Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Select Committee on Electricity Prices
25/09/2012
Electricity price increases in Australia

DERUM, Mr Oliver, Policy Officer, Energy and Water Consumers' Advocacy Program, Public Interest Advocacy Centre

HODGE, Ms Carolyn, Senior Policy Officer, Energy and Water Consumers' Advocacy Program, Public Interest Advocacy Centre

LEE, Ms Katrina, Strategic Policy Adviser, Choice

LEVEY, Mr Matt, Head of Campaigns, Choice

[15:51]

CHAIR: We now welcome representatives from Choice and the Public Interest Advocacy Centre. We have received your organisations' submissions. Are there any amendments or additions you wish to make to those submissions?

Mr Levey : No.

Ms Hodge : No.

CHAIR: Do you wish to make an opening address to the committee?

Ms Hodge : Yes, I would like to.

CHAIR: Go ahead.

Ms Hodge : Thank for the opportunity to contribute to today's proceedings. The Public Interest Advocacy Centre welcomes this inquiry's objective to seek a better understanding of rising electricity prices. We see this as an opportunity to work with government and other stakeholders to place downward pressure on electricity prices, especially given the sharp and regular rises households have faced recently. An understanding of price and cost drivers is important. In PIAC's view, it is equally important to find ways to ensure that people have continued access to electricity as an essential service. The issue of rising electricity prices should be understood by the impact on people. In summary, the most recent electricity price rise sees people in New South Wales facing an increase of between $208 and $427 for an average annual electricity bill. This comes on top of a recent history in which double-digit price rises have become the norm.

We see price rises translate into rising disconnection numbers in New South Wales. According to the most recently available figures, approximately 18½ thousand people were disconnected for nonpayment of bills in the 2010-11 financial year, and this is up by 15,835 from the previous year. Within this group, 18½ per cent, or nearly 3½ thousand people, were pension recipients and almost 1,500 people were disconnected more than once.

We are increasingly aware that people in the workforce are also struggling to pay their electricity bills. Additionally, PIAC hears from community organisations who are inundated with requests for assistance to pay electricity bills, and our own research tells us that people are choosing not to heat or cool their homes because of concerns about cost, even when they need that heating or cooling to manage a medical condition.

These are just some of the social impacts of rising electricity prices, yet this important information is not admissible in processes used to set the price people pay for electricity. For this reason, PIAC supports an amendment to the national electricity objective so that access is considered when making decisions about an electricity market that operates efficiently and effectively in the long-term interests of consumers. PIAC is not advocating for the electricity market to be designed exclusively in response to low-income and vulnerable consumers. However, we do support action to ensure that electricity continues to be accessible to people in amounts that afford a dignified life.

In our view, there are opportunities to work together to foster continued access to electricity for residential consumers around the country. To do this, PIAC recommends the instigation of a national process to review customer assistance and develop best practice principles to guide the delivery of this assistance in a manner that is as efficient and effective as possible. We believe the Productivity Commission is well placed to undertake such a review.

Finally, electricity drives people's lives, and continued access to this essential service is vital to protect people's basic dignity and fundamental rights. As such, PIAC strongly supports a formal process through which all stakeholders, including federal and state governments, industry, regulators, ombudsmen and consumer advocates can work together to develop an electricity affordability strategy. An affordability task force convened by the chair of the Standing Council on Energy and Resources, Minister Martin Ferguson, would be a sizeable win for Australian electricity consumers and a forum to identify practical and achievable actions to facilitate access to electricity that is as equitable as it is efficient. Thank you.

CHAIR: Thank you, Ms Hodge. Mr Levey?

Mr Levey : Thanks to the committee for the opportunity for Choice to appear today. Our concern is obviously that which is at the centre of the committee's terms of reference, which is that we have seen a significant increase in electricity prices, particularly since around 2007, facing residential consumers. With that, we have seen a significant increase in what you could call proactive marketing activity—in some cases, quite aggressive, intrusive and misleading marketing activity—that is making it difficult for consumers to navigate an increasingly complex market.

