Brendan Nelson (Bradfield, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

by leave—I move:

That this House censures the Prime Minister and his Government for deceiving Australians and letting them down over record high petrol prices by:

(1)

describing petrol prices at over $1.60 a litre as “a little problem” for Australian consumers and giving up on them with his own damning admission that he had “done as much as we physically can to provide additional help to the family budget”;

(2)

grossly misleading Parliament and the Australian people on the contents of an ACCC report that the Government has used to defend its flawed Fuelwatch scheme;

(3)

ignoring the Prime Minister’s own commitment to evidence-based policy making when he ignored the expert advice of the Department of the Prime Minister and Cabinet, the Department of Resources and Energy, the Department of Finance and Deregulation and the Department of Innovation, Industry, Science and Research;

(4)

ignoring the advice of the Minister for Resources and Energy that Fuelwatch is anti-competitive and would hurt small business;

(5)

refusing to immediately lower petrol prices by cutting the 38 per cent fuel excise on petrol;

(6)

going to absurd lengths to put spin ahead of substance—risking higher prices, just to “appear” to be doing “something”;

(7)

pathetically claiming high petrol prices are a result of traffic jams across cities; and

(8)

treating the Australian people and this Parliament with arrogant contempt by refusing to guarantee that his fuel policies won’t increase the cost of petrol as his own public servant experts fear.

This censure is against the Prime Minister and is against his government because, in the space of six months, the Australian people have been severely let down. A week ago today the Prime Minister in Adelaide declared, ‘There is nothing more that we can phy-si-cally do to provide additional support to the family budget.’ We then had the extraordinary statement in this House earlier this week when the Treasurer of Australia, that nervous man who is desperately trying to fill the very large shoes of the member for Higgins, declared that Australians are happy. We are now in the extraordinary situation also where one of the most senior and respected ministers of the government, the Minis-ter for Resources and Energy, in a letter to his own Prime Minister and his own cabinet colleagues, has argued that FuelWatch will most hurt the people for whom it is allegedly intended and that is low-income families, particularly in areas like the outer suburbs of Western Sydney. He further argued that it would increase regulation on business, that it would be anticompetitive and that it would also importantly undermine the so-called government’s reform credentials, whatever is left of them.

Not only did we learn last night from Channel 9 and the highly respected political journalist Mr Laurie Oakes that the Minister for Resources and Energy wrote to his own Prime Minister and his own relevant ministers, including the Minister for Finance and Deregulation, saying that FuelWatch was actually going to hurt vulnerable low-income Australian families but also, confirmed by the Treasurer and the Assistant Treasurer at an extraordinary nine-minute press conference held last night at 6.30, we now know the content of that material from the four key economic departments of the government is accurate. We are in a situation now where the Prime Minister of this country—having run around Australia last year as the Leader of the Opposition, picking up apples and bananas in fruit shops and supermarkets throughout the country, making Australians falsely believe that he would do something to bring grocery prices down, occasionally dropping into the family kitchen of an everyday Australian household and making them falsely believe he would be doing something about their cost of living pressures, he would help them with their rent and make sure their interest rates were going to be more affordable in some way, wandering past service stations and making the right kinds of noises on popular television, whether it was Sunrise or Todaymade Australians believe that, if he became the Prime Minister of Australia, in some way petrol prices would come down.

What has happened here is a great parody—a great summary—of what this Prime Minister and this government is about because, having under a false pretext gotten himself elected as the Prime Minister of Australia, he then turned around to his spin merchants, who normally sit in here in the parliament, and said: ‘I have actually told Australians petrol is going to come down. What on earth am I going to do about it?’ So he has gone to the book and said, ‘What do I do?’ And what he has done is come up with this thing called FuelWatch.

FuelWatch is nothing more than a fraud being perpetrated upon the most vulnerable Australians. That is not only the view of the opposition; it is the view of one of the government’s most senior ministers, the Minister for Resources and Energy, but we also now know that it is the considered view of the four major economic departments in the government.

What happened then was that the Prime Minister said, ‘Well, I have come up with this stunt; I need to make Australians think that FuelWatch—watching petrol—is actually going to bring the price down.’ He said to his advisers, ‘Well, I need some evidence to support it.’ So he turned around to his own department, the Department of the Prime Minister and Cabinet—and the Prime Minister himself has said ‘all of the Public Service departments need to come to the centre of government decision making’—and his own department said: ‘Well, Prime Minister, with FuelWatch there is actually no evidence that it is going to work. In fact, it is possible that it will increase the price of fuel.’ So the Prime Minister’s own department actually said that the ACCC modelling indicates a small overall price increase cannot be ruled out. In other words, the Department of the Prime Minister and Cabinet said, ‘We cannot guarantee that this will not increase the price of petrol; in fact, we think it will.’

