Luke Hartsuyker (Cowper, National Party, Deputy Leader of Opposition Business in the House) Share this | Hansard source

We on this side of the House welcome moves towards a single national product safety regime. We continue to have reservations about whether what it proposes goes far enough in the broader context. We trust this is only the first move towards rationalising federal and state legislation in general. There are great benefits to be drawn from rationalisation, for consumers, business and the Australian economy as a whole.

Product safety is an important issue for every consumer. We all need to have confidence that the goods we buy are safe and, if they are found not to be so, we need confidence that an efficient system exists for prompt and thorough recall. Under the current system with differing state regimes, we run the risk of confusion, with the possibility of products being declared safe in one state and unsafe in another. Clearly, with nearly all products being sold interstate and many being imported, the current state of affairs does not work to the advantage of the consumer.

The Assistant Treasurer has drawn attention to the gaps in the current system and the fact that none of the current bans or standards apply across all jurisdictions. This is clearly not satisfactory for consumers and, with many children’s products being imported, parents will, I am sure, welcome the move towards a single national regime. We look forward to examining the details of the national product safety law and its implementation. The Assistant Treasurer can rely on the support of the opposition for measures which genuinely improve the position of the consumer, be they in relation to petrol, groceries or child care. However, there are two areas of the Assistant Treasurer’s statement with which I would like to take issue.

Firstly, he noted that this measure has been on the agenda of the Ministerial Council on Consumer Affairs since 2003 without any progress. Indeed, many issues have been on the agenda of COAG and the ministerial council for some time without progress. I hope the Assistant Treasurer has also drawn to the attention of his colleagues in the state governments this sad lack of progress. It was quite clear that, during the tenure of the coalition government, it was a point of principle for the state representatives on COAG not to agree to any progress on the rationalisation of responsibility between the two levels of government, whatever the potential benefit. But, if progress on product safety represents a change of heart on the part of state governments, it would be churlish of us to do anything other than welcome it. So I hope the change of heart is permanent and I look forward to a similar announcement from government in the areas of workers compensation and occupational health and safety, for instance.

Secondly, the Assistant Treasurer referred to fair trading offices remaining in the control of the states and territories under the Productivity Commission’s recommendation for a single law, multiple regulator model. As long ago as February 2006, the Productivity Commission made it clear in its report on product safety that its preferred approach was the establishment of a single law and single regulator requiring the referral of existing state and territory powers to the Australian government. The single regulator would be the ACCC. Let us turn to volume 2, chapter 2, section 4.3 of its report on consumer policy framework issued earlier this year, to which the Assistant Treasurer referred. Under ‘Who should enforce the new generic law?’ it says:

The choice between the two options—

a single national regulator or the current approach of separate regulators in each state and territory—

is finely balanced.

The report said:

The ... advantages of a one regulator model are that it should help to:

• ensure that the intent of the single law ... was not undermined by unwarranted variations in enforcement approaches ...
• preclude wasteful duplication of regulatory effort where the same issue is needlessly pursued by more than one regulator ...
• allow for the linkages between consumer and competition policy to be reflected in all enforcement of the generic consumer law, rather than only in the ACCC’s more limited current enforcement remit in the consumer policy area.

The report goes on to say:

Further, the Commission is sceptical about the contention that a single national regulator would be intrinsically less well placed or inclined to apply the new national generic law to local issues. Under the current regime, the ACCC’s focus has sensibly been on applying the consumer provisions in the TPA to nationally significant issues. But there is no inherent reason why an appropriately tasked and resourced national regulator could not effectively apply the new law at the local level.

The report states:

... the multiple regulator model—

favoured by the Assistant Treasurer—

does have one important advantage. There are synergies ... between the role of State and Territory Fair Trading Authorities in enforcing the generic consumer law and their other regulatory roles.

But it is fair to say that the balance of advice from the Productivity Commission, in not just one but two reports, was in favour of a single regulator. Against that background, it comes as something of a surprise to read the final recommendation in this year’s report:

... for the time being ... the new national generic law should be jointly enforced by the Australian Government and the States and Territories.

I note that the commission states that a single regulator has intrinsic merit, especially in the longer term. The Assistant Treasurer has also mentioned that the price tag for taking over fair trading offices would be $526 million a year. The Productivity Commission puts the annual budget for the eight state and territory generic consumer regulators at more than $300 million:

It was put to the Commission that, based on the current experience with shifting responsibility for trade weights and measures to the national level, these transfer costs could be considerable. Such costs could be reduced through a staged process, drawing on the experiences from similar transfers that occurred in the 1990s in the corporations and financial services areas. But this does not negate the more general point that the transactions costs of the resource transfers required to ensure effective application of the new generic consumer law to local issues under a one regulator model (or to deal with constitutional issues), must be factored into the overall benefit cost calculus.

Finally:

In the Commission’s view, the ACCC would be the logical choice as the regulator for the new national generic law under a one law, one-regulator model. It has extensive experience in enforcing the TPA—on which much of the new generic law will be based—across all jurisdictions.

A reading of these two reports makes it quite clear which option the Productivity Commission preferred. It is also quite clear that the government could not wring any more concessions out of the state and so has left the job half done.

Just look at the Financial Review for 8 May in which the New South Wales Minister for Fair Trading, Linda Burney, is quoted as saying that the state offices have had to be part of the enforcement regime. (Time expired)

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