Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Link to this | Hansard source

I welcome the opportunity to speak on the Trade Practices Amendment (Infrastructure Access) Bill 2009, which the coalition supports in principle. We should never underestimate the importance of markets in the functioning of an economy.

Craig Emerson (Rankin, Australian Labor Party, Minister Assisting the Finance Minister on Deregulation) Share this | Link to this | Hansard source

Hear, hear!

Luke Hartsuyker (Cowper, National Party, Deputy Manager of Opposition Business in the House) Share this | Link to this | Hansard source

Indeed so, the minister interjects. Markets play a pivotal role in the allocation of resources and they ensure that resources are allocated efficiently. The Trade Practices Act has an important role in assisting competition policy to get the sorts of competitive outcomes that are going to benefit industry and benefit consumers. Alan Greenspan, in his book The Age of Turbulence, had a look at the issue of the relative performance of a controlled economy and a market based economy. That opportunity was provided with the fall of the Berlin Wall. Economists had been speculating on the relative prosperity of the market based West Germany and the controlled East Germany, but the fall of the wall gave the opportunity for an experiment, if you like, to examine the relative prosperity of the two approaches. Economists were very surprised by the fact that the controlled economy was only able to achieve about 30 per cent of the GDP of the market based economy.

Germany certainly has a great deal of control in its market economy—it is not a purely a market based economy; there is a great degree of government intervention in that economy—but it was interesting to note that markets had provided great wealth and prosperity to the West Germans that the East Germans could only hope to aspire to in many years to come. So we see that our markets in this country have an important role to play, as do markets around the world. And our Trade Practices Act has an important role to play in ensuring that markets operate efficiently and effectively.

The objectives of this bill are to minimise delays in decision making under the National Access Regime. The National Access Regime provides a mechanism for business operators to be granted access to privately held infrastructure which cannot be reasonably duplicated by a competitor. The regime provides a mechanism for access to privately held, nationally significant infrastructure where two parties cannot reach an agreement on its use. The regime was introduced by the Keating Labor government in 1995 and was implemented by part IIIA of the Trade Practices Act.

In 2006, under the Howard government, COAG agreed to the Competition and Infrastructure Reform Agreement, or CIRA, which committed the Commonwealth to reform part IIIA. COAG agreed to introduce the requirement that regulators will be bound to make regulatory decisions within six months and that, where a merits review is provided for, reviews are to be limited to the information submitted to the original decision maker.

This bill gives effect to the amendments agreed to by COAG. Under the new laws, the National Competition Council must make recommendations on applications within an expected period of 180 days. The minister must then make a decision on the NCC recommendation within 60 days from receiving the recommendation. Where the minister does not make a decision within this time, it is assumed that he or she agrees with the recommendations made by the National Competition Council. Decisions by the ACCC on access undertakings, industry codes and arbitrations of access disputes must be made within an expected period of 180 days, and decisions by the ACCC on competitive tender processes must be made within 90 days.

The measures will support more efficient infrastructure investments where this investment by the private sector is dependent upon access to competitors’ infrastructure and a decision by the minister to grant the access. The bill will also help encourage investment where a company is concerned about delays in gaining access to infrastructure. The regime will enhance competition in industries where access to infrastructure is a necessity for companies to compete.

Competition benefits all Australians because it delivers better services, lower prices and more efficient markets. Unfortunately, this government does not always understand the needs of smaller businesses and the importance of their ability to compete in the market. We have seen the release of the report of the Senate inquiry into the government’s failed GROCERYchoice website. Many independent retailers gave evidence to that inquiry conducted by the Senate Economics References Committee that the website would have placed them at a significant disadvantage in the market. When designing the site, the government failed to take into account issues such as lack of competition in remote areas and the high costs of delivery to smaller retailers. Master Grocers Australia told the committee:

Smaller retailers certainly have less scale than a large, 3,000 square metre supermarket.

Or even larger supermarkets. They went on:

There are different costs associated with running those different businesses, whether it be labour, overheads, rent, wage percentages and so forth.

The committee made the following recommendation:

… both the Government and the Australian Competition and Consumer Commission note that the operation of the GROCERYchoice website was prejudicial and unfair to independent retailers.

The committee concluded that GROCERYchoice would have been anticompetitive and hurt smaller retailers in their attempts to compete against the majors. The government has a history of promising big and delivering small. GROCERYchoice was nothing more than a fraudulent scheme aimed to get the Prime Minister off the hook with respect to his promises on the cost of living.

During Senate estimates hearings, the ACCC advised that $6.6 million had been spent on the GROCERYchoice scheme. The final cost is expected to be in the order of $8 million-plus. The Senate report into the farce also said the initiative was characterised by ‘waste and mismanagement’ and designed to fulfil a ‘hollow election commitment’ by Labor to bring downward pressure on grocery prices. The website was a mere stunt to convince the public that the government was acting on a promise, when in fact it was doing nothing at all and in the process wasting over $8 million.

The legal sector have expressed concerns in relation to the bill before the House by suggesting that the government’s amendments to infrastructure access will be illusory. The law firm Mallesons Stephen Jaques writes that the reduction in time spent examining applications may result in a ‘compromise in the quality of key regulatory decisions, especially where the review body has insufficient information to make a fully informed decision’. Given the government’s track record of rushing into economic policy and policies such as GROCERYchoice and FuelWatch without considering the nature of the market, the criticism from the legal sector would have to be taken very seriously indeed. To address procedural concerns, the bill contains a number of ‘clock stoppers,’ which extend the time limit for procedural reasons. These clock stoppers will apply to only the National Competition Commission and ACCC and tribunal decisions.

With regard to NCC recommendations and ACCC and tribunal decisions, the clock will be stopped when making requests for information and when the regulator agrees to stop the clock for a certain period on the agreement of relevant parties to the decision. There are three additional clock stoppers for ACCC decisions, including a time allowance for periods of public consultation. There are no clock stoppers for where a decision is being made by a designated minister. Therefore, a compromise of quality in decision making will not occur if the agencies use clock stoppers to perform their duties carefully. In the absence of legislative clock stoppers, the parliament must bring the minister to account where he or she has not made a decision and he or she has had reasonable time to do so.

The amendments to infrastructure access are welcomed by the coalition. If they function as intended, they will encourage competition in all sectors requiring access to privately held infrastructure of national significance. These are amendments originally agreed to by the Howard government through COAG. The coalition in principle supports the bill, which will result in a more effective and efficient market arrangement.

Belinda Neal (Robertson, Australian Labor Party) Share this | Link to this | Hansard source

I rise in the House today to speak in favour of the Trade Practices Amendment (Infrastructure Access) Bill 2009. The bill, which amends the Trade Practices Act 1974, will implement certain commitments made by the Council of Australian Governments to improve arrangements currently existing under the Competition and Infrastructure Reform Agreement. In particular the bill makes changes that will improve regulatory certainty and streamline the administrative procedures under the National Access Regime.

The National Access Regime is a mechanism designed to regulate access by third parties to nationally significant infrastructure projects—such as port facilities and rail lines—which are owned and operated by another commercial entity. The most well-known recent example of disputation over access to such major infrastructure facilities was the ultimately successful attempt by the Fortescue Metals Group to gain access to the Pilbara rail lines owned by BHP Billiton. That dispute between the two companies dragged on in various courts for approximately 22 months. It involved considerable expense and created an atmosphere of great uncertainty for the companies, their shareholders and, most importantly, prospective investors in Australia’s burgeoning resources and export sectors. Nationally significant infrastructure projects are vital to ensuring Australia’s economic growth in the future.

The changes will make access to infrastructure facilities easier for third parties, increase competition and make sure our major facilities are utilised to their fullest potential and used in the most efficient manner. The Rudd Labor government is committed to achieving a seamless national economy. This aim has been one of the driving imperatives that underlie the reform initiatives being rolled out by COAG.

I am pleased to be speaking on this bill today because it highlights the importance that this government places on providing the infrastructure this country needs to successfully navigate its way out of the global economic crisis. For too long Australia has been held back by inadequate infrastructure provision. The existing and future infrastructure projects that will be dealt with by the bill before us today are large in scale and of immense significance to our national economic prospects.

The Rudd Labor government has also made great progress in providing community and regional infrastructure funding that is having positive effects in every town and city around Australia. I know that my own electorate of Robertson, which is based on the Central Coast of New South Wales, there have been decades hamstrung by a lack of infrastructure. Physical and social infrastructure provision has never kept pace with the growth in population in the Central Coast region. Nor has it met the growing expectation of the communities located there for better and improved facilities, such as parks, playgrounds, community buildings, safer streets and more liveable town centres.

After years of neglect under the former Liberal government, I am pleased that the present government is beginning the process of addressing the massive backlog in the provision of these community facilities. The delivery of infrastructure facilities to the people of Robertson has always been and will remain one of my top priorities. I made a number of infrastructure commitments to the people of Robertson before the last election and I am heartened to say that all of them are in the process of delivery as we speak. These projects are supporting significant numbers of jobs for tradespeople, contractors and small businesses across the Central Coast and they are delivering the infrastructure that our region needs for the future: $81 million has been allocated to build the Mardi Dam to Mangrove Creek Dam water pipeline, which is ensuring the Central Coast’s water security into the future; $840 million was invested to fund start-up planning and design works for a dedicated freight rail line between Sydney and Newcastle; $7 million was provided to Gosford City Council to build 400 additional commuter car parking spaces in the Gosford city centre; $900,000 has been invested to construct shared-use community sporting facilities at Erina High School; and, lastly, $680,000 was provided to install CCTV security cameras in three CBDs on the peninsula. These were all election commitments that are improving the quality of life for Central Coast residents and improving their communities.

In addition to these valuable projects, the Rudd Labor government’s Nation Building Economic Stimulus Plan has been great news for infrastructure provision in my electorate. So far the economic stimulus plan has invested more than $110 million directly into the Robertson electorate. More than $81 million of this expenditure has flowed from the Building the Education Revolution program, which is transforming the schools of the Central Coast. The 33 primary schools in Robertson are now receiving new classrooms, libraries and covered outdoor learning areas under the government’s Primary Schools for the 21st Century program. In addition to this, we have received significant injections of funding in new and upgraded social housing, black spot road grants and energy efficient housing. The Regional and Local Community Infrastructure Program has so far delivered more than $5 million to the Gosford City Council to upgrade our parks, playgrounds, sporting grounds and community buildings. Under this program, a $3 million peninsula recreation precinct will soon provide world-class sporting and recreation facilities to thousands of local families. These projects are giving a boost to jobs on the Central Coast by building the infrastructure our region needs for tomorrow.

