Steve Fielding (Victoria, Family First Party) Share this | Hansard source

Does Fuelwatch work? Who knows? Does Fuelwatch cut the cost of petrol? No-one will guarantee it. Will Fuelwatch save families money? Again, no-one is sure. Will Fuelwatch increase petrol prices? No-one can say. Did the Senate Standing Committee on Economics inquiry prove Fuelwatch was a winner? No. Are there still concerns about Fuelwatch? You bet. Fuelwatch was sold by the Rudd government with much fanfare as the scheme to help Australians struggling to cope with soaring fuel prices. It is no secret families need help with skyrocketing costs of petrol, but we are still unsure if Fuelwatch is the answer. Families in outer suburbs and regional areas have been hardest hit by soaring petrol prices. Lower income families and first home buyers tend to live in the outer suburbs where housing is cheaper, but because of poor public transport they depend on their cars and suffer from punishing petrol prices.

Family First understands how difficult it is for families to juggle soaring grocery prices, interest rates and high petrol prices. They deserve a fairer go from petrol companies and the government. That is why Family First has been campaigning for the past three years for a 10c a litre cut in petrol tax to help families. That is why Family First has campaigned to make sure we have a competitive petrol market. Family First believes the government can give Australians a fairer go with petrol and they can do this by providing real competition for petrol. It was very much a shame that when the Labor Party had the numbers with the Oilcode and the sites act a year or two ago they decided to throw it out and have no restrictions on who can own and operate petrol-retailing stations. What a shame. They knew they had the Family First vote. They knew they had Senator Joyce’s vote. They refused to make sure there was going to be real competition at the retail level. What a shame.

When it came to predatory pricing the Rudd government went softer and weaker, not harder. Family First still believes they should go further with predatory pricing to make sure that pricing is not used to stomp out competition and to see independents disappear. We also believe that the ACCC should have greater powers when it comes to breaking up the cosy club that exists between the petrol retailers and the oil giants. We also believe that we need greater competition at the terminals and the storage facilities. These are things that the Rudd government can actually do to give Australians and their families, who are struggling to make ends meet and struggling to cope with petrol prices, a fairer go, and to bring real competition to see downward pressure on petrol prices.

Family First started off as an enthusiastic supporter of Fuelwatch because we thought it would offer some relief to families. But after the events of the past six months that support is a lot more cautious. Last December the Australian Competition and Consumer Commission published its Petrol prices and Australian consumers report. It followed the 45th or 46th petrol inquiry to have been held over the last 20 years. This report found that motorists in Western Australia had saved 1.9c a litre on average due to the scheme there. On the basis of that report, which started under the then Howard government, Family First supported Fuelwatch as a scheme and a way to offer families some relief from skyrocketing petrol prices. The reported average saving per litre of 1.9c indicated that families could expect to save $300 million a year at the petrol pump.

Fuelwatch sounded like it would really make a difference to struggling families. But by the time the Senate established an inquiry into Fuelwatch, on 17 June, the government was starting to change its mind about the scheme, and Family First had begun to reassess its support. The Senate inquiry presented an opportunity to again examine and consider the merits of Fuelwatch. Family First’s doubts grew as the government’s rhetoric on the Fuelwatch scheme continued to change. The government had been fully behind the Fuelwatch scheme, announcing cabinet approval for the scheme on 15 April and with the Prime Minister speaking about Fuelwatch at a press conference on 29 May. But it seems that after that date the government stopped mentioning the claimed 1.9c a litre difference in price. This significant change in rhetoric was confirmed when the ACCC fronted Senate estimates on 5 June this year and downplayed the price difference. The ACCC said that it was not the price difference that was the important part of Fuelwatch but the improved ability of families to compare petrol prices. The change of emphasis by the government was stark.

Family First participated in the Senate inquiry and found a number of issues of concern arose including the question of whether independent petrol retailers are disadvantaged by Fuelwatch, why the federal government has not released its economic modelling to academics outside the federal government for peer review, whether reports of the Western Australian scheme take into account the impact of the introduction of supermarket petrol retailing and whether reducing price fluctuations actually disadvantages families that go to the trouble of filling up at the bottom of the price cycle. Family First is prepared to consider the Fuelwatch scheme because it may well still help families cut their petrol bills—but no-one knows. But the government’s tap dancing on Fuelwatch and its shifting of the boundaries have failed to give Family First confidence that the scheme will do what it set out to do: save people money at the petrol pump. Given that no-one is prepared to guarantee Fuelwatch will cut the price of petrol and given the concerns raised, it would make sense to trial the scheme for a year in a market where there is some support for the scheme. Family First would support a Fuelwatch scheme if it were preceded by an open and transparent one-year trial so we could be sure that it would provide benefits to families and would not disadvantage small businesses before it was rolled out across Australia. Family First is proposing that both each state Premier and each state peak motoring body would have to endorse Fuelwatch before it would be adopted as a one-year trial in their state.

So what does this mean? This would probably mean Fuelwatch being adopted in New South Wales, where the local motoring body, the NRMA, is supportive. This would give the Australian Competition and Consumer Commission a chance to produce a detailed report after the first year of operation, when we can then properly evaluate the outcomes of the trial. If the outcomes of the trial are good, the Fuelwatch scheme can be rolled out to the rest of the country. Some argue that there has already been a trial in Western Australia. But the scheme in Western Australia was made for the people of WA and not as a test site. The effect of the WA scheme has come under question throughout the inquiry, so it is worth doing a purpose-built trial.

The government has backed away from this scheme, saying that Fuelwatch is not about cutting the average petrol price and saying instead that the real benefit of the scheme is to help motorists compare prices between petrol stations. That backflip concerns Family First and should concern the Senate, because what we heard from experts at the Senate inquiry into the Fuelwatch scheme was that it may, instead, push prices up and squeeze out independent petrol retailers. Let’s be frank: if Fuelwatch is not going to cut the average petrol price, what is the point?