Then he went to the Department of Finance and Deregulation. That department said: ‘Well, in fact, it is likely to create a de facto floor price. It will increase the regulatory burden on business of over $20 million a year.’ So he went to the second pigeonhole to get a solution—the department of finance—and they said that it will actually create a de facto floor price. In plain language, that means that the current lowest price for petrol will be higher than it is. So the second department said it is going to increase the price of petrol.

He then went to Resources and Energy and, as we know from the Minister for Resources and Energy, that department said, ‘It is actually going to hurt the people who need the cheapest petrol.’ And that is those people who were lining up on Tuesday night down the eastern seaboard of the country. Prime Minister, the people who are going to be hurt according to your own minister and your own departments are the people who are most vulnerable—the people who are most sensitive to the price of petrol—and they are the people who are capitalising on the cheapest price in the cycle on a Tuesday night.

He then went to the industry department and that department, amongst other things, said: ‘It is actually going to be bad for small business. It is going to take independent retailers out of the sector. It would cost them an additional $4,000 a year.’ So here we are with major oil giants effectively controlling much of the petrol retailing in this country, aided and abetted by Woolworths and Coles, and then we have got a significant and very important part of the sector—the independent small business part of it—and the government’s own department is saying that it is going to increase the cost of business for them by $4,000 a year.

So what does the Prime Minister do? He then goes to the ACCC report and selectively pulls out bits that he thinks are consistent with the stunt that he has already confected and then tries to tell Australians that watching the price of fuel is going to bring it down.

The other very important thing is this: if the Prime Minister wants to listen to people, he should get out of his white car and go down on a Tuesday night to the queues of people lined up outside petrol stations trying to maximise the lowest price in the cycle and, firstly, he should ask them whether they think a cut in the excise of 5c a litre would actually help and, secondly, he should explain to them how FuelWatch is actually going to make prices cheaper—because it is not. The one thing that the Prime Minister would not guarantee was that the introduction of FuelWatch would not increase the price of petrol by a single cent.

The RACV, which represents motorists in the state of Victoria, has as its slogan: ‘We are here for you.’ They are there for you, but the Prime Minister of Australia is not. The RACV, in writing to me on 22 May this year, said:

The RACV does not support the FuelWatch system in its current format as we believe Melbourne motorists would be denied access to weekly discounted fuel.

It further said:

The most recent report by the ACCC into petrol prices states that in Melbourne 65 per cent of petrol was sold on the four days when prices were at their lowest, whereas in Perth, where FuelWatch operates, 60 per cent of petrol was sold on the four days where prices were above the average weekly price cycle.

The RACV, in quoting the ACCC report, further said that there is increased potential for anticompetitive effects in rural and regional areas due to the more concentrated nature of the market in these areas, the potential for reduction in the predictability of price cycles for consumers who have adapted to them, a significant dependence on the media if any of the proposed benefits are to be realised and the administration costs of such a scheme are likely to be large—all of which has now been confirmed by the four major economic departments that advise the government. It also said in conclusion that the RACV will continue to oppose the introduction of FuelWatch:

... as we consider Melbourne motorists will on average pay more for their fuel under this scheme.

Similarly, the RAA, which represents motorists in South Australia, wrote to me several days ago. The letter states, in part:

The RAA has long opposed the introduction of FuelWatch and continues to remain opposed, because we consider South Australian motorists will be no better off under the scheme and indeed may be distinctly disadvantaged.

The letter then states:

Please note the RAA has indicated that it is willing to change its position if the federal government or the ACCC can furnish the data that is said to demonstrate that their concerns are unfounded.

Pointedly, it concludes:

However, no data has been provided.

I suspect the data provided by the four key economic departments advising the government is quite to the contrary. But as to the bigger issue, even though the government describes $1.64 a litre for petrol as ‘a little problem’, there is an even  bigger problem now for Australians.

This country deserves better than it is getting from this government. Australians have been let down. Australians have been deceived by the man who is now the Prime Minister of this country and the government that he leads. Every Australian should see the front page of today’s Melbourne Age, which has the headline ‘Cabinet leak leaves Rudd petrol strategy in tatters’. It is not only the Rudd government’s petrol strategy that is in tatters; it is the government itself. There are millions of Australians for whom this is not a game, for whom the government of this country is not about factional people fighting one another, for whom it is not about people getting into positions by virtue of fraudulent, misleading hopes held out to Australians. For millions of people in this country, it is about survival. It is about paying your mortgage. It is about trying to find the money for your rent. It is about deciding what food you can afford to buy this week. It is about meeting your credit card payments. It is about clothing your children. It is about being able to go about your business—to run a small family business, to survive on a farm. That is what it is about.

