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Friday, 20 March 1987
Page: 1259


Mr BARRY JONES (Minister for Science, Minister Assisting the Treasurer on Prices and Minister Assisting the Attorney-General on Consumer Affairs)(3.20) —This makes two matters of public importance in a single week. I can hardly believe it. As many have been directed towards me this week as over the past four years. But this one was a real featherweight attack. I can understand the sympathy that is being expressed for the shadow Treasurer. It was very hard to regard the attack seriously. It was a bit of personal denigration and a bit of funny play acting. I do not propose to reply in kind. I think the issue is a serious one and I think it is a misuse of the forms of the House to present a completely trivial approach to an important subject.

I must say that the last week, since the announcement of my appointment by the Prime Minister (Mr Hawke), has been one of the more interesting weeks in my political career but, on balance, I would say one with far more gains than losses. I have had valuable discussions today with the Executive of the Australian Federation of Consumer Organisations and Mr Jim Priest, and the President of the Australian Pensioners Federation, who have pledged their support for the proposed price watch network. This community-based operation is well on the way. I have also had discussions with all State Ministers for prices matters and/or consumer affairs-Mrs Deirdre Grusovin in New South Wales, Steve Crabb in Victoria, Vince Lester in Queensland, Ian Taylor in Western Australia, Chris Sumner in South Australia and John Beswick from Tasmania. All of them have offered personal co-operation and I will be seeing each of them as soon as possible when I visit all States. I thank them for their courtesy. The only Minister I have not had a chance to speak to yet is Mr Dale from the Northern Territory. Of course, I have had consultations with my colleague the Minister for Territories (Mr Scholes) who has responsibility for prices in Canberra.

I place this stress on the States to underline the fact that the States have constitutional responsibility for prices. The Commonwealth can intervene on prices only in very limited areas. Shopping, of course, is obviously organised on regional or metropolitan bases; it is not organised nationally. I take this opportunity to commend the success of Mr Steve Crabb, the Victorian Minister for Labour, for securing the passage this week of his Grocery Prices Bill, in which he had the support of the National Party of Australia in Victoria. The National Party in Victoria was very happy to do its Liberal colleagues in the eye over this matter and it is particularly interesting that it should do this to its Liberal colleagues in the week of the Central Highlands by-election. The Leader of the Liberal Party Opposition in Victoria, Mr Jeff Kennett, has referred to the National Party as `free enterprise socialists'. So there we are. I hope I can count on the support of the National Party here in the chamber.

I have also talked with the Chairperson of the Prices Surveillance Authority, Ms Rolfe; the Trade Practices Commissioner, Mr McComas; and I will meet Mr Justice Paul Stein, the Chairman of the Consumer Affairs Advisory Council, on Monday.


Mr Reith —What's the relevance of this?


Mr BARRY JONES —The relevance of this, of course, is that this is a serious task; it is being addressed with integrity, and I believe it deserves the support and the sympathy of the Opposition. I think the Opposition's capacity to trivialise issues is really beyond all contemplation. But, despite the efforts of the Opposition to reduce the exercise to a level of low farce, I believe that we ought to take it seriously and I believe it can succeed. It is certainly essential to maintaining fairness in the prices and incomes accord. The Opposition needs to lift its game in this area. The new Consumer Affairs Bureau is a sensible consolidation of activities that, until now, have been spread across a number of portfolios. I think it is a great improvement to have the Prices Surveillance Authority and the price watch network under the one umbrella. Because of my long association with consumer affairs, I am looking forward to making a useful contribution in this obviously politically sensitive area. The whole area of prices and consumer affairs, including labelling, packaging and safety, is essential to consumers-the people whom this apology of an Opposition treats with such contempt.

Curiously, the Opposition and the people who influence the Opposition in policy simply cannot address the significant issues of pricing. Indeed, I should point out that there is some confusion even within the ranks of the Opposition. The shadow Treasurer complained that price levels in Australia were increasing at a rate four times higher than the Organisation for Economic Co-operation and Development average. He complained about it very vigorously. The curious thing, of course, is that, if he had listened to the matter of public importance on Wednesday when the honourable member for Parkes (Mr Cobb) spoke, he would have found that the honourable member was at some pains to incorporate in Hansard a table indicating that between 1966 and 1986 the cost of rump steak, eggs, laundry detergent and so on had actually fallen. So the argument made by the shadow Treasurer of prices rising at a uniquely high rate in Australia is obviously something that has been lost on the honourable member for Parkes, who was at some pains to make the following point:

Business today is probably more highly competitive and cut throat than it ever was. Profits have been cut to the bone in order to survive.

Further, he said:

I seek leave to incorporate in Hansard a table which shows how much prices have dropped, in real terms, in the last 20 years.


Mr Reith —Does that mean you deny the relativity of our inflation rate compared with overseas?


