Martin Ferguson (Batman, Australian Labor Party, Shadow Minister for Primary Industries, Resources, Forestry and Tourism) Share this | Hansard source

As I rise today to speak on the Petroleum Retail Legislation Repeal Bill 2000, I think we all appreciate that Australians are more concerned than ever about record high petrol prices. Reform of the petrol retail industry, including the repeal of the two acts dealt with in this bill, has never been more important.

The Petroleum Retail Marketing Sites Act 1980 and the Petroleum Retail Marketing Franchise Act 1980 are outdated. They serve no useful purpose in today’s petrol retail industry, and I will tell the House why. Well over 50 per cent of the industry by volume of sales is not covered by these acts, including the supermarket chains Coles and Woolworths, and the rules for market participants are inconsistent and unfair. That is bad for industry and, perhaps far more importantly, that is bad for the Australian consumers, who are doing it tough at this point.

The Oilcode, which will be introduced as a mandatory industry code under section 51AE of the Trade Practices Act 1974, will finally and appropriately bring the whole industry into a common regulatory regime, with better protections for market participants and better protections for consumers. The Oilcode will improve the protections available to commissioned agents and independent operators, who currently do not have the protections available to franchisees. Both franchisees and commissioned agents will also appropriately have access to a low-cost dispute resolution scheme for the first time.

The Labor Party’s view is that section 46 amendments to the Trade Practices Act are necessary to address outstanding concerns about the potential for abuse of market power. I call on the government to bring these forward as a matter of urgency. In that context, I also indicate to the House that we are taking the government on trust with respect to these very central and important amendments. I expect the minister to confirm in his reply undertakings given to the opposition that the government is keen to introduce legislation, the Trade Practices Legislation Amendment Bill (No. 2) 2006, to implement its response as soon as the Trade Practices Legislation Amendment Bill (No. 1) 2005, the Dawson bill, has passed through the parliament. In essence, we have shaken hands on the importance of this amendment. It is therefore very important that the minister, in replying to the debate, confirms on the public record his undertaking given to the opposition with respect to the importance of those amendments and their urgency.

Nevertheless, the introduction of the Oilcode to cover the entire petrol retail sector is an improvement over the existing situation, where more than 50 per cent of the industry by volume is not regulated at all. Petrol retail reform is a good step forward to give consumers more confidence that the petrol prices they are paying are as fair and as competitive as we can make them. But reform, we also accept, has been a long time coming.

Interestingly, petrol reform has been on the Howard government’s policy agenda since 1996. In 1998, the opposition appropriately said that it would support petrol reform as long as the Oilcode was agreed to. But it has taken this government another eight years to get to that point. As in many other policy areas, reform under the Howard-Costello government has stagnated over 10 long years. The Australian government, led by the Prime Minister, John Howard, simply cannot keep up with the changes that are necessary to encourage investment and maintain competitive markets and affordable prices in petrol, electricity, transport and telecommunications. Look at the debacle, for example, that confronts the Australian community on the issue of broadband this very day.

The Howard-Costello government has also failed completely to keep the reform momentum of the Hawke and Keating governments going. That was when tough decisions about reform in the Australian economy and opening it up to competitive pressures were actually put in place—the foundations of economic growth that we now experience. But we are starting to pay the price. We are paying the price for neglect—if anything, absolute negligence by the Howard government—on the need for ongoing reforms so as to keep Australia competitive. I refer to labour shortages, erosion of our skills base, choked infrastructure which is holding back exports, inflation pressures, productivity stagnation and higher interest rates.

It is most worrying of all that the Howard-Costello government’s answer to everything as we appreciate it—as is reflected in the recent budget—is simply ‘spend, spend, spend’. Unfortunately, all the indicators now show that that short-term approach to economic management has hit a brick wall. The budget is no longer sustainable. If anything, the chickens are coming home to roost. What are the indicators? Let us deal with a couple of those indicators. Interest rates are rising and the government seeks to deny that they have an impact not only on business in Australia but also on ordinary households trying to make ends meet from week to week and day to day and pay their mortgage payments. The high level of debt held by Australians continues to rise disproportionately to the increase in their incomes and cost of living in Australia.

