Andrew Leigh

Digital Competition And Economic Dynamism
Monash University Business School, Melbourne
Friday, 17 March 2023

Introduction

I acknowledge the people of the Kulin Nations, the Traditional Custodians of the land on which we gather today.

I pay my respects to their Elders, extend that respect to other First Nations people present today, and commit myself, as a part of the Albanese Government, to the implementation in full of the Uluru Statement from the Heart.

I would also like to acknowledge Monash University and thank the Business School for putting together such a great event. I’m especially chuffed that you’ve invited Joshua Gans to join us. Joshua is one of Australia’s great competition thinkers, but now works out of the University of Toronto. He and I have co-authored nine journal articles and a book, but we’ve never before spoken at the same conference. So thanks to the organisers for allowing Joshua and me to tick that one off our academic bucket lists. 

I also recognise the work of Australian Competition and Consumer Commission Chair Gina Cass-Gottlieb and Productivity Commission Chair Michael Brennan.

Making It Fairer For All

The Daily Telegraph, 17 March 2023

My first music purchases were records. Mostly, I bought 45 RPM singles. But when I could afford them, I splurged on 33 RPM albums. The money from my newspaper delivery job didn’t go far, which meant that I listened to the same songs again and again. Pick a Midnight Oil song from the 1980s, and it’s a fair bet that I know every word.

A generation later, my three sons listen to music through Spotify. They have access to virtually everything ever recorded, and jump happily through artists and genres. My boys literally have access to a million times as much music as I did.

Something else has changed. When I was buying vinyl, there were plenty of indie record labels. Today, Spotify dominates the streaming market. As a result, musicians and songwriters are feeling the squeeze. Cellist Zoë Keating estimates that Spotify pays her just one-third of a cent per play. For most artists, streaming doesn’t pay the bills. 

ABS TO COMMENCE ANNUAL TIME USE SURVEY IN 2024

The Australian Bureau of Statistics will conduct the Time Use Survey on an on-going basis from 2024.

The Time Use Survey is a detailed data collection that records the activities Australians take part in each day, including the amount of time people spend on unpaid work such as caring for children and older people, and doing housework.

Decades ago, Australia was a global pioneer in time use surveys, conducting surveys in 1992, 1997 and 2006 before a sixteen-year hiatus. The most recent survey took place in 2020-21 during the exceptional environment of the COVID pandemic. 

Matter of Public Importance
House of Representatives, 9 March 2023

In Australia, the last six Liberal leaders have lost their jobs, one way or another, because of climate policy. We saw the Howard government thrown out in 2007 in part because of inaction on climate. We saw the Morrison government turfed out in 2022 because of inaction on climate. We saw the double defenestration of Malcolm Turnbull because they just couldn't cop his approach to climate change. As Malcolm Turnbull has put it, the Australian Liberal Party ‘is not capable of dealing with climate change.'

It doesn't have to be this way. If you look around the world, everywhere except Australia and the United States, conservatives are taking action on climate change. The UK conservatives have committed to a fully decarbonised power sector by 2035 and a zero-emissions vehicle mandate, have established the UK Green Investment Bank and have put policies in place that, if Coalition members opposite were sitting in the House of Commons, they would have all voted against.

E&OE TRANSCRIPT
RADIO INTERVIEW
ABC RURAL COUNTRY HOUR WITH WARWICK LONG
THURSDAY, 9 MARCH 2023

SUBJECTS: Right to repair agricultural machinery.

WARWICK LONG (HOST): Let's keep talking government right now, but very much an on farm issue. The Federal Government is asking the Australian farming industry for ideas on how best to give farmers the right to repair the equipment they buy. So in January, the American Farm Bureau signed an MoU with major farm machinery dealers to allow US farmers access to machinery repair codes, diagnostics and manuals after they were initially locked out by companies protecting intellectual property rights. The same issue is facing Australian farmers and they want a similar solution. Andrew Leigh is the Assistant Minister for Competition and he says he wants to hear from industry about some of these solutions and work out a deal for Australian farmers. I spoke to him earlier today.

ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY ANDREW LEIGH: Certainly we’re interested in the potential for expanding the right to repair. For many years, I've been campaigning for data sharing, for mechanics to be able to fix modern cars. Modern cars are computers on wheels, and unless independent mechanics have access to that data, they were looking at going to the wall. And the very same issue arises with agricultural machinery. The movements in the United States suggest a way in which this might be possible to achieve and certainly it would improve agricultural productivity, because you're talking about farmers being able to fix their machines quicker and at harvest time, you've got dollars going out the door if you're not harvesting quickly.

Sri Chinmoy Peace Run
House of Representatives, 9 March 2023

Since 1987 more than seven million people worldwide have held the Sri Chinmoy peace torch, including Pope Francis, Mother Teresa, the Dalai Lama, Nelson Mandela, Bob Hawke and John Howard. The 2023 Sri Chinmoy Oneness-Home Peace Run started in Brisbane and came to Canberra today. As ACT patron of the peace run, I was pleased to welcome the team to Parliament House, along with members and senators from across the parliament.

The team carrying the torch in relay has included Abhijatri Robinson (South Africa); Annabel Hepworth (Australia); Ashadeep Volkhardt (Australia); Bayarkhuu Batbayar (Mongolia); Fatima Caal Caal (Guatemala); Gabriel Quintana (Guatemala); Gesiane Nascimento (Brazil); Grahak Cunningham (Australia); Harashita Sunaoshi (Japan); Harita Davies (New Zealand), a three-time finisher of the world's longest race, the Sri Chinmoy 3,100-mile race; Joe Ward (Australia); Liana Tibaquira (Colombia); Mirabel Gonzalez Lopez (Guatemala); Narantuya Batsaikhan, Mongolia; Paramananda (Indonesia); Prachar Stegemann (Australia); Salil Wilson (Australia), global CEO of the peace run; Sarankhuu Jargal (Mongolia); Shasti Aston (Australia); Stacey Marsh (New Zealand), the national coordinator of the peace run for Australia; Susan Marshall (New Zealand), women's winner of this year's Sri Chinmoy 3,100-mile race. Plus thousands more Australian school students and members of community groups and clubs, along with citizens from all walks of life who have held, walked or run with the peace torch.

House of Representatives, 8 March 2023

We on this side of the House are concerned with ensuring that Australia has a more dynamic economy. We are committed to action on climate change, as embodied in schedule 2 to the bill, which enacts sustainability standards, implementing the Australian government's election commitment to ensure a standardised, internationally aligned reporting of climate related plans, risks and opportunities by large businesses.

The government is committed to ensuring that Australia has a more dynamic economy. Over recent decades, we've seen an increase in market concentration and an increase in mark-ups, the gap between costs and prices. We've seen a fall in the startup rate and a decline in the share of Australians starting a new job. It's very clear that the Australian economy is becoming less dynamic. After the lousiest decade of productivity growth in Australia's postwar history, it is vital that we look at the benefits that could be garnered from competition reform. In the 1990s Australia saw a productivity surge, and a good part of that had to do with the reforms to competition initiated by Fred Hilmer and Paul Keating at the beginning of that decade. Those Hilmer-Keating competition reforms garnered some $5,000 a year in benefits for the typical Australian household.

We need to consider today whether competition reform can help deliver a more dynamic economy. Since coming to government, the Albanese government has increased the penalties for anticompetitive conduct. We have banned unfair contract terms. We've received an important report from the Australian Competition and Consumer Commission into digital platform services. And we are currently consulting on platform-specific regulation and a ban on unfair trading practices. Around the world, we can see the thinking on competition shifting. The Biden White House has quite a different approach to competition issues than the Obama White House did. There is a greater awareness that big is not necessarily beautiful and that large firms can affect the entire ecosystem. The impact of monopsony power, the way in which large firms can squeeze their suppliers, is coming into sharp focus. Take Apple, for example. Apple is able to occupy a dominant position in the smartphone market, charging more to consumers than it would be able to do if it had a smaller market share. But Apple can also squeeze its suppliers. There's only one way of getting an app onto the Apple app store, and that is by going through Apple. That's why the typical cost of an in-app purchase is 30 per cent. So monopsony power can hurt suppliers, just as monopoly power hurts consumers.

