Jennie George (Throsby, Australian Labor Party, Shadow Parliamentary Secretary for Environment and Heritage) Share this | Link to this | Hansard source

With an election just months away, the Howard government now belatedly acknowledges that petrol prices are too high and that motorists are being ripped off. It has taken a long time to acknowledge what motorists have known for years. As far back as November 2003, my office undertook a local survey over a four-week period which showed that the price of unleaded petrol peaked on Thursdays and the highest average cost of unleaded petrol was also highest on Thursdays. This local information coincided with the results of petrol price monitoring by the ACCC in the Sydney region between May and August 2003 which showed that all 18 petrol price peaks occurred on a Thursday, with the most common day for low prices being on Tuesday. When I pursued these matters with the ACCC on behalf of my constituents I was advised that they could act only if I was able to provide evidence of a breach of section 45A of the TPA by showing that actual collusion between suppliers had taken place. The evidence that I was to provide had to prove that there was agreement in advance to set prices.

Similarly, motorists who I represent know that the price of petrol continues to remain high in Australia even when prices are falling overseas. Motorists are being ripped off because the oil companies are not passing on international price reductions at the local bowsers. In the week ending Sunday, 3 June, the average weekly price of petrol in Wollongong was $1.35, the highest it had been in 40 weeks of the survey period. These increases did not reflect the recent falls in the Singapore price, which continues to be used as the benchmark. The peak motoring group, the Australian Automobile Association, claimed a few days ago that there was no doubt that oil companies were price gouging. They pointed to the drop in the Singapore benchmark price of around $9 a barrel which should have translated to a between 5c per litre and 10c per litre lower price at the bowser.

We now have the farcical situation of the federal government and the ACCC each trying to flick-pass the responsibility to the other. The Prime Minister said:

… if the ACCC wants further monitoring powers, then we will certainly be willing to provide them.

The commission chairman, Graeme Samuel, responded by saying that any change in his powers ‘was entirely a matter for government to deal with’. Talk about an unnecessary stand-off. It is an abrogation of responsibility while motorists are being ripped off. We all know that motorists have been ripped off for many years. The question is not, ‘What is going on?’ but ‘What does the Howard government intend to do to stop this occurring?’

We are told by the ACCC that price following is not collusion. Proving price fixing, they say, is about proving that there is agreement in advance to set prices. Under current law, price fixing is both hard to detect and hard to prove, as we saw in the recent case involving a group of petrol suppliers in Geelong. It appears to me that the law needs to be amended so that the hurdles are lowered to enable successful prosecutions. It is, after all, the federal government’s responsibility to equip the ACCC with adequate powers to pursue apparent collusion on pricing as well as movements in Australian retail petrol prices that are out of kilter with international benchmarks. In the meantime, the Treasurer should do what Labor has been urging for a long time and issue a formal direction to the regulator which would give it the power of compulsory information acquisition from the retailers. The government should also agree with Labor’s proposal to appoint a national petrol commissioner with the sole responsibility to formally monitor and investigate price gouging and collusion.

The Howard government has a duty to do everything in its power to ensure that motorists are not paying one cent more on petrol than is absolutely necessary, and motorists need to know that petrol prices are being fairly set, something that clearly they are very concerned about. As the price of petrol continues to rise in Australia while the international prices are low and falling, motorists are continually concerned about the increases that we see on particular days of the week, specifically on Thursdays and particularly in pension weeks when they really impact on low-income earners and pensioners. Motorists continue to be concerned that the government has washed its hands of any kind of intervention in this issue despite repeated calls by the Labor opposition to at least give the regulator formal powers that go beyond the cursory monitoring that has been occurring for several years. It is interesting, isn’t it, that in the lead-up to an election the Prime Minister has now suddenly acknowledged that petrol prices are too high and that motorists are being ripped off. He can acknowledge it, but the test will be to see what action the government takes to curb price gouging in petrol prices.