While these projects are not in the same dollar-value league as the Pilbara rail line, they are no less important to the people of Robertson, whose lives are bettered by having them built in their community. We must remember that local infrastructure projects just like these are being rolled out in every school and every community across the nation. That is why I commend this government for its rock-solid commitment to infrastructure delivery, whether the projects are small playgrounds in areas of real need or nationally significant projects. The infrastructure access bill proposes new and fresh arrangements that will make far better use of our privately owned infrastructure. It makes modest but telling changes to the way the National Access Regime operates in a variety of ways—that is, ways that bring clarity and increased efficiency to decisions about who can legitimately gain access to certain facilities. The bill will help facilitate third-party access to nationally significant infrastructure facilities by ensuring that the decision-making processes are faster and more transparent.

There are three pathways for a business to gain access to a service under the National Access Regime. Firstly, access can be gained by a declaration of a service provided by an infrastructure facility. Secondly, it can be achieved through state or territory access regimes that have been certified as effective. Thirdly, it can be secured via access undertakings made by service providers. The regulatory processes associated with access to these infrastructure facilities and services will become more streamlined and more certain for all parties, particularly the owners of the infrastructure and those businesses seeking access to the facilities. The result will be greater competition in markets that depend on facilities that cannot be economically duplicated. For example, it would be a patently inefficient outcome for Australia’s economy to build two rail lines right next to each other so that iron ore exports to China from the Pilbara region of Western Australia could be enhanced and bottlenecks to trade overcome. The Australian government is now facing a huge infrastructure investment challenge. It is imperative that export bottlenecks are reduced and that the nation is provided with sufficient export infrastructure to allow Australia to meet the opportunities arising from the phenomenal and sustained growth of countries such as China. There must be strong incentives for private sector investment in major infrastructure projects that will aid this growth.

The Australian government must also ensure that existing infrastructure and, equally importantly, new infrastructure projects that will be necessary for future capacity increases are used efficiently. It is important to note that the infrastructure access bill does not seek to replace commercial negotiations between infrastructure facility owners and access seekers. Instead, it provides enhanced incentives for negotiation between infrastructure owners and those access seekers. The bill sets clearer rules for both parties and for regulators that will enhance access on reasonable terms and conditions, should negotiations between the parties fail. The bill sets time limits on decision-making processes under the National Access Regime, reducing what are sometimes lengthy and costly delays. The National Access Regime has been in place since 1995 and has proved a useful means to regulate access within key infrastructure sectors.

Both infrastructure owners and access seekers have stated that the decision-making processes under the regime are too lengthy and therefore can involve unacceptable costs. Some owners have in fact expressed concern that the regime was causing regulatory risks that may actually hinder investment in essential infrastructure. Since 1995 there have been a number of reviews of the National Access Regime to improve certainty and transparency in the decision-making process, to impose time limits on decisions and to introduce a limited form of merits review for regulatory decisions.

In November 2008, COAG agreed to the National Partnership Agreement to Deliver a Seamless National Economy, which reaffirmed COAG’s commitment to complete outstanding reforms under the Competition and Infrastructure Reform Agreement. This bill before us today implements the Australian government’s commitments under that agreement. One of the fundamental adjustments the bill makes to the National Access Regime is the introduction of binding time limits. These replace the target time limits introduced in 2006. Regulators under the regime—which include the National Competition Council, the ACCC and the Australian Competition Tribunal—must make decisions about infrastructure access within a statutory time period of six months. For relevant ministers the statutory period is set at 60 days. The existing merits review arrangements sometimes meant that parties to an access agreement review could bring up additional information that had not been provided to the original decision maker in their deliberations. The bill provides that where merits review of decisions is available, the Australian Competition Tribunal may only have regard to the information taken into account by the original decision maker.

For new infrastructure the bill provides for an up-front decision about whether a service to be provided by a proposed infrastructure facility is eligible or ineligible to be deemed a declared service. Once a minister decides that a service is ineligible, it cannot be declared for at least 20 years, or longer if the minister so determines. To improve regulatory certainty, the bill will enable a service provider to submit an access undertaking to the ACCC which includes one or more terms known as fixed principles. These fixed principles will apply for a certain period beyond the expiry date of the undertaking. When important variations are fixed, investors and access seekers have greater certainty regarding the terms and conditions of access to the service under future access arrangements. For example, a fixed principle could apply to the calculation of a regulatory asset base so that the value of the asset base is set for future undertakings. This would allow access providers and seekers to extrapolate access prices under future access arrangements and have more certainty in their investment planning.

A fixed principle could also be an obligation, such as the standard at which the service is to be provided. It could also be a process, such as a procedure that the service provider will follow before undertaking new investment in the relevant facility. Once accepted by the ACCC, the fixed principle must be included in any subsequent undertaking covering that particular service for as long as the fixed principle is in operation. Under current arrangements, there are only limited means by which the ACCC can accept variations or amendments to access undertakings entered into by the various parties. For example, for a revised undertaking to be accepted, it first has to be withdrawn completely and then resubmitted for consideration. This has caused delays and increased costs and may have led to the perception that an infrastructure provider which had voluntarily agreed to grant third-party access had acted improperly. Under the bill, the ACCC now has enhanced ability to accept amendments and variations to undertakings.

The bill also streamlines the declaration test. This means that a minister or the National Competition Council will no longer need to be satisfied as to health and safety matters when considering applications. Clearly, these matters are dealt with adequately via other legislation. Also, the minister or the National Competition Council must take heed only of state or territory access regimes that have been certified as effective national access regimes, thus allowing easier and faster decisions to be made. Under the Competition and Infrastructure Reform Agreement it is expected that state and territory access agreements are to be certified by the end of 2010.

The bill improves the efficacy of the National Competition Council’s decision-making process by providing it with the ability to make decisions without having to hold meetings. Decisions can now be effected by the simpler and quicker method of circulating a document for signature. Decision-making processes by the Australian Competition Tribunal will also be improved by the bill. Currently, any decision to declare a service is automatically stayed by an appeal to the tribunal. This provides a strong incentive for service providers to initiate appeals and then delay their completion. Under the new arrangements, the tribunal will be empowered to determine whether a stay is appropriate. This provision removes the cumbersome and time-consuming automatic stay mechanism that currently applies. This will speed up the resolution of access disputes, as preliminary matters may be settled in advance of the tribunal making a decision under the review. The bill also gives the tribunal powers to award costs in reviews of declaration decisions. This will also reduce incentives for delaying tactics, frivolous review applications and other inappropriate actions.

In conclusion, it may be said that these changes to the National Access Regime are modest in nature, but they serve a larger purpose that is vital to the nation’s economic future. These measures will bring significant improvements to the infrastructure access arrangements that are currently in place in Australia. The incentives for parties to negotiate clear, appropriate and cooperative agreements will benefit all concerned. There will be speedier and more certain arrangements, the roles of the various regulators are now more clearly defined and their decisions will be more easily arrived at. The amendments contained in the infrastructure access bill demonstrate the Rudd Labor government’s commitment to fostering a seamless national economy. In combination with the massive program of local, regional and community infrastructure provision under the Nation Building Economic Stimulus Plan, Australia is undergoing an historic reshaping of its national economy and a transformation of its communities. I commend the bill to the House.

Scott Morrison (Cook, Liberal Party, Shadow Minister for Housing and Local Government) Share this | Link to this | Hansard source

This has been the longest day. In parliamentary terms it is in its 131st hour, so it has indeed been a very, very long day—and it has been an extraordinary day. On indulgence, Madam Deputy Speaker Burke, can I just pass on my congratulations to our new leader, Tony Abbott, the member for Warringah. I wish him all the best. We will be fighting hard with him, because this will be a big fight. I also place on record my deep and sincere thanks to Malcolm Turnbull, the member for Wentworth, also a dear friend, and I wish him all the very best at this time. He showed tremendous grace today, and I commend him for that. So we go forward, choosing clearly to give the planet, but not Kevin Rudd, the benefit of the doubt.

The Trade Practices Amendment (Infrastructure Access) Bill 2009 is a very important piece of reform which the coalition supports. This bill is part of a process of reform that has been going on for almost two decades and it adds to the work of successive governments. In our island continent, how we plan, build and operate our infrastructure to serve the needs of our people and their industries will be, I believe, our biggest challenge during the time I hope to serve in this parliament. Today we have an unexpected new framework against which all of our infrastructure decisions must be taken. Treasury’s revised forecast that Australia will be home to 35 million people by 2049 is a profound and challenging statistic, one that we need to get our heads around, and we must frame policy in this place across many different areas as we go forward.

I believe there is genuine and understandable concern in our community about how we will cope with this number of people and what we need to do to cope with this number of people, with a national survey published just two weeks ago revealing that four in 10 Australians are now worried about whether the infrastructure, the services and the various other things that we provide to sustain the quality of life in this country can service that population. These are fair questions, these are honest questions, and they are questions we must wrestle with in this parliament and in our policies.

Growth is a good thing—growth is a very good thing—and we need to also acknowledge that as we go forward in this debate. Our solution for dealing with growth is effective action now to encourage infrastructure provision that will meet our transport, education and health needs, and boost our export industries. There is no other option; we simply must achieve infrastructure resources that deliver new productivity gains and new competitiveness in our global markets if we are going to be able to provide and sustain the quality of life that we enjoy today and I am sure we hope future generations will enjoy.

The challenges that sit under this very complex policy conundrum relate to how we are going to deal with some very important issues, and they are as follows: we have the challenge of a shortfall of 200,000 dwellings in our housing resources, with construction unable to match our immediate growth rates let alone address the backlog; we have the challenge of coal loaders lining up 20, 40 or 50 at a time outside our terminals at Newcastle or Dalrymple Bay, wasting time and money; we have the challenge of a rail system that fails to maximise our productivity, with visionary projects such as the inland railway from Victoria to Queensland being placed on the backburner; we have the challenge of a road network masked by its missing links, not least of which is the F6 freeway extension from Sydney to the New South Wales South Coast and in particular the Illawarra which is the missing link in Sydney’s road system, which those opposite have chosen at both a state and a federal level to ignore time and again; and there are the challenges of public transport systems that need to be able to move a growing population around our cities, particularly when we are looking at having populations of seven million in cities such as Sydney and Melbourne, and a doubling of the population of Brisbane over the period that I have referred to. These are all big challenges, and hit-and-miss announcements of infrastructure upgrades will not deliver on them.

