Page 3531 - Week 13 - Thursday, 26 November 1992
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This report represents the culmination of about a year's work by the Working Group on Petrol Prices in collecting data and consulting with the community and the industry on petrol issues in the ACT and interstate. The working group contacted and sought submissions individually from every service station operator in the ACT, from every major oil company in Australia, from all representative organisations connected with the petroleum industry in Australia and the ACT, including the Australian Institute of Petroleum and the Motor Trades Association. The group also sought and received submissions from the ACT consumer organisation Canberra Consumers and from the NRMA.
There was at the time the group was established, and I believe that there still is, a lot of concern in the community about petrol prices in the ACT. The Government has always recognised that there were a range of longer-term and structural issues affecting the petrol market in the ACT which needed to be considered in a systematic way if a credible response to this matter was to be made. It was this task which the working group was established to undertake, and its findings and recommendations are set out in this report.
The main finding of the report is that there is a lack of competition at all levels in the ACT petrol market and that this is the reason for higher ACT petrol prices. The report recommends a range of measures to stimulate a more competitive environment in the ACT petrol market, including the promotion of additional independent competition into the market and a series of changes to government planning and land policies affecting service stations. For the first time, we have a document which comprehensively examines the ACT petrol market and the wide range of government policies and practices which affect it, and therefore we now have a tool which should help to provide a basis for us to develop sound policies on this issue.
Because of the importance of this issue to the public and the industry, we believe that there should be a period of comment on this report and its recommendations before any final decisions are taken. For this reason, the Government has not adopted the report. We propose that comments on the report be directed to the working group, care of my department, until 20 January of next year. I look forward in the coming months to learning of public and industry comment on the report. Given this public comment process, the Government will not proceed with the price control legislation - the Fair Trading (Fuel Prices) Bill - until it decides its position on the recommendations of the working group's report.
The Government has consistently said, in response to the industry's concern that we should not introduce price control but should leave it to the market, that we would be comfortable with that if the market was operating fairly. This report is an indictment of a market which is not operating competitively; of a market which, compared with an average Australian market of some 20 per cent independent involvement, has only 7 per cent independent involvement, and in which there is no evidence of price competition or price differentiation across the whole community.
Debate (on motion by Mr Humphries) adjourned.
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