Wilson Tuckey (O'Connor, Liberal Party) Share this | Hansard source

It is clear to me that I cannot respond to the words of a previous speaker in this House, and I will leave it at that for the time being. I have got much to say about the inadequacies of the Western Australian FuelWatch system as it applies in my electorate, where it is meaningless. Furthermore, I have a long recollection of the processes by which it was achieved. Now we are going to have this system loaded across Australia—if it is constitutional. I doubt that it is constitutional, because I have not seen yet where an Australian government can impose price fixing. Apparently telling people that they cannot change their prices for 24 hours is not price-fixing. That stretches credibility to some degree and is further evidence of what happens when panicked governments start to come up with legislative solutions which they have not properly researched. So let us get it straight.

In Western Australia in my electorate and in the approaches to my electorate, you can drive away from the city and by the time you have gone 50 kilometres the price of fuel is 10c and 15c over and above the regulated price in the city. Yet on the best of information—and by quotes that I have received—the average road transporter of fuel in Western Australia will shift it for half a cent per 100 kilometres per litre. Tell me how an almost infinitesimal charge can result in 10c a litre change.

That is the first failing of FuelWatch as it exists in Western Australia. Twice a week they publish a terminal gate price, no doubt to assist the consumer on the mark-up that they think some reseller is achieving. But if you are a truly dedicated independent, and you want to sell at a highly competitive price and put it on their register, just you try to get into the Kwinana refinery and buy fuel at the terminal gate price.

That is what this chamber should be talking about; not a shonky scheme that does not work. If anyone takes the total body of opinion of the ACCC, until more recent events they said it would not work—and it does not work. What is it about? It is about giving a warm and fuzzy feeling to motorists that throughout the process of a working day—and I will come back to that—they can be assured that if they buy in the morning the price will be the same in the afternoon. And what was the grizzle that created this scheme? It was that you could take the risk of buying in the morning and the price actually fell in the afternoon. Of course, the person who filled their tank in the morning did not think that anybody else was entitled to a cheaper price than they got that day.

I am old enough to remember petrol rationing and how, years after the Second World War, the bureaucracy a la ACCC had hold of that and hung on to it like grim death, and there were some public servants who were doing financially very well out of it. It was well known how to get extra ration tickets. But what I am saying to you is that anybody who gets a regulatory regime will hang onto it and defend it notwithstanding that it delivers no benefit to the community.

There is only one way that you can deliver benefit to the community with regard to the price of fuel. You can ensure that there is an open marketplace. There were threats made to the Richard Court government by BP, around the era of all these wonderful reforms, that they were going to close the Kwinana refinery. The response was FuelWatch. The response was a readjustment of the fuel standards in Western Australia. I do not think any other state picked up that arrangement. But what did it achieve for BP and for the Kwinana refinery? It virtually banned the import of Singapore refined petrol. Western Australia was unique in that they had an independent—it is still active; someone told me the other day there were 25 outlets—called Gull. I do not know if it still survives here in Canberra but one was erected here. The reality was that Gull had managed to purchase a little tank farm connected to the port of Fremantle or Kwinana somewhere. And because the Singaporeans have very large refineries with the intention of producing jet fuel they frequently have surpluses—maybe not so much today, but they certainly did in that period—of petrol. And Gull was bringing it down as a direct import and, of course, knocking the spots off the heavies.

So the parliament of Western Australia, supported in more recent times by Jim McGinty, changed the fuel standard. McGinty’s words were, ‘I do not think the Western Australian public minds paying an extra couple of cents for fuel, because it is of a better environmental standard.’ I think he should have seen last night’s Newspoll on what people thought about having to pay extra for petrol to save the environment—63 per cent said no.

But the whole situation is this: in Western Australia a company that was truly independent and was delivering fuel was cut off with not a squeak—in fact, with the total support of the present state Labor government over there. What is more, when they came to Canberra, as some of those who have been around a while will remember—Parliamentary Secretary Kerr at the table would remember—there were traffic jams because they were able to sell petrol so much more cheaply than was charged in Canberra, a big city. The rates that are generally charged in Canberra have nothing whatsoever to do with the freight cost out of, say, Sydney or Botany Bay or somewhere. The reality is that Gull was swapping its cheap petrol delivered to Perth with a major supplier who was fuelling them here, and they were cutting the price.

They are the issues that we should be debating in this place today. What happened? The only way you can reduce the price of fuel as a parliament is to reduce the taxes that you levy upon it. There is no other way. Do not think price fixing will work. The history of price fixing is that it is the highest common denominator. I can still remember being in a grocer’s shop where, if you queried the price, they opened a book and said, ‘It’s got to be right; the government’s put it in the book.’ It had to be right! It was the government price! You are telling this parliament that, after all the historical evidence that it does not work, this is the way to protect people from the escalation in fuel prices. You can tell us the story that it is all about international price movements but throughout the world the pressure is the government rip-off.

