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

I certainly welcome the opportunity to speak on this matter of public importance. The issue of Fuelwatch and GROCERYchoice does raise important questions about the way in which the ACCC has conducted its affairs under the Rudd Labor government. Is it an organisation acting in the public good, or is it acting at the whim of the hollow men who lurk in the backrooms of the Prime Minister’s office? Has the ACCC attempted to provide a quick political fix for the Prime Minister in relation to his promises on fuel prices, grocery prices and the cost of living?

History has shown that the ACCC has spoken out repeatedly against the Fuelwatch scheme. As far back as 2002, Allan Fels, the former Chairman of the ACCC, wrote to the Western Australian state minister expressing his concerns in relation to the Fuelwatch scheme. But with the election of the Rudd Labor government there commenced a miraculous transformation. The ACCC apparently had found its road to Damascus, and that road was going to be financed by the Australian families and battlers who struggle to make ends meet, as they would be the ones who would be paying more for their petrol as a result of Fuelwatch. Forget the fact that Fuelwatch involved price fixing. Forget the fact that the independent sector has been saying repeatedly to the members opposite that Fuelwatch will work against the best interests of independent retailers and that it is competition and not watching fuel prices that will deliver better deals for motorists. The Prime Minister said, ‘Jump,’ and the ACCC said, ‘How high?’

Of course, the members opposite will rally to the defence of the ACCC. They will tell us that the ACCC is independent. They will tell us that the ACCC has been working in the public interest. But let us ask some simple questions. Firstly, if the arguments for the introduction of the Fuelwatch scheme are so compelling, why did the ACCC not include Fuelwatch as its first recommendation in the inquiry into the price of unleaded petrol? In fact, it did not even have Fuelwatch as its last recommendation. The ACCC inquiry into the price of unleaded petrol failed to recommend Fuelwatch at all. Why was that? Did the ACCC forget to put in a recommendation about Fuelwatch? Was it a lapse of memory, perhaps? You would expect to see Fuelwatch figuring prominently in the body of the report. A reasonable person would expect to see a large chapter detailing the benefits of and totally devoted to Fuelwatch, as it forms the basis of the government’s response in relation to fuel prices. But, in fact, when you look at the report, you have to wait until the last chapter to find material on Fuelwatch. It can be found in chapter 15 at 1.3, in the last pages of the report—hardly front and centre.

How then has the ACCC come to recommend Fuelwatch? Where is this new and compelling evidence that has come to hand which can justify this change in position by the ACCC with regard to Fuelwatch? The reality is that there is no such evidence. The modelling conducted by the ACCC has been criticised as being flawed not by members on this side of the House in isolation but by organisations such as Access Economics, Concept Economics, Professor Sinclair Davidson, Professor Frank Zumbo and Professor Don Harding. Professor Harding said of Fuelwatch:

I find that the ACCC applied the wrong tests to the wrong variable. Specifically, they studied the nominal retail margin when economic theory suggests that the analysis of anything but the real retail margin to producers creates a mis-specified model inconsistent with the econometric assumptions used.

Mr Henry Ergas, Chairman of Concept Economics, said in relation to the ACCC modelling—

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