Nola Marino (Forrest, Liberal Party) Share this | Hansard source

The Fuel Quality Standards Amendment Bill 2009 standardises the quality and improvements of fuel being distributed in Australia in order to regulate fuel quality for environmental improvement, the adoption of better engine and emission control technologies and more effective engine operation. The Fuel Quality Standards Act 2000 was introduced by the coalition to provide a national framework for controlling and improving fuel quality. The act established for the first time in Australia a national regulatory regime for fuel quality that was backed up by a comprehensive monitoring and enforcement program. In 2003 the coalition successfully implemented amendments to the act that were necessary to enable the Commonwealth to impose requirements for labelling of fuels at the point of sale and to make a number of existing offences under the act strict liability offences.

In 2004-05 an independent statutory review of the Fuel Quality Standards Act 2000 was undertaken by the Fuel Quality Standards Act Review Panel with assistance from Economic Associates Australia Pty Ltd and SWB Consulting Ltd. It concluded that the overall policy objectives of the act were being met and should not be altered. Minor recommendations revolving around three areas were made to ensure nationally consistent standards; improvements to monitoring, compliance and enforcement; and improvements to the administration of the act.

This bill aims to make administrative amendments and implement the recommendations of an independent statutory review, conducted under the coalition, which found that these objectives are being met. The coalition supports the minor administrative amendments to improve the bill by amending the process for granting approvals to vary fuel standards by wielding the conditions that the minister can apply to approvals, by simplifying the approval procedures when a decision is urgently required to avoid a fuel supply shortfall and by enhancing monitoring and enforcement powers, including the introduction of a civil penalty regime and the establishment of an infringement notice system.

Amendments to the bill will improve the efficiency and effectiveness of the Fuel Quality Standards Act. In particular the amendments will improve the development and enforcement of fuel standards, which will benefit the public and the environment through cleaner fuels and reduced vehicle emissions. Through this bill the government will impose a new petrol tax under the ETS within one year for commercial transport and within an electoral cycle for passenger vehicles. This will be a new tax law and a new tax for motorists and all fuel users.

Further concerns I have relate to the Rudd government’s emissions trading scheme. There is no doubt that the government’s proposed legislation is seriously and fundamentally flawed. To use one example, it assumes that Western Australian energy production is connected to the national grid. We all know that Western Australia is basically an energy island. With the planned introduction of the government’s Carbon Pollution Reduction Scheme, I am concerned about the impacts a future emissions trading scheme will have on Australian industry across the board. It will impact on the transport sector, the mining sector and the farming, agriculture and forestry industries, and there will be a cost to every Australian community, individual and family. Fuel is and will continue to be a very important component in Australia’s productivity and commercial ventures, as well as an ongoing component of our energy balance.

I have mentioned many times in this chamber that my electorate of Forrest not only is the south-west food bowl of Western Australia but also contains major mining and resource activities. Transport and fuel are integral components of these industries. The transport industry itself has faced major cost increases recently. Fuel is also a major operating cost for forestry contractors. Most are small businesses and most are concerned that this government will exclude them from compensation arrangements for extra fuel costs under the proposed CPRS. It has been estimated that the result will be a cost of $14,000 a year for additional fuel charges, and most contractors are already on very narrow margins and will not be able to absorb these increases. In my electorate, this is on the back of the impact of the Varanus gas explosion. The log haulers were parked up almost immediately. We have lost contractors, and some of the remaining operators have had to sell assets just to survive.

We have seen the failed introduction of Fuelwatch, which was supposed to put competition into fuel prices. But the days of real fuel competition have been compromised by the strong position of supermarket chains in the petrol market. Consumers cannot necessarily plan ahead, as they are expected to with Fuelwatch, as to where the cheapest fuel is supposed to be, particularly in regional areas. Generally all they can do is watch the prices remain high.

According to the CSIRO’s June 2008 report entitled Fuel for thought, Australia is more vulnerable to changing market circumstances than other countries due to its relatively high vehicle use, the relatively high fuel consumption by vehicles, the almost 97 per cent reliance on oil based fuels for transport and the declining domestic reserves of conventional oil. About 41 per cent of final energy consumption is used in the transport sector, and demand has grown by 2.4 per cent per year. The vast majority of domestic passenger and freight trips are undertaken in road vehicles, which account for 75 per cent of transport fuel use. Air transport is the second highest user, at 16 per cent, then water, at four per cent, and rail transport, at two per cent. The high level of car ownership in Australia means that transport accounts for 14 per cent of Australian’s total national greenhouse gas emissions, which is roughly equivalent to the emissions from agriculture.

There is no doubt that the price of fuel will increase under the emissions trading scheme. Those with low incomes will be most vulnerable to rising fuel costs, as spending on fuel represents a greater proportion of disposable income. In addition, there is a tendency for this group to own less fuel efficient vehicles and have fewer resources to invest in alternative fuel or more efficient vehicles. Regional communities and those located on the urban fringes will also be disproportionately impacted upon, owing to their higher fuel use and fewer options for reduced motor vehicle travel or public transport.

The increased cost of oil based fuels will filter through the economy, increasing the costs of all goods and services. The mining and metal-manufacturing sectors are amongst the highest users of transport as an input to production. According to the 2005 ABS report, the transport of food to retail outlets accounts for between one and six per cent of the cost of grocery items. The impact of the ETS on local and regional producers getting their products to markets will result in higher cost increases both to the producer at the farm gate and, through the food supply and value chain, to the consumer. An emissions trading scheme that does not include international emitters will represent a serious threat to food security and to our home-grown regional food producers, food manufacturers and exporters.

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