Andrew Leigh

E&OE TRANSCRIPT
RADIO INTERVIEW
2CC DRIVE WITH LEON DELANEY
THURSDAY, 15 FEBRUARY 2024

SUBJECTS: Improving competition, right to disconnect, unemployment, inflation.

LEON DELANEY, HOST: Joining me now, the Assistant Minister for Competition, Charities, Treasury, Employment and pretty much everything else and our local member here in the seat of Fenner, Dr Andrew Leigh. Good afternoon.

ASSISTANT MINISTER FOR COMPETITION, CHARTIES, TREASURY AND EMPLOYMENT ANDREW LEIGH: Good afternoon, Leon. Great to be with you and your listeners.

DELANEY: Well, thanks for joining us today. What does it mean, this empowerment of consumers and small businesses act?

LEIGH: We've been doing a lot on the competition front, raising penalties for anti-competitive conduct, banning unfair contract terms, setting up the Competition Taskforce, and the next brick in that wall is a reform which will ensure that designated consumer and small business advocates will be able to bring systemic misconduct to the attention of the competition watchdog and have it dealt with. Right now, a complaint that's raised by a peak body is treated the same as every other complaint that comes through. This designated complaints power, which exists in other countries, will ensure that those systemic issues can be brought forward by consumer and small business advocates and get an answer within 90 days.

DELANEY. So, this basically creates a sort of a priority channel for complaints that are coming from representative bodies. Is that the idea?

LEIGH: That's it. Fast track, high priority. They'll be able to have selected complaints that they bring forward. That could be anything from drip pricing by airlines to concerns about small businesses not getting paid on time. These advocates are the eyes and ears in the community. They might see misconduct before the regulator does, and this lets them bring it to the attention of the regulator.

DELANEY. So, that might be anybody, like CHOICE, the Consumers Association, or it might be an ombudsman. It might be any of those particular sorts of those bodies?

LEIGH: Exactly those sorts of bodies. We'll have a careful process to choose the designated complainants, but they'll obviously be household names, bodies that people are familiar with, who have a track record of looking after consumer and small business interests. It's all about making sure that we get more competition in the economy, more productivity, and better prices.

DELANEY: Now, we've seen plenty of discussion about competition, or the lack thereof, in recent times, and how that has resulted in oligopolies. I'm sorry? Oligopolies. There you go. It was a bit of a mouthful, wasn't it? But I got there in the end, such as the supermarket consortium, which seems to be. Well, they're not exactly working in cahoots, but we could be forgiven for thinking so, couldn't we?

LEIGH: Well, when we saw the introduction of Aldi into the supermarket industry, we saw prices fall. That suggests that the power of competition applies in the supermarket industry as it does elsewhere. There's been concerns in the supermarket sector about prices for suppliers going down, but prices for consumers not falling. At the same time, there's been concerns too that suppliers are getting squeezed and consumers are getting price gouged. So, we've done a couple of things. We've got CHOICE doing quarterly price monitoring. We've got Craig Emerson reviewing the Food and Grocery Code of Conduct and we've got the competition watchdog reviewing supermarket prices.

DELANEY: And when do we expect to hear the outcome of that review?

LEIGH: The ACCC review into supermarket prices will come down in an interim form by the end of this year and then in a final form next year.

DELANEY: Okay. Because obviously a lot of people are waiting to see what that actually says. We all believe that we're being ripped off at the supermarket. We just want to see some sort of firm evidence of it. If that's what is shown by that report what can be done to rein in the aggressive pricing policies of supermarkets?

LEIGH: The competition watchdog has strong price monitoring powers and a range of penalties that it's able to apply. It's done that on various occasions with the supermarkets themselves, as well as, of course, misconduct by other large firms in the economy. And we know that when you're a monopoly, you can have a tendency to throw your weight around. We've seen that in other industries before. So, I'm confident that the competition watchdog will do a careful analysis here. Helped by the fact that they have better price monitoring data than ever before.

DELANEY: Yeah, as well as supermarkets, of course, the other big one that people have been talking about lately is airlines, isn't it? I mean, airlines have actually been making pretty good profits since the pandemic. And passengers are paying through the nose, aren't they?