I ask the Prime Minister: Prime Minister, how can Australians have trust in your government if your key ministers cannot trust one another, let alone their own departments? How can they further trust a government in which now the Prime Minister of that government himself cannot trust his own ministers and wilfully ignores the considered advice of his four key economic departments? These four departments—the Department of Finance and Deregulation, the Department of the Prime Minister and Cabinet, the Department of Resources, Energy and Tourism and the Department of Innovation, Industry, Science and Research—all had the opportunity to read the ACCC report. These are departments headed and populated not by fools. These are departments which are headed and populated by people who really understand economic argument.

I say to the Prime Minister that there may not be a silver bullet in relation to petrol, but Australians deserve much better than a government that is firing blanks. We need a government in this country that is orderly, where ministers have confidence in one another, where they can have confidence in their Prime Minister and where they can have confidence in the advice that is given to them by their key government departments. We are now in a situation in Australia where the Prime Minister of the country—who is more concerned for his own image, his own popularity and currying favour with cheap headlines than actually making decisive decisions to deliver cheaper petrol—has chosen a stunt and then desperately distorted the advice from the ACCC to find the advice which actually suits the stunt of the day, as evidenced by the Australian newspaper, and ignored the advice of the four key economic departments.

This is the Prime Minister who goes to one audience and says one thing and then goes to another and says something else. This is the same Prime Minister who said he would be evidence based. This is the same Prime Minister who said that he would bring the government departments to the centre of the policy-setting agenda. On 29 November last year he said:

The driving agenda for Commonwealth-State relations is located within both the Prime Minister’s portfolio and the Treasury portfolio—

and that government departments would be brought to the centre of government decision making.

Opposition Members:

Opposition members interjecting—

Brendan Nelson (Bradfield, Liberal Party, Leader of the Opposition) Share this | Link to this | Hansard source

In one sense, it is a joke, but I say to Australians—to those of us who have mortgages, who have car loans, who have petrol that we have to buy to put in them, who have groceries that have to be bought, who have kids that need clothes, who are trying to put a roof over their heads—as busy as they are: have a look at the pathetic nine-minute press conference from the Treasurer last night. Australians have to trust and have faith in their government and their ministers. We are in a situation where we have a stunt driven Prime Minister who ignores the advice of the key government departments, a nervous Treasurer who is simply not across his brief, and ministers who will not trust one another—let alone their own departments. We are in a situation where this country deserves better. With petrol at $1.60 a litre and rising, Prime Minister: cut the excise; pull no more stunts—we need real leadership, we need decisive action. We will not allow everyday Australians in particular to be punished by this stunt driven government, and we will oppose FuelWatch.

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Is the motion seconded?

Malcolm Turnbull (Wentworth, Liberal Party, Shadow Treasurer) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak.

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

I move:

That all words after “That” be omitted with a view to substituting the following words: “the House censures the Leader of the Opposition for:

(1)

his failure to stand up for the interests of Australian motorists and consumers;

(2)

capitulating to the interests of big oil companies;

(3)

failing to put forward fully costed budget proposals; and

(4)

continuing the practice of economic irresponsibility.”

Stuart Robert (Fadden, Liberal Party) Share this | Link to this | Hansard source

Mr Robert interjecting

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

Order! The member for Fadden is warned.

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

What we have today on the part of the Liberal Party is something very straightforward and very simple—two propositions: the absolute failure to stand up for the interests of Australian motorists and, secondly, the absolute capitulation of the Liberal Party to the interests of big oil. This is what it is all about. For 12 years in office, those opposite had an opportunity to stand up for the interests of Australian motorists. They had an opportunity to stand up against the interests of big oil. They had an opportunity to do something about the structure of the Australian petroleum industry. They had an opportunity to deliver a decent outcome for Australian motorists, and they have failed to do so—after 12 years. Secondly, in the course of the last six months what they have concluded is that all problems associated with oil and petrol prices in this country have uniquely arisen as a result of the last six months that we have been in office, as opposed to the 12 years they were in office.