Then we go to the issue of prices, which is central to this debate. Prices are going through the roof. Wages—that is an interesting debate. The government are in so much trouble handling the industrial relations debate today that they now have a junior minister, the member for North Sydney, Mr Hockey, to try to assist the Minister for Employment and Workplace Relations to sell their message. That is interesting because the truth is that they know it is very hard to sell. I will tell you why it is very hard to sell. Wages for those already struggling are under pressure because of the government’s extreme industrial relations changes, which not only open these wages and conditions to attack but also create a major sense of uncertainty in their minds, in their household’s minds, in their families and in Australia at large.

Then we go to the issue of tax cuts. We heard the Prime Minister and the Treasurer waxing lyrical about the impact that the tax cuts were going to have, only a matter of months ago on the second Tuesday of May. The facts show that they have been swallowed up because of mismanagement by the Howard government on a broad range of other fronts. We have the issue of competitiveness and our capacity to survive in a tough global market. Foreign debt is through the roof.

All these indicators suggest that unfortunately the Howard government approach of buying or spending their way out of trouble is no longer appropriate. Tough decisions and leadership are required. Let us go to the issue of the petrol debate. Back in 2001, when they were having difficulties, they decided to cut petrol excise. They have used tax cuts, family payments, baby bonuses and any number of handouts to buy off the electorate, but eventually, as we all appreciate, the patience of the Australian community runs out just as the government coffers are starting to run dry. They have no options left on petrol prices. One of the reasons is that petrol reform has taken 10 long years.

Excise cuts are no longer an option because we simply cannot afford them. This government has still done nothing to address the real issue. The real issue is Australia’s security. This is the guts of the debate that Australia has to have in the lead-up to the next election, because if we do not get this debate right we not only worsen the potential situation confronting Australian consumers but also put at risk Australia’s economic future. The principal reason is that the Prime Minister has sat in the oval office and accepted that basically we should place our future, in terms of where we go on resource security and the energy debate on transport fuels, on foreign oil from—guess where—unstable parts of the world like the Middle East. What a gamble. It is not a gamble that the Labor Party is prepared to take.

I say that because it is obvious to everyone except the government that, if you do not have home-grown fuel industries, Australia is at risk. We will always be hostage to foreign oil. We will always be hostage to unstable areas such as the Middle East. These are very serious issues that Australian consumers understand and appreciate. They are very serious issues that Australian industries speak to me about regularly in terms of my portfolio responsibility as the shadow minister for resources—a portfolio that includes energy, forestry and tourism. This is about what is going to rule the future and our capacity to have energy to drive the Australian economy.

I think we have to accept that there is no longer a capacity for short-term fixes. We need a national transport fuel policy that guarantees supplies for the long term and gives Australia options to deal with global fuel supply and price emergencies. That is the debate in Europe; that is the debate in North America; that is the debate in Asia; but unfortunately it is not the debate that the Prime Minister wants in Australia, because it requires tough decisions and leadership. I believe that we can no longer ignore that debate because, if other countries accept that this is the new Cold War and that the new cause of tension in the international community is who supplies the energy, then it is also part of what we have to face up to in guaranteeing our future as a nation. I will tell you why. It is pretty simple. It is about supply and demand. Who supplies the energy and who has influence over the energy supply of the world has economic power in the world. We want the Australian economy to go at full bore. We want to guarantee the creation of further training and apprenticeship opportunities for the Australian community. That requires a few tough decisions.

We have to lift our productivity and we have to try to make it easier for Australian workers to survive from week to week and day to day with all the added cost pressures that are imposed on them because of neglect and negligence by the Howard government. That simple debate goes like this: when supplies are short or demand is high—or both, as is the case right now—guess what? Prices go up. Prices are going up at the moment. As you as a former teacher know, Mr Deputy Speaker Hatton, it is simply economics 101. Unfortunately the Treasurer does not understand it and nor does the Prime Minister. They are not really interested in economic reform in Australia; they are merely interested in political survival: who occupies Kirribilli House or who might occupy Kirribilli House in the future. That is what occupies the minds of the Prime Minister and the Treasurer from sun-up to sundown each day—not where Australia goes but who occupies the Lodge and Kirribilli House and who might occupy the Lodge and Kirribilli House in the future.