How did fuel taxes start? I think it was Bob Menzies who said, ‘We need some money to fix your roads; we will put a small tax on petrol and use it for that purpose.’ That is hypothecation. What happened over time? It just became a very soft and easy method of raising revenue, and the Hawke government—I think it was John Dawkins—introduced indexation. Up until then, in my experience in this place, if the government wanted to increase consumer taxes—be it on alcohol, be it on petrol—they had to confront the electorate. It was not a bad idea if you told them before the election what you were going do. That did not happen with petrol on this occasion. The reality was that they moved from a situation of a legislative, fixed rate of excise to one of indexing it for the purpose of building it up by inflation. And what a clever trick that was—invented by a Labor government. Petrol is obviously a major component of the CPI. So it was self-generating. Every time you increased the excise, you increased the inflation rate so that you could increase the excise again.

In the Howard government we recognised the inequity of that and we froze it. And what is more, we adjusted it in the process of bringing in tax reform and the GST. By that time, of course, the High Court had made a determination on the state governments’ so-called licence fees, averaging at about 8c a litre. We can read more information about that with respect to Queensland, which never had one, and how we insisted that they did not get a windfall out of the arrangements. We had to add, under Peter Costello as Treasurer, an excise increase for that purpose. But we then dropped it anyway. And we got it down to the present figure and we froze it.

We have stood up in this parliament and said that, when we are re-elected, we will reduce it. And we will not be the first in the world. I am just waiting for Gordon Brown in England to realise that the 60 per cent, or whatever they take, is going to have to change because he has riots on his doorstep. I think it is a rather good idea, actually, that the fishing industry of Europe have decided that for a few weeks they are not going to continue to rape the North Sea because they cannot afford the fuel. But do you know what will happen there in the end? I think I read that the EU is going to give them $100 million. In other words, they are saying, ‘We will take it with this hand but do not tell anyone and we will give it back with the other.’ I reckon that giving the fishing areas of the Northern Hemisphere a bit of a rest might not be a bad idea, but that is beside the point.

The time is approaching when governments will not be able to see petrol as a form of revenue. There was a time when customs duties were a major contributor to this parliament’s revenue. Then we discovered that customs duties were not good for consumers, were not good for people and did not make industry efficient. And, funnily enough, with their incapacity to deal legislatively with union problems, both Whitlam and Hawke dramatically reduced import duties for the purpose of bludgeoning the workforce into common sense. I think that was a blunt instrument and not a very smart way to do it, but do not tell me it did not happen; it is a matter of history.

What I am saying is that this system will not work. It was established in Western Australia on a false premise. Its only achievement is to give a warm and fuzzy feeling to people in that they can buy petrol in the morning and know it is the same price. We are told how transparent it is. If you are computer literate, you can go to the website. How many pensioners have got the capacity to do that? Of course, working families might be better off. Otherwise, they can get their kids to use the free computers they have at school which nobody can plug in at this stage of the game. So that is not very helpful.

If you come to my state and watch the fuel price on television, you have to read the best price in a blink. It does not all go through; it is selected by the television company, and it goes bing, bing, bing, bing. Too bad if you see 5c a litre at Whoop Whoop service station and then you realise that it is on the other side of town and you are going to use more fuel to get there than you are going to save. Do not tell me about people having choice. If they just happen to live in the wrong district they have no choice. And, if they live in the bush, they have no help whatsoever. Geraldton, in my electorate, has its fuel delivered by sea. It probably nets into their tankerage for less than it would for some of the non-refining big people in Fremantle. Yet, any day that you go there, the resale price is 10c or 15c above the equivalent in Perth. If you tell me that that is Fuelwatch and that it is working, I want to know about it.

You will never influence the marketplace to the extent that you wish to. You are not entitled in this parliament to apply price fixing. And, if you want the states to refer their powers, why not let them do it on their own? Ring up Iemma and say: ‘You are approaching an election. Put this in place. Everyone will love you,’—and wait and see what his answer would be. He would not want to do it, and this parliament has no constitutional right to do it. But that is only evidence of a government that does not know what it is doing. As I said in a doorstop interview this morning in regard to this government, when you prick a balloon you only get gas. And that is about all we have got on this issue.

But on this side of the House there is a positive, honest commitment, backed up by our past performance in which we froze the excise. We say that we will cut that excise, and that will deliver a real saving to the people of Australia—not funny business and not something that cannot be tested even in operation. Once you get it you do not know what will happen, and there is no way to test its operation.

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