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Govt prepared to negotiate changes on petrol -

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Govt prepared to negotiate changes on petrol scheme

The World Today - Wednesday, 13 August , 2008 12:15:00

Reporter: Sabra Lane

ELEANOR HALL: Assistant Treasurer Chris Bowen is the Minister responsible for the Government's
FuelWatch Scheme.

He's been telling Sabra Lane that the Government is willing to talk to the Senators about their

SABRA LANE: Chris Bowen, Senator Xenophon and Fielding say they can't support the Government's
FuelWatch scheme as it stands. Is the scheme dead?

CHRIS BOWEN: Look, what Senator Xenophon has said today is that he wants to see more transparency
into the petrol market. He wants to see more competition and we agree with him.

Now our bottom line is that FuelWatch is designed and will deal with the fundamentally
uncompetitive elements in the retail petrol sector in Australia and get consumers a lot more
information about how to find the cheapest petrol in their area.

Now if Senator Xenophon or any other Senator has suggestions that they can make to make the
legislation more acceptable to them, which don't undermine the Government's fundamental policy
objectives, to give consumers and motorists a better go, then we would be happy to consider it.

All legislation in the current environment is requiring a discussion and negotiation to get through
the Senate.

I'm particularly unsurprised that FuelWatch would be any different.

SABRA LANE: Both men say they believe it will have a detrimental impact on independent operators.
Nick Xenophon says it has had a terrible impact in Western Australia where the scheme is in place
now. Is that the case and how many independent operators have closed their businesses since
FuelWatch started there in 2001?

CHRIS BOWEN: Well, all the evidence from Western Australia is that there is no negative impact on
independent fuel operators. The number of independents in Western Australia has gone down by no
more than in any other state or territory in Australia and indeed, independents have reduced in
numbers around the world. So there is no evidence there is any link between FuelWatch and a
reduction in independents at all.

But as I say if Mr Xenophon has concerns, as always, we are happy to talk them through with him and
are happy to see this through the Senate in a way that meets as many people's concern as possible.

SABRA LANE: Under the plans as they stand, retailers will have to notify their prices a day ahead
and can't change them for 24 hours. The Senators say that can harm the smaller independents. Are
you open to having a scheme that allows retailers to drop their prices without being fined?

CHRIS BOWEN: Look, the fundamental elements of FuelWatch are that there need to be price certainty;
that people need to know when they go to the service station, if they have looked up the price in
advance, they know what it is when they get there. Now if there are ways that can meet those
concerns which the Government can talk through with those independent crossbench Senators, we'd be
happy to do so.

But the crossbench Senators and the Government are coming from the same direction - we want to see
more transparency and competition in the fuel market. The only people opposed to that transparency
are the Opposition. They'll oppose FuelWatch which means we'll have discussions with the other
Senators as we are always, as we have begun to do and will always going to need to do.

SABRA LANE: The Senators today have said that Treasury hasn't released all of its modelling; that
alarm bells are ringing. Why won't the Government release all that modelling? The Government says
it is big on transparency here, why won't it release all the modelling?

CHRIS BOWEN: I'm sorry. I'm not sure what you are referring to there, I haven't seen those comments
in relation to modelling. The ACCC has done very extensive modelling on the FuelWatch scheme and
that has all been released.

SABRA LANE: Well both Senators this morning have said that they have an issue with that because
they claim the Government is withholding all that modelling.

CHRIS BOWEN: All the modelling that has been done; all the econometric modelling that has been done
has been released. It is in the ACCC's report.

SABRA LANE: You believe the Senators are misguided on this point?

CHRIS BOWEN: I would be happy to talk to them about that because the modelling, and this has
received extensive publicity, the modelling that the ACCC has done in report and subsequently in
consultation with the Australian Treasury has been released.

They may be referring to the raw data. Now the raw data was supplied by informed sources and their
agreement would be needed for it to be released. The ACCC sought that agreement and it hasn't been

SABRA LANE: So the company doesn't want that information released?

CHRIS BOWEN: That is correct. They only want to release it to people who they choose to release it
to - if that is what the Senators are referring to.

SABRA LANE: I believe that is and they are calling for full transparency.

CHRIS BOWEN: Well, the ACCC would be happy to release it if they receive permission from the firm
which supplied it. They would be equally happy for the firm to release it generally.

SABRA LANE: This looks to be a sticking point. Are you going to try and force this?

CHRIS BOWEN: Well again, I am more than happy to talk through any issues that they have and any
modelling that we have has been released. The raw figures that it was based on, we would release if
we were contractually able to and we have asked to be contractually released to make that
information publicly available.

ELEANOR HALL: That is Assistant Treasurer Chris Bowen speaking to Sabra Lane.