LEON DELANEY:
And the federal government has announced a new taskforce to crack down on unfair pricing practices in relation to the National Disability Insurance Scheme. The Assistant Minister for Competition, Charities, Treasury, Employment and Federal Member for our local Seat of Fenner, Dr Andrew Leigh, good morning.
ANDREW LEIGH:
Good morning, Leon, great to be with you and your listeners.
DELANEY:
I managed to get through that without falling over. If I had a dollar for every time I said "good afternoon" this morning, I could afford to retire.
LEIGH:
You're a versatile gentleman, turning up in all parts of 2CC.
DELANEY:
I do the best I can. Now obviously there's been a recent review of the National Disability Insurance Scheme which identified a number of issues, and one of the more prominent ones, of course, was the issue of rorting. So what's this new taskforce going to do to put an end to it?
LEIGH:
We're just trying to deal with what Bill Shorten calls the "wedding tax", the fact that for some people in the NDIS, when providers discover they're on the NDIS they're charging them more, simply because the government is paying the bill.
We've known about the problem for years. Most service providers are doing the right thing, but there's a small minority of dodgy providers who are doing the wrong thing. And that's why we're making sure that this taskforce has the powers to crack down on overcharging, to crack down on people being charged more simply because they're on the National Disability Insurance Scheme.
DELANEY:
What sort of regulation is there for providers? Do they need to be registered in some way, and do they have to conform to a particular framework of rules?
LEIGH:
They've got to be registered, and they've got to operate through the scheme, but we're also now making sure that the Australian Competition and Consumer Commission has additional resources to crack down on overcharging, and it's just not fair to have people pressured into buying a supported service they don't need, and being charged more than they should be.
We've had support from the organisation People With Disability Australia, who are as outraged as we are about NDIS participants being ripped off.
DELANEY:
So what sort of penalties will be involved for those providers who are found to be doing the wrong thing?
LEIGH:
Well, these penalties range right through up to criminal sanctions against the providers; we've got significant cash penalties, and that makes sure that we're cracking down on what is fundamentally a rip‑off of people with disabilities and a rip‑off of the Australian taxpayer.
We're writing to every NDIS participant, carers, guardians and nominees, explaining their rights, and explaining how they can help us fight back against this NDIS wedding tax, this idea of raising prices just because somebody is on the National Disability Insurance Scheme.
Now for some many Australian families, as you know, Leon, the National Disability Insurance Scheme has been a game changer, but there's a small number of dodgy providers who saw it not as the best way to help people with disabilities, but as the best way to unfairly line their pockets at the expense of the taxpayer. That's just not on.
DELANEY:
Well, you know the old adage, wherever there's a big bucket of government money, there will be people crowding around it buzzing about like blowflies, won't there?
LEIGH:
That's always the risk, and the clear message to them is that the era of ripping off disabled people in the NDIS is over. It is just outright wrong, it's a breach of federal law, and people who are overcharging clients who are on the National Disability Insurance Scheme are going to have the book thrown at them.
DELANEY:
Absolutely. And of course that taskforce, as you've announced, has already commenced operation. Meanwhile, the Greens are pushing a bill that will bring about mandatory divestment to break up the supermarkets duopoly if they get their way.
Now apparently there are some members of the Coalition that think it's a good idea. What do you, and what does Labor think?
LEIGH:
I mean we've got Peter Dutton saying, "You ought to boycott Woolies," and we've got the Greens saying, "You ought to break up Woolies”, it's left to Labor in the sensible centre to say, "Actually neither of these solutions are going to be particularly effective, the best thing is to work with the supermarkets to bring down prices."
So we've got CHOICE now doing quarterly price monitoring, which will make sure that consumers can see where the cheapest basket of groceries can be found. We've got the competition watchdog doing an inquiry into prices and Craig Emerson looking at the Food and Grocery Code of Conduct and whether that should be made mandatory in order to protect suppliers, and we raised the penalties for anti‑competitive conduct and banned unfair contract terms as part of our broader review of competition settings. We want to do things that work. It's not clear to us, and when we look at the international evidence that a divestment power is one of those things.