We can no longer accept the contempt shown by the Australian government for these hard issues that have to be fronted up to now. The solution has to be embraced by the Australian community, with leadership from government in partnership with the private sector. The solution is home-grown fuel industries in Australia. That requires that we accept that there are policy options available to ensure that the wheels continue to turn for Australian consumers and Australian industries, to ensure that Australians can afford fuel and to ensure that Australian industry can afford energy. That drives job growth, apprenticeships and higher education opportunities. In doing so, it creates the social dividend which enables us to have a decent healthcare system and to look after the elderly in their aged years, and it also gives us the capacity to create opportunities for families experiencing stress at the moment, to manage the family difficulties of child care. So I would have thought the debate is pretty simple. It goes from A to B and C: make the hard decisions, embrace the policy options and get on with implementation. But unfortunately this is where the Howard government is remiss.

Federal Labor, alternatively, has always supported the oil and gas and alternative fuel industries. Let us deal with a few facts of modern history in Australia, because these industries are strategically important to Australia, strategically important to the region in which we live and strategically important to the world. I remind the House that Labor supported the proposal to extend the effective excise-free period for biofuels and LPG by three years to 2011. It supported legislation to introduce mandatory cleaner fuel standards that should benefit environmentally friendly fuels. So it is not about having economic growth without paying attention to environmental considerations; it is about doing both.

However, while Labor supported this approach, the House should be reminded that the overwhelming reason was—and this has always been the key to running a business in Australia—to provide some level of certainty for the alternative fuels industry and for the refining industry. It was the Keating government which introduced an 18c a litre production bounty for ethanol in the 1993-94 budget and, in addition, the zero excise rating for the product.

Perhaps the member for Blair ought to pay a little bit of attention to the history of why ethanol has gone backwards while the Howard government has been on watch. The record shows that the Howard government abolished the bounty scheme one year early, in the 1996-97 budget. It has consistently undermined the industry by changing the playing field on a regular basis over the last nine years. In the last parliament alone, the Howard government changed its mind not once, not twice but on three occasions with respect to the excise regime, not only for ethanol but also for the LPG industry. Despite his May 2002 view that applying an excise to ethanol and LPG was a bad idea, the Treasurer announced in the 2003 budget that he would do just that. He announced that biofuels and LPG would be subject to an excise from July 2008. In December 2003, guess what? He changed his mind again, announcing a new excise regime to apply from July 2011.

For those reasons, we will be moving today a detailed second reading amendment which stands in my name, to be seconded by the member for Hunter, Mr Fitzgibbon. This goes to the future of the ethanol industry. I challenge the member for Blair, who likes to interject, to have the guts to cross the floor like other members of the government if he wants to stand up for his local community and to vote for this second reading amendment, because it is about guaranteeing the future of ethanol and biofuels in Australia. I will tell you, Mr Deputy Speaker: I have no doubt that he will dog it. He will go missing in action when it comes to putting up his hand. He has form on that front.

These are important issues, because, between May and December 2003, the LPG industry was in turmoil. Many of the small business operators involved in LPG conversion and maintenance suffered from serious business downturns due to the uncertainty about the excise regime. Similarly, the biofuels industry suffered during this period because there was simply no certainty for investors in the industry. It has taken time for the industry to recover. That is mainly because record high prices have meant that consumers are more willing to set aside their concerns about fuel uncertainty than they would otherwise have been and that biofuels are now more price sensitive and attractive to refiners and marketers. In fact, let me say at this point that Caltex is to be commended for its announcement today that it will discount E10 petrol by 3c per litre. We await the other refiners.

The history of the Howard government’s double backflips on alternative fuels is in stark contrast to the stability Labor provided through its 13 years in office when it maintained the LPG excise exemption introduced in 1979 for fuel security reasons. The other stark contrast—

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