House debates

Tuesday, 4 December 2018

Adjournment

Energy

7:35 pm

Photo of Barnaby JoyceBarnaby Joyce (New England, National Party) Share this | | Hansard source

One of the core tenets of John Stuart Mill was that producers and sellers should be perfectly free. He did create one sole check on that, and that is the equal freedom for the buyer to supply themselves elsewhere—to go elsewhere if they were being done over. Adam Smith had a similar tenet—that the monopolists, by keeping the market constantly understocked, by never fully supplying the effectual demand, sell their commodities much above the natural price and raise their emoluments. These people were approaching the issue of monopoly power and oligopoly power and called into question that we have to have a society that checks these powers. Even if you go right back to Edward the Confessor, they talk about 'forstealing'. Once more, the concept of people manipulating the market is not new. The UK has the Enterprise Act. In 1890, there was the Sherman Antitrust Act. The Clayton Antitrust Act of 1914 was built on the Sherman Antitrust Act. Canada has a Competition Act.

When people talk about sovereign risk, you can't get more sovereign risk than this: a power company, such as AGL, coming in and saying: 'We will supply the market at the quantity we believe gets us the best price.' It is called shorting the market, and there is nothing new about that. AGL's obstinacy and belligerence has brought forward the divestiture powers that are present in the legislation that is before the parliament. I might have had many arguments recently with the former Prime Minister Malcolm Turnbull, but on this we are 100 per cent on the same page. Mr Andrew Vesey sat in that room when we tried to say 'be reasonable', and he knew that we had no laws to deal with the power that he had. There was not an arrow in our quiver that we could properly fire. And so, when he said that Liddell basically had no value on their books—and even later, when we found out that people were willing to offer up to a quarter of a billion dollars—he denied the sale because he knew that the effect for the price of his commodity by shorting the market, by, as Adam Smith said, never fully supplying the effectual demand, was going to be a windfall gain to him.

We have a peculiar situation now, because the Labor Party is standing behind the big corporations and protecting their interests—against the interests of small business and against the interests of people trying to pay their power bills. What a peculiar place this has become. Why would the Labor Party stand behind the big corporations? Well, there is a contract in here. The contract is that they don't question the big corporation's power and the big corporation will never question their direct payments and withdrawals from their members for union fees. This is what we see in big corporations; there is a linkage there.

In the National Party, we like small business. We like the right of the individual to basically move through the economic stratification of life, from the lowest level to the highest level, limited only by their innate abilities. We called for the power companies to be reasonable—and they weren't. And power companies who had never darkened the door of a member's office are here now saying the sky is going to fall in. Well, it hasn't. The sky hasn't fallen in in the United States, Canada or England. But there has to be a check on this. These divestment powers are so vitally important if we are to have a sword of Damocles not to use every day but to say: 'You will treat the parliament with respect, you will treat the request of the Prime Minister of Australia with respect. If you don't, we have the power to legislate'—and we must do that in this case.

We had a state owned organisation—I know the history—but it became a private organisation, and we had vertical integration within that organisation that gave them immense market power. We understand that AGL is not going out of coal. They've got Bayswater, a massive coal-fired power station, but they like the idea of Liddell closing down, because that way they can make more money out of a smaller number of product. This is an interesting time. This is, I believe, a line of demarcation. The Labor Party can stand with the major power companies and prattle on about some peculiar reason of how they are going to protect sovereign risk and how they're going to protect the market. We will look after the mums and dads who can't pay their power bills.