The reality is that we are dealing, right across the world, with governments which are challenged with the problem of global oil prices. Global oil prices have risen, and risen extensively. Every government in the world is trying to deal right now with the flow-through consequences to their consumers. This is a massive challenge. We have had oil price riots in Indonesia. We have also had protests throughout the United Kingdom. We have had statements in Canada about the impact it has had on Canadian motorists. This is a factor which is occurring right across the world and, therefore, we are faced with very simple alternatives: do you deal with this responsibly and intelligently in a long-term fashion, or do you simply, in your first budget reply, reach up to the old cookie jar and say, ‘Here is a bucket of money we can pull down to buy a few cheap votes’? That is exactly what those opposite have sought to do. When you look across the country and try to find any substantive support for those opposite in their proposal through the budget reply, it is very difficult to find.

The core challenge that we have in this debate is whether you are going to take a decision on behalf of the interests of motorists or whether you are going to tap the mat and simply concede the ground to the interests of big oil. What we have had on the part of those opposite is something pretty clear. Their argument, prima facie, in this censure motion is this: every minister in the government should simply blindly follow every piece of departmental advice that they get. That is the proposition. That is the core proposition being advanced. The model of Westminster which those opposite are advancing is this: whenever a public servant comes up to you with a piece of advice, you are duty bound to implement that—lock, stock and barrel. That is the view which those opposite have. In other words, as members of the executive, as ministers of the cabinet and as members of the government, your job is simply to be here as puppets on a string—with a public servant here and, in the case of their most recent response to our policy, the big oil companies over there, pulling the other strings. In other words, there is no independent capacity for making a decision. We actually take a different view. In the Westminster model, when departments put forward, as they should, their own comments and views in terms of coordination comments, that is helpful to inform the overall public policy debate. But are those opposite who have previously been ministers or cabinet ministers saying to me that they have always responded, to the letter, to every piece of advice in the coordination comments and every piece of advice that they have received from their department?

Scott Morrison (Cook, Liberal Party) Share this | Link to this | Hansard source

Mr Morrison interjecting

Harry Jenkins (Speaker) Share this | Link to this | Hansard source

The member for Cook is warned!

Kevin Rudd (Griffith, Australian Labor Party, Prime Minister) Share this | Link to this | Hansard source

My point is: are those who have been ministers—including the minister who was formerly responsible for Work Choices, ministers responsible for education, ministers responsible for defence, ministers responsible for every portfolio in the government—seriously saying to us that every time the department provided a piece of advice this was therefore their bounden duty, and it would lead to a collapse of the Westminster system if the minister said, ‘Actually, I have a different point of view’?

In fact, the reverse model of government, which those opposite are advancing, is this: the responsibility of ministers is to stand up here simply as the mouthpiece for government departments, simply as the mouthpiece for public servants. This government has a different view: not only do we welcome advice from public servants but we will engage in debate with the Public Service. We will not always agree with the Public Service and, as I have said repeatedly, we will take advice from beyond the Public Service. In terms of the advice that is available to government on this matter, we go back to this weighty tome delivered by the ACCC. The ACCC says, on page 247 of the document:

The main finding from this econometric analysis is that the average of the price margin reduced by a statistically significant amount for Perth relative to the eastern capitals in the time since the introduction of FuelWatch. The relevant weekly average price margin was around 1.9 cpl less on average for the period from January 2001 to June 2007 than for the period from August 1998 to December 2000.

This is econometric analysis provided by the ACCC. The member for Higgins, the former Treasurer, who has not graced the chamber yet, said that this outfit—the ACCC, headed by Graeme Samuel, appointed by the previous government—was in fact the most competent to make analysis on these matters. The former Treasurer, who was adulated yesterday by the current Leader of the Opposition as the bee’s knees of economic policy, stated publicly at the time this report was commissioned that his view was that the ACCC was the most competent body to examine these matters. That is the first proposition. The second proposition is this: this ‘competent body’, so named by the former Treasurer, Mr Costello, produces its report, which contains this econometric analysis and contains that information in the conclusion. Then those opposite are saying: ‘This is the authoritative body. This is the responsible report. Here is the evidence it contains. And you, the government, should ignore it.’

That is essentially the proposition of those opposite. Therefore, the argument in public policy development is: as ministers of the government you are therefore bound and obligated to ensure that you take every single piece of Public Service advice and ignore every other piece of advice which exists and when there is a conflict of advice, say, ‘I have got to stick to what one particular department may say.’

We have a distinctly different view. We welcome the contribution of the Public Service to the debate. The contribution of the Public Service is absolutely critical. What we have said to public servants since forming a government—and we have not changed any departmental heads—is that we do not mind if you contest our views. We welcome a debate; we welcome an argument; we welcome a discussion, in contrast to those opposite who, when they went in, had a quite different view. Remember the debate with Mick Keelty over the question of al-Qaeda and the question about what happened at the train station in Madrid? What did Mr Downer say in response to Mick Keelty when he offered a contrary view to the government? What did he say to him? Downer said, ‘I think that he is just expressing a view that reflects a lot of the propaganda we are getting from al-Qaeda.’ That is the view which you took to your public officials when it came to any public servant who had a contrary view to the policy decisions of the government—in other words, to attack them, to ridicule them and, even worse in this particular statement by the former foreign minister, say that they were acting in cahoots with terrorist organisations.

