David Fawcett (Wakefield, Liberal Party) Share this | Hansard source

I rise to address this motion today concerning the important issue of petrol pricing, because it has such a large impact on the families, businesses and individuals in the electorate of Wakefield whom I have the privilege of representing in this place. It has a large impact on families because public transport is so poor in parts of South Australia. Families in One Tree Hill, from the Clare and Gilbert Valleys and out in Kapunda, as well as in some of the outer metropolitan areas, need to operate vehicles for just about everything they do, whether it be the shopping, taking children to sport or getting to work. This has a large impact on their weekly budget as petrol prices vary.

What is the industry’s position on this? The Australian Institute of Petroleum quite rightly point out that 95 per cent of the wholesale price is governed by the Singapore benchmark for 95 octane unleaded. Their figures—and they use a range of statistical measures, including a rolling seven-day average—show that the trend of the wholesale price follows the Singapore benchmark pretty closely, with about a two-week lag, and for both rising and falling prices, they claim. But I have to say that, from the feedback I get in the street and from what I see in the petrol stations, people are rightly sceptical about the fact that that lag is balanced on either side. People are also sceptical because the peaks and troughs within that seven-day rolling period seem to rise close to long weekends, public holidays and other times when they will have that greater demand for petrol.

What have the government done to date? Unlike the ALP, who supported indexation for petrol, which meant that the take of excise continued to increase, this government reduced excise by 6.7c a litre in 2000 and, in 2001, reduced excise again and in fact abolished indexation. The result of these measures is that petrol is now some 17.2c cheaper than it would have been if we had not abolished the indexation supported by the previous Labor government. So families who use, on average, say, 50 litres of petrol a week are now saving nearly $450 per year.

The result of these measures is that Australia is now the fourth lowest country with respect to petrol prices in the OECD; only the United States, Canada and Mexico offer lower prices to the public than Australia. Other countries in the OECD can pay anything up to $2 a litre or more for petrol. State governments also play a part. It is terrific to see Queensland continuing with its subsidy of 8.4c per litre. It is sad to see that both Victoria and Tasmania, which have had a subsidy—albeit a very small one—are getting rid of that subsidy. I am sorry to report that South Australia does not have a subsidy even though, as Queensland demonstrates, because of the large amounts of GST flowing into those states, they have every capacity to provide that subsidy to motorists.

One of the other avenues that the government has to act is through the ACCC. The Australian Competition and Consumer Commission monitors petrol, diesel and auto LPG at 4,600 of the 6½ thousand sites around Australia. This monitoring is not a toothless tiger. In 2005 it identified price fixing in Brisbane and firms were fined some $470,000. In the Ballarat area, where a price-fixing cartel was identified, some $20.1 million of fines were allocated to, and costs were awarded against, the people who were guilty of that price fixing.

But it does not stop there. The Chair of the ACCC, Mr Graeme Samuels, noted in January this year and again in June that there is a noticeable margin emerging between the Singapore benchmark and the Australian retail price. He subsequently wrote to the Treasurer to ask that an inquiry be authorised under part VIIA of the act. The Treasurer has since authorised this and a report is due on 15 October 2007. One of the things the Australian public has been calling for is an inquiry that can go inside the gate to look at the books and the accounts of the petrol companies so that, unlike the many other inquiries that have been done, we can actually get to the depths of this and find out what is happening. It is hypocritical of the ALP to be criticising this power when they voted against the government’s amendments to the Trade Practices Act, which actually grant search-and-seizure powers to the ACCC to get exactly this kind of information. I welcome this inquiry and I trust the outcome will see further relief to the families of Wakefield.

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