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Wednesday, 7 December 1983
Page: 3444

Mrs KELLY(10.55) —Mr Deputy Speaker and colleagues, I came into the House tonight hoping that for once we would hear a constructive debate on the Prices Surveillance Bill 1983. I thought it would be constructive because this Bill is central to the prices and incomes accord, which has the support of industry, the trade union movement and the people of Australia in general. Instead of that, what do we find?

Mr Macphee —The employers are not party to the accord.

Mrs KELLY —The employers participated in this very House in agreements made at the National Economic Summit Conference. The prices and incomes accord was the basis of all those discussions at the Summit. For once one would have expected that the members of the Opposition would have given some support to this legislation. Instead we have not heard one word of support. What has the debate been about tonight? It has been about the economy and union bashing, not about an issue which is so central to the economic direction of this country. There has been no discussion also about the effect that this Bill will have on consumers in Australia, mainly because the Opposition does not care about them at all. The Opposition has taken this opportunity to bash the unions and to criticise the Government's economic policy when the rest of Australia was hoping that for once it would come out and say: 'Well, go and try it. You have a mandate to do this so we will give you our support'. The Opposition is not big enough to say that sort of thing. All it wants to do is criticise. It is never prepared to provide any constructive policies and tell us what its alternatives are. All we have heard tonight is a barrage of criticisms.

The Bill before us tonight represents a major part of the Government's prices and incomes policy. It shows that we are living up to our commitment. I refer to the promise that we gave in the election in March this year. This policy has been enthusiastically endorsed by the community and by business groups as well as the voting public throughout Australia. The Prices Surveillance Bill will complement the incomes accord, which has already proved successful.

Mr Andrew —It was not as successful as the wages pause.

Mrs KELLY —It would be totally unrealistic to expect unions to forgo wage increases. The interjection from a member of the Opposition was to the effect that the accord has not been nearly as successful as the wages freeze. How long could the wages freeze have gone on? The Opposition when in Government had no wages policy at all. It simply said: 'Forget about the workers. Forget about their demands and just do not give them a wage increase while prices are going up'. How long do honourable members opposite think that situation could continue ? The Opposition does not provide any alternative at all. It would be absolutely unrealistic to keep the screw down on wages without doing anything about prices.

This package is all about equity. Equity dictates that both measures are required. This Bill completes the package of the prices and incomes accord. Under the prices and incomes accord, the strongest unions in monopoly positions have agreed that, for the good of the whole community, they will restrain their wage demands provided that corresponding price restraint is also introduced. Instead of the members of the Opposition complimenting the unions for that action, all they have done is criticise and bash them. The Government's policies have proven to be correct. We have already brought inflation down to well below the double digit level. The prices surveillance legislation will further promote this trend. In that way economic recovery can proceed, more jobs can be created and inflation can be kept at a minimum. In introducing this measure the Government has rejected the approach of the previous Administration, with its adherence to rigid fiscal and monetary policy in its effort to hold the economy down. It proved to be a total failure and was rejected by the electorate in March this year.

Mr Gayler —Even Mr Macphee did not want it.

Mrs KELLY —The Opposition cannot work out what its policies are at all. Members of the Opposition have different views. Mr Macphee has a totally different view on the direction of wage policy to that of the Deputy Leader of the Opposition ( Mr Howard). The Labor Government does not believe that rigid restraints and controls are the appropriate method to use in promoting sustained growth. Rather , as the Treasurer (Mr Keating) outlined in his second reading speech, the best form of price restraint comes from the effective operation of competitive market forces in which the majority of businesses in Australia operate. The Government recognises that sound profits are an essential requirement for increased employment in the private sector. It is determined that prices surveillance will not be used to impede growth. Rather, the intent of the Prices Surveillance Bill is to concentrate only on those goods and services where firstly no effective market forces operate and where effective competition is absent, and secondly, where prices and wage decisions have a strong significance throughout the economy. Where both these conditions exist, the Treasurer may determine that prices in these cases be monitored.

Because the new legislation will apply only when these two conditions are met, most Australian businesses will not be subject to surveillance. It is expected that the major public authorities such as Telecom Australia and Australia Post will be monitored. It is hoped that, after further consultation with the States, major State authorities will be similarly brought under surveillance. I think that is critical to the success of this legislation. In this way, the benefits of the wages and prices policy will flow through to everyone. The Government is confident that with so many co-operative Labor governments in power, products and services in the States that satisfy these two basic criteria will be brought under surveillance. Special consideration will be given to the surveillance of petroleum products.

Mr Goodluck —Aha! That is the one I will be waiting for.