We have a different view of public policy. We take our advice from the Public Service and from agencies such as the ACCC, which exists within the Treasurer’s portfolio. We take advice from a range of sources and we make a decision. The core argument which has been put forward here is that, because individual government departments had a different view from the decision that was taken by the government, there is something inherently wrong in that as a model for public policy decision making. That of itself is a fraudulent proposition.

That deals with the process matters. If you go to the substance of the matters which are being advanced by those opposite in this debate, it goes down to the question of whether in fact the FuelWatch scheme is capable of providing a useful guide to prices in the future. Again I go back to the substance of the econometric analysis and its conclusion about 1.9c a litre—and that is contained on page 247. Therefore, based on that, we have also had subsequent statements by the chairman of the ACCC who, I am advised, again today on national radio has confirmed that the advice is robust and that it is the econometric analysis which is available, and he is prepared to state his support for FuelWatch on that basis. So you have the competition watchdog up there saying that this is the best thing for motorists. You have the substance of the econometric analysis saying the same thing. On top of that you have a number of motoring organisations across the country saying the same thing. But those opposite are saying that their responsibility is to simply be there at the beck and call of the large oil companies.

Let us go to the second proposition which is contained in the substance of this debate: the impost on business. On the question of the impost on business, which is referred to in one of the other sets of coordination comments referred to in the media today, there is reference to that possible impost on business. There are two points to make about this. Currently, petrol station owners across the country, by virtue of the arrangements which many of them have with the price collection data systems which exist often in conjunction with the larger petrol companies, are themselves often paying fees to that data collection company. That is the first point. There is already, if you like, a compliance cost to those individual service stations operators in terms of their current arrangements.

The second point is this: when the cabinet considered this matter its decision was that businesses would not have a net cost disadvantage to themselves in the implementation of this regime. This is a core element of cabinet’s decision on the day, entirely mindful of the advice which was coming forward about the possible impact on small businesses, entirely mindful of the costs currently being borne by small businesses in the implementation of current arrangements and entirely mindful that government would not allow any of those small businesses and service station operators in any way to be financially penalised by the arrangements which were going to be introduced by the government. That goes to the two core propositions which are being advanced.

Then we come to the other one which is advanced by the opposition, I presume, as its most recent element of policy on this, which is that you can have a notification system but there is no requirement for the price to be held the following day. Has the Leader of the Opposition thought this through? Have you thought through how this would work in practice? You would have a system whereby mum and dad sitting in their house, say, in a suburb in Melbourne, would go onto FuelWatch and see at 8 am on a given morning, when they were about to take off and take the kids to school, that service stations had notified at that particular time of day that their price was X. They jump in the car, drive to the service station and find the price has changed. They have spent 20 minutes driving to the service station thinking that it is a place where they were going to get a cheaper price, and in fact it has changed. That is the model which you have advanced. Have you thought it through in terms of what happens to consumers on the ground? I do not think that the opposition has thought this through at all.

Then you go to the absolute absence of any policy on the part of those opposite. As of yesterday, let us go to the core elements of their position on FuelWatch. You had a WA Liberal senator out there yesterday saying that she thought it was a fantastic thing—and I do not know what you have done with her overnight but I presume that she has been put in the can. Then on top of that you have the position on the part of the member for Wentworth saying that he supports part of our proposition, not all of it. He opposes but is not necessarily not supporting the arrangement. That is his position.

The Leader of the Opposition I notice for the first time today actually said that the Liberal Party is voting against this. Here we are with a policy introduced and made public by the Assistant Treasurer on 15 April and here we are at the end of May and finally we discover the resolve to take a position. You have had no position consistently on FuelWatch and no position consistently on excise, where the shadow Treasurer says that he is not going to implement it anyway when he replaces the Leader of the Opposition in that position. And beyond that again there is a model of Public Service management which says that your job as ministers is to blindly take the advice of any public servant who comes up to you with a piece of advice, as opposed to exercising the discretion which you have as ministers. This government intends to govern differently for Australia’s interests and the interests of motorists. We will stand up for the interests of Australian motorists. We will not stand idly by while those opposite are happy to simply act in the interests of big oil companies. We stand up for the consumer. We stand up for the motorist and we will resolutely maintain our position in support of their interests. (Time expired)

Debate interrupted.