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Legislative Assembly for the ACT: 2000 Week 11 Hansard (30 November) . . Page.. 3485 ..

MR HARGREAVES (continuing):

The government intends to open the hire car industry right up by allowing school and formal vehicles to lease an annual licence for $10,000. Mr Smyth believes that this will provide greater flexibility in the industry. What the minister does not realise is that approximately 30 restricted hire car vehicles operate in the wedding and formal market. If the government's changes go ahead, those vehicles can enter the hire car market and destroy the 22 businesses that already provide this service. The minister would argue that this is competition and that these 22 hire cars have a monopoly of the market. Let me quote the definition of "monopoly" in the Dictionary of Modern Economics for Mr Smyth and for the entertainment of the Chief Minister, who cannot seem to wrap his mind around a serious issue:

There are 22 businesses in the ACT hire car industry. Each supplies a similar product. If you do not like one hire car, you have the option of choosing another. The hire car industry is optional. Therefore, there are few buyers of the product, unlike the taxi industry, which has many. The hire car industry shares its financial take between 22 or fewer cars. Any additional cars will reduce this income. This sector is not a monopoly and should not suffer under the guise of competition policy.

Many of the operators in the industry bought hire car plates with their superannuation, outlaying approximately $120,000. They saw it as a good investment which would give them a comfortable return, but this has hardly been the case. At this stage I would like to acknowledge the presence in the gallery of representatives of that industry. I thank them very much for coming along this morning.

Over recent times operating costs have skyrocketed. Fuel costs have doubled this year, with fuel now costing operators $5,000 a month; vehicle registration costs an extra $300 for; and business has declined due, amongst other things, to the Prime Minister not residing at the Lodge, with the resultant loss of big visits by big business and lobbyists.

One hire car operator said that their figures for the month of September were down compared with previous years. September is generally quiet, but $8,000 this year compared to $35,000 for 1999 is a substantial decline. At the briefing I had from the department, I was told that they expected to lease four plates. These four plates would cost existing operators $300,000 a year. This, on top of increased operating costs, would surely have an immediate and disastrous effect on existing operators.

This attack on the hire car industry is deregulation by stealth. We saw it with the milk industry. Vendors content delivering in their particular zone were turned upside down when the government announced the review. Those vendors trying to sell their milk runs found it impossible, and the value of their runs dropped overnight when the review was announced. All you have to do is substitute the word "milk" with "hire car". The situations are identical.

I received a letter from the owner of hire car plate H4. He owned his plate for six years but decided in October 1999 to sell it. Prospective buyers told him that they would not purchase his plate until after the review had been completed. On 23 November 2000, H4 was returned to storage at the motor registry because the owner had been unsuccessful in

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