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Legislative Assembly for the ACT: 1998 Week 8 Hansard (29 October) . . Page.. 2468 ..

ACTEW - Customer Base

MR HIRD: I address my question to the Acting Chief Minister, Mr Humphries. Can you explain how ACTEW's customer base is being affected in the deregulated electricity industry? What effect is this likely to have on a government-run utility?

MR HUMPHRIES: Yes, I can, and I thank Mr Hird for that question. There is no doubt that we are entering a highly-competitive market for electricity at the present time - an era in which electricity suppliers will face a high degree of uncertainty. That is unfortunate for electricity suppliers, but I think it is worth pointing out that electricity consumers are likely to stand to gain very handsomely. That is an essential point, Mr Speaker, which I think has been lost so far in the debate about ACTEW. With increased competition comes increased attention to consumer satisfaction, to wider choice and, importantly, to competitive price structures.

Do not take my word for it. Look at the experience with the privatisation of other major government utilities in the last few years. Who recalls the dark ages in Australian telecommunications when Telstra - Telecom, as it was then known - had a telephone service monopoly in this country. We thought very little in those days of paying $3 a minute to call relatives in the UK, the US or New Zealand because that was the going rate, the only rate that the monopoly provider, Telecom, provided. But we have had competition. Optus and other providers have entered the marketplace. The result is that we now can get phone calls for as little as 48c a minute to the US and 45c a minute to New Zealand.

That happened because of the Labor Party, Mr Speaker - a Labor Party prepared to privatise when it was in the public interest. Mr Stanhope and Mr Quinlan know that because their faction in other branches of the Labor Party around Australia are involved at the present time and have been involved over the past with major exercises in privatisation - the Commonwealth Bank, Qantas, OTC and a whole host of other important Commonwealth government enterprises. Consumers have been big winners in that process. They have got the benefit of those processes. Retail contestability in the Australian context is being phased into the electricity market, Mr Speaker.

The latest figures indicate that ACTEW is losing more customers than it is winning. I know that members opposite do not like the idea of sites or businesses being talked about, so I will go with some other term. It has lost contracts to supply 167 gigawatts of energy and in its place it has won contracts to supply just 80 gigawatts of energy. It has gained less than half the number it has lost. That is not because ACTEW's quality of service has been substandard, because it has not been. ACTEW has been a very good supplier of services and a quality of service. Why have they lost those customers, Mr Speaker? Because of price. Price is a very key issue in the market. ACTEW on-sells electricity from elsewhere. It is, to some extent, a victim of the prices being charged elsewhere. ACTEW cannot on-sell electricity cheaper than it is paying for it unless, of course, it gets a government subsidy. Members opposite have already told us that they want ACTEW to be subsidising us, not the other way round.

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