Australian Government, 2008‑09 Budget
Budget

Australian Competition and Consumer Commission

Section 1: Agency overview and resources

1.1 Strategic direction

The Australian Competition and Consumer Commission (ACCC) is an independent statutory authority which administers the Trade Practices Act 1974 (TPA) and performs functions under other Commonwealth legislation and State and Territory Competition Policy Reform Acts.

During 2008‑09 the ACCC's role is to enhance the welfare of Australians by:

  • promoting effective competition and informed markets;
  • encouraging fair trading and protecting consumers; and
  • regulating infrastructure service markets and other markets where competition is restricted.

A major new measure arising from the Water Bill 2007 extends the ACCC's role to regulatory oversight of bulk water pricing, rural water delivery charges and other regulated water charges in the Murray‑Darling Basin. The ACCC regulatory oversight role includes the conduct of irrigation infrastructure operations through the development, monitoring of compliance and enforcement of water market rules, and advice to the Murray‑Darling Basin Authority in respect of water trading rules. The ACCC is required to advise the Minister regarding the water charging implications of, and efficient market arrangements for, new Australian Government infrastructure investment.

Another major new measure is monitoring of grocery prices and the publishing of price data on a dedicated website. The new function relates to the Government's election commitment to direct the ACCC to publish, on a dedicated website, a periodic survey of grocery prices at supermarkets for standard grocery items. In keeping with the ACCC's mission to promote informed markets, this new function has the objective of providing consumers with information to determine the supermarket chains in their region that offer the lowest price for the different baskets of goods published on the dedicated website.

A further new measure, subject to the enactment of legislation, is the establishment of price commitment rules for retail petrol prices and the introduction of a National FuelWatch Scheme, similar to retail arrangements which currently operate in Western Australia. In keeping with the ACCC's mission to promote effective competition and informed markets, the new function will require fuel retailers to notify the ACCC about their next day's price for specified fuel blends each day. Retailers will be required to maintain their notified prices for a 24 hour period the next day. The ACCC will make prices for the following day publicly available. This provides an opportunity for consumers to observe the next day's notified price and make purchase decisions in an informed way. Retailers will be required to comply with the national price commitment rules. When retailers sell at a price higher or lower than the notified price, enforcement action can be taken by the ACCC. This scheme is in addition to the measure which includes the appointment of a Petrol Commissioner with particular focus on petrol arrangements and the introduction of formal monitoring of petrol prices under Part 95ZE of the TPA.

Challenges impacting on the ACCC's outcome, going forward, arise from the broader environment. A growing interest in environmental and `green' issues impacts across many functions of the ACCC. These challenges bring new opportunities to provide competition and regulatory leadership on emerging issues as well as impacting on traditional enforcement activities.

The Government has committed to provide funding of up to $4.7 billion, and to consider regulatory changes necessary to facilitate the deployment over five years of a National Broadband Network (NBN). The ACCC will have a key, ongoing advisory role regarding competition and pricing issues, including the provision of a formal report on NBN Proposals to the NBN Expert Panel.

Changes in the communications industry provide challenges for the ACCC's regulatory role and will require the ACCC to be kept abreast of the debate, provide technical advice as required by the government and be able to respond to regulatory changes and challenges that might emerge.

The reforms for gas and electricity continue to evolve as Commonwealth and State negotiations continue. As energy functions pass from the States to the Commonwealth the Australian Energy Regulator's (AER) role as Australia's independent national energy market regulator will be complete. The challenges for the AER are to work within the evolving regulatory landscape while performing regulatory resets, monitoring compliance and providing timely and relevant information to energy market participants.

Subject to the enactment of legislation, the TPA will provide for criminal sanctions for price fixing and market sharing (cartel conduct). This along with other foreshadowed amendments to the TPA will strengthen the objectives of the Act to achieve compliance with competition laws.

1.2 Agency resource statement

Table 1.1 shows the total resources from all origins. The table summarises how resources will be applied to the ACCC.

Table 1.1: Australian Competition and Consumer Commission resource
statement — Budget estimates for 2008‑09 as at Budget May 2008

Table 1.1: Australian Competition and Consumer Commission resource statement — Budget estimates for 2008-09 as at Budget May 2008

1. Appropriation Bill (No.1) 2008‑09.

2. Appropriation Bill (No.2) 2008‑09.

3. Receipts received under s31 of the Financial Management and Accountability Act 1997.

4. Estimated adjusted balance carried forward from previous year for annual appropriations.

5. Estimated opening balance for special accounts. For further detail on special accounts see Table 3.1.3.

Third Party Drawdowns from and on behalf of other agencies

Third Party Drawdowns from and on behalf of other agencies

Note: the ACCC provides financial services to the NCC and has drawdown access to manage the NCC's finances.

1.3 Budget measures

Budget measures relating to the ACCC are detailed in Budget Paper No. 2, Budget Measures 2008‑09. Table 1.2 provides a summary of government measures and identifies the relevant output groups associated with each measure.

Table 1.2: Australian Competition and Consumer Commission 2008‑09 Budget
measures

Table 1.2: Australian Competition and Consumer Commission 2008-09 Budget measures

Prepared on a Government Finance Statistics basis.

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