Look no further than hints recently of the opening of the Richmond Air Force base to commercial aircraft, with a complete lack of thought for the absence of adequate road and rail infrastructure to support those aircraft movements. Richmond has been defined as a potential or interim second airport. I know that the residents of that area—having spoken to the now member for Greenway and hopefully next member for Macquarie—have genuine concerns that this short-term second airport will become a long-term second airport. You cannot go and place those sorts of commitments on a local community when the infrastructure is simply not there to support an operation of that kind, let alone deal with the issues that relate to national security matters—how that airport would operate and how it will interface with its very important work, much of which is emergency service and rescue work and things of that nature at that base. That is what our Air Force and armed services are involved in. The infrastructure is currently not there to support that type of arrangement. It is important than when we make decisions about infrastructure they are not made in a slapdash way which only adds further burdens and complicates the problem rather than putting in place a long-term plan that will deliver on what we will need in the future.

A faster growing population must be viewed, as I said, as an opportunity. It is now time that we as a nation took a view on what our population target should be. It is not good enough for this government to simply say, ‘Our population is projected to be 35 million by 2049,’ and that is it. That is a number we need to think about. It is a number that we have to understand in terms of what our infrastructure can support. How are we going to grow our economy over that period of time to support a population of that size? We need to form considered views about that and then ensure that we take the responsible action to deliver on the consequences of our decision. If we say that there is going to be a population of a particular size, then the consequences of that are what we need to do in terms of how we run fiscal policy, infrastructure policy and regulatory policy in this country. We need to ensure that we put in place, for future generations, what we need.

I recall when I was in primary school, those 35 years ago, we visited not this place but the one down the hill, and they had to make the decisions on these same issues that we are going to have to make for the future. I remember the population at that time was around 13 million, and the scale of the increase was similar to what we face now over the next 40 years. So those in that time in that place made their decisions; we now in this place must make similar decisions, and good decisions, for the future.

The more substantial question is: how do we work through the policy challenges? Can we provide the infrastructure through public and private means? If not, what adjustments will need to be made to immigration or family policy and what adjustments will need to be made to infrastructure provision to match the framework we hope people will live in? Once we move into these sorts of questions, we can see there are ramifications across so many policy areas. We also see the governance challenges. The role of local councils, for example, becomes incredibly important—their planning policies, land availability; the provision of roads, waste collection and landfill, and waste management more generally—all the basic services that we depend on. States will need to assess population trends for everything from land release and public transport through to water and sewerage and the like—even policing. Federal policy adjustments to meet population trends go well beyond immigration and into communications, education, labour resources and our skills base, environmental impacts and many more areas. Human services provision alone ranges from pension entitlements to unemployment benefits.

I note with interest today that the debate is far from settled inside the government. Until today, all we had heard was the population projection of 35 million, through the Intergenerational reporta process which was begun by the Treasurer under the former government, the former member for Higgins. Now at least the member for Wills, I notice, has entered the debate and said, ‘There should be 26 million.’ He is entitled to that view, and I am glad that one person on the government benches is thinking about population policy and what is needed. Whether he is right about that is the nature of the debate, and it is a debate I think we should be keen to get into. The point is this: there is no distinguishable, coherent population policy coming from the government at this time, despite their having had two years to grapple with these issues. The fact is, as I said before, that growth is good, but growth will only be good if it is backed by a coordinated, proactive policy that delivers the infrastructure and services needed not only to support the population but also to sustain and enhance the quality of life we aspire to for all Australians in the future.

For infrastructure provision in particular, the task requires governments to come together to remove any possible roadblock to this growth. It means abandoning lazy, disinterested approaches to regulatory reform, which this bill I fairly acknowledge will address, and it demands a new concerted effort at all levels of government and, most importantly, in the relationship between governments and the private sector. Genuine regulatory reform must be an ongoing process. The Howard government made hard yards on this. Australia cannot now afford to see that momentum dwindle or be lost.

This legislation, as I mentioned, does take up something of these challenges that lie ahead of us and, as I said, it is supported by the coalition—drawing on the reform initiatives over almost two decades. Its intent is to increase regulatory certainty and streamline administrative processes under the National Access Regime. It is about how we better utilise the scarce infrastructure resources we as a nation have invested in, whether that investment has occurred from a private or public purse, and it is about certainty for business so they can make decisions about their investments with some knowledge of the processes and that those processes may be speedy to ensure that they can give their investments best effect.

The National Access Regime allows potential users of essential infrastructure to seek access on reasonable terms if commercial negotiation with the owner or operator has failed. Examples of essential infrastructure are natural gas pipelines, the electricity grid and rail track—assets which play a leading role in Australia’s economic growth. I refer to the Parliamentary Library’s most relevant quote from an article put together by Koshy and Kenyon, ‘Third-Party Access to Infrastructure: The Case of the Mount Newman Rail Line in the Pilbara’, where they say:

It is often the case that a market is dominated by a single piece of infrastructure and some form of monopolistic power is conferred on the firm owning the infrastructure, both in the existing, as well as related, markets. This can occur to the extent that the firm exhibits quite marked pricing power or where it is uneconomic for other firms to duplicate the infrastructure.

To balance the rights of consumers with the infrastructure owner in such cases, Australia has developed a national system for third party access to key economic infrastructures. This system allows potential competitors to seek access to infrastructure as a means to introduce competition into affected markets.

That is what these changes are seeking to achieve and that is why they are supported. The reality check, though, is that this bill actions one or two outstanding matters from COAG decisions and a Productivity Commission review, the vast majority of which—there are now just a number are remaining, which include those in this bill—were actioned by the previous government as a sound momentum of reform on these matters. That government enacted a series of improvements to the way that the National Access Regime operates, streamlining regulatory processes and applying meaningful deadlines and binding time limits. The Howard government was prepared to take hard decisions and it understood that infrastructure was not just about building things but about making sure that the things that are built, whether by governments or the private sector, could operate to best efficiency. There is no greater example of the tectonic shift in the performance of our infrastructure than the historic waterfront reforms of the Howard government, which saw crane rates—part of the infrastructure that sits all around our ports—move in productivity from an average of 17.1 containers an hour in 1996 to 28.2 containers an hour by 2004. Infrastructure policy is not just about hard hats, luminous vests and press releases but about the whole process of how we build it, how we plan it and how we operate it. That is why regulatory reform in this area is so vital.

More concerning, there is no indication that this government is giving any thought to coordinating a new infrastructure strategy other than statements of intent. Labor was elected on a platform that included:

… a pipeline of critical infrastructure projects will be available allowing the infrastructure sector to invest with certainty and make best use of available skills and resources.

This was the commitment of the now Minister for Infrastructure, Transport, Regional Development and Local Government, but does anyone remember that he also said in the same breath that ‘superannuation fund managers, private investors and industry groups have been calling out for national leadership and coordination’? My point here is that there is plenty of rhetoric about moving forward with an infrastructure pipeline, but we are not seeing that followed through in practice. The Business Council of Australia, the Productivity Commission or those operating in industry are looking for the leadership that the minister for infrastructure said he would provide. But what they are seeing instead is a real failure to coordinate and streamline between government agencies, a failure to deliver on basic commitments, a failure to attack the central need in any significant way other than to pick up the work left over by the previous government that they had already spelt out and, in particular, a real failure to follow through with undertaking proper cost benefit analysis on projects such as the O-Bahn project in South Australia.

Regardless of what your views on the O-Bahn project might be, you do not go and invest tens of millions of dollars of taxpayers’ money based on a flyover in a helicopter. That is not proper cost benefit analysis. That is not transparent. That is old-fashioned pork-barrelling infrastructure spending—something that this government made many accusations about when they were in opposition. Now, when they find themselves on the Treasury bench, they fly over cities in helicopters deciding where the votes are and ensuring the money follows. That is not proper cost benefit analysis. That is not proper transparency.

The government refuse to release the analysis on the projects they committed to. That is not proper transparency and that is not proper decision-making for a government that says it is all about proper processes. So what we are not seeing is a pipeline of projects that the private sector can be cognisant of as the direction of future infrastructure investment in this country. That is what we need. Infrastructure Australia is a fine organisation led by a fine individual in Michael Deegan. It is doing outstanding work, but it is not being listened to by this government. It is basically an outpost of great intellect and great merit but one that literally sits without influence in this government. I wish it had influence because if it did I think we would be getting a greater direction on where these dollars should be spent.

We need to recognise that at the end of the day the federal government does not spend 100 per cent of the money spent on infrastructure in this country. It is not the federal government. If you went by the government’s rhetoric on this issue, you would think that every brick that is being laid in this country, every load of cement that is being poured as a slab, was as a result of the direct investment of the Rudd government. That is the expectation that they created and that is the perception in government that they are trying to maintain. It is an absolute nonsense. The government is spending a handful of the dollars that are actually spent on infrastructure in this country. The private sector, the states and local governments are the heavy-lifters and have always been the heavy-lifters on infrastructure spending in this country. I believe that people will increasingly be disappointed as they wake up to the spin of this government, which says, ‘It’s actually us doing all this work.’ At the end of the day the people who are really making it happen are those in the private sector who are out there investing their dollars, and what they are looking for is direction.

It is the government’s obligation to create the right policy environment, a coordinated policy approach between federal, state, territory and local governments, to deliver reform and encourage private sector activity. It means ensuring governments are appropriately tasked, responsible, accountable and working together. It means targeting scarce resources, public and private, to projects that support and service growth and productivity gains for the long term. It is about conditioning a positive environment, whether it is in pricing issues or other regulatory matters. It is about planning it, building it and running it, and we need a policy that deals with all three. They are interlinked. If you cannot run it properly, you will not attract the finance. If the planning is substandard the costs will increase, and if costs are high, not least through excessive taxes and charges that run to construction projects like bees to a honey pot, then the economics of the work will be compromised and that work may not get done.