We have identified the main drivers of the electricity cost increases in recent years as network costs. Certainly there are other factors—and some of those have been identified here today—but far and away the greatest impact and the most significant source of those increases has been from the so-called poles-and-wires infrastructure. The data that we can see shows that it is going to remain a critical factor in years going forward, along with wholesale electricity costs.

We think the committee has a crucial role to play in identifying some of those options that can reduce the pressure on household bills in the future and make it easier for consumers to navigate the electricity market with confidence and with protections. That is something we have touched on in our submission. We think there is a critical opportunity between now and the end of the year, given that some parameters have been put around the Council of Australian Governments process. We know that states individually and through the AEMC and through rule-change proposals have no shortage of options in front of them that could be adopted. I think our message to the committee would be that you can play a very powerful role in creating political momentum for change, which has probably been the key missing element of these processes through recent years. We have made a number of recommendations to the committee, which we would be happy to expand on if you wish, but otherwise I will leave the rest to our submission.

CHAIR: Thank you. How would a national energy advocacy body benefit consumers and, more broadly, future development of the national electricity market? And how would that national body go beyond what is currently the purview of the national electricity market project, a collaboration of advocacy organisations facilitated by the Consumer Action Law Centre?

Mr Levey : We are participants, along with the Total Environment Centre, PIAC and others, in a process that is looking at the model for establishing a national energy consumer advocacy body. It is critical for a range of reasons. One, which I think has been alluded to already, is that consumers are regularly outgunned in a very technical and complex decision-making process, particularly around revenue determinations. There is no shortage of resources sitting on the industry side. The fact that consumer advocates cannot muster similar resources is, I think, to the disadvantage of consumers across Australia, both business and residential consumers. I think we are increasingly moving towards national processes in the energy market. The NECF is an example, albeit a stalled one. But certainly the NEM itself is nominally a national process, and it makes sense that you would have a national consumer representative in that process, given that generation does, transmission does, distribution does, retailers do, industrial energy users do and large energy users do. So it is kind of the missing bit, in a sense. Those are two reasons, and I guess a third is that there is a lot of extremely talented, passionate and dispersed consumer advocates in the energy space at the moment. They are coordinated well, to a degree, through the round table, but I think there is the capacity for additional resources and a national body to take that to another level which would actually allow the consumer voice to be heard much louder in some of these processes.

Ms Hodge : I think also that the round table is more of a network than a coordinated entity, and the national body could be a place for coordination of different aspects of advocacy. There are a couple of things I would like to point out. It seems to me very much that networks are resourced by consumers to advocate their position in price-setting processes. I do not think consumers have an equal value of advocacy in those processes. We had Rod Sims, the former Chair of the IPRT, speak at our conference last year, and he talked about the weight of the submissions—physically, I think!—in page numbers, and how they were growing. So they were seeing thousands and thousands of pages submitted about network pricing proposals and what sorts of skills are needed to really unpack that and establish whether all of that comment is justifiable for those cost decisions to be made.

There is another thing of value that I think a national body can add to the process that we have in train. We have a lot of disparate consumer advocates who are funded on a cyclical basis. They have to apply, say, for 12-monthly or biannual funding. What happens is that over the time of, say, a regulatory reset period of five years, all of those staff may have changed over. So I think a national body would be a place where an organisational memory could be held. You could build skills to repeatedly engage in this process and use the knowledge learnt from each process to strengthen your capacity to advocate for better outcomes for consumers.

CHAIR: A number of organisations that have appeared today have advocated greater exposure to market prices at the retail level as a means of driving changes in consumer behaviour, and they have advocated it in various means—full retail contestability, time-period pricing, rollout of smart meters. I was just wondering what your organisation's views are on those submissions.

Ms Hodge : I can give you a basic view, although I have not read those submissions, unfortunately. I think we have to take real care to think about the level of capacity that consumers have to change their behaviour. I think there are savvy people who are well-resourced and who can make investments in technology to understand their energy usage and perhaps invest in some load-control technology or log on to web portals and understand pricing messages. There are also people who have a fairly low level of discretionary use. For those people, understanding that there are critical peak pricing times would only serve to heighten their anxiety about electricity prices in the knowledge they are going to have difficulty affording that next bill.