Mr BARRY JONES —That view is not consistent with what the shadow Minister has been saying. The honourable member also confuses, of course, the matter of price rises and price levels. Although there are certainly disturbing indications of increases in rate-particularly over the last 12 or 18 months, especially since the impact of devaluation has hit-the honourable member does not point out that, while price rises are occurring at a disturbing rate, in a number of areas price levels in Australia are significantly lower than in most OECD countries. Food, fuel, clothing and building materials are lower in price here than in most OECD countries; certainly they are much lower than in West Germany and Japan.


Mr Reith —So the rate of inflation is irrelevant, is it?


Mr BARRY JONES —The rate is certainly significant, but one would have to say that in a number of areas the base rate of goods is certainly significantly lower than in a number of countries such as Japan where, although one either has a very small rate of increase or, as in the case of West Germany, a negative rate of increase, the actual base price is enormously higher than in Australia.

It is very curious to note how anxious some of the conservative forces behind this Opposition are to ignore the question of prices. If one goes through an interesting manual entitled `Mandate to Govern: A Handbook for the next Australian Government', produced by the Australian Institute for Public Policy, it is, I think, impossible to find any reference at all to the word `prices'. Its authors have been so anxious to avoid any reference to prices that this work fails to give the prices and incomes accord its correct name. It is simply called the accord. Under the heading the `Accord and Wages Policy' on pages 8 and 9 there is no reference to the word `price' anywhere. It is as if prices do not come into the matter. But there is no secret of the weight that this Government, and certainly the trade union movement, puts on the need to maintain a level of equity and fairness. Over the last four years the trade unions in this country have shown an extraordinary degree of restraint. I think it would be ridiculous and unfair if that restraint were met with an unacceptably high level of price rise.

In my interview with Laurie Oakes last Sunday-I repeat something that I said during the discussion of the matter of public importance on Wednesday-when Laurie Oakes asked me about price levels I started to make a comment but was diverted and did not complete what I meant to say. I remarked that the total percentage of household income devoted to food prices had remained remarkably stable, that over an eight-year period from 1978 to the present the proportion of household income devoted to food had fallen from 14.7 per cent to 14.5 per cent. While that statistic, of course, was correct, I neglected to take the opportunity to point out that what that meant, in effect, was that, while the same proportion of income was spent, the basket of goods that was taken home by the consumer was lighter. Instead of being able to pay for five loaves of bread, one could pay for three loaves of bread; instead of buying five litres of milk, one could buy three litres of milk, and so on. I think that that point, which seemed to feature very heavily in the newspapers on Monday, needed to be made.

It is clear that because we lack constitutional power over prices-a power which was refused by the Australian voters twice, in 1946 and 1973-we can rely on our powers to co-ordinate, to work with the States in the area of responsibility that is primarily theirs, and we can inform. I think that this has been the most important role of the Prices Surveillance Authority. The establishment of the Prices Surveillance Authority was promised in the prices and incomes accord in 1983. It was enacted in 1984. Since then it has conducted a number of inquiries. Of course, it has the power under the Act, by its use of the corporations power, to freeze prices pending an inquiry.

I said the other day that I thought the inquiry into the price of biscuits which was being undertaken could perhaps be postponed as it was not one of the most important areas. I find now that because of the nature of the Act, once a direction has been given and the price freeze mechanism operates, the Minister no longer has any control; it has been passed over to the PSA and the Minister has no responsibility to tell it to change its work program until it has discharged its responsibility. I hope that it can consider the matter of biscuit prices fairly speedily and then consider areas that I regard as being of higher significance, namely, children's clothing and footwear, non-prescription pharmaceuticals and cosmetics, which are areas which, certainly, the consumer organisations have indicated are areas of considerable concern.

I think that the information provided through the PSA-the price news information that it circulates-has been important in bringing about a proper recognition of consumer sovereignty. I refer to the time when I brought Ralph Nader to Australia in 1972 with the support of the present Minister for Arts, Heritage and Environment (Mr Cohen). The first time I met the Minister was when we brought Nader out on that occasion. Since that time I have always been concerned that the consumer ought to be able to exercise sovereignty, that the consumer should be able to look at what is available and then make a decision based on his or her best judgment.

To some extent-I am not sure whether I would necessarily include the honourable member for Hotham (Mr Kent) in this-we in this chamber are all disciples of Adam Smith. Adam Smith, of course, said that market forces ought to determine price, but he was also very careful to say that the proper operation of market forces depended on perfect information. If one does not have perfect information, the consumer lacks the consumer sovereignty and the capacity to make the appropriate decision. What we are attempting to do, and what I believe we will do with the collaboration of the States, the continued work of the Prices Surveillance Authority and the work of the revamped and reorganised Consumer Affairs Bureau, is to restore consumer sovereignty. We will give the consumer the opportunity to find the best place at the best price to exercise his or her purchasing power. This is of particular significance to the people at the lower end of the socioeconomic pyramid-the people to whom, unlike members of this House, a $5 difference in price makes a great deal of difference in terms of their quality of life.


Mr DEPUTY SPEAKER (Mr Leo McLeay) -Order! The Minister's time has expired. The time for the debate has also expired.