As I look at this bill, I support its intent. It carries on the many reforms that have been taking place over many years. But we still do not have a forward infrastructure agenda that deals with planning it, building it and operating it. This government is dealing with the leftovers of reform that they have picked up from the previous government. They will be supported because these are our reforms, basically, at the end of the day. I call on the government and the minister for infrastructure to put away his hard hat, to put away his vest, to put away his camera, to put away all of the trappings of politicking that go with the infrastructure investment under this government, and get out his pencil and his calculator and sit down with those like Infrastructure Australia who are trying to put a genuine pipeline of projects on the drawing board and listen to them and do the homework that he said he would do and be upfront and honest with the Australian people about where the bang for the buck is going to be in these investments. That is what is going to address our challenges for the future. (Time expired)

Chris Hayes (Werriwa, Australian Labor Party) Share this | Link to this | Hansard source

It is right that the member of the member for Cook refers to the issue of pricing principles and the significance of pricing principles when it comes to investment in infrastructure. For those of us who have been in the House a little longer than the member for Cook, I do recall back in 2006 when I spoke on the Trade Practices Amendment (National Access Regime) Bill. In that piece of legislation that passed the House under the Howard government I indicated then that the government had been drawn kicking and screaming through its pig-headedness to implement a measure of pricing principles into that legislation. That was something they were most reluctant to do. So when we are talking about the champions of investing in infrastructure, when it came down to the issues of the National Access Regime, clearly, whilst the words were there, it took the vibrancy of an opposition committed to infrastructure reform to drag the Howard government kicking and screaming into addressing pricing principles in terms of the National Access Regime. I do, however, agree with the member for Cook in his comment about Michael Deegan, the head of Infrastructure Australia. Apart from being a good friend, I actually know Michael Deegan to be very diligent, very competent and a person who is absolutely dedicated to the task at hand.

The national infrastructure access regime was introduced in 1995, following a recommendation of the Hilmer committee. It is an important piece of economic regulation. It is a key component of Australia’s regulatory framework promoting the development of competition and efficient markets. When we are talking about infrastructure we are talking about the veins and the arteries of our economy. Infrastructure such as roads, ports, railways, airports, power lines and gas mains are certainly all significant public commodities. All go to adding to the economic infrastructure of the nation. Infrastructure is a critical source of economic competitiveness. It represents the basic building blocks for our economy, and efficient management of our infrastructure is crucial to the long-term success of our economic progress.

The National Access Regime establishes the circumstances under which access to nationally significant infrastructure can be provided. There are three pathways to access under the National Access Regime. Firstly, the access seeker may apply for declaration of an infrastructure service; secondly, a certified state or territory infrastructure access regime may provide for access; and, thirdly, the provider of an infrastructure facility may have an access undertaking that sets out the terms and conditions for access.

A service may be declared where: access would promote a material increase in competition in another market; it would be uneconomical to develop another piece of infrastructure—in other words, to duplicate infrastructure; the facility is of national significance; access is not the subject of an effective state or territory access regime; access can be provided without undue risk to human health and safety; and where access would not be contrary to the public interest. It is important to note that declarations do not provide a right of access but rather a right to arbitration by the Australian Competition and Consumer Commission if the commercial negotiations fail. I think that was the significance of the comment the member for Cook made when he referred to the issue of access to rail lines in the iron ore town up in the Pilbara. Although this regulation framework has proven to be a good model to date, infrastructure owners and access seekers have argued that processes under the access regimes are too lengthy and become too costly.

Some owners of nationally significant infrastructure have expressed concern that the Access Regime is generating regulatory risk that may hinder investment in essential pieces of infrastructure. That was the point I made in a speech in February 2006 when we were discussing the importance of incorporating pricing principles in the National Access Regime. People are not about to invest without certainty, and bear in mind that resources for investments in these pieces of infrastructure will ordinarily be raised publicly, whether through direct investment or through the share market. These things require certainty. Therefore, we need not only efficient operations but also efficient investment in these pieces of infrastructure in the first place. That was the point we made in the debate on the initial bill, in 2005, in terms of the government’s reluctance at that stage to incorporate pricing principles.

Although this regulation framework has proven to be a good model to date, people are still concerned about the certainty with which they would raise investment dollars in order to construct the infrastructure that falls under the National Access Regime. Some owners of nationally significant infrastructure have expressed concerns about what they want and each of those concerns has come down to certainty. They want to know whether, if they commit resources to invest in a piece of infrastructure, that piece of infrastructure is likely to be declared at some stage. They want to know whether it will be a matter that is open to competition—as in the case of the Pilbara rail line, operated by BHP—or, alternatively, it will be a matter of access, such as the national gas mains out of Moomba, for instance. The provider of these facilities needs to have significant knowledge as to whether they will be subject to the regime.

Therefore, this bill is designed to deliver a measure of certainty to those who are going to invest in the development of these pieces of infrastructure so that they can, at least, be mindful of two things: firstly, whether the infrastructure will fall under the regime and, secondly, how they will set the price for those who want to access those pieces of nationally important infrastructure.

Infrastructure is a critical component of the government’s productivity agenda. It is certainly significant in terms of micro-economic reform. Delays and cost in decision making under the Access Regime may have a clear and adverse impact on, firstly, the construction of the infrastructure and, in turn, on economic growth and national productivity.

This bill will provide regulatory certainty and will streamline administrative processes under the National Access Regime. The reforms in the bill drew on the recommendations of COAG, the Productivity Commission, the National Competition Council, the Australian Competition and Consumer Commission and the Australian Competition Tribunal. Firstly, the bill will establish time limits for decision making about third-party access to infrastructure and it will limit reviews of those decisions to information provided to the initial decision maker. The bill will also provide greater regulatory certainty for potential investors in new infrastructure. As I said, this legislation is designed to overcome what is considered to be an impediment to investment—that is, the lack of certainty when it comes to the construction of major pieces of infrastructure in the country.

Under the existing Access Regime, a private investor who is, at least, considering building an infrastructure facility cannot determine with any degree of certainty whether or not the service to be provided will be either declared or declarable. This bill provides an upfront decision to be made by the designated minister. If the minister decides that the service provided would not meet the test of declaration under the Access Regime then that particular project or piece of infrastructure cannot be declared for a least another 20 years. That provides the constructor or the investor in the infrastructure with that degree of certainty. In other words, access to that piece of infrastructure cannot be then contested for 20 years.

The bill also improves regulatory certainty by enabling a service provider to submit to the ACCC an access undertaking which includes one or more terms that will apply for a certain period beyond the expiry date of the undertaking. When important variables are fixed, service providers and access seekers can more easily determine the terms and conditions under which access arrangements or agreements can be set. This bill contains a number of modest but important measures to increase regulatory certainty and improve decision-making processes under the National Access Regime, helping to support infrastructure investment that is needed to underpin the economic growth and national productivity of this country.

We on this side of the House are, quite frankly, proud of our position in putting infrastructure investment at the forefront of our economic credentials. This government set up Infrastructure Australia. This government set up an inventory of economic-development-generating infrastructure. In terms of providing attention to infrastructure, only the Rudd Labor government has taken up the cudgels since the Hawke-Keating days.

As a matter of fact, it was the micro-economic reforms of the Hawke and Keating governments that led to the strong period of growth that the Howard government inherited and squandered over a period 12 years by its failure to invest in infrastructure. The efficient operation of roads, rail, ports, airports and electricity and gas facilities is essential for lowering the input costs of Australian businesses, which often results in Australian businesses being more competitive on a world scale and in reducing prices for domestic consumers. These are things that were started in the period of the Hawke and Keating governments. They were the things that the Howard government inherited back in 1996. Along with education and health, infrastructure was one of the other things that the Howard government refused to invest in. It refused to back the Australian people in terms of their future.

We on this side of politics are determined to keep Australia on a competitive international footing. We have one of the few economies that did not go into recession recently. Of all the OECD’s 30 mainstream economies, ours did not go into recession. Among those world economies, our economy is now leading the way in terms of positive growth. Part of that is because of the attention that we are now giving to investment in infrastructure. That is not something on which we are going to rest on our laurels; that is something on which we need to be ever so vigilant. We must ensure the efficiency of our ports and our rail mechanisms.

My electorate is in the south-west of Sydney, and I have the Australian Rail Track Corporation, or ARTC, constructing their freight line through the south-west of Sydney at the moment. That is going to establish the south-west of Sydney as an inland port. It is going to be significant for generating thousands upon thousands of jobs as advanced intermodal terminals are built. It will mean that areas from Eastern Creek through to Picton will be the beneficiaries of being an inland port. Containers will be accessed from Port Botany and will be able to be accessed through each of those locations. That will stimulate new growth and in fact new industries, not only because of the access provided by that freight rail but, in addition, because of access to the road infrastructure, such as the M7 and the widened F5. These certainly are matters which come within the purview of this government in terms of its attention to providing efficient infrastructure management for this country.

The Rudd Labor government has been committed to the F5 widening, a $140 million project that was established. We committed to that road widening when we were in opposition. It was actually opposed by the other side of politics. They did not think we needed it. I think the local member argued that instead of widening the road we could have some form of overhead conveyance or something else. This was not a project that was taken on to limit the road traffic crawl in mornings and afternoons in the south-west of Sydney. This was very much centred on having the appropriate pieces of infrastructure, including road infrastructure, to establish the south-west of Sydney as an inland port, whereby organisations and companies that would benefit by using the rail network would also have access to the main southern highway to distribute their goods and services. That was certainly a significant piece of infrastructure that was committed to by the Rudd government prior to our taking office. As I have said, that is something that was opposed by the other side but on which we demonstrated foresight as to what was necessary to kick-start industry efficiency and drive economic growth throughout all levels of our economy.

These are things that we in Labor are committed to. These are things that make us fundamentally Labor. These are things on which, with any advancement that has been made—particularly with the National Access Regime in 2005—the other side has had to be taken kicking and screaming to actually make the changes necessary, particularly when it came down to the pricing principles. These are fundamental to us. We are not picking winners. We certainly want to establish the necessary infrastructure framework under which Australian industry and the Australian economy can excel. For that reason, I commend the bill to the House.

David Bradbury (Lindsay, Australian Labor Party) Share this | Link to this | Hansard source

It gives me great pleasure to rise to speak in support of the Trade Practices Amendment (Infrastructure Access) Bill 2009 and to do so after the member for Werriwa, who has made some significant contributions to this debate. I would like to reinforce some of the points that he has made, but I would also like to address some of my comments to the statements made earlier by the member for Cook. It was interesting to hear the member for Cook talk about the infrastructure needs that we face in this country, particularly with a larger and growing population. But, as the member for Werriwa pointed out quite succinctly, the member for Cook has not been in this place all that long—in fact, he was elected to the parliament at the same time as I was, at the last election—and perhaps he can be forgiven for showing some ignorance as to what occurred in this place and what occurred on the watch of the former government. When it comes to infrastructure spending, the Howard government was missing in action. Those on the other side very rarely put up a defence when it comes to infrastructure spending. They seek to try to turn to a fresh page and start to look forward, rather than try to defend the very poor record of the former government.

