.

The Commonwealth has recently passed the Competition Policy Reform Act 1995, with necessary amendments to the Trade Practices Act, which will be important in oversighting the new measures. The States and Territories have passed, or will be passing, the legislation that is now before us. The Trade Practices Act will soon apply in all jurisdictions and will include not just private sector activity but government business activity as well. Since the Trade Practices Act already applies to the private sector in the ACT, our particular interest in the new legislation is in its impact on ACT government business activity. The legislation we debate today will require further critical examination of the operations of government business activities, and we should understand the distinction between government business enterprises and the broader range of government business activities.

In its full impact, the new national competition policy covers six areas of government action: One, limiting anti-competitive conduct of firms; two, reforming regulation that unjustifiably restricts competition; three, reforming the structure of public monopolies to facilitate competition; four, providing third party access to certain facilities that are essential for competition; five, restraining monopoly pricing behaviour; and, six, fostering competitive neutrality between government and private businesses when they compete.

The so-called Hilmer reforms will have their biggest impact Australia-wide in the four key areas of public utilities, the building industry, transport and communications, and the unincorporated sector of the professions. Productivity improvements made in these areas will, of necessity, vary across the States and Territories. The full effect of all the reforms is claimed to bring substantial benefits to Australian households. It may, it is claimed, take seven or eight years to occur, but real household consumption is projected to rise eventually by over 4 per cent and to be maintained at that level. Real investment and real government consumption are also expected to increase by about 21/2 per cent. As a result, real wages and employment are claimed to increase and communities in general, including the ACT, should be better off.


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