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Wednesday, 3 November 1976
Page: 2266

Mr MARTYR (SWAN, WESTERN AUSTRALIA) -Has the Minister for Business and Consumer Affairs heard that in Western

Australia oil companies such as Ampol and Shell are providing 60 days credit to ACTU-Solo Enterprises Pty Ltd and that the price per gallon paid by ACTU-Solo is less than that paid by old established independent lessees of company stations.

Mr Goodluck - A good question.

Mr MARTYR - I have not finished yet. Is the Minister aware also that service stations leased to the independent proprietors are now virtually on payment with order for petrol where previously they had 7 days credit and that some proprietors have said publicly that in effect they, and not the oil companies, are financing the ACTU-Solo operation? Will the Minister have a look at this matter to see what can be done, either through the Prices Justification Tribunal or perhaps through restrictive trade practices legislation?

Mr HOWARD (BENNELONG, NEW SOUTH WALES) (Minister for Business and Consumer Affairs) - I am aware that a lot of concern has been expressed, not only in Western Australia but also in such places as Tasmania and Newcastle about marketing practices in the petroleum industry. The House will be aware that the Government has under consideration at the moment the recommendations contained in the fourth report of the Royal Commission into Petroleum and Petroleum Products. We also have under consideration recommendations of the Trade Practices Review Committee which in some areas have relevance to this subject.

For many years there existed in the Austraiian petroleum industry arrangements between oil companies and independent dealers whereby those dealers were tied to particular companies and in return for that guaranteed supply the companies tended to provide relatively long term leasing arrangements and also other financial incentives and help. As a result of a determination of the Trade Practices Commission which applied the existing trade practices legislation, those arrangements are no longer regarded in their entirety as being acceptable. One of the consequences of that determination has been to encourage the oil companies, for commercial reasons, to change some of their marketing practices. I think that, before one jumps to too many conclusions as to who is right and who is wrong in this area, it ought to be borne in mind that it is very difficult in an industry such as the petroleum industry to accommodate completely in the one stroke the interests of consumers, the interests of the small dealers and also the natural desire of large companies with heavy capital investment to secure their points of distribution.

The activities of ACTU-Solo are, of course, relevant to the Government's consideration. I ° should make it clear that the Government would not want a situation where price flexibility in the petroleum industry was eliminated. It is not in the interests of the consumer to eliminate price flexibility; it is in his interests that there be price flexibility. The Government is concerned also that independent dealers as a class should not be forced out of business.

Mr E G Whitlam (WERRIWA, NEW SOUTH WALES) - I ask the Minister for Business and Consumer Affairs a supplementary question. I notice that on 2 June last the Minister gave an answer in which he referred to the problems faced by independent dealers in motor spirit. He said in his reply that the Government had set up an interdepartmental committee to look into the reports which had already been received from the Royal Commission into Petroleum. Has the interdepartmental committee made any reports itself on any of the Royal Commission 's reports?

Mr HOWARD -That question was asked of me about 2 weeks ago by the honourable member for Franklin. On that occasion I advised the House that I had in fact received the report of the interdepartmental committee and consequentially upon that I would be making certain recommendations to the Government.

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