When it comes to infrastructure, we can go back and have a look at the many, many—in fact, over 20—warnings from the Reserve Bank in relation to some of the pressures that were leading to rising interest rates when those on the other side last held the treasury bench. When the coalition were last in government, the Reserve Bank issued warning after warning in relation to infrastructure bottlenecks. The failure of the former government to do anything to address those infrastructure bottlenecks clearly contributed to the inflationary pressures that ultimately led to the highest interest rates that we have seen for quite some time. They were the party, of course, that promised that they would keep interest rates at record lows.

The Reserve Bank is meeting today and will be deliberating on the future direction of interest rates. But—notwithstanding the decisions it takes today—clearly interest rates are at a much better level, in terms of affordability for people right around this country and where they are placed at the moment, than they were when we as a government came into office. In no small measure, the failings of the former government were as a result of their failure to address some of these infrastructure bottlenecks.

So it is interesting to hear the member for Cook talk about the challenges that we face. He did not provide a lot of commentary in relation to this particular bill, which I assume he supports. I assume that because these are good initiatives and good measures that will provide greater certainty to those private investors who are looking to invest in nationally significant infrastructure. Essentially, that is what this bill is about. It is about ensuring that, in that balancing act between not duplicating infrastructure and maintaining fair and reasonable access to nationally significant infrastructure, we are able to do that in a way that does not provide a disincentive for investment in new, nationally significant infrastructure. This bill addresses some of those concerns that have been voiced by many throughout industry and, indeed, by many of the key regulatory bodies.

It is worth noting that the proposals contained in this bill draw upon recommendations from a number of significant regulatory bodies over a number of years. More recently, we have seen COAG recommending some of these proposals, as have the Productivity Commission, the National Competition Council, the Australian Competition and Consumer Commission and the Australian Competition Tribunal. But, even more significantly, we have heard the calls for the types of reforms that are proposed here coming from those in industry—those who have provided the capital, who have invested in the new nationally significant infrastructure facilities that our country has seen in recent times, and those who might be proposing to do so in the future.

I note that the member for Cook also, in the only attempt to defend the record of the former government, offered up waterfront reform as being the most significant contribution that the former government had made in improving productivity. I will let others judge the success or otherwise of those measures. But, as I said earlier, when the former government left office the Reserve Bank was making repeated warnings about the failure to meet the levels of productive capacity that our nation needed in places such as our ports. So, whatever decisions they took, they failed against that benchmark. But, if waterfront reform is in fact one of the key achievements of the former government, then that is perhaps a more polite way of expressing the ongoing commitment to Work Choices and labour market deregulation that is so central to the beliefs of those on the other side.

We saw that from the new Leader of the Opposition today—in some of his first comments as the Leader of the Opposition, breathing life back into the body that is Work Choices. He wants to give it another name; that was pretty clear from what he had to say today. But he certainly was not hammering that final nail into the coffin of the corpse that is Work Choices. In fact, he was breathing life back into it. Members in this place would be well aware of his ongoing commitment to driving down the terms and conditions of working people right around this country. For those who might have forgotten that, it is incumbent upon all of us to remind them over the coming period.

The member for Cook also made some comments in relation to airport capacity and the Richmond RAAF base. I put on record that the government, in the minister for transport’s statements, has made it very clear that no decisions have been taken in relation to the current reviews of airport capacity that are being undertaken. But I would like to read a couple of comments from the press release that was issued by the Hon. Anthony Albanese, the Minister for Infrastructure, Transport, Regional Development and Local Government, on 23 November this year. Importantly, in that statement, the minister said:

… the Government will not engage in speculation about individual locations.

So there was certainly nothing to verify the suggestions in relation to Richmond RAAF base that are being made by those opposite. But, to my mind more importantly, the statement also says that the white paper and the government’s response:

… will also consider the future of the Badgerys Creek site given the Government has ruled it out as an option for a second airport. This will focus on how the site can provide a stimulus for jobs and economic development for western Sydney.

The member for Cook did not offer a view on this; perhaps some of the other speakers later in this debate might choose to do so. But my understanding is that it remains opposition policy that a second Sydney airport be built at Badgerys Creek. In fact, when they left office the position that prevailed was the retention of the Badgerys Creek airport site for Sydney’s second airport. I have not seen any statements made since, by anyone on that side of the chamber, that they were walking away from their commitment to preserve Badgerys Creek as an option for a second airport.

So if the member for Cook truly wants to point towards a failure by this government to take decisions in a consultative way on airport capacity—and the government, I might add, is currently going through an extensive consultative process through the white paper process—if that is the criticism that the member for Cook is levelling, let us just take a couple of steps back and look at what a debacle the handling of the Badgerys Creek site had been under the former government.

After all the toing and froing that occurred in the many years prior to the former government leaving office, the best position that they were able to come up with in relation to meeting future airport needs in the Sydney Basin was to retain in government ownership the Badgerys Creek airport site with a reservation over that site, as expressed in the Airports Act, with a commitment to roll out an airport on that site if and when it was required. There was no alternative planning for any sites elsewhere and no alternative process.

If the member for Cook is serious about holding up governments and their willingness to deal with airport related issues as being a measure of success or otherwise when it comes to infrastructure planning, the former Howard government got a fail with a capital F. We as a government are committed to working through these matters and to trying to address some of the key productivity challenges of our economy. Infrastructure is a central challenge of that nature.

In relation to the bill that is before the House, I mentioned earlier that there have been some recommendations that have come forward from various bodies, including the Productivity Commission, and I note that the House of Representatives Standing Committee on Economics is currently undertaking an inquiry into raising the level of productivity growth in the Australian economy. This has been a very interesting inquiry. I am pleased to be a member of the committee and involved in that inquiry. I note that the Productivity Commission, in a submission dated as recently as September this year—and the content of their submission was reaffirmed in their verbal testimony—made a number of points in relation to infrastructure and the need to streamline the process for access approvals and to deliver greater certainty when it comes to investment in infrastructure for those private holders of capital that might be willing to undertake such investment. The Productivity Commission’s submission, on pages 46 and 47, says:

More broadly, good regulation is central to Australia reaping the potential benefits from private investment in infrastructure. Competition regulation has a key role. Third party access regimes for ‘essential facilities’ have been modified in recent years to reduce their potentially inhibiting effects on investment. But further legislative amendments are needed following a Federal Court decision in 2007 that has raised questions about the sustainability of the light handed approach for airports, posing risks for investment in infrastructure more generally …

That was the Productivity Commission. Having made earlier recommendations for governments to take action when it comes to this particular area, they raised it once again in that inquiry—an inquiry focused on how we can lift and improve Australia’s productivity to reap the benefits of continued prosperity in this economy. They highlighted third-party access arrangements and nationally significant infrastructure as a key consideration that should be on the table for government reform, as indeed it is in this particular bill.

The national infrastructure access regime was introduced back in the mid-nineties and emanated from the deliberations of the Hilmer committee and the reforms that flowed from that process. Essentially this regime is concerned with the development of both competitive and efficient markets. It is about ensuring that we are not duplicating essential infrastructure but that adequate arrangements are in place to provide access seekers with access to nationally significant infrastructure. Under current arrangements there are effectively three pathways: an access seeker may apply for a declaration of an infrastructure service; a certified state or territory infrastructure access regime may provide access; and, thirdly, the provider of an infrastructure facility may have an access undertaking that sets out the terms and conditions of the access.

Infrastructure services may be declared for a number of reasons. The primary reasons an infrastructure service may be declared are: where access would promote a material increase in competition in another market; where it would be uneconomical to develop another facility to provide the service; where the facility is of national significance; where access is not the subject of an effective state or territory access regime and therefore denying that second pathway; where access can be provided without undue risk to human health and safety—and that is to be repealed; and where access would not be contrary to the public interest. A declaration, of course, does not provide a right to access but it provides a right to arbitration by the ACCC if commercial negotiations do not lead to a successful resolution in respect of access arrangements.

The essential problem with the current set of arrangements is that the process ends up being far too lengthy and, as a consequence of that, far too costly. I know that there has been some criticism from some quarters. I have seen some of the criticism coming from the legal fraternity. Clearly, when it comes to the costs associated with the existing set of arrangements, one of the outcomes the government would hope for from these proposals is that it would streamline the process and would eliminate some of that cost associated with the ongoing legal wrangles that might be associated with battles over third-party access.

Earlier in the debate the member for Robertson referred to various disputes regarding BHP and the Fortescue Metals Group. When one looks at the amount of time that those particular disputes took before a resolution was achieved, regardless of which side of the debate one comes from, that is clearly evidence that the current set of arrangements do not provide for a speedy determination of these matters and, as a result, cost all parties a great deal. That detracts from the productivity benefits that would otherwise be reaped from investment in such infrastructure.

The bill establishes time limits for decision making about third-party access to the infrastructure. It also limits reviews of those decisions to the information that was provided to the original decision maker. That stops the opening and reopening of new matters of dispute and determination. The bill also provides greater certainty for potential investors in new infrastructure. Under the existing access regime, a private investor who is considering building an infrastructure facility cannot determine with any certainty whether or not the services that are to be provided by that proposed facility would be declarable. Obviously that gives rise to great regulatory uncertainty for the investor. This bill provides for an upfront decision to be made by the designated minister. If the minister decides that a service provided by a proposed facility would not meet the test for declaration, then it cannot be declared for at least 20 years, providing the investor with the certainty of knowing that for the next 20 years no such declaration can be made. The bill improves regulatory certainty by enabling a service provider to submit to the ACCC an access undertaking which includes one or more terms that will apply for a certain period beyond the expiry date of the undertaking.

When all of these measures are combined, the bill provides a number of sensible improvements to the infrastructure access regime that currently prevails. It provides a streamlined approach for determining whether or not declarations are to be made and, most importantly, it provides private investors—private capital—with the certainty of knowing that, once a decision has been made by the designated minister, they can undertake a substantial investment in a nationally significant project and do so without the uncertainty of having someone reopening these matters throughout. This means a significant dividend will be paid to the Australian economy and our productivity into the future. (Time expired)

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I rise in support of the Trade Practices Amendment (Infrastructure Access) Bill 2009. The Minister for Small Business, Independent Contractors and the Service Economy, Minister Assisting the Finance Minister on Deregulation and Minister for Competition Policy and Consumer Affairs outlined very succinctly in his second reading speech on 29 October 2009 in relation to this matter what this piece of legislation will do. He set out very clearly that we are honouring the commitments that were undertaken with respect to the Council of Australian Governments—known as COAG—under the competition and infrastructure reform agreements entered into with the states and territories.