We have just done some research into electricity use by people with a physical disability. What we found is they are very motivated to change their behaviour because they are very concerned about the costs but they also have some difficulty in making changes. For instance, they may have the Home and Community Care service come to do personal care or household duties. Those services come at set times, which cannot be changed. People with multiple sclerosis and others need heating and cooling to manage medical conditions and life-support devices that may need to run 24 hours a day. They cannot change their behaviour. We have to be really careful about the consumer protections that come alongside cost-reflective pricing.

Ms Lee : One of the important things to emphasise is that generally consumers do not actually really care what the price is; they care what the price of the bill is. One of our recommendations is that we consider that a national energy savings initiative, where it is cost-effective, should be introduced. That could be one that would help households to reduce bills, including vulnerable consumers. The PM's energy efficiency task force did some modelling on it recently and, from what I recall, Brad Archer mentioned this morning that more is being done. In the Prime Minister's energy efficiency task force they estimated that a national energy savings initiative would be able to save households up to $296 a year in 2020 and also save $3.5 billion to $12 billion in deferred energy generation transmission infrastructure by 2040.

To expand on Carolyn's point about energy being an essential service, I am sure you have all heard the analogy about peak demand and the Harbour Bridge. If you use that analogy and think about it, the price of the toll changes so it varies according to the time of the day, but people still need to get back home. If you were to introduce time-varying prices for consumers, to a certain extent they still need to cool their home after it has been 40 degrees for three days. You would need to have a multipronged approach if you were to introduce time-varying prices; it is not going to be the answer in and of itself.

Expanding on protections for consumers, there was some discussion today about uniform obligations on retailers. I note that in Victoria, which as you know is the only state to have mandated smart meters, there are no protections in relation to smart meters specifically. I know that Victoria has highlighted its intentions to legislate derogations from the NECF in a variety of aspects. These include: an obligation on retailers to enter into community service agreements; time frames to afford customers who are disconnected from supply an opportunity to be reconnected on the same day; a customer's right of free connection if they are eligible for a utility relief grant; a requirement for an energy retailer hardship policy to provide energy efficiency assistance options for hardship customers; and an obligation on retailers to enter into community service agreements.

I would recommend the committee speak to other consumer groups that are based in Victoria such as Consumer Action Law Centre, which, I understand, you will be speaking to on Thursday. That is something to bear in mind as well. I think it is important to think about how the consumer is going to engage with time-varying prices in that, for example, a person needs to be able to engage with the tariff design and it needs to be easy to understand. Generally consumers—or the vast majority of us—have always had flat prices for energy 24/7. It will be a step ahead to introduce time-varying prices so you will need to ensure that community engagement is up there at the forefront when you are rolling out these sorts of technologies. For example, it will be useful to see in Victoria in relation to, say, the off-peak rate. It needs to be for a long enough period that you are able to run your whole dishwasher or your washing machine.

CHAIR: Do you believe that there is a way that governments could provide that price signal for consumers which has the capacity to change their behaviour but provide adequate protection for vulnerable consumers moving forward?

Ms Hodge : I think that, if people were not locked into paying particular tariffs, that could represent an opportunity for people who think they can benefit from going onto time-of-use pricing. There are people who are very conscious of the way they use their electricity, and they would welcome the opportunity to try to shift their consumption in order to save, but the concern is that people will not understand how much engagement they will need to maintain in that behaviour change to have a long-term positive result. So, if people are not locked into particular offers and they can see how it goes and then opt out if it does not suit them, I think that could provide some level of comfort. I do agree with Katrina about increasing people's energy literacy—going from a stage where energy has been a generic product to talking about energy storage and smart grids and smart meters and privacy issues. There is a high level of anxiety because people do not understand all of these complex parts of the market. In Victoria we have a real opportunity to learn by a real-life example, but we should also keep in mind that Victoria offers a percentage based rebate to vulnerable consumers where, if their bill goes up as a result of time-of-use pricing, their rebate will go up as well. In New South Wales we have a flat rebate where, if people move onto a variant pricing tariff, their rebate will stay at a uniform rate under the circumstances we have now. That is why we are asking for a review of customer assistance—we believe that we are moving into a modern market and we want to look at modern ways to deliver customer assistance. I think it is time to move on from what we have done historically.

