Fair Trading Amendment (Fuel Price Transparency) Bill 2016
16th March 2016
Mr GREG PIPER (Lake Macquarie) [12.19 p.m.]: Notwithstanding the concerns raised by the shadow Minister for Innovation and Regulation, including questions around possible duplication of Commonwealth requirements and the regulatory burden, I strongly support the Fair Trading Amendment (Fuel Price Transparency) Bill 2016. It should be seen as a victory for common sense, accountability and transparency. My support also transcends concerns that The Greens have raised about the ethanol industry in this State, although I agree there are concerns with the industry that must be addressed. The bill addresses the range of fuels commonly supplied to the New South Wales motoring public, whether a premium high-octane product, regular fuel or ethanol blend. The bill is about empowering the public.
The Fair Trading Amendment (Fuel Price Transparency) Bill 2016 will deliver a win for motorists, drive competition in the marketplace and shine a light on an industry that has been far too secretive for far too long. For many years fuel prices in my electorate of Lake Macquarie have been the subject of debate. Prices are consistently high—generally higher than those in neighbouring electorates and certainly higher than those in Sydney, where genuine competition in the marketplace plays a much greater role in delivering a better deal for motorists. When I drove in to Sydney on Tuesday, I could not help but notice that the current price war is delivering a boon for Sydney motorists. Almost every petrol station was selling standard unleaded fuel for about 95¢ per litre—a price unheard of for many years. Currently, back home in Lake Macquarie that same fuel is selling for about 107¢ per litre. Unfortunately, that is something we have become quite used to in regional areas.
Before I expand on that point, I will acknowledge some of the benefits this bill brings. It will require service station operators to upload current prices online so that motorists can make an informed choice about where they will buy their fuel. This will not only lift the veil on pricing structures set by the fuel companies but also remove much of the scepticism and suspicion concerning price collusion—that is one of the great debates in Lake Macquarie. We have pockets of the industry that are reasonably competitive and provide good value for motorists, and others that are not. We have regular instances where fuel can be selling on one side of the lake for 20¢ per litre more than it is on the other.
But our concerns do not end there. Last year, a study conducted by the NRMA found that drivers in the Lake Macquarie and Newcastle area were paying an average of 17¢ per litre more for fuel than their Sydney counterparts. It found that a lack of competition in the local retail market was forcing local motorists to pay through the nose. Sometimes it costs a Lake Macquarie car owner $20 more to fill up the car than it would a Sydney motorist. That is in spite of the fact that fuel gate prices between Sydney and Lake Macquarie rarely differ. Yesterday, for example, wholesale fuel prices for a litre of standard unleaded in Sydney was about 100.5¢ per litre in Sydney and 102.4¢ per litre in Newcastle, which neighbours my electorate. Yet, according to the NRMA's data, the price at the Sydney bowser was about 15¢ per litre cheaper than it was in my electorate.
This disparity occurs only because the long-suffering motorists of Lake Macquarie and other regional areas are subsidising the price war in the Sydney market. The NRMA reported yesterday that some places in Sydney were selling a litre of E10 fuel for less than 90¢ per litre. At home, that same fuel is selling for as much as $1.20 per litre. I agree wholeheartedly with NRMA president Kyle Loades—himself a Hunter region local— who knows the story only too well. He says that Lake Macquarie motorists have every right to be angry and frustrated at the huge pricing irregularities. There appears to be no reason for this to be happening, other than a lack of competition. If we cannot achieve greater competition in our local market then the best thing to do is put more power in the hands of motorists.
The bill will provide motorists with the ability to make an informed choice. It ensures transparency in what has been a closed industry shop for way too long. How fuel companies have set their bowser prices is a mystery that has confounded many for decades. They are required to provide pricing displays outside their petrol stations and will now be required to provide those prices online. This will form the basis for a new online market of providers—possibly led by the NRMA—who will convey that real-time data to motorists via websites and smartphone apps. This, in my opinion, will weed out the unscrupulous and put power in the hands of consumers in many regional areas such as Lake Macquarie who have previously had their pockets gouged.
Last year, the Newcastle Herald reported that the pricing gap between petrol stations in the Hunter sometimes extended beyond 40¢ per litre. This generally equates to a $20 difference in the price of a tank of fuel. The bill gives people the power to decide where they will buy their fuel. If they are heading out for the day to Sydney or elsewhere they will be able to check prices online before setting out and determine where to spend their money in order to receive the best deal. Competition in the marketplace will drive prices down. Some would say that average prices are largely determined and controlled by the big two fuel companies that dominate my electorate. I am sure residents of New South Wales will make good use of this pricing information and no doubt will readily adopt technology that assists them to do that. Residents of Lake Macquarie, including Toronto and Morisset further to the south, will be very pleased to have this knowledge in their hands. This information and emergent technology will change the paradigm around purchasing fuel. It is to be commended. I commend the bill to the House.
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