House debates

Thursday, 30 March 2017

Questions without Notice

Tasmania: Fuel Prices

2:52 pm

Photo of Andrew WilkieAndrew Wilkie (Denison, Independent) Share this | | Hansard source

My question is to the Prime Minister.

Honourable Members:

Honourable members interjecting

Photo of Tony SmithTony Smith (Speaker) Share this | | Hansard source

The member for Denison has the call, and the clock is ticking.

Photo of Andrew WilkieAndrew Wilkie (Denison, Independent) Share this | | Hansard source

Prime Minister, you have intervened in the gas market, directed ASIC to look at electricity prices and announced an expansion of the Snowy Hydro scheme. But there remains one big energy problem: the absurd difference in the price of petrol and LPG in Tasmania compared with the mainland. This difference is often in the tens of cents per litre and cannot be explained by Bass Strait costs alone. Prime Minister, surely energy security and affordability is too important to leave to the market. What will you do about this? Will you intervene and help ordinary Tasmanians in a way no Prime Minister has ever done before?

2:53 pm

Photo of Malcolm TurnbullMalcolm Turnbull (Wentworth, Liberal Party, Prime Minister) Share this | | Hansard source

I thank the honourable member for his question and indeed his confidence. Petrol prices have an enormous impact. As we know, they are a big part of every household's budget, and access to affordable and reliable fuel is vital for families and for businesses. Competitive markets provide us with the means of achieving that, and the more competitive the better, because they bring lower prices and better service. We have to remain vigilant to ensure markets are working in the best interests of consumers, and we are already doing this.

From late 2014, as the honourable member would be aware, the government asked the competition watchdog, the ACCC, to monitor the prices, costs and profits relating to petrol prices across Australia, including in Tasmania. Petrol companies know they are under scrutiny, and consumers can see how they are behaving. Secondly, the government is implementing the Harper competition reforms, giving more powers to regulators to protect consumers. These reforms include amending the law to prohibit corporations from engaging in a concerted practice that has the purpose, effect or likely effect of substantially lessening competition. The honourable member would recognise that the Labor Party is opposed to those reforms. The legislation to enact this has been introduced by the Treasurer.

The honourable member's electorate is in Hobart, which has two of Tasmania's five receiving terminals that then distribute fuel throughout Tasmania. Hobart's prices tend to be lower than the rest of Tasmania's as a result. However, it is without question that Tasmania's prices are among the highest in the nation. That is because of higher transport costs, higher operating costs per litre due to the small size of the market and relatively weak retail competition. The ACCC has found, however, that in Tasmanian cities such as Launceston increased competition has made a positive difference for consumers in petrol prices.

I should add that our government has been very effective in delivering tangible outcomes to the people of the honourable member's state, boosting the Tasmanian Freight Equalisation Scheme to reduce the cost of shipping between Tasmania and the mainland. We have provided $22 million towards the Hobart International Airport runway extension, $24 million towards the Hobart airport roundabout upgrade and flyover, and many other infrastructure projects, including the relocation of the University of Tasmania in Launceston and of course the massive investment in the Midland Highway.

Tasmania does have unique challenges—we know that. We are responding. I want to thank the honourable member for his question and for giving me the opportunity to explain how we are working hard to deliver for the people of his state.