Mr MUTCH (10:18 AM) —The role of the ACCC, the Australian Competition and Consumer Commission, as stated in its annual report, is to:

. . . improve competition and efficiency in markets, foster adherence to fair trading practices in well informed markets, promote competitive pricing wherever possible and restrain price rises in markets where competition is less than effective.

This role is becoming extremely important in Australia's economic performance. The importance of a dynamic market cannot be underestimated. With the deregulation of so many industries over the past couple of decades, consumers in the Australian economy have benefited significantly from productivity improvements that have been associated with the increased competition. Monopolies, thankfully, are becoming a thing of the past. Very few industries now have only one supplier of goods and services. Even the waterfront is facing up to competition.

Mr McClelland —It always has.

Mr MUTCH —I think the member for Barton says that with a wry smile on his face. I do not want to be too harsh on him, because he is a great supporter of census retention and I thank him for his support on that issue. It is competition, however, that enables business to perform to its best, because in a competitive market it has to thrive to survive.

Standards of service are significantly better in a competitive environment: one only has to look at Telecom 10 or 15 years ago, as compared with the modern-day Telstra. That does not mean that we do not have a number of complaints about services provided by Telstra as well, but we have to continue to monitor these to make sure that they lift their game on a continuing basis.

The Australian Competition and Consumer Commission has a significant role to play in ensuring that industries are able to deliver the benefits of competition for the betterment of all Australians. A significant role played by the ACCC is certainly worth the $35 million that is invested in the budget for it. This money spent is worth the potentially billions of dollars that pro-competitive practices can save Australian industries and the Australian consumer.

Our role as members of the House of Representatives Standing Committee on Financial Institutions and Public Administration is to review, in this instance, the work of the ACCC and to scrutinise its activities, because we have the important role of ensuring that, while potential monopolies are accountable to the ACCC, the ACCC is accountable to us and to the Australian people through us. That is a very important role that we play. The ACCC of course is independent of government, and I do not think there is any argument about that. The best way we can ensure that the ACCC performs well is to regularly scrutinise its performance.

We conclude the report by saying that overall the ACCC is performing reasonably well; but, as the report shows, there are still areas for considerable improvement in its performance. The honourable member for North Sydney (Mr Hockey) did instance a couple of examples of concern. I recall a situation where he was sympathetic to the ACCC because it seemed that they were being ripped off. They were getting advice from the Australian Government Solicitor, and the Government Solicitor was subcontracting out some of the legal work to a firm of solicitors who were also being paid by Optus. It seemed that there was some sort of subsidisation going on, but the Australian Government Solicitor was charging the ACCC at commercial rates. We have looked into that issue and we note that things are going to change in the future.

There are critics of the ACCC. Some critics say that it uses its very powerful influence excessively. It is accused often of having a tendency to transform markets to accord with its view of best competitive practice. The critics have accused it of coming to conclusions on the basis of poorly researched information or information that is incomplete. It has also come in for criticism for its preparedness to act on media reports or on reports coming from parties seeking to use the ACCC to gain a commercial advantage. These criticisms are going to occur: you have got to understand that the ACCC is always going to be controversial.

There are many important challenges ahead. The telecommunications industry must be monitored to ensure continuing competition. In terms of local calls, there must be a fair system whereby each party is able to compete while providing benefits for consumers. Consideration must also be given to access to this local market for other service providers who may not own cables. Although significant reductions have occurred in the long-distance telephone market, there must also be further reductions in the years to come. Profit margins are extremely high for overseas calls, even though special rates are offered on odd occasions. For example, special deals for as low as $20 per hour to ring the UK are occasionally offered. However, I believe that we can do even better than that.

We also have to look at the use of new technology which is coming on the scene. Over the past couple of years, the Internet has become increasingly popular. The nature of this technology presents a whole new set of challenges to the ACCC to encounter in the years to come, to ensure that big business does not engage in anti-competitive behaviour.

In terms of waterfront reform, the ACCC has a continuing role to play in ensuring that anti-competitive practices are monitored and prevented. The waterfront is an extremely important area in terms of our international competitiveness and our economy. An efficient waterfront has the ability to ensure that our exports are competitive and that therefore our export businesses prosper. Such an environment creates more jobs for Australians. It is in instances like these that anti-competitive behaviour has in the past destroyed jobs, and this is now changing—thanks to government action. I would like to congratulate the ACCC for the stand that it has taken in the waterfront dispute.

Another area of importance is the financial institutions sector. I believe the government has provided the economic conditions to help financial institutions grow. We have seen institutions like Aussie Home Loans, Westpac and others lead the way in cutting lending rates to home buyers and businesses. I think the government deserves some credit for creating the stable economic environment in which interest rates have been able to come down. Investment is very important in Australia because investment means jobs. The role of the banks must continue to be monitored by the ACCC because the cost of finance is a significant reason that firms choose to invest, which is so important for our economy.

As Professor Fels said in his address to us on 20 November 1997, the ACCC is an enforcement body and not generally a policy adviser or a policy advocacy body, but sometimes the reason they get involved in that area is that the government wants to know a bit more about a particular market where they may be looking at taking much needed action. Competition policy is about improving the efficiency of our industry for the benefit of all Australians. There are further challenges ahead.

With the sale of public assets, especially utilities, the ACCC will have a continuing role to play ensuring that the interests of all parties are protected. With the proposed sale of the remaining two-thirds of Telstra, the ACCC will have an important role to ensure that the battlers do not get ripped off by a monopoly or duopoly. The conditions must exist for effective competition and safeguards must be in place against monopolies and any form of price collusion. These are some of the goals that the ACCC must achieve. It is the responsibility of this government to ensure that the conditions for competitive behaviour are set in place and it is the responsibility of the ACCC to enforce this anti-competitive legislation.

Debate (on motion by Mr Reid) adjourned.