CHAIR: I will ask one more question, and perhaps you can take it on notice because we have time constraints. If we were to advocate a rollout of smart meters—and I am not saying that we will, but if we were to do so—what would be the conditions that your organisations would put on that for governments or regulators to ensure that the lessons are learned from what happened in Victoria?

Mr Levey : I will just touch on that very quickly from Choice's perspective. One is to get the protections right. The allusion to the Victorian protections is, I think, what we would be looking at: incorporate that level of protection within the NECF and make it nationally consistent and robust; get the information right—there are proposals around for an information hub to let consumers access their own consumption data, and the exciting possibility there is that you can open up the market to a lot more innovation and competition around energy retailing. So, instead of this idea that somebody is going to want to sit there and check how much energy they are using every five minutes, you get entrants into the market who are going to take that information and make it accessible and meaningful for consumers. I think the third thing is to ensure that the benefits are properly aligned. Smart meters might do a whole bunch of wonderful things for remote meter reading and helping network businesses do things, but if it is the consumer who ends up paying for it then you are not going to get community support, as we saw in Victoria. So we would say to put the community support, the protections and the information first, and then, if you have a business case that says there are going to be benefits, bring it in.

Senator EDWARDS: You have a lot of recommendations here related to electricity technology, and it is quite a big wish list. It recommends a rollout of smart grids and related electricity technology, accompanied by education programs and targeted programs to install in-home devices; incentives to use bespoke energy and efficiency programs; widely publicised, simplified information about tariffs; trial periods for innovative energy offers; and so on. Who pays? They are massive programs.

Ms Hodge : It is a good question, but when these things are not done we see massive consumer backlash and halting of programs that may provide benefits for consumers. So I think it is more about getting things right from the outset rather than fixing problems later because they were not—

Senator EDWARDS: So is it a role for government? Is it a role for electricity retailers? Is it a role for the electricity industry—network providers and generators as a whole? I agree that there is a lot of ignorance. You would not find too many of my family that would understand the complexities of the electricity market, apart from that bottom line.

Ms Hodge : Yes.

Mr Derum : It would certainly have to be a collaborative effort. You say that it is a huge process, and it would be, but it would only be a small part of the huge process of rolling out smart meters, we think.

Senator EDWARDS: Yes, but that is not all that you are talking about, is it? You are talking about bespoke energy efficiency programs and particularly identifying groups. Then you get into picking winners. Who is going to receive the support and who is not? Who is going to identify that? Which department is going to do that? Who does all those things? Then you are talking about actual installation of devices for low-income people. Once again, who do you pick? Who falls in the crack and who falls outside the crack? There are all those types of things. I am just wondering: how do you facilitate all your dreams and aspirations for this complex problem?

Ms Hodge : I think Oliver is right that it is a collaborative approach. We work with governments at times to identify fairly cost-neutral solutions. The community sector is very good at getting information to consumers on low budgets. Government has other channels for information provision, and network businesses and retailers do similarly. I think that, if we work together, we can try to get more information to consumers. There has also been some movement around Home Energy Saver Scheme projects. New South Wales has the Home Power Savings Program, which provides energy audits. Some of these things could be adjusted to suit particular consumers.

We are at a time of immense change. A long time ago we probably talked about load control hot water or off-peak hot water in the way we are talking about storage now. If we think about off-peak hot water, a lot of people have access to the benefits of paying that lower rate.

Senator EDWARDS: But they were able to store their hot water in their homes. You are talking about storage of power for peak demands somewhere else, which requires more infrastructure spending, doesn't it? That will just put further pressure on the network providers to further gold-plate, put in more infrastructure, spend more billions and seek a return on those billions deployed.

Ms Hodge : I am not sure that we are saying that. I think what we are trying to say is that, if there are benefits coming through from what we are learning from innovation and technology, we do not want those benefits to be segmented in part of the consumer base. If we say that we can do all of these things, be more energy efficient, use less and pay lower bills, we do not want that to only be the purview of the savvy consumer. If we can get the benefits to lower income consumers, we may be able to make savings around the rebates and concessions that are provided. We may. That is not something I am saying is definite, but I think we could explore opportunities. The budget lines may not align, but people in public housing at present who are living in inefficient housing stock are paying high electricity bills. I guess what we are aiming for is to give them more power to be more efficient in their consumption, face lower bills and maybe seek less emergency assistance to do so.