We are amending the trade practices legislation which has been in operation since 1974, and particularly the National Access Regime which is found in part IIIA. The bill that is being debated today is designed to improve the regulatory situation by streamlining processes to enable companies and businesses who are undertaking infrastructure projects of a national and significant nature, giving them certainty and the opportunity to get access to facilities owned and operated by other companies and entities and ensuring that those projects can continue and are not held up by the burden of red tape.

We have about 22 million Australians living on this continent and, sadly, we often seem to have more regulation than the 500 million Europeans have to endure. We are overgoverned, often by weak government, in this country. We have a federal system that has a lot of eccentricities and oddities. There have historically been dingo fences throughout the jurisdiction of the Commonwealth of Australia which have prevented uniform practice of law. On numerous occasions we have had to overcome the strange jurisdictional aspects of the power of the Commonwealth, limited by section 51 of the Constitution and other provisions, to ensure that a national approach on many areas is undertaken. You only have to see the Corporations Law, the defamation law, the family law et cetera to realise that is the case. Certainly matters of environmental significance, national significance and international significance have had to be legislated for using foreign affairs powers contained in the Constitution. So dealing with the strangeness of our Federation has been a challenge for governments of both persuasions since Federation. Ensuring that we get adequate regulatory systems for infrastructure is simply crucial, not just nationally but for the area in which my electorate is contained, which is Blair in South-East Queensland, which is the fastest growing region in the country.

What we are doing here with the National Access Regime is about promoting a market economy, an open economy and an economy that works efficiently, seamlessly and effectively. It is not about replacing business arrangements, it is not about burdening companies with red tape and overregulation and it is not about replacing commercial negotiations which companies and individuals can undertake. It is about improving the relationship between facility owners and access seekers. It enhances the incentives to negotiate and create a seamless national economy that promotes the development of infrastructure, whether that is in health, education, road, rail, ports or other forms of infrastructure which are crucial to improving productivity, and undertakes macro- and micro-economic reform to make sure that our economy can operate efficiently in a fair and just way for all Australians.

The history of this can be found back in the early 1990s, but before I go through the history I want to commend the member for Werriwa, the member for Robertson and the member for Lindsay, who have gone through in detail the law which is being changed and how it will operate. I do not intend to speak in detail about the legal changes except to comment on a few of them as I go through. The history of this can be found in the Hilmer report. The chairperson of that inquiry was Fred Hilmer, a very eminent Australian businessman. That report goes way back to 1993.

The official title of the committee which developed that report was the Independent Committee of Inquiry into Competition Policy in Australia. That committee made the point that it was necessary to have efficient operation of a market economy that relied upon business dealings which were certain and were based on the fundamental notions of private property and the freedom to contract. It noted that we needed to improve our open market economy to make sure we are able to compete internationally.

The then Labor government took notice of what was said and adopted national competition policy principles, which were designed to improve our competitiveness, the productivity of our workforce and thereby the prospects of a more prosperous future for all Australians—one in which Australians lived a decent life, where their accommodation was accounted for and where they could raise their families in the way they hoped and aspired to. Australia adopted that commitment to national competition principles. That was enshrined in the term ‘competition principles’, which is well known to bureaucrats as well as the business community. We put that in legislation and amended the Trade Practices Act back in 1995, creating a legal regime to ensure that competition policy was adhered to and best practice and best principles could be looked at and followed.

The new legal regime under which firms and businesses could get access to essential facilities owned by another company or business was enshrined in legislation. That became known as the National Access Regime. It is contained in part IIIA of the Trade Practices Act. The Trade Practices Act is yet another great Labor reform—done under the Whitlam Labor government. Whether it was the Hawke and Keating government with opening up the economy, the development of a superannuation industry in this country, enterprise bargaining, the prices and income accord, or floating the dollar—Labor governments have had the will and the wisdom to undertake reform for small businesses as well as large businesses. Often those opposite say they are on the side of business, but the record of history shows that it is Labor governments which are the reformist governments in this area.

The amendments to the Trade Practices Act were crucial. To give the Howard government credit, they did instruct the Productivity Commission to review the National Access Regime back in 2001. The report that came down recommended that we continue to adhere to that access regulation system, not abandon it at the time. Fortunately, the Howard government took the view that they should comply with that. The Productivity Commission did recommend a number of changes which were regulated and brought into law on a bipartisan basis.

We looked at this again and COAG agreed to the National Partnership Agreement to Deliver a Seamless National Economy. That was undertaken back in November 2008. The then Assistant Treasurer made the point that it was important that we undertake those reforms to improve the efficiency, timeliness and effectiveness of regulatory decision making under the National Access Regime, so we undertook some reforms and looked at how legislation could improve the National Access Regime. There had been arguments and submissions made to the Productivity Commission by infrastructure owners and those people who were euphemistically described as access seekers that we needed to improve processes. I have looked at some litigation that was undertaken at the time and subsequently and it is clear that the cost of legal proceedings, the cost of doing business and the burdensome nature of the bureaucracy needed to change.

I commend the government for the reforms they have undertaken with this legislation. I think it is the case that most Australians recognise that we need competitive and efficient markets. We need to make sure that there are circumstances in which businesses—and often there are alliances of companies that undertake, say, road construction—need to have access to other facilities and other property to undertake their work. For example, with the Ipswich Motorway upgrade in my electorate it is important that we have access to property and access to other facilities so that that national project can be undertaken.

I will just briefly address how the law is changed and what it means. What is happening here with the legislative changes is that we are implementing, as I said, the COAG commitments to introduce some binding time limits. There is also some limited form of merits review. We are improving the regulatory certainty by determining the services that are ineligible for declaration, as the members for Werriwa and Robertson described in detail. We are streamlining the administrative and decision-making processes by allowing amendments to access undertakings and variations to declaration applications, streamlining the declaration test, allowing the deeming of decisions in some instances and providing the National Competition Council with the ability to make decisions without meetings.

So some significant changes are being made in that regard, as are improvements in the pathways to the National Access Regime—the declaration principles. There is the repeal, of course, of one of the factors—the undue risk to human health and safety. The circumstance in which a service can be declared is being repealed. It is important to note that declaration does not always provide a right of access but, rather, a right of arbitration, which the ACCC can undertake if the companies cannot determine through negotiation what should happen.

Infrastructure is absolutely vital to the government’s productivity raising and microeconomic reform agenda. It is important to make changes to improve regulatory certainty such as we are undertaking. The member for Cook made some very interesting points about this. He spoke about how the coalition government made improvements to the waterfront, which I would dispute, and he made a comment which I think was simply nonsensical: that we are undertaking the Howard government’s infrastructure reform agenda. I would ask the member for Cook to come up to South-East Queensland and have a look at some of the road infrastructure there. If he does that he will see that what he said about road infrastructure is simply rubbish. The main road between Ipswich and Brisbane is the Ipswich Motorway. This government is committing $2.5 billion across the project for upgrading to be undertaken.

The Howard government steadfastly refused to undertake the work on the Dinmore-Goodna section. This government has committed about $1.95 million in that area. The Rudd Labor government had to be elected for that project to be undertaken. The coalition, after 11½ years of opposing that vital infrastructure project of national significance, has voted against the funding for it since the last election. Curiously, on 27 October in this chamber, the Leader of the Nationals and Deputy Leader of the Opposition came out publicly and said that if they win the election next time they will stop the work on that project. That is their commitment to road infrastructure in South-East Queensland.

What about the other projects? The Warrego Highway is a main road that links areas west of Ipswich through Toowoomba and beyond. We have heard the member for Maranoa on numerous occasions complain about the state of the Warrego Highway. This government is the government that has done the most work on the Warrego Highway in terms of committing dollars—far more than we ever saw the Howard government commit. It is the same with the Cunningham Highway. These are national highways—major roads leading west of Ipswich through Toowoomba and beyond and south of Ipswich towards New South Wales. These works are crucial national projects that the Howard government failed to deliver in 11½ years, and this government is undertaking that work.

I think the member for Cook happens to be the housing spokesperson for the opposition. He should have a good chat to the Queensland Minister for Housing and Homelessness Services, the Hon. Robert Schwarten, who has had that role for more years than I can remember. Mr Schwarten, affectionately known to all Queenslanders as ‘Schwarto’, constantly complained about the hundreds of millions of dollars—developing into billions of dollars—that the Howard government ripped out of social housing and public housing across this country. In contrast, in my electorate alone we have seen about $33 million invested in social housing since the Rudd Labor government undertook the nation building and economic stimulus strategies, and 133 Defence houses are being built in the Ipswich area as a result of what the Rudd Labor government is doing. That is investment in vital national infrastructure. Why is it vital? Because it supports the RAAF base at Amberley—the biggest Air Force base in the country, which is also having more than $1 billion of infrastructure built on it.

The coalition simply neglected South-East Queensland year after year after year. The Ipswich area has a population of about 160,000. The next 20 years will see about 434,000 living in that area. It is the fastest growing area in the fastest growing region in Australia. The whole western corridor and the whole of South-East Queensland will see another 1.2 million people living in it in the next 20 years. That is why legislation like we are debating today is so crucial—to make sure that the companies that build vital infrastructure, whether in road or rail, as we are currently seeing in South-East Queensland with the line between Ipswich and Brisbane and the Springfield area, or in hospitals or schools, can build it. My electorate alone has 313 projects across 85 schools.

Whether it is the BER funding, housing funding, Defence funding or the infrastructure funding that is developing the Ipswich CBD—and we are putting in $10 million there—these vital national projects need certainty and need companies that can get access to property and that do not have to fight with other companies. They need to get certainty in terms of business regulatory reform. That is why alliances of companies like Origin Alliance, which is building the Dinmore-Goodna section, need access to a nation building system and a legislative framework that will enable them to invest with certainty and efficiency and with commitment to South-East Queensland. That is why it is so important that we do this.

