Mr FORREST —My question is addressed to the Treasurer. What reforms has the government initiated to increase competition and enhance price transparency in petrol retailing? What has the government done to establish a regime for open terminal access in the petroleum industry, and what benefits will the government's policy deliver to petrol consumers, especially those in rural and regional areas like those in Mallee? What has been the success of the government's policy so far?

Mr COSTELLO (Treasurer) —I thank the honourable member for Mallee for his question. I acknowledge the interest he has shown in the petroleum industry.

Mr Melham —What is he—a petrol head?

Mr COSTELLO —No, he's not a petrol head—I think you're a far more likely candidate, my friend. In July, the now Minister for Defence, Mr Moore, and I announced the government's reform plan for petroleum retail marketing. It was based on the recommendations of the 1994 Industry Commission and the 1996 Australian Competition and Consumer Commission inquiry into petroleum products.

I have always said that petrol pricing will depend on a number of factors. One of the principal ones is the world price for oil. The exchange rate will contribute to it. Refining costs will contribute to it. We have always said that, all other things being equal, a more competitive retailing end of the market will deliver lower prices. That is, prices will move according to world prices and exchange rates and everything else—things we do not have control over—but, all other things being equal, if you have a more competitive retail end of the market, you will get better prices.

Mr Fitzgibbon interjecting—

Mr SPEAKER —The member for Hunter!

Mr COSTELLO —Our package was to allow open access to oil terminals for bulk fuel supply customers, and we have done that. Our package was to get monitoring of prices by the automobile clubs, and the automobile clubs are now doing that for us. Our package was also to introduce a more competitive regime in relation to petrol marketing. Of course, like all economic reform, it was opposed by Labor. Labor opposes everything, and so it opposed reforms to petrol marketing. In fact, Labor said in its policy: `The one sure thing is that under Mr Howard petrol will rise.'

Mr Fitzgibbon —That's right!

Mr COSTELLO —That's right, is it? Okay. One of the thinkers on the Labor frontbench says that that is right. The consumer price index for the September quarter showed that petrol prices fell 2.2 per cent. The Labor Party said that the one sure thing is that petrol prices would rise—and that has been confirmed by a member of its frontbench. The consumer price index for September showed that prices fell 2.2 per cent and, in relation to some areas, you can actually now buy petrol for under 60c a litre.

We have implemented open access. This has given new opportunities for bulk suppliers to get into the industry. We intend to move on and enhance competition in the retail area because, by enhancing competition, by getting more effective sales of goods and services, you are going to see the kind of productivity lifts that the Prime Minister talked about which will make our country strong.

Mr Fitzgibbon interjecting—

Mr SPEAKER —The member for Hunter is ignoring the remarks of the chair.