Andrew Leigh

Joint Media Release with
Alicia Payne
Member for Canberra

David Smith
Member for Bean

JOINT MEDIA RELEASE

KEEPING THE AIS IN CANBERRA IS A WIN FOR AUSTRALIAN SPORT

As the federal representatives of the ACT’s three federal electorates, we welcome the Government’s decision to accept the recommendation of the Independent Review into the Australian Institute of Sport (AIS) Infrastructure to keep the AIS in Canberra. 

As we argued in our joint submission to the Independent Reviewers, Ms Erin Flaherty and Ms Robyn Smith OAM; the AIS has a proud history of sporting excellence and its future is in Canberra.

Keeping the AIS in Canberra avoids the considerable costs of relocation and allows those resources to instead be reinvested in upgrading and updating its facilities. It involves less disruption to the training regimes of athletes preparing for upcoming Olympic and Paralympic games.

WHY MANY PAY TOO MUCH FOR FLIGHTS, AND HOW TO MAKE THEM MORE AFFORDABLE

A high-performing aviation sector is critical to Australia's way of life, connecting people and communities, while supporting economic activity and employment across regions.

Australia accounts for around 1.7 cent of global economic activity. Given this, we benefit greatly from adopting and modifying innovation from overseas. Swiftly bringing new ideas and products into our economy has been a major driver of economic growth for decades - and will continue to be so into the future. Travel is an important mechanism for sharing ideas, even in a post-pandemic world.

A healthy aviation sector means we can be better connected to the rest of the world, better equipped to adopt innovations and better able to help diffuse new ideas within Australia. In short, the aviation sector has large spillovers to other sectors, not just in obvious areas like tourism but right across the economy.

Using detailed microdata from the private sector and the Bureau of Infrastructure and Transport Research Economics, Omer Majeed from the Competition Taskforce in Treasury has teamed up with Professor Robert Breunig at the Australian National University to examine how competition has changed over time and the impact on aviation activity and prices. In an Australian context, it adds to the relatively limited evidence base demonstrating the relationship between competitive pressures and consumer prices.

The results show a strong relationship between competition and airfares. When one airline services a route, airfares average 39.6c per kilometre. With two competing airlines, the average fare drops to 28.2c. With three competitors, to 19.2c. In other words, the price per kilometre is halved when three competitors fly a route compared with the situation when there is only a single monopoly airline. With four or five competitors, the price drops further still.

GETTING ON WITH THE JOB

One of the great things about a sports-filled summer is that we get to spend plenty of time playing the armchair critic.

Unfortunately, some people take this a little too far. Nationals leader David Littleproud (SM, Jan 21) criticised Labor's actions to address the cost-of-living challenges, conveniently failing to admit that the Coalition squibbed it in government and has opposed cost-of-living relief from the opposition benches.

Since coming to office, the Albanese government has been hard at work examining Australia's competition law and policies to make up for the Coalition's negligence.

E&OE TRANSCRIPT
RADIO INTERVIEW
ABC PERTH DRIVE
TUESDAY, 30 JANUARY 2024

SUBJECTS: New Treasury research on competition in the airline industry.

JO TRILLING, HOST: As the new year begins you might be thinking about booking a holiday and living here means travelling by air does not come cheap. Well, a new government study has been looking at airline competition and has found that airfares drop significantly when two or more airlines compete against each other, which means bigger savings. I don't think that's news to anybody. Well, Andrew Leigh is Labor's Assistant Competition Minister. He says more competition equals lower prices and more flexible travel options for you.

ASSISTANT MINISTER FOR COMPETITION, CHARTIES, TREASURY AND EMPLOYMENT ANDREW LEIGH: Ever since Adam Smith we've known that more competition means lower prices. But this quantifies the impact on the domestic airline market. It shows that if you've got a monopoly carrier flying a route, then airline passengers pay on average 39 cents per kilometre. If you've got three carriers, that drops down to 19 cents per kilometre and it drops further still as you get four or five carriers on a route.

One of the other things that the study shows is that even in anticipation of a new competitor coming into a route, prices fall. So, Australians really benefit from greater domestic airline competition, which is one of the reasons that the Government's bringing out an Aviation White Paper and putting in place a slots review to make sure that the slots are allocated in a way that doesn't lock in the incumbents and lock out the challengers. Perth's distance from the rest of the country does make domestic aviation competition important and Perth's international engagement means that more international carriers really matter.

CHOCOLATE, CARTELS & COMPETITION

One of the summer’s box office hits is Wonka – the prequel to Willy Wonka and the Chocolate Factory. Without giving too much away, it’s the tale of how Willy Wonka takes on the chocolate cartel of Slugworth, Fickelgruber and Prodnose.

