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Category: Privatisation and Deregulation / Economic Trends / Consumer Protection

Consumer watchdog 'at the point of almost opposing privatisation'

Tuesday, 26 Jul 2016 13:47:11 | Stephen Letts

ACCC chairman Rod Sims (ACCC, file photo)

The Australian Competition and Consumer Commission's chairman Rod Sims has argued that consumers are being hurt by poorly regulated privatisations that are driving up prices and have little to do with economic reform.

Mr Sims said the situation is getting worse, as the main concern of governments with privatisation is maximising proceeds from the sale by fighting against effective regulation.

"A sharp upper-cut is needed. It is increasing prices, let's call it out," Mr Sims told the Melbourne Economic Forum.

"The whole idea of asset sales is that the private sector can run them more cheaply than the public sector.

I am now at the point of almost opposing privatisation.

Mr Sims said many reforms in recent years by governments - both state and federal - had been done badly, and not only affected productivity but undermined the chances of much needed economic reforms being undertaken.

He argued that "very bad reform implementation has been a big part of the current backlash" against any economic reform.

High prices from privatisations - high gas prices and power prices from poor regulation - have damaged our productivity.

Mr Sims cited the contentious shift of vocational education to the private sector, away from publicly funded TAFE institutes, as an example of poor policy which undermines community confidence in reform.

As well Mr Sims pointed to concerns about electricity privatisation in Queensland, where power prices have doubled over the past five years, as well as the sale of east coast port facilities.

The ACCC is currently reviewing the sale of the Port of Melbourne, having scuttled an earlier plan from the Victorian Government which would have seen stevedoring rents jump by up to 750 per cent and the port entrench its market dominance ahead of its privatisation.

The ACCC's current concern centres on the involvement of the big industry superannuation fund IFM in the bid for the port, when it already owns large stakes in the Port of Botany, Port of Brisbane and Port Kembla.

AustraliaPlus


 

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