Mrs KELLY —It is the one I will be waiting for, too. What we are finding is an acknowledgment from the Opposition that there is a great need for uniform prices surveillance legislation. I do not know why the honourable members opposite are not on this side of the House supporting this legislation tonight, instead of taking the view of the Opposition of destructively criticising it.

Mr Carlton —Price fixing has never worked.

Mrs KELLY —But price surveillance does work.

Mr Carlton —Rubbish.

Mrs KELLY —We will find out, because thank God we received the mandate from the people in March. Under this legislation, the Petroleum Products Pricing Authority will be subsumed under the new Prices Surveillance Authority. It is hoped that, with consultations with the States, we will see an elimination of differential retail prices from State to State set by the various State pricing bodies. It is critical that we get the States to agree to the petroleum pricing functions being passed over to the Prices Surveillance Authority. Petrol prices are clearly an area where surveillance is needed. If we look at the increases over the past five years from the September quarter of 1978 to the September quarter of this year, we find that there has been a massive increase in petrol prices of 145 per cent. In the same period there was an increase in the minimum award rate of 57 per cent, of average weekly earnings of 68.2 per cent and an increase in the consumer price index of 61.2 per cent.

Mr Carlton —There is something called OPEC that had something to do with it.

Mrs KELLY —There have been extraordinary circumstances in relation to that price increase. I recognise that. But the increase has been variable from State to State. Where there have been price fixing arrangements, as there have been in New South Wales, we have seen a much more moderate increase in the price of petrol.

Mr Cadman —New South Wales is the worst in the Commonwealth.

Mrs KELLY —The honourable member should compare the situation of New South Wales to that of the Australian Capital Territory. In the Australian Capital Territory petrol prices are at least 5c a litre more than they are in New South Wales. That is totally inequitable. There is a price differential between Tasmania and Victoria and in South Australia, despite the fact that we are supposed to have had the Petroleum Products Pricing Authority working. It is absolutely critical that the Government should negotiate-

Opposition members interjecting-

Mrs KELLY —Members of the Opposition, by their interjections, clearly indicate that they should be on this side of the chamber supporting this legislation. If they believe in uniformity in the price of petrol in Australia they should be voting with us. In such circumstances, it is absolutely critical, particularly in regard to the price of petrol, that the Government should negotiate for the handover of these powers from the States in order to establish a centralised approach to the surveillance of petrol prices. It is fairly obvious from the figures that I have given that the petrol companies have not exercised any restraint in the setting of prices by virtue of their monopoly position. So that is a very good example of where the Prices Surveillance Authority should be able to take action.

In the past, I have been very critical of the Petroleum Products Pricing Authority. It has done little other than simply rubber stamp requests for price increases. The result of having this large number of different petrol pricing bodies and different administrative arrangements from State to State has meant even higher prices for motorists. No one in this House can deny that fact. The Australian Capital Territory, of course, is in by far the worst situation. This is an issue about which I have spoken frequently in this House and outside this Parliament. It is about time that we had some uniformity. Take, for example, the situation of the Australian Capital Territory, just to demonstrate the inequalities which exist. Petrol comes into the Australian Capital Territory by train. The same petrol is sent out to Queanbeyan and sold there at 5c a litre cheaper than it is sold in Fyshwick. That is absolutely ludicrous. It is sold at 5c less in Queanbeyan when there is already a State tax in New South Wales. It does not make any sense at all. What we need quite clearly is to have this function placed under the control of the Prices Surveillance Authority. This is just one example which demonstrates that need.

The prices surveillance legislation will enable the Treasurer to direct inquiries into the pricing structure of any goods and services which have significant impact on the national economy. However, to a large extent, the majority of Australian businesses will not be affected by this measure as they already operate in a competitive market environment. What could be fairer than this legislation? Yet the Opposition still will not support it. The Government recognises the need to encourage the private sector. This legislation is not anti-private sector legislation. We know that to get more jobs we have to have growth in the economy. We need to have more employment opportunities. The guidelines of this legislation are very fair and reasonable. It shows only the smallness of the Opposition that it is not prepared to accept the opportunity to give this legislation the chance to work.

These guidelines will ensure that voluntary compliance with price restraints will become accepted practice by employers and manufacturers, just as voluntary compliance by the unions in relation to the new wage indexation guidelines has resulted in an undertaking to make no extra claims during the duration of the present wage system. Both sides need to make this commitment in order to ensure that the benefits of the prices and incomes accord flow to all Australians. I ask the Opposition to consider its position, to give us the opportunity to get this legislation working, to give this legislation the opportunity to ensure that the prices and incomes accord can work.