LEIGH: The latest price reports suggest that domestic airfares have come down a little. But particularly if you're looking at the discounted economy fares, they're still not back at pre-pandemic levels. We have got the Competition Taskforce doing some analysis on domestic airfare pricing and it's shown pretty conclusively that if you've got three carriers flying a route, the price per kilometre is about half what it is if you've just got a monopoly carrier.

DELANEY: Okay? Now, also this week the Government has introduced today, I believe, the amendment to last week's closing the loopholes industrial relations bill number two. Because that bill last week was, well, it was a bit of a rush, wasn't it? And the Government accidentally left a few things in there that they didn't mean to. Now that referred to criminal penalties for employers that failed to follow the rules on not contacting employees out of hours. Nobody wanted to see criminal penalties for that. Why was that in the legislation in the first place?

LEIGH: Well, the reform is, as you noted, Leon, just a right to disconnect saying that employees can't be required to do unpaid overtime by being contacted by the boss when they might be at a kid's birthday party and having the boss demand a response, even although they're not on the clock. That was never intended to carry criminal penalties. We moved an amendment in the Senate that would have taken the criminal penalties out. But in a bit of a tantrum, the Liberals ensured that we kept criminal penalties in. The changes don't take effect for another six months and so we've introduced this bill into parliament which will take the criminal penalties out.

DELANEY: Okay, but that wasn't the answer to the question, why were they in there in the first place?

LEIGH: Look, I haven't followed every twist and turn as to how the legislation came into being. I do know that we sought to fix it and the Liberals didn't want us to fix it. So, this bill will sort things out well before those provisions take effect.

DELANEY: Well, it has been suggested that the fact that it was in there but you didn't want it in there, was evidence that perhaps the drafting of the bill had been rushed in the first place.

LEIGH: The fact is that the Liberals had a chance to take the criminal penalties out. That's what they said they wanted. But when it came to action in the parliament, they didn't do it. The Liberals’ tantrum is the only reason we're having to introduce this bill into parliament. The Liberals now have a position which is against wage rises, against job security, against safer workplaces, and against closing the gender pay gap. They've got an appalling track record when it comes to looking after the safety and wages of workers. It takes the Labor Government to ensure that we have proper real wage rises, which we've seen now for two consecutive quarters. Proof is in the pudding that when you have a Labor government, things for workers get better.

DELANEY: All right, well, unemployment has just gone up in today's figures and it's above 4% again. Now, whatever happened to the idea that full employment might be a figure where it starts with a three?

LEIGH: We've had a remarkable run of low unemployment in Australia and that's been sustained by Labor's policies of making sure that we have more opportunities for more workers. We've seen more jobs created during our first term in office than in any other first term government in Australian history. And while, of course we want to keep unemployment as low as possible, the fact is that it is still remarkably low by historical standards. Four percent unemployment still represents a very strong labour market performance. More people getting more work under labour.

DELANEY: Well, yes, but nevertheless, the ugly reality is that we have a Reserve Bank Governor now who is on the record previously as having said that unemployment has to rise in order to bring down inflation. Now, can't we control inflation without putting people out of work?

LEIGH: Well, I think that's what we've seen over recent months. We've seen inflation moderate considerably without unemployment going up considerably. There were people 18 months ago who are saying we'd have to have a massive rise in unemployment in order to deal with inflation. That hasn't been the story in the US and I don't expect it'll be the story here either. We're seeing steady moderation of inflation, well down from its quarterly peak, which was just before the Liberals lost office, coming down now to much more reasonable levels and our targeted measures are helping there. The targeted childcare changes, the targeted energy bill relief, the increase in Commonwealth Rent Assistance, all of those, the Australian Bureau of Statistics says are bringing down inflation compared to where it would have been. And many of those are opposed by the Liberals.

DELANEY: All right, well, we've seen today's unemployment figures. Obviously we'll look forward to the next set of inflation figures when they come out. Thanks very much for chatting today.

LEIGH: Always a pleasure, Leon. Thank you.