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Wednesday, 28 June 2000
Page: 18458


Mr CHARLES (3:01 PM) —My question without notice is to the Minister for Financial Services and Regulation. Would the minister inform the House what Australia's competition watchdog, the Australian Competition and Consumer Commission, will be doing over the next 10 days to protect consumers from price exploitation during the transition to the new tax system?


Mr HOCKEY (Minister for Financial Services and Regulation) —I thank the honourable member for his question. The Commonwealth government has allocated more than $56 million over three years to the ACCC to assist it with its price monitoring functions as a result of the transition to the new taxation system. At its peak, over the next 10 days, the ACCC will have more than 2,000 people working on price monitoring, either through the ACCC itself or through its contractors. This is the most extensive price monitoring and consumer protection regime ever undertaken during the transition to a new taxation system, outside of price control in Great Britain and a price freeze in Belgium, Korea and the Netherlands.

Unlike other GST implementation programs around the world, the ACCC has covered all means of assisting consumers and business. In relation to indicative prices, the ACCC has printed eight million everyday shopping guides which have been mailed to 6.7 million households. They are still available in post offices and newsagents around Australia. The ACCC has distributed a further 760,000 leaflets with facts for consumers to households, and that material is being translated into six different languages, including Italian, Chinese, Spanish, Vietnamese, Arabic and Greek. The ACCC's hotline, 1300 302 502, has received more than 78,000 calls to date, mostly about pricing inquiries. Despite the best endeavours of the Labor Party, the ACCC has conducted an advertising campaign to tell consumers the phone number. The ACCC is also providing extensive advice to business. They have distributed more than 3,400,000 booklets and fact sheets to businesses, as well as 200,000 small business pricing kit CDs. In addition, the ACCC has held 90 seminars around Australia.

In relation to the price monitoring of individual goods and services, Australia's competition watchdog is monitoring more than three million prices on 1,000 goods at between 8,000 and 9,000 different sites around Australia. The ACCC is also considering approving public compliance commitments from business. These public agreements between the ACCC and businesses cannot be used by business to claim an exemption from the full force of the law. The ACCC is agreeing to pricing methodology, but it is not signing off on individual prices. I reissue a warning to business: if they try to exploit consumers during the transition to the new taxation system, they may be liable for fines of up to $10 million for corporations and $500,000 for individuals.

This regime that we have put in place is delivered by enforcement. There have been 763 completed matters since January this year, and a further 522 active matters are being investigated. Legal remedies so far have included an exploitation notice being issued, nine court enforceable undertakings and 30 voluntary undertakings made between the ACCC and those businesses. This price monitoring regime that the government has put in place, backed up by very significant powers under the Trade Practices Act, is delivering results. In the first two surveys after the first reduction in wholesale sales tax on consumer goods, it was found that, at a retail level, higher than expected benefits were passed through to consumers. The ACCC is doing an excellent job of protecting consumers, and it enjoys the full support of this government.