Senator EDWARDS: That is a circular argument, though, because that is state spending for public housing and public housing infrastructure, and then that gets into other budgetary issues.

Ms Hodge : You see my pain!

Senator EDWARDS: I see your pain but we are tasked with the job of trying to cut through.

Ms Hodge : Sure. I think that it is a difficult task and that is why we have asked for a national forum on affordability, because we think that in segments of the market—consumer advocacy, network businesses, retailers and government at federal and state levels—there are excellent ideas and there are practical things that could happen. There are a lot of things that we do not agree on but if we could identify the things that do agree on and we could move towards all that and that would be a real win for consumers. I do take your point that it is challenging. I do take your point that state and federal budgets are under pressure. New South Wales increased their main electricity rebate by $55 last year and at the same time our prices went up around $300, as you can see. But the industry has no skin in the game: the prices move here and the budget to help vulnerable consumers is over there, and this is not contributing. So we really need to have a conversation about how we can get affordability and I think that will be identifying some of the ways that we can work together.

Senator EDWARDS: On affordability, one of your other recommendations—and this is my final point, Chair —is that electricity green schemes should be funded from a progressive revenue source such as general taxation. Are you talking about a further impost there on the community in regard to that when we are already funding renewable energy certificates as being passed through to the consumer and when we are already funding a carbon tax which gives some recompense to the tune of $10.10 a week but goes nowhere near capturing any of the full amount of what energy costs have gone up by for the consumer? Are you advocating here that electricity green schemes should, in fact, receive some general taxation recognition?

Ms Hodge : From the outset, if we are thinking about bringing forward green schemes we need to understand the impact they have on electricity prices. At the moment the funding model we have is regressive for some of the green schemes and some of those green schemes have come in without any compensation to low-income and vulnerable consumers, who spend a much higher percentage of their disposable income on essential services. So we would like to see an investigation of how to fund things without passing those costs on to the low-income and vulnerable consumers in Australia.

Senator XENOPHON: Ms Hodge, this is not a trick question and if I could just walk you through it.

Ms Hodge : Sure.

Senator XENOPHON: In recommendation 2 you have said:

PIAC recommends that the National Electricity Objective be amended to read:

to promote efficient investment in, and efficient operation and use of, electricity services for the long term interests of consumers of electricity with respect to:

1. price, quality, affordable access, safety, reliability, and security of supply of electricity; and

2. the reliability, safety and security of the national electricity system.

Can I focus on the words 'long-term interests of consumers'. EWN Publishing, which is a specialist publisher on electricity matters, says that the SCER, the standing council, has watered down the law and changed the objective of the law from 'interests of consumers' to 'long-term interests of consumers' and that by doing so it has actually made it more difficult for consumers. You may want to take this on notice. I understand what you have done: you have just added to the objectives. Do you think there is an argument, as set out by some electricity commentators, to get rid of the words 'long term' so that it just refers to the 'interests of consumers' rather than the 'long-term interests of consumers'? That is something you may want to consider. It is a technical point but I think it is still an important one in terms of the emphasis that you put on the way interpretations are made with respect to determinations.

Ms Hodge : I might take part of it on notice. I think I could probably to do more justice to it out of this room.

Senator XENOPHON: Sure, and that is why I wanted to give you fair notice in relation to that.

Ms Hodge : The only thing I would say just quickly is that investments in infrastructure happen over a long period. I am wondering how you make those decisions if it is not long term. What we are really advocating is to also include reference to affordable access in there, because, if we have the most efficient market, one that is reliable, but people cannot afford to access it, we are not sure how that is in the long-term interests of consumers.

Senator XENOPHON: Sure. If you do not want to consider it—although Keynes said 'in the long run we are all dead'. But anyway. I do not want to verbal Mr O'Reilly, from the electricity suppliers association, but he said door-to-door sales were basically terrific because it meant more choice and more competition in the marketplace. Senator McEwen and I have both had complaints from constituents about aggressive tactics. What feedback has Choice had as an organisation with respect to churning?

