Andrew Leigh

LABOR LEADING CONSUMER AND COMPETITION DEBATE

HOUSE OF REPRESENTATIVES, 27 JUNE 2018

Dr LEIGH (Fenner):  I move:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House notes the Government's failure to commit to a full suite of measures to strengthen the consumer watchdog, including:

(1) increasing the maximum penalties for anti-competitive conduct;

(2) cracking down on payday lenders;

(3) providing the Australian Competition and Consumer Commission with an independent market studies function;

(4) increasing the litigation budget of the Australian Competition and Consumer Commission;

(5) requiring car manufacturers to share technical information with independent mechanics on commercially fair and reasonable terms, with safeguards that enable environmental, safety and security-related technical information to be shared with the independent sector; and

(6) prioritising cases that disproportionately affect disadvantaged Australians".

It is always a good day when the coalition belatedly adopts Labor's policies. On 15 June 2016, Labor called on the government to raise the penalties for ripping off consumers. We did so following a succession of scandals in which firms had seen penalties for anticonsumer conduct as simply the cost of doing business. We had that period from 2011 to 2015 when Nurofen, one of the big shots in the pain business, began selling a series of painkillers said to target pain in the body—Nurofen Back Pain, Nurofen Period Pain, Nurofen Migraine Pain and Nurofen Tension Headache—but the fact was they all had the same active ingredient, 342 milligrams of ibuprofen lysine. The fact was that Nurofen were misleading consumers, and the penalties dealt out to them were a mere slap on the wrist.

The same was true when Dulux said that their outdoor paint could reduce the temperature of a house by 10 degrees and when Uncle Tobys asserted that its oats were ‘a natural source of protein’, leaving it to the fine print for consumers to understand that the oats are only a good source of protein when eaten with skim milk. More recently, we've seen the list of those who've been reprimanded by the competition watchdog read like a Who's Who of the top end of town: Jetstar, Virgin, Arnott's, Optus, Harvey Norman franchisees, Kogan and Unilever. Earlier this year we had the Federal Court bring down a judgment against Flight Centre, finding that Flight Centre had asked a number of airlines not to publish on their websites ticket prices that were than Flight Centre's prices. That decision saw a penalty of $12½ million for conduct between 2005 and 2009. Indeed, Rod Sims, the head of the ACCC, has voiced concerns that penalties for anticonsumer and anticompetitive conduct in Australia are 'significantly lower' than the penalties in other OECD jurisdictions.

So this bill is welcomed by this side of the House. This is a Labor policy being enacted into law. But the coalition need to go further. They need to amend the Competition and Consumer Act to give a fully autonomous market studies function to the Australian Competition and Consumer Commission  and to explore public interest issues such as pricing discrepancies and increased market concentration. They need to increase the Australian Competition and Consumer Commission ‘s litigation budget so they can take on more potential scammers like those going door to door in Indigenous communities, ripping off some of the most disadvantaged people in Australia. They need to ramp up the penalties for anticompetitive conduct, which are lower in Australia than they are in comparable jurisdictions. Labor's policy on penalties for anticompetitive conduct says courts should use the European Union formula in the first instance, which makes the base penalty 30 per cent of the annual sales of the relevant product or service, multiplied by the number of years the infringement took place, capped at 10 per cent of annual turnover.

We have, in Australia, fewer competitive markets than we need. 

By one estimate, in the research done by Adam Triggs and me, more than half of Australia's market are concentrated -- where concentration is defined as the big four having more than a third of the market. We need to see fewer monopolies and more competitive industries in Australia. Only Labor's policy will deliver that. Labor welcome this belated adoption of our policy, but it shouldn't have taken two years to get this point. Indeed, this bill has languished on the Notice Paper since February. We should have had it dealt with by now.

Other measures include an ‘egg-citing’ measure about the definition of 'free range' which ensures that Australian customers know what 'free range' means when they see it on a label. We know many shoppers feel that suppliers are being a little chicken in telling them exactly what's going on. Having a precise definition of 'stocking density' will be good for consumers. Labor also supports the amendments to the Competition and Consumer Act to ensure that confidential supplier information obtained by the Australian Energy Regulator in performing its wholesale market monitoring and reporting functions under the National Electricity Law remains confidential under Commonwealth law.

The contrast between the two parties when it comes to consumer and competition issues is stark. Labor would have acted on this issue of raising penalties more than two years ago. That was when we announced this Labor policy. Labor still believe that there is more to be done in making sure the penalties are right, that the regulator is appropriately resourced and that the regulator has the teeth to do those critical market studies. Labor will be supporting the bill, but we are doing so at a time when we know the government are going soft on payday lending because of their 'friends of payday lending' backbench group that is stopping them supporting a bill that has previously been backed by their own party room.

We know they're not doing the right thing by independent mechanics, who are currently hitting the wall because they don't have access to the same data to fix cars that the authorised dealers have. We had the absurd situation on Monday of a private member's motion debate in which the coalition said they were already requiring manufacturers to share the same information with independent mechanics as they do with authorised dealers. That would be news to Australia's tens of thousands independent mechanics who right now suffer a competitive disadvantage by not getting the same data the authorised dealers get. As a consequence, consumers are paying higher prices and getting less choice.

Labor have always been the party of consumers and competition. Labor continue to lead the consumer and competition debate, and we welcome the government, two years late, catching up on this important reform.

The DEPUTY SPEAKER (Mr Goodenough):  Is the amendment seconded?

Mr Clare:  I second the amendment.

The DEPUTY SPEAKER:  The original question was that this bill be now read a second time. To this the honourable member for Fenner has moved, as an amendment, that all words after 'that' be omitted with a view to substituting other words. If it suits the House, I will state the question in the form that the amendment be agreed to. The question now is that the amendment be agreed to.

ENDS
 
Authorised by Noah Carroll ALP Canberra