Mark Butler (Hindmarsh, Australian Labor Party, Shadow Minister for Climate Change and Energy) Share this | Hansard source

I rise to speak on the Treasury Laws Amendment (Prohibiting Energy Market Misconduct) Bill of this year. This is legislation that has been around this parliament or, more to the point, the previous parliament for some time. And, as I think the Shadow Treasurer has indicated, subject to support by the government for a number of amendments which I will address in the course of my remarks, the opposition will in a constructive way be supporting this legislation.

This is, I need to stress, not legislation that we would be necessarily bringing forward, were we on the Treasury benches. We instead would be focused on developing a coherent national energy policy of the type that has been recommended by so many different advisory bodies, whether they are government electricity agencies established under the National Electricity Market, think tanks like the Grattan Institute or any of the myriad bodies that consider this matter.

It's quite clear that what the energy market, particularly the electricity market, needs is a coherent national energy policy, and I will talk about that a little later in my remarks. It is also important to note that this legislation, or any variant of it, has not been recommended by the consumer watchdog. It is apparently a piece of legislation designed to improve the circumstances of consumers in the electricity market. Not only was it not recommended by the ACCC after its lengthy examination of the retail electricity market but, indeed, it recommended against a divesture power, as did Professor Ian Harper in his review of competition policy for the government a couple of years earlier.

As any observer of this debate would know, various business groups, energy users and energy suppliers over the last 12 or 18 months have been critical of the legislation in its different iterations. But since the election in May, the business groups, most notably the Business Council, have changed their views from one of opposition to one of instead seeking to work with the government to improve the operation of this bill, and that too, in the spirit of being a constructive opposition, has been the approach of the Labor Party. Most notably, after considerable debate about the impact of potential ministerial overreach in the operation of the original bill, it is pleasing to see that government has curbed or pulled back the ministerial power that would be able to be exercised under this legislation and instead has properly substituted a role for the ACCC—the body set up under legislation of the Commonwealth parliament to protect the interests of consumers—and also a very important role for the Federal Court. We take that as a significant improvement to the bill given that, since its original presentation, we had been complaining of overreach on the part of ministers.

There are, though, a series of outstanding measures that I am sure the shadow Treasurer will refer to that I want to talk to in some detail that are the subject of amendments that I'll be moving in the third reading debate. The first is that we have complained since the original presentation of this bill that it contained a very significant loophole to allow the privatisation of publicly owned electricity assets—namely, the forcible divesture of publicly owned electricity assets and the transfer of those assets to private companies. We know the Liberal Party is addicted to the privatisation of electricity. I come from the state of South Australia where all of the electricity assets were privatised by the Olsen government, by the Treasurer, Rob Lucas, who, again, is the Treasurer of South Australia, and is now undertaking at privatisation exercise of our rail services. In Victoria too and in other jurisdictions, we saw over the course of the 1990s and 2000s wholesale privatisation by state Liberal governments of our electricity assets. We were promised there would be more choice and there would be better prices and competition in the market, but I think anyone who has had even a casual look at the operation of the electricity market knows the privatisations have worked for companies but they haven't worked for consumers.

The member for Kennedy and Labor identified this loophole in the original presentation of the bill. The government went some way to closing the loophole but it is clear that, in the form in which the minister has presented this bill, there is still the capability of a divesture order to downgrade the level of public ownership of an existing electricity asset in those states like Queensland, Western Australia and Tasmania where, time and time again, the community, through state election campaigns, has voiced its view that it wants its electricity assets kept in public hands. So I will be moving an amendment to ensure that that loophole is closed absolutely and completely, to ensure that, if the operation of this legislation results in the divesture of a publicly owned asset, it can only be divested to another publicly owned asset with the same or greater level of public ownership.

We are also obviously, as a Labor Party, very concerned that workers and their entitlements not be prejudiced by the operation of this legislation. Workers, after all, have no responsibility for the conduct that is apparently the driver of this legislation being put in place, no responsibility for allegations of cartel conduct or reductions of competition in the market. It is, I'm sure, no surprise to anyone that this government has apparently paid no attention at all to the possibility that workers' entitlements will be reduced by the operation of this legislation. It's simply not a matter that is typically on the radar of this government. Our advice is that the transmission of business provisions contained in the Fair Work Act do not cover a transmission that is caused by a forcible divestiture of the type contemplated by this legislation. So I will be moving an amendment in the third reading to ensure that the transmission of business provisions of the Fair Work Act are deemed to apply to this type of transmission—namely, a forcible divestiture. That will ensure that those entitlements that are contained in registered enterprise agreements and in awards are preserved and protected for workers, who are, as I said, not the subject of the so-called mischief that lies at the heart of this legislation.