DELANEY:
Well, I guess one of the things that might have inspired that line of thinking is that big countries like the United Kingdom have got half a dozen big supermarket players; we've only got the two big ones, the United States even more. More players in the game means better competition, doesn't it?
LEIGH:
That's right. The way in which our Australian supermarkets got big was through mergers, snapping up smaller rivals such as Franklins, which used to exist, and that's why we're reviewing Australian merger laws, making sure we've got merger settings that are fit for purpose, and also looking at the pricing practices in the big supermarkets.
But I'm not aware, Leon, of any other country that's been breaking up its supermarkets. Peter Dutton might want to tell people not to shop at Woolies, the Greens might want to break up Coles and Woolies. Labor wants to work with the supermarkets to get the very best deal for Australian consumers while respecting the hundreds of thousands of Australians who work at those organisations.
DELANEY:
Yeah. Now the other thing of course is that with the big supermarkets, they do have the cost efficiency of scale. So they, generally speaking, do deliver lower prices than smaller independent competitors like convenience stores. So I'm not sure that there's an argument to be made that they've been gouging us on the prices, but I think there is an argument to be made that they've been unfairly wielding market power to disadvantage their suppliers and in particular the farmers. What do you think?
LEIGH:
There's two sides of the coin when you've got market power, there’s monopoly power, where you gouge consumers, and there's monopsony power where you gouge your suppliers. I think most economists would agree with you that the bigger and most pernicious impact over the last couple of decades has been the squeeze on suppliers.
That's not to say that consumers haven't been affected, and that's why we've got the Australian Competition and Consumer Commission now doing a deep dive looking at that, and not just looking at it at an anecdotal level, but actually crunching through big data sets in the way that just was impossible a decade ago.
Big data is a game changer when we're looking at competition reform. Our Competition Taskforce has been doing some great analysis on everything from mergers to domestic airlines, and I hope the competition watchdog will be able to do the very same with an analysis of supermarket prices.
DELANEY:
Indeed. And the government this week is planning to make its submission to the Fair Work Commission on the wages review, and it's interesting that the government is making a point of being very clear that they want any wages increase to be on top of any benefit that might be gained from the Stage 3 income tax cuts. Why have you felt that that is necessary?
LEIGH:
Well, we want Australians to earn more and keep more of what they earn. Changes to the Stage 3 tax cuts were deliberately designed to ensure that every taxpayer got a tax cut. 84 per cent of taxpayers are going to be better off as a result of the changes we've made. We don't want to see that undermined by any decision of the Fair Work Commission.
We've made very clear to the Fair Work Commission in our submission that the real wages of Australia's low paid workers can't go backwards. That's what we've done in the last two submissions that we've made to the Commission. In fact the very first decision of the Albanese Cabinet was to approve a submission to the Fair Work Commission saying in categorical terms: minimum wage workers deserve a pay rise in real terms.
DELANEY:
Indeed. And I've also read a report today that the tax cuts that are being delivered on 1 July, whilst I'm sure they will be welcomed by many people, in reality all they do is return the bracket creep from the last seven years. So we're still really not making the advance that we might think we are, are we?
LEIGH:
Well, compared to Scott Morrison's plan, Labor's tax plan returns more bracket creep to more taxpayers. Peter Dutton wants Australians to work longer for less. We want Australians to earn more and keep more of what they earn. Our tax plan is fair, it's good for productivity, boosts labour supply, and it's not going to have any additional impact on inflation.
Right now we've got inflation moderating, we've got unemployment low, 3.7 per cent unemployment, and we've got real wages rising. Under the former government you had keeping real wages low as a deliberate design feature of their economic architecture. Under us, real wage rises are a focus for the government, and tax cuts for all Australians are our policy.
DELANEY:
Andrew, thanks very much for your time today.
LEIGH:
Thank you, Leon.