Page 3619 - Week 12 - Thursday, 13 October 1994
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but it is not all right for the major oil companies to say so. What is the distinction? What is so great about Mr Burmah? On the same page the Minister said that the Government has been particularly concerned to do what it can to correct those aspects which are unique to the ACT. In other words, they knew that they could not deal with the majors on the basis of that, so they are fixing those conditions that are unique to the ACT. But I ask, in connection with the Government's response, "What are the factors that are unique to the ACT?". What has happened is that the local small businesses and investors have been victimised and have suffered major financial loss as a result of Mr Connolly's decision. But he has not addressed any factor that is unique to the ACT, because the simple fact is that there are none.
At page 3 of his response to the report he said that the Public Accounts Committee has been more concerned with the effects on existing operators in the ACT oil industry than with the price of petrol. You are darned right we were. The Government's actions have no long-term beneficial effects for anybody. They have had an immediate adverse consequence for local business; but they have had no effect at all on the majors. So, what you have is a short-term reduction in prices and no guarantee whatsoever that they will stay down. Mr Connolly cannot produce one jot of evidence that even Burmah will keep the price down. They are under no legal obligation to do so. In exchange for getting the price down for a short time, we are driving local small businessmen out of business. Mr Connolly said that the preferred approach is to ensure that the market is competitive. But the market is not competitive. It is no more competitive today than it was a year ago. It merely gives Burmah a price advantage. There is no competition in that. That advantage, to the extent that Mr Connolly sees it as one, will dissipate as the market settles down and Burmah simply puts up the prices to coincide with what the other majors decide is the price.
At page 4 Mr Connolly said:
Effectively this Recommendation -
referring to one of the specific recommendations -
is suggesting that the Government abolish existing franchise arrangements and convert franchisees into independents.
This had to do with our recommendation that he enact legislation that would protect an individual franchisee from victimisation by the major with which he is associated, if he does what he is allowed to do legally under his franchise and goes and buys fuel somewhere else. He said that we have misunderstood it. He said that we are suggesting something that we never suggested and had no intention of suggesting. It is absolute rubbish. It is not what the committee suggested at all, and the Government has totally misrepresented this recommendation. If he had bothered to read the franchise agreements, he would have understood exactly what we meant. The existing franchise arrangements ostensibly allow operators to purchase elsewhere. They are precluded from doing so only by the coercive power of the majors. They know that, if they go and buy one gallon of fuel on a wholesale basis from some major dealer other than the one from
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