Mr Levey : I will say a couple of things, and Katrina may wish to add to this. We are in the middle of finalising some numbers which asked consumers nationally about their door-to-door sales experiences with energy, and we are very keen to provide that to the committee in a couple of weeks. The work we have undertaken to date has shown a very negative response from consumers to energy being sold door to door. We were certainly supportive of the recent 'do not knock register' legislation in the parliament, which I believe is not proceeding. But certainly along with other consumer groups we think there is enough evidence that, when energy is sold door to door, it is often done in a fairly proactive if not intrusive and sometimes misleading fashion.

Senator XENOPHON: Mr O'Reilly said there is a cooling-off period.

Mr Levey : There are reasonably robust requirements under the Australian Consumer Law applying to those who undertake door-to-door-sales. I think the question is whether those undertaking the door-to-door-sales are abiding by those requirements.

Senator XENOPHON: And most of them are agents, not actually employees of the company.

Mr Levey : Correct. They are often not only third parties but fourth parties. So there is quite a long chain there. The ACCC launched a major research project a couple of weeks ago which looked at the structure of this industry and many of the pervasive problems. It is estimated that there were one million door-to-door energy sales last year and that the average household gets door knocked eight times. That is going to skew much higher in states like New South Wales and Victoria.

Senator XENOPHON: Can you send us any response you have to that ACCC paper? That might be useful.

Mr Levey : I can do that. My final point is that we think there are issues in the Victorian experience, where churn is often taken as a proxy for competition. There was a bit of analysis recently that said again Victoria had achieved the most competitive energy market in the world. We question whether an amount of switching, which involves retailers treading water and spending very large amounts on the market budget just to maintain their current market position, is a reflection of genuine competition. We are strong believers in genuine competition and we would like to see more of it. We would like to see more product differentiation in the energy market. I would question whether what we are seeing in Victoria necessarily fits that definition.

Senator XENOPHON: I see that your former colleague Mr Zinn has gone to an aggregator—One Big Switch.

Mr Levey : That is correct.

Senator XENOPHON: The review of the limited merits review regime, the interim stage 2 report prepared for the standing committee, was quite scathing of the way the law operates and how difficult it is for consumer groups and stakeholders to access it. Do either of you have a view on that? If this interim report becomes a final report, I would say it would be a call to action for significant reform.

Ms Lee : I would like to expand briefly on my colleague Matt's points in relation to retail marketing down in Victoria as well. I notice that the AEMC, in their final report on possible future retail electricity prices 1 July 2011 to 30 June 2014, estimate that for the Victorian market, even with the carbon price included, the retail component is 31 per cent of the price increase relevant to all the other factors. If you take a look at the other states and territories across Australia, it is about 10 to 15 per cent, which is nowhere near that number. So that is something to bear in mind when you hear assertions by the energy retailers Energy Assured that Victoria is the most competitive market in the world. There are high levels of churn. As Cameron said, one in four people change every year. You have got to question whether those people are actually finding something that they like. Are they changing because they do not find something they like? This is just adding to everybody's bills through marketing costs.

Senator XENOPHON: They are like swinging voters.

Ms Lee : I had not thought of that analogy! Just in relation to your point on limited merits review, one of the things that needs to be considered is that the Australian Competition Tribunal have actually heard a total of 53 substantive matters, which I believe is all the decisions that the AER has made on economic regulation. It is important to remember that the networks are actually able to cherry pick parts of the decision that they do not like, that they want to contest. If you think about it, there are millions or billions of dollars at stake. If you could cherry pick little bits and then take them to the High Court, why wouldn't you do it? I think it is a natural question that has got to be asked. Particularly where the weighted average cost of capital parameters, the rate of return factors, were being considered, the applicant was actually successful in every ground on every review where they looked at that particular factor. I note that also in the paper that you mentioned, Senator Xenophon, they actually quantify the full financial impact of these decisions. Bear in mind this figure did not include the Victorian electricity distribution review and included neither the Queensland nor the South Australian gas review. They estimated all those decisions to come to a financial impact to consumers of $3.6 billion.

Senator XENOPHON: Thank you. That is very useful. You might take it on notice about the limited merited merits review or do you want to comment now?