Between them, the cartel controls the chocolate market. Prices are kept high. Innovators are kept out. Big chocolate has the police in its pocket, and is willing to use every bitter trick to preserve its sweet control over the market.

For many Australian consumers, Wonka will resonate. Over recent years, the Australian Competition and Consumer Commission has taken action against anti-competitive behaviour in pharmaceuticals, finance, waste disposal and building construction. When so-called competitors collude, the public pays the price.

E&OE TRANSCRIPT
RADIO INTERVIEW
MORNINGS, ABC CANBERRA
TUESDAY, 30 JANUARY 2024

SUBJECTS: New Treasury research on value of competition in the airline industry.

ADAM SHIRLEY, HOST: The skies well, clear as a bell. A good day for take-off and landing, but you'll pay the price. As we know, flying in and out of Canberra costs a fair bit more than any other city in Australia. For a long time it's been a bugbear. But will anything fundamentally change it and stop the gouging that you might feel?

Dr. Andrew Leigh is Federal Member for Fenner and Assistant Minister for Competition and Charities. Dr. Leigh, is it too much money to fly in and out of Canberra?

ASSISTANT MINISTER FOR CHARITIES, COMPETITION, AND TREASURY ANDREW LEIGH: Certainly an expensive route, isn't it, Adam? The cancellation rate is among the highest in Australia and this analysis that we've gotten out of Treasury suggests that there's a direct relationship between airline competition and how much you pay. When one airline services a route, then you pay on average about forty cents per kilometre. With two, you go down to go down to twenty-eight cents, with three you go down to nineteen cents. In other words, when you got three competitors on a route, then you're paying half as much per kilometre as when you've just got a single monopoly carrier.

The Albanese Government will direct the Australian Competition and Consumer Commission (ACCC) to investigate pricing and competition in the supermarket sector to ensure Australians are paying a fair price for their groceries.

We understand that Australians are under the pump and the cost of groceries is among the biggest concern for many.

This 12-month ACCC inquiry – the first of its kind since 2008 – will investigate the competitiveness of retail prices and allegations of price gouging in the supermarket sector.

E&OE TRANSCRIPT
TV INTERVIEW
SKY AFTERNOON AGENDA WITH TOM CONNELL
THURSDAY, 18 JANUARY 2024

SUBJECTS: Labour force figures; Competition in the supermarket sector

TOM CONNELL (HOST): We’re joined by the Assistant Treasury and Assistant Employment Minister, Andrew Leigh. Thank you for your time. I think you're the Assistant Minister to the Treasury?

ASSISTANT MINISTER FOR CHARITIES, COMPETITION, TREASURY AND EMPLOYMENT ANDREW LEIGH: That's right, yes.

CONNELL: There you go. So, unemployment still with a three in front of it, it feels like a four is pretty inevitable. More than 100,000 full time jobs going. Is that going to be the well, not the new normal, the old normal is a three in front of it, unrealistic, do you think, as a permanent sort of facet of the economy?

LEIGH: Well, Tom, it is worth recognising how strong the labour market has been under the Albanese government. Under the former government, unemployment was around 5-6% for most of their nine years in office. Under us, it's consistently been below 4%. That translates into about 300,000 more jobs than if unemployment had been where it was under the Coalition.

E&OE TRANSCRIPT
TV INTERVIEW
SKY AM AGENDA WITH CHENG LEI
WEDNESDAY, 17 JANUARY 2024

SUBJECTS: Appointment of Craig Emerson to Review Food and Grocery Code of Conduct; Measures to assist with rising cost of living; Rate of unemployment; Cost of school supplies; Support for charity sector.

CHENG LEI (HOST): Joining me now is the Assistant Minister for Competition Charities and Treasury Andrew Leigh. Hey there, Andrew. Thanks for coming on the show. So, let's talk about this review. Why was that rejected?

ASSISTANT MINISTER FOR CHARITIES, COMPETITION, TREASURY AND EMPLOYMENT: Cheng, David Littleproud was part of a government that did nothing on competition for a decade. So, it's pretty rich for him to be talking about it now. The fact is, since we came to office, we've increased the penalties for anti-competitive conduct. We've banned unfair contract terms. We carried out a review last year into the dispute resolution processes of the Food and Grocery Code of Conduct. And as scheduled this year we're conducting a review into the Food and Grocery Code of Conduct itself. Unlike previous reviews of the Code, this is being conducted by one of our top policy economists, Craig Emerson, a man with a big heart and a big brain who'll bring his intellect to bear on looking at how Australian suppliers and consumers can get a better deal in the grocery sector.