We had a National Health and Hospitals Reform Commission forum in my electorate. The overwhelming response was in support of the government’s infrastructure projects, whether it was in hospitals or health or schools or roads, and we got applause for it. Dozens of people there acknowledged that was going on. The legislation that is before the House will facilitate the legislative framework for that. The legislative changes will assist vital infrastructure in South-East Queensland. For that reason, I support the legislation. (Time expired)

Mark Dreyfus (Isaacs, Australian Labor Party) Share this | Link to this | Hansard source

I support the Trade Practices Amendment (Infrastructure Access) Bill 2009. This bill is in the great tradition of Labor governments’ concern for infrastructure in this country. It continues on from a substantial number of reforms that have already been made by the Rudd Labor government to infrastructure and to the system of regulation of infrastructure in Australia. This bill demonstrates perhaps better than most how the Rudd Labor government, in its focus on infrastructure reforms, is continuing reforms from the Hawke and Keating Labor governments.

Well-planned infrastructure is very important for a country as large as ours. I am talking about transport infrastructure, water infrastructure and communications infrastructure. We need transport infrastructure, we need energy and water infrastructure, to meet the challenges presented by climate change, to meet the challenges that are presented by the size of the continent that we occupy and to meet the reality of the mostly dry and mostly brown land that we inhabit. We need of course social infrastructure, in the form of schools and hospitals, and we need to ensure that the infrastructure we have is properly utilised. This is what underlies the scheme of regulation that the amendments contained in this bill are concerned with. The particular form of regulation here is the national infrastructure access regime which was introduced following the August 1993 report of the Hilmer inquiry—an independent committee of inquiry established by the Keating government—often referred to as the Hilmer report.

The Hilmer report recommended, as part of a scheme of national competition policy, that there ought to be an access regime so as to properly share, in an economic and efficient way, infrastructure that already existed on a national scale. To bring this to life a little: the national infrastructure access regime is concerned with infrastructure such as national-scale railways and gas pipelines. Another example of how this national infrastructure access regime has been used since it was introduced by amendments made to the Trade Practices Act which came into effect in 1995 is the freight handling regime at our large airports. All of these types of infrastructure are very expensive to duplicate and it is appropriate that there be an access regime which makes possible—but certainly does not compel—the sharing of that infrastructure by other enterprises or businesses which may wish to use the existing infrastructure in their own businesses.

The other emblematic aspect of this legislation is that any examination of the history of the national infrastructure access regime demonstrates that, while the Hawke and Keating governments had a great concern for both the building of infrastructure in our country and the efficient utilisation of existing infrastructure, the former government had nothing of the same concern; indeed, the dilatory way in which the former government attended to the Productivity Commission’s very detailed recommendations for reform in 2001 is emblematic of the lax and lazy attitude of the former government on matters concerning infrastructure. You could extend that to saying that the former government had very little care for microeconomic reform and matters of economic regulation. Throughout the former government’s 11½ years in office it appeared that their primary concern with economic regulation was to lessen the rights of Australian workers. The major piece of economic legislation by the former government was the Work Choices legislation that they introduced and rushed through as soon as they got control of the Senate. We have heard an echo of that today from the new Leader of the Opposition who it seems is still devoted to Work Choices. In his very first media conference as leader he referred to the Work Choices regime. He said—and we should all be very concerned about this—that the phrase ‘Work Choices’ is dead. That would suggest that we are about to see a return to a promotion of the industrial relations policies of the former government.

To return to the subject matter of this bill: the national infrastructure access regime, introduced in 1995, was the subject of very detailed recommendations by the Productivity Commission in a review published in September 2001. In that report the Productivity Commission analysed at considerable length—as the Productivity Commission are wont to do; the report runs to over 500 pages—the purpose of a scheme of access regulation. They considered whether or not the national infrastructure access regime had been successful and the ways in which it might be possible to improve it.

The Productivity Commission made the point in their report that, although determinations under part IIIA of the Trade Practices Act had been few in number up to that point, 2001, the existence of the regime influences investment decisions and decisions that are made about essential infrastructure throughout Australia. It has an influence on the value of infrastructure assets. The report notes that the value of infrastructure assets affected by the regime—this is at 2001; there would be an even larger sum now—was over $50 billion. Infrastructure services affected by this regime affect very many important aspects of the Australian economy and the report gave examples of gas regimes, rail regimes, Victorian shipping channels and other matters that are potentially affected.

The Productivity Commission went on to note the potential costs that are bound up in having an infrastructure access regime, noting, obviously, that access regulation can intrude very significantly on property rights. It can give rise to a range of costs that have to be set against the benefits. Those costs would include administrative costs for government, compliance costs for business and constraints on the scope for access providers to deliver and price their services. And, probably the most important one, they drew attention to the reduced incentives to invest in facilities to provide new essential services or to maintain existing facilities. They noted other costs as being an inefficient investment in downstream markets and also wasteful strategic behaviour by both service providers and access seekers. They were talking there about a gaming phenomenon in business.

They explained in their report how there can be a deterrence for investment for two reasons, saying:

Potential exposure to access regulation is likely to increase the general level of risk attaching to investment in essential facilities.

The second reason offered was:

Investments in essential infrastructure will also be deterred if regulated terms and conditions are not expected to provide a sufficient return.

Notwithstanding those potential costs and the difficulties of administering a national infrastructure access regime, the Productivity Commission concluded in no uncertain terms that retention of what they described as a ‘modified’ national access regime was warranted. They went on in their very lengthy report to make some very detailed recommendations about how the provisions found in part IIIA of the Trade Practices Act, inserted by the Keating government in 1995, might usefully be amended so as to ensure that the national infrastructure access regime would work better, have less risk of cost, have less risk of deterrence to investment and in all respects provide a more timely and efficient system of access.

The recommendations that the Productivity Commission made included inserting provisions that changed the objects clauses for this part of the Trade Practices Act, some changes to the declaration criteria, provisions for dealing with negotiation and arbitration, provisions that removed immunity to Commonwealth access regimes and amendments which looked quite closely at improving the efficiency of the access regime and access pricing principles, and otherwise made suggestions as to procedural and administrative matters—in particular, introducing time limits for decisions by the Commonwealth minister, time limits for assessments by the National Competition Council and reporting arrangements and requirements for the Australian Competition and Consumer Commission.

I mention all that because I am very critical—and we should all be critical—of the slowness that was shown by the former government in taking some five years to act on a detailed set of suggestions made after considerable consideration by the Productivity Commission which were designed to ensure that this important form of economic regulation, the national infrastructure access regime, could work. It was not until 2006 that the Trade Practices Act provisions which set up this national infrastructure access regime were amended. In large part, the former government did act on the suggestions that had been made some five years earlier by the Productivity Commission, but it really was all too slow, which is representative of the attitude that the former government took to infrastructure matters.

In February of the same year, 2006, the Council of Australian Governments agreed to the Competition and Infrastructure Reform Agreement, which in turn made some further suggestions, among others to:

… introduce requirements that regulators will be bound to make regulatory decisions under an access regime within six months, provided that the regulator has been given sufficient information.

Again, no action was taken by the former government to ensure greater timeliness of the decision making that is bound up in this infrastructure access regime. Winding through the courts as far as the High Court, regrettably we have had a very dramatic example of just how slow the making of decisions in relation to infrastructure can be in the form of a very long running dispute between the Fortescue Metals Group and BHP Billiton Iron Ore Pty Ltd, a subsidiary of BHP Billiton, concerned with the access that is sought by the Fortescue Metals Group to two distinct rail lines in the Pilbara region, the Mount Newman and Goldsworthy rail lines. These rail lines are excellent examples of the kind of infrastructure that is intended to be the subject of the national infrastructure access regime.

I am not going to pre-empt what ought to be the eventual outcome of that particular dispute on the use of those rail lines between Fortescue and BHP Billiton. They are rail lines to which the Fortescue group wishes to have access. I mentioned this dispute as an example of why it is necessary for the amendments that are contained in this bill to be made, because these amendments are directed at increasing the speed with which the access regime is to be operated. It is a regime that depends on the making of declarations and a recommendations process involving the National Competition Council.

What has been demonstrated by the Fortescue-BHP dispute over access to those two rail lines in the Pilbara is that, starting in 2004 when the request for access was first made, the matter has been before two judges in separate decisions of the Federal Court, before another decision of the full Federal Court and finally before a decision of the High Court. All of those decisions and hearings before single judges of the Federal Court, before the full Federal Court and before the High Court were, regrettably, only bound up with preliminary aspects of the process by which decisions are to be made under the national infrastructure access regime.

It is to be hoped that, if the amendments contained in this bill are passed, in terms of some of those preliminary stages and the speed with which it is possible to, firstly, get recommendations from the National Competition Council and, secondly, have them reviewed under the review processes that are provided in the legislation, it is then going to be possible for the national access regime to be operated a great deal more quickly. The key provisions of the legislation are directed to timing, but there are also provisions in this legislation which will streamline the process for amending access undertakings.

The disincentive to investment that the Productivity Commission looked at when it did its report back in 2001 is of course, in part, a disincentive that is created by uncertainty in the way in which a regime like the national infrastructure access regime is going to work. The more that the legislative scheme, which introduces the obligations that will apply to infrastructure, is given clarity, the better in terms of removing the disincentive to investment, which we would all wish to avoid, that is going to be bound up with having an access regime of this nature.

This legislation deals with a key component of Australia’s regulatory frameworks. It is legislation which is going to promote the development of competitive and efficient markets. It is entirely consistent with a concentration that the Rudd government has had on infrastructure matters, I might say, not just in relation to the regulation of national infrastructure but in relation to the provision of national infrastructure. It is worth reminding the House of what the OECD Economic Outlook interim report released in March this year had to say about the Australian government’s response to the global economic crisis, because it noted in no uncertain terms that the composition of Australia’s fiscal response to the economic crisis had been tilted very heavily in favour of investment spending, that is, spending on infrastructure to a much greater degree than in any other OECD economy.

What we have seen from the Rudd government is very large spending that is to be made on more efficient metropolitan rail networks, which will deliver significant economic and social benefits through less road congestion and will lead to lower greenhouse gas emissions and faster travel times for commuters. It is also worth mentioning the $3.4 billion that is going to be spent on the Network 1 road freight corridor linking Melbourne and Cairns and the $389 million for port infrastructure, which will improve access to global markets for our export industries. The Rudd government is very concerned to not just create actual building of infrastructure where government can do that but also create the conditions in which private investment can take place in an atmosphere of certainty and in an atmosphere which promotes investment. What we see in the provisions here in the Trade Practices Amendment (Infrastructure Access) Bill—(Time expired)

Dick Adams (Lyons, Australian Labor Party) Share this | Link to this | Hansard source

The lack of public infrastructure spending over the last 12 years prior to 2007 has led to many areas of our states and territories selling off assets and now having to buy them back because of their neglect or closure. Because the public sector should operate under the same terms of reference as those in the private sector, there needs to be regulatory processes to ensure that that is the case and that it is as transparent as possible.