Better Together
CPA Australia, Sydney
Wednesday, 1 March 2023

Thanks very much, Wayne [Stokes], for the generous introduction. Thanks to all of you who have come here in person. In the slightly post-COVID age we’re in, it’s lovely to be in a room with other human beings, and that’s a theme that I’ll be touching on a little bit today. Welcome also to those who are joining virtually.

As Wayne did, I acknowledge that we’re meeting on the traditional lands of the Gadigal people, pay my respects to elders past and present, acknowledge any Indigenous people present and commit myself as a member of the Albanese Government to the implementation in full of the Uluru Statement from the Heart.

I just finished reading Katherine Rundell’s biography of John Donne. It’s called Super‑Infinite, a title that comes from the way in which Donne’s great focus was on the things that transcend us. When we think about John Donne, we think of that wonderful line, "no man is an island". Of course, a little gendered for his age, but still a powerful reminder of the importance of focusing on those activities that bring us together.

Indeed, it’s hard to point to many achievements of humanity, whether it is creating a great invention, winning a war or building a city, which have been done by a single person alone. Most of the achievements of which humanity can point back are collective achievements. They're achievements of "we", not achievements of "me". And yet over recent decades, Australia has shifted starkly from being a nation more of we to a nation more of me. I want to start by just taking you a couple of metrics for that.

The first is when we look at the number of organisations per person in Australia, that figure has dwindled. We can go to the Directory of Australian Associations, started in the late 1970s, which tracks the number of organisations in Australia, and we see from that a decline in the number of organisations per person. If you wanted to join an organisation in Australia today, there are simply fewer to choose from per person than there were in the late 1970s.

E&OE TRANSCRIPT
TV INTERVIEW
SKY NEWS AFTERNOON AGENDA WITH KIERAN GILBERT
TUESDAY, 7 MARCH 2023

SUBJECTS: Interest rates; Impact and causes of inflation; Government’s response to cost of living.

KIERAN GILBERT (HOST): Let's get back to the issue of the rate rise today, the 10th consecutive rate rise at an RBA board meeting. The Assistant Minister for Treasury, Andrew Lee, joins me now. Is there any hope from the RBA statement that this might be the last, or at least close to it?

ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY ANDREW LEIGH: I would have hoped so Kieran but if you look at the end of the RBA statement, they do say that further tightening is likely. So that's unfortunately troubling news for many households. If you look at the impact of the typical mortgage holder over the course of this rate rise cycle, which started just before the election, somebody on a typical mortgage will have seen their monthly repayments go up $658. This increase on its own pushes up repayments for that typical mortgage holder by $51 a month. So it's a significant impost on the Australian household.

E&OE TRANSCRIPT
RADIO INTERVIEW
ABC RADIO NATIONAL DRIVE WITH ANDY PARK
THURSDAY, 2 MARCH 2023

SUBJECTS: How Uncompetitive markets hurt workers; Non-compete clauses in employment contracts; Superannuation tax breaks worth more than the full-rate aged pension

ANDY PARK (HOST): The cost of living is rising, interest rates are going up, groceries are getting more expensive, and it's getting harder to travel with the rising price of airfares. None of this is news to you, but in recent weeks we have heard stories of people who are really struggling, which are in stark contrast to some of the eye boggling profits from some of Australia's largest companies and their reporting. So what can we do? What should we do to ease the pressure on the average Australian household? Andrew Leigh is the Assistant Minister for Competition, he joins me now on RN Drive. Good day, Andrew

ASSISTANT MINISTER FOR COMPETITION, CHARITIES AND TREASURY ANDREW LEIGH: Great to be with you.

PARK: You've spoken about market concentration allowing companies to lift profits excessively and keep wages low. Are Australian consumers and workers being rorted here?

LEIGH: We certainly know that excess monopoly power is bad for consumers. It drives up prices and drives down choice. It means that firms don't do as much research and development and you don't get the sort of innovation that you'd expect in a highly competitive economy. But what I'm increasingly concerned about now is that market concentration might also hurt workers too. The classic extreme is a company town where you've only got one choice as to who to work with. In that situation, you have the employer exerting a sort of power over the workers that a monopoly exerts over consumers. And this monopsony power, the power that employers have over workers, seems to be prevalent in a lot of parts of Australia, particularly regional Australia. That might be a reason why we haven't seen the sort of real wage growth we would have hoped over the last decade.