Page 590 - Week 02 - Thursday, 9 March 2006
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market determine the correct level of fares if the minimum fare is set above the ACTION fare? If the minister is going to set the minimum fares against the benchmark of existing ACTION fare services, what motivation is there going to be, what drive is there going to be, for an enterprising response service, which merely wants to supplement existing ACTION bus services, to come forward and compete?
If the minister sets a minimum fare, I feel this will really block competition. How can a new provider provide any level of service unless they know that their fares are going to be set by a neutral umpire? That is why we have the ICRC in this town: it provides those sorts of neutral determinations. So the opposition reiterates the need for the determination of fares for new players coming into the field to be set by the ICRC. We just think that will open up the opportunities. It will provide, again, a more imaginative and flexible transport landscape, which must more greatly benefit the ACT community. Again, the most important issue here is the service that we provide to the ACT community, and I am sure the minister wants to do the best he possibly can. The ICRC determination will provide a fairer and more concise determination in these matters and, therefore, I commend the amendment.
MRS DUNNE (Ginninderra) (5.28): Mindful of the need for haste, I just need to put on the record the concern that the opposition has about the faulty notion of setting the minimum fare, because the whole problem with setting a minimum fare is that this is one of the elements of the current legislation that will mean that we will not have demand-responsive public transport in the territory. As things stand, the minister is going to be in a situation where he will set fares in such a way that there will be, again, no competition with ACTION, and this will mean that it will be exceedingly difficult for people to succeed.
It seems ludicrous that in a market you would set the minimum cost. I can understand perhaps a maximum cost, so that there is no price gouging, but setting a minimum cost really is designed to entrench the monopoly of ACTION. I am heartened by the fact that the minister draws attention to the fact that this is a disallowable instrument and that there is scope for the Assembly to intervene in his determination. But that is not enough consolation for me and the opposition, and that is why we have moved the amendments.
DR FOSKEY (Molonglo) (5.30): At first blush it seems reasonable to argue that what is good for the goose is also good for the gander and that, given that the ICRC is used as the body to make decisions for fares at both ends of the public transport spectrum, it ought to be the ICRC rather than the minister who deals with this demand-responsive, hybrid form of public transport as well.
However, I understand, and Mr Hargreaves referred to it, that a referral to the ICRC costs about $200,000. That kind of expense might be justified when dealing with an industry-wide or monopoly pricing policy. But the problem we have in applying it here, as a rule, is that the various demand-responsive transport services are likely to prove small, diverse and competitive. Each service may adopt a different fare structure, although it was noted in the substantive debate that we recommend a transparent, easily understood fare structure be applied across Canberra.
If there does develop a need for a general look at appropriate fare structures across the field, the minister can certainly refer it to the ICRC. But at this stage it seems
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