My learned colleague the member for Isaacs just mentioned access to iron ore trains in the Pilbara in the north of Western Australia and the amount of costs that have gone into the courts since 2004 as one example where there needs to be quite a lot more work. I think the Trade Practices Amendment (Infrastructure Access) Bill 2009 will pull together some of that and save people a heck of a lot of money.

The honourable member for Kalgoorlie, who is at the opposition table, has probably come to the front bench under the reshuffle of the leadership on that side of the House. I congratulate him on that promotion. I am sure he will comment a great deal about this bill when he has an opportunity to speak.

There has been a lot of news coverage and discussion lately about the large corporations, and about one wanting to hire or use the present infrastructure instead of building their own. This bill deals with that important matter. I note also that the declaration does not provide a right of access but rather a right to arbitration by the ACCC if commercial negotiations fail. We need to make sure that it is cost-effective. Tying arguments up in courts over a long period of time certainly does not serve our nation well. It does not get that infrastructure working in the interests of the nation so that infrastructure and capital, where it has been outlaid, are paying their way and increasing productivity. According to the Independent Committee of Inquiry into National Competition:

As a general rule, the law imposes no duty on one firm to do business with another. The efficient operation of a market economy relies on the general freedom of an owner of property and/or supplier of services to choose when and with whom to conduct business dealings and on what terms and conditions. This is an important and fundamental principle based on notions of private property and freedom to contract, and one not to be disturbed lightly.

Despite this acknowledgement, the Committee of Inquiry report of August 1993—known as the Hilmer report after the chairman, Fred Hilmer—recommended the implementation of a national competition policy for Australia to improve productivity, to increase international competitiveness and to maintain and improve living conditions. Australia’s commitment to national competition principles was subsequently enshrined in the Competition Principles Agreement and the Agreement to Implement the National Policy and Related Reforms entered into by the Commonwealth, state and territory governments in April 1995.

Amendments to the TPA which came into effect in 1995 established a new legal regime under which firms could be given a right of access to essential facilities owned by another firm, when the provision of such a right meets certain public interest criteria. That legal regime is the National Access Regime, which is contained in part IIIA of the Trade Practices Act. Section 44DA of part IIIA requires decisions about access regimes to be consistent with the principles set out in the Competition Principles Agreement. In 2001 the Productivity Commission reviewed the National Access Regime. It considered that:

Given the in principle case for some curbs on the exercise of monopoly power in the provision of essential infrastructure services, the limited experience in Australia with access regimes, and ongoing structural change in a number of infrastructure sectors, abandoning access regulation at this stage would be inappropriate.

However, the Productivity Commission did recommend a number of changes. The government’s response to the recommendations was largely positive. The Trade Practices Amendment (National Access Regime) Act 2006 made the necessary amendments to the TPA. In particular, the amending act inserted statutory pricing principles to provide guidance for pricing decisions and to contribute to consistent and transparent regulatory outcomes over time as well as certainty for investors and access seekers.

I believe that this bill is an important piece of economic regulation because it helps to address the time taken in allowing government to undertake scrutiny of projects and it will help transparency and consistent guidelines to operate. It is a key component of Australia’s regulatory frameworks, which promote the development of competition and efficient markets.

The National Access Regime establishes the circumstances under which access to nationally significant infrastructure can be provided. There are three pathways to access under the National Access Regime: (1) an access seeker may apply for a declaration of an infrastructure service; (2) a certified state or territory infrastructure access regime may provide for access; and (3) the provider of an infrastructure facility may have an access undertaking that sets out the terms and conditions of access.

A service may be declared where access would promote a material increase in competition in another market; where it would be uneconomical to develop another facility to provide the service; where the facility is of national significance; where access is not the subject of an effective state or territory access regime; where access can be provided without undue risk to human health and safety; and, of course, where access would not be contrary to the public interest.

It is important to note that declaration does not provide a right of access but rather, as I said earlier, a right to arbitration by the ACCC if commercial negotiations fail. One would hope that corporations—and we are encouraging them—could work together and reach those commercial arrangements. But if that cannot happen then the ACCC can arbitrate. Although this regulatory framework has proven to be a good model to date, infrastructure owners and access seekers have argued that processes under the access regime are too lengthy and costly. We heard the previous speaker on this side of the House, the member for Isaacs, outline the legal situation in relation to that very well. One case which began in 2004 has not been resolved yet.

Infrastructure is a critical component of the Rudd government’s productivity-raising, microeconomic reform agenda. This was also the case under the Hawke and Keating Labor governments. They laid down this regime and spent a lot of time endeavouring to improve the infrastructure in this country. The Rudd Labor government has gone out of its way to build on the needs of the nation with infrastructure. We need to catch up on a lot of infrastructure which the last government failed to put in place or to encourage the states to get involved in to help increase the productivity of the nation.

Australia needs to use its infrastructure well and cost efficiently. We have to make sure that we are increasing our productivity through the use of infrastructure. When you look at all the coal ships anchored outside ports and coal loaders with bottlenecks in rail services to them, you see that these are all inefficiencies where the infrastructure needs to be improved. We need to make sure that these costly inefficiencies are dealt with. Roads around capital cities which cause congestion are also costly. Of course, with climate change, congested roads pollute greatly and the vehicles on them use more fuel. Transport needs to be efficient and effective to reach its total potential. And then there is the matter of the Pilbara, which I mentioned earlier.

Tasmania has many infrastructure issues. We had a real issue with our rail system, but a lot of money is now being put into it by the Rudd government. The infrastructure money is bringing our rail system between the north and the south and the north-west coast down to the west coast back to a reasonable state. This infrastructure, which transports our mining resources to the port of Burnie, was greatly rundown by the previous operator over many years. The need to upgrade it has been great.

Delays and costs in decision making under the access regime may have an adverse effect on the infrastructure investment that is needed to underpin economic growth and national productivity. This bill will improve regulatory certainty and streamline administrative processes under the National Access Regime in several ways. The reforms in the bill draw on recommendations from COAG; the Productivity Commission; the National Competition Council, NCC; the Australian Competition and Consumer Commission, ACCC; and the Australian Competition Tribunal. The bill will establish time limits for decision making about third-party access to infrastructure and it will limit reviews of those decisions to information provided to the initial decision maker.

The bill will also provide greater regulatory certainty for potential investors in new infrastructure. Under the existing access regime, a private investor who is considering building an infrastructure facility cannot determine with certainty whether or not services to be provided by the proposed facility would be declarable. The bill provides for an up-front decision to be made by the designated minister. If the minister decides that a service provided by the proposed facility would not meet the test for declaration under the access regime, it cannot be declared for at least 20 years, thereby providing the certainty investors need.

The bill also improves regulatory certainty by enabling a service provider to submit to the ACCC an access undertaking which includes one or more terms that will apply for a certain period beyond the expiry date of the undertaking. When important variables are fixed, service providers and access seekers can more easily determine the terms and conditions for access under future arrangements.

In conclusion, I think this bill contains a number of modest but important measures to increase regulatory certainty and improve decision-making processes under the National Access Regime. This will help to support the infrastructure investment that is so vitally needed to underpin economic growth and national productivity in this country. I support the bill.

Craig Emerson (Rankin, Australian Labor Party, Minister Assisting the Finance Minister on Deregulation) Share this | Link to this | Hansard source

in reply—I thank those members who have spoken on this legislation: the member for Lyons, who has just finished; and the members for Isaacs, Blair, Lindsay, Werriwa and Robertson. I also thank the members for Paterson and Cook and the member for Cowper, the shadow minister for competition policy and consumer affairs. I take the opportunity to thank the coalition for the indication of support for this very important legislation. I further wish to take the opportunity to thank my predecessor in the role of Minister for Competition Policy and Consumer Affairs, because it was the member for Prospect who conceived of these reforms, and he is at the table today as we bring these reforms to the attention of the House for a vote, quietly confident that it will enjoy bipartisan support. That is a tribute to the work and the consultation that was undertaken by the Minister for Human Services and the Minister for Financial Services, Superannuation and Corporate Law—so thank you very much, Minister.

Since its introduction in 1995, the National Access Regime has proven to be an innovative and important piece of economic regulation. However, infrastructure owners and access seekers have argued that processes under the Access Regime are too lengthy and costly. Indeed, some owners of nationally significant infrastructure have expressed concern that the Access Regime is generating regulatory risks that may hinder investment in essential infrastructure, and we do not want that. The government acknowledges that delays and costs in decision making under the Access Regime may be having an adverse effect on the infrastructure investment that is needed to underpin economic growth and national productivity. As we have heard during this debate, the bill will improve regulatory certainty and streamline administrative processes under the National Access Regime. The bill will establish time limits for decision making about third-party access to infrastructure and limit reviews to information provided to the initial decision maker.

Importantly, the bill will provide greater regulatory certainty for potential investors in new infrastructure. Under the existing Access Regime, a private investor who is considering building an infrastructure facility cannot determine with certainty whether services to be provided by the proposed facility would be declarable. The bill provides for an upfront decision to be made by the designated minister. If the minister decides that a service provided by the proposed facility would not meet the test for declaration under the Access Regime, it cannot be declared for at least 20 years. The bill also improves regulatory certainty by enabling a service provider to submit to the ACCC an access undertaking which includes one or more terms that will apply for a certain period beyond the expiry date of the undertaking. When important variables are fixed, service providers and access seekers can more easily extrapolate the terms and conditions for access under future arrangements.

I would like to inform the House that this bill has been referred to the Senate Economics Legislation Committee for inquiry and report by 9 March 2010. This will enable further public consultation on the proposed reforms. The government will consider the committee’s findings and recommendations carefully before the debate on the bill in the Senate.

In conclusion, this bill contains a number of modest but important measures to increase regulatory certainty and improve decision-making processes under the National Access Regime. These reforms will help to support the infrastructure investment needed to underpin economic growth and national productivity in Australia. I commend the bill to the House.

Question agreed to.

Bill read a second time.