Ms Hodge : We could just make a brief comment that we have not concentrated on this process because we have been aware that our colleagues in Victoria, the Consumer Action Law Centre and the Consumer Utilities Advocacy Centre, have been engaged in the merits review. I guess what we try to do as advocates is look at things that we have expertise in and that we can change and use our scant resources to do so.

Senator XENOPHON: The Australian Industry Group has not weighed into it. I am not surprised.

Ms Hodge : I think it is a good example of how a national body could work on large-scale reforms for better outcomes for consumers, because, at a jurisdictional level, we do have to use our resources for things we think we can change. We are really glad that there are people across it that are doing really effective advocacy.

Senator XENOPHON: You could take this on notice—so I don't miss my flight!—but does either group have a view about Mr Oakeshott's bill for a national takeover of the rules? Assuming that there are not any constitutional legal impediments, do you think that would be a better policy approach—to have a uniform body to look at issues? Thank you very much.

CHAIR: The Ethnic Communities Council, in their submission to this inquiry, make the point that they believe that understanding the electricity market is difficult enough as it is but, for people from a non-English-speaking background, it is extremely difficult and retailers do not provide enough information, and information in other languages, to break down some of those barriers. Is that coming through in any of your research? Do you have a view on it?

Ms Hodge : I would have to support my colleague's view, as more of an expert in that area, but I do think that there is a little bit of a one-size-fits-all approach to explaining things to consumers. People who speak different languages and people who are hearing-impaired or have other ways of communicating do struggle, so that is why we are always keen to look at consumers not as a homogenous group but perhaps look at greater equity of information provision and protection for different groups.

Mr Derum : If you look at the number of languages that the Energy and Water Ombudsman New South Wales provides its information in, that gives you a good sense of the demand that is out there for it.

Mr Levey : It is not something that Choice has looked at specifically. It is not an issue that is necessarily unique to the electricity market. You look at telecommunications and banking and some other markets as well; there is a lot of evidence that consumers who fit into those categories are not always well served by the information that is mandated.

You have seen, I think, in the recent Telecommunications Consumer Protections Code some efforts that go a bit further along the lines of addressing some of those issues. I think it is worth sometimes looking across markets for solutions which assist consumers and not being constrained just within the energy sector.

CHAIR: A final question for both organisations, and you can take this on notice: what is the impact for your organisations and consumers of an inconsistent adoption of a national energy consumer framework?

Mr Levey : We are very supportive of jurisdictions adopting the framework. We understand that a huge amount of resources were put into it, not only from the consumer movement and regulators but also from market participants. The fact that it has since not been adopted creates something of a waste of money. Regulatory inconsistency creates costs to business which inevitably get passed on to consumers. The fact that we do not have a single national website which is unbiased that we can send people to to get information on electricity deals is a great shame. We understand that certain states have expressed different reasons for not signing on. We would certainly encourage New South Wales, if they are looking at additional protections; that could be a great thing, but it should not be a barrier to getting on board with some of the things that are already there. So our hope is that, as there is a cost to consumers at the moment from a lack of national consistency, that cost will soon be ameliorated.

Ms Hodge : Also, under the NECF, consumers would have benefited from a consistent approach to information provision through the Retail Pricing Information Guideline—that is a standard template for providing information on offers—and the comparator website that would have been managed by the AER. It does hold back advocates from really building the capacity of consumers to understand these things because the information is provided in a range of different ways, and where standardisation occurs then it helps us to help consumers get better outcomes and really make informed choices about the offers that they are going ahead with. We have different feed-in tariffs. We have different policies on exit fees. We have a whole range of complexity in amongst our energy offers, and the best thing is for consumers to understand that and make informed choices.

CHAIR: Thank you. I thank all of the witnesses. You are now excused. Can one of the committee members move that we accept all of the documents that were tabled by the various witnesses today?

Senator EDWARDS: I so move.

Senator XENOPHON: I second that.

CHAIR: There being no-one against, I declare that motion carried. That concludes today's proceedings. I thank all of the witnesses for giving evidence. I also thank Hansard, Broadcasting and the committee secretariat. The committee now stands adjourned.

Committee adjourned at 16:37