GOVERNMENT BILL: National Energy Laws
November 13th, 2018
On the 13th of November, Mark spoke to the Statutes Amendment (National Energy Laws) (Binding Rate of Return Instrument) Bill 2018.
The Hon. M.C. PARNELL: I rise to support the second reading of this bill. As we see on many occasions during the parliamentary year, national energy laws are brought into the South Australian parliament first because we are the lead legislators.
This is almost a broken record but, as I say on every one of these occasions, as much as we would like to amend some of these bills my experience of the last 12 years is that neither Liberal nor Labor has been prepared to countenance any amendments to national energy laws. I maintain that is an abrogation of our responsibility as legislators because I think we could actually make some improvements to many of these national laws if only we were given the latitude to do so.
This particular bill is not as contentious as some of the other ones we have dealt with. I have had a look at some of the stakeholder positions that were taken during the public consultation on the draft of the bill back in April this year, and there is general support across the board so I do not think there will be a problem with the bill passing.
The importance of getting the formula right in terms of rate of return is pretty simple. Ultimately, consumers end up paying, and when you have these natural monopolies with their regulated asset base and their guaranteed rate of return the consumer's interest has to be front and foremost, otherwise business will do what it does and extract every last dollar it can from the resource it is controlling.
I will briefly put the only questions I want to raise on the record now. They relate to the power imbalance that exists between representatives of consumer organisations and the industry sector itself. I refer to the submission that was made by the Public Interest Advocacy Centre on 13 April. Whilst generally supportive of this bill, they point out that this resource imbalance means that in a particular competition case in New South Wales the energy networks ended up paying legal costs of around $90 million fighting the case. The consumer advocates had half a million dollars to spend. There is a serious imbalance of resources.
One important aspect of this bill is that it provides for a consumer reference group. There will be a body of people representing the interests of consumers and they must be listened to and their views taken into account. The Public Interest Advocacy Centre points out that in order for this consumer reference group to be effective it must also be appropriately resourced. By resourced they mean that they need payment for the time that is spent and they need funding to be able to commission research that is in the interests of consumers.
So these are the questions I would ask the minister to take, and if he is able to give an answer in the committee stage that would be good. What are the proposals or plans for the Australian Energy Regulator to fund this community reference group? What do they have in mind? Is there a budget? Will the representatives of the various consumer bodies be paid to attend the meetings?
In fact, to put a little more context to it, the sort of people we are talking about, the people the Public Interest Advocacy Centre represent, are groups like the Salvation Army, St Vincent de Paul Society, Physical Disability Council, Anglicare, Good Shepherd Microfinance, Financial Rights Legal Centre, Tenants' Union, Mission Australia. These are not people who are loaded with money and what money they do have they spend for the benefit of the community. So that is my main question in my second reading contribution: how will the consumer reference group be funded?
The second question that I will put on the record is that the bill provides a get out of gaol free clause, a clause that basically says, 'Here are the rules, but if you do not follow them it does not really matter.' We see that in legislation a lot. Proposed new section 18R—Failure to comply does not affect validity, reads as follows:
Failure to comply with this Subdivision does not invalidate or otherwise affect a rate of return instrument.
I understand why they put these clauses in because what they are trying to avoid is a catastrophic result flowing from an official miscounting of days on a calendar and not giving someone exactly the right amount of time to comment or some minor thing, so I get why we put these things in.
But my question is: what comeback is there for, say, representatives of energy consumers when the process has not been followed? Is there anything they can do? The clause says that the rate of return instrument will not be invalidated, but what is the response? Where would people go if they were dissatisfied with the process that the Australian Energy Regulator followed? With those brief words, the Greens will be supporting the second reading of this bill.
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