Jason Falinski (Mackellar, Liberal Party) Share this | Link to this | Hansard source

On behalf of the Standing Committee on Economics, I present the committee's report entitled Review of the Australian Competition and Consumer Commission Annual Reports 2019 and 2020, together with the minutes of proceedings. The ACCC and the Australian Energy Regulator appeared in virtual hearings before the Economics Committee on 23 October 2020 and 24 February 2021. The committee hearings were both well attended. I thank the regulators for their involvement and their eagerness to answer some of the inquiries from committee members, which were reflecting much of the concern that we found in the Australian community.

The COVID-19 pandemic has had a profound impact on the economy and prompted significant changes to the regulatory work and priorities of the Australian Competition and Consumer Commission. The challenges presented by the pandemic and the subsequent economic crisis forced the ACCC to authorise behaviour that would normally be considered anticompetitive. For example, the ACCC temporary market authorisations have allowed companies both to cooperate and to coordinate their responses, which includes banks coordinating on deferring mortgage repayments in the interests of consumers and the broader economy.

I would like to take a moment to reflect on the fact that Australia's inflation is relatively muted, generally speaking. In comparable economies, specifically the United States, inflation is running at above six per cent at the moment, whereas in Australia it is within the target band of two to three per cent. It is possibly the case that the reason for this has been the problems with the supply chain management in the United States, which Australia, despite the behaviour of the unions, has managed to avoid.

It is of great concern that, when we look at some of the economic headwinds that Australia faces at this point in time, we see that the union movement, instead of helping their fellow Australians, are instead taking advantage by running rolling strikes, whether it's the New South Wales Teachers Federation, who represent some of the best paid teachers in the world, or the MUA, which is now part of the CFMMEU—the union whose letters keep growing; soon the CFMMEU will have taken over the entire alphabet, if we're not careful, and then we will need a competition policy issued on protecting the alphabet from takeover by the union movement. When their fellow Australians are finding strains, when the economy is under pressure, this is the moment that the CFMMEU have decided to have a bunch of rolling strikes to put pressure on the Australian economy.

Opposition Members:

Opposition members interjecting—

Jason Falinski (Mackellar, Liberal Party) Share this | Link to this | Hansard source

Now those on the other side wake up! They're not concerned when their fellow Australians are facing inflationary pressure, they're not concerned when they're facing cost-of-living pressure and they're not concerned when the economy is under pressure, but they are concerned when you criticise the union movement. It's 'Come in spinner' on that side. The only people they care about are organised labour and their mates in industry super. Anyway, I will return to the ACCC annual report.

Additionally, Australia's international and domestic borders have been impacted by the pandemic, with the travel industry having to issue refunds on an unprecedented scale. I would like to pause at this point and say if there is any one sector of our economy that has been put under more pressure than any other it is the one with those people involved in helping others enjoy holidays and have again and again tried to provide overseas travel with certainty, only to see health issues intervene. They have tried to keep their businesses afloat. They have tried to keep Australians involved— (Time expired)

Report made a parliamentary paper in accordance with standing order 39(e).

Andrew Leigh (Fenner, Australian Labor Party, Shadow Assistant Minister for Treasury) Share this | Link to this | Hansard source

Australia has a competition problem. Work by the Treasury authored by Jonathan Hambur and others has shown that we've seen an increase in mark-ups over recent years. Work by the industry department led by Sasan Bakhtiari has shown we have seen a rise in market concentration. The ACCC told the House economics committee:

We agree the economy is too concentrated.

Under the Liberals' watch, large firms have gotten larger and the start-up rate has fallen. The Australian economy is becoming too concentrated by a small number of large firms. Indeed, you can play the dinner party game: 'Name us a handful of Australian industries that are not dominated by a handful of big firms.' This isn't just an issue of supermarkets and banks. It's not just an issue of telecommunications. It's an issue that goes as far as baby food, beer, internet service providers and department stores. As the ACCC told the House economics committee, it has not won a contested merger for a quarter of a century. That's why you've had the ACCC head, Rod Sims, calling on the government to engage in a sensible conversation about Australia's merger laws and whether they're fit for purpose. But, instead, the government has ruled out that conversation entirely. It's not interested. It's not interested in having a conversation with the competition regulator and the Australian people about making sure that our markets are more competitive.

Competitive markets aren't just critical for customers. Of course, customers benefit through lower prices and greater variety, but competitive markets matter for those of us who care about dynamism, because so much of productivity growth comes through new firms and new ideas. If you are a large, cosseted monopoly, you don't have to invest in research and development; you can just sit back and dig your moat and keep the competitors out or, if they get too big, buy them. So the Australian economy suffers when monopolies become too large.

Workers are hurt as well. The naughty cousin of monopoly is monopsony. That's the phenomenon that happens when workers don't have a choice of employers. The worst of this is the one-company towns, places like Pullman in the United States. In Australia, I can think of a number of mining towns. When workers don't have outside options, their wages are lower and they're more vulnerable to mistreatment. So this rise that we have seen in monopolies across Australia has been bad for wage growth as well. Increasingly, economists are recognising that one of the reasons the labour share of national income has fallen is the rise in monopsony hiring power.

So it's good to hear the competition regulator speaking about these issues, as it did in the report that we're discussing today. But the problem is that the government isn't serious about tackling these issues, whether they occur at the high level of mergers or at a specific industry level. Labor went to the last election promising a 'your car, your choice' policy through which independent mechanics would get the data they need to fix modern cars. Because modern cars are computers on wheels, denying independent mechanics that data effectively denies them the ability to fix modern cars. The government always says that it's committed in principle, but, in practice, it never gets around to doing it. The scheme is only now up and running, many years after the ACCC first warned about it. It's a long time after the government was first warned about it. How many independent mechanics have gone to the wall because of the government's inability to speak out for this critical sector?

We're seeing the same with the car dealers industry as well, and we're seeing the same in the area of scams. In the report that the member for Mackellar has referred to, the ACCC's Scamwatch has received almost 5,000 reports mentioning COVID-19.

Labor will fight online scams by establishing a national antiscam centre and doubling funding for identification recovery services. Only Labor can be trusted to protect Australians from scams. I want to acknowledge the House of Representatives Standing Committee on Economics secretariat, particularly Nicolette Cilia, who I understand was the key person responsible for drafting this important report.

Andrew Wallace (Speaker) Share this | Link to this | Hansard source

The time allotted for statements on this report has expired. Does the honourable member for Mackellar wish to move a motion in connection with the report to enable it to be debated on a future occasion?

Jason Falinski (Mackellar, Liberal Party) Share this | Link to this | Hansard source

I do. I move:

That the House take note of the report.

Andrew Wallace (Speaker) Share this | Link to this | Hansard source

In accordance with standing order 39(d), the debate is adjourned. The resumption of the debate will be made an order of the day for the next sitting.