I also foreshadow that there is a further concern—that is, that entitlements that are not contained in registered agreements or awards but have still been properly negotiated between trade unions and employers are not also protected by this legislation. It is utterly important that many of those important safeguards, many of those hard-fought entitlements, whether they be around redundancy, portability of employment or what have you, also be safeguarded under the operation of this legislation. So I foreshadow very clearly—and we have communicated to the government very clearly—that we intend to explore this issue in detail in a Senate inquiry and to also consider amendments that would sit alongside the amendment I'm already moving around the operation of the Fair Work Act transmission of business provisions to make sure that worker entitlements contained in unregistered agreements are similarly protected. We expect that the government will support that amendment, because, after all, it is not the workforce that is the target of this legislation; it is the companies themselves.

Finally, these are extraordinary powers. They've been described as such by the ACCC and many other observers. Forcible divestiture is not a power that's typically been enshrined in legislation, let alone used in Australia. If this parliament is to adopt this power in the energy market, it should be the subject of an independent review after a period, before the sunset clause kicks in, to assess whether the operation of the legislation matches the rhetoric of this government. And I'll be moving an amendment in the third reading on that as well.

I would hope that all of those amendments, particularly the amendments that close the loophole on privatisation and protect worker entitlements, will be supported by the government. We've already indicated to the government that, if those amendments are supported in this House, we will support the passage of the bill, but, if those amendments are not supported by the government, we will be voting against the bill. We're very confident that our amendments improve the bill markedly, adding to the improvements that we, along with other stakeholders, were able to force the government to make to the bill before it was originally presented during the last parliament.

I want to be clear that this bill, in no way, is a substitute for a proper, coherent national energy policy. As the second reading amendment moved already by the shadow Treasurer very clearly points out, this is not an academic point. Australia finds itself in the throes of the deepest energy crisis since the mid-1970s, and, unlike the energy crisis of the mid-1970s, which was caused by an external shock—the oil crisis—this energy crisis is the product of profound public policy failure. Households and energy-using businesses are paying the price for this crisis. Wholesale prices are up across the National Electricity Market, on average, by 158 per cent since the crisis really took grip in 2015. Power bills for households and businesses are going up and up, and it's quite clear that the market expects those bills to continue to go up. The Financial Review only reported very recently that forward prices in the electricity market are up 29 per cent in just the 12 months since the former Prime Minister, Malcolm Turnbull, and the National Energy Guarantee were both dispatched in a coalition party room ambush. The Minister for Energy and Emissions Reduction pretends that prices are going down. He quite misleadingly points to the operation of the default market offer, which was a recommendation from the ACCC, as well. Labor was the first party in this parliament to indicate its support for a default market offer, which would operate to the benefit of the small minority of consumers, estimated at substantially less than 10 per cent, who have been languishing on standing offers for far too long. They have seen a price reduction in their bills as a result of the operation of the default market offer. But the minister needs to be up-front and honest. He needs to be straight with the Australian people that that constitutes substantially less than 10 per cent of the market, and they have been paying far too much for far too long. More than 90 per cent of consumers and the vast bulk of energy businesses continue to see their bills going up and up and up, wrecking household budgets and jeopardising the viability of many, many high-energy-using businesses, in particular. And it is exacerbated, of course, by the complete mess we have seen in the gas market.

The key problem, as identified by advice after advice, is the lack of a coherent national energy policy. The Australian Financial Review National Energy Summit, a very substantial annual occasion in the energy sector, held only the week before last, saw body after body present their key, clear view that until we have a national energy policy that makes sense in this country, this crisis is going to get worse before it gets better. The Grattan Institute, reflecting on what's happened to wholesale prices under this energy crisis, confirmed that it has resulted in $1 billion in additional windfall profits to just the big three private energy companies—an additional $1 billion in additional profits every year since this crisis took hold, paid for by Australian households and energy-using businesses. We know that there were more than a dozen—16 at our last count—attempts to land a national energy policy during the last parliament, none of which succeeded. The closest was the National Energy Guarantee. The member for Hughes is here; he wasn't a particular fan of the National Energy Guarantee, but neither was the now Minister for Energy and Emissions Reduction. It promised—according to the now Prime Minister, when he was the Treasurer, and the now Treasurer, when he was the energy minister—a reduction in household bills of about $550 on average. Instead, what we have seen since that coalition party room ambush is power bills go up and up and up.

The Prime Minister is also seeking to convince the Australian people that all things are hunky-dory in the investment market. Yes, we had a burst of investment in renewable energy to discharge the renewable energy target that the Labor Party had put in place when we were in government. Those opposite have tried to tear it down, time and time again, particularly the now Minister for Energy and Emissions Reduction, who came into this parliament surfing a campaign of being anti renewable energy. But what the Prime Minister doesn't tell the Australian people is that Bloomberg, the organisation he enlists in his claim that we were leading the world in renewable energy investment, has also reported that renewable energy investment is already down 50 per cent in the first half of 2019 alone. The Clean Energy Council says that is probably a low-ball estimate. We expect thousands and thousands of jobs to be lost from this sector, which should be growing.

We do support this bill, provided the amendments that I'll be moving in the third reading part of the debate are supported by the government. But we will continue to hold this government to account for its hopeless management of energy policy.

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