Leon Delaney:
Andrew Leigh, good afternoon.
Andrew Leigh:
Good afternoon Leon, great to be with you.
Delaney:
Well, you’re the Assistant Minister for Competition, amongst other things. Can’t you tell Qantas to be more competitive?
Leigh:
Katy Gallagher has done exactly that, and certainly she’s speaking on behalf of all of the ACT federal Labor representatives. The cancelation rate is outrageous, and the fares are sky high. The fact is that you can get the bus up to Sydney for less than 50 bucks. And so, the idea that they ought to be charging 700 bucks for a 30‑minute flight just strikes me as pretty outrageous.
Delaney:
It’s a weird flight isn’t it? Because you actually spend more time in the airport than you do in the air. But even so, sometimes people just have no choice but to take that flight because they need to be travelling between Sydney and Canberra fairly quickly to meet an appointment or meet a deadline or something of that nature. It’s basically extortion, isn’t it?
Leigh:
Well, Katy Gallagher is speaking out on behalf of not only the government, which is paying fares for people to come to and from Canberra for public servants and politicians to make that trip, but also for the Canberra travelling public. Because analysis from Canberra Airport seems to suggest a bit of a price spike during parliamentary sitting periods, not just on that Sydney to Canberra leg, but also on Adelaide, Perth and Brisbane. Their analysis seems to suggest mark‑ups anything up to 135 per cent coinciding with parliamentary settings. That’s not what you’d expect in a competitive market, to say the least.
Delaney:
No, well that’s very close to profiteering isn’t it? When you see, ‘oh look at the calendar it’s parliamentary sitting week, we’re going to jack up the prices’ – that’s surely sailing pretty close to the wind in terms of what the law allows, isn’t it?
Leigh:
Well, we’ve passed the analysis on the Australian Competition Consumer Commission, which is responsible for enforcing the law, but the direct letter that Katy Gallagher has written to Qantas speaking on behalf of the 4 federal Labor representatives really is about trying to get them to pull their heads in and do better by Canberrans. You know, you shouldn’t be buying a $700 ticket and then facing a one in 7 chance it’s going to get cancelled.
Delaney:
Absolutely not. It’s a bit like, you know, buying a ticket in the lottery and then being told, ‘no, we’re not going to have the draw’.
Leigh:
Yeah, I sometimes joke to friends that when you get a ticket to Sydney, it’s an option to fly to Sydney in the event that there’s enough people that want to fly at that time. And if there’s not, then often you can find your flight cancelled and attendant delays, and that means people missing birthdays, weddings, important meetings – all of those things. Canberrans finding that it’s more reliable to get in the car or get on the bus, which of course, takes a whole lot longer.
Delaney:
It does. Now, the Shadow Minister for Transport Bridget McKenzie has also called on the federal government to move more quickly in terms of the new slot management scheme for Sydney Airport. Does slot management play a role in Qantas decisions to cancel flights?
Leigh:
Slot management is a different issue that’s about making sure there’s plenty of competition for getting in and out of Sydney Airport. We had Bonza setting up a while back and saying that they didn’t want to fly into the biggest airport in Australia because they couldn’t get the landing slots they needed. That was one of the factors that led Catherine King to put in place the slot review led by Peter Harris and the decision to revamp the slot management process there. Getting Western Sydney Airport open will be another important source of competition, and really is vital for the traveling public and of course for all the businesses that depend on people being able to fly around the country.
Delaney:
It’s not an entirely unrelated matter though, is it? Because the suggestion is that Qantas is able to obtain slots that it doesn’t necessarily intend to use?
Leigh:
Yeah. I mean, there’s certainly been allegations of squatting on slots and the suggestion that holding a slot and then cancelling it didn’t face attendant penalties. All of those were issues that were canvassed in Peter Harris’s review of the slot management process at Sydney Airport, what led Catherine King to act so decisively to see more competition there. We know we’re a market which has 3 domestic airlines but 2 of them are owned by the same company, and that really limits the amount of choice that Australians have when they fly. And we know that when there’s routes with more competition, our fares tend to be lower.
Delaney:
All right. Of course, yesterday we saw the 3 day productivity and Economic Reform Roundtable wrap up and come to a conclusion. I’m sure you’re going to tell us what a raging success it was, but what actually came out of it that’s going to benefit Australians?
Leigh:
It was a fabulous productivity powwow, and as somebody who has been passionate about productivity and the attendant boost to living standards, I found it really valuable. Attendees came in wearing not their sectional interest hats, but their national interest hats. And the conversation ranged very broadly. So, we had a range of discussions around some of what we need to do to build more homes, and the role that regulation can play even when well‑intended. We had some really useful discussion around the road user charging that affects heavy vehicles and the challenge of getting more heavy electric vehicles onto the road in order to reduce pollution. We had a whole lot of discussion around artificial intelligence and how we make that a national priority for Australia. So, 29 hours, hundreds of contributions. I was there for the lot. Loved it and thought it was really important for the nation.
Delaney:
Well, I knew you’d enjoy it because that’s just the kind of guy you are. But let’s look at a couple of things that actually did emerge from that. As you said, doing something about improving the ability to deliver more homes more quickly. And there’s some discussion about the National Construction Code isn’t there, and what can be done to reduce some of the red tape that appears to be constraining construction, but that is fraught with difficulty, isn’t it? Because some red tape is important?
Leigh:
Absolutely, we want to make sure that the homes that are being built are built to high standards. But as Clare O’Neil has pointed out, she’s spoken to plenty of builders who say that the problem used to be building the home, and now the problem is doing the paperwork. She’s looking at how we can reduce complexity and red tape in the National Construction Code in a balanced way that takes into consideration some of the concerns that were raised at the roundtable. So, Clare is going to be acting on that swiftly. She’s already actively engaged with states and territories on this conversation as to how we can streamline regulation and get more homes built.
Delaney:
Yeah. When we last spoke, I very briefly mentioned that one of the elements that’s contributed to the increase in the cost of housing over the decades has been the shifting of costs from local government authorities in provision of infrastructure like stormwater drainage and streetscaping and car parking and all that sort of thing. That’s been shifted onto the shoulders of the developers. They have to pay either significant development fees to the council, or they actually have to create that infrastructure themselves. That’s one of the factors where that cost shifting has actually increased the cost of a new home and land package, for example, quite dramatically over the years. So how can we address that? And what can councils do, because they’re strapped for cash anyway, in terms of making it easier for people to provide that housing?
Leigh:
Yeah. I mean, I don’t think it’s quite as stark as you characterised it there Leon. Those fees have for a long time been associated with building new developments, but we’re very conscious…
Delaney:
Well, I did say decades.
Leigh:
That’s nicely put. So, this hasn’t just turned up in the last few years, but we do need to get the balance right. The complaint that I hear most often when I speak to builders is more about speed. They want speed and certainty. They want to be able to get through these processes and one of the other issues is environmental approvals for new homes. There are tens of thousands of homes which are caught up in the environmental approvals process. So, Murray Watt is working with Clare O’Neil on that to see what we can do to knock off that backlog. We had Daniel Mookhey there representing the state and territory treasurers. He did a great job of talking about the work that New South Wales and other states are doing in order to get on top of this. There’s plenty of work going on, and it’s all focused around getting those approval times down so we get houses built for young Australians.
Delaney:
Indeed. There was a story today in ‘The Canberra Times’, and I don’t know if you’ve had time to sit but a particular developer and the construction of a set of about 100 apartments on Northbourne Avenue – 105 of them actually. Apparently, groundbreaking took place yesterday. That was more than 2 years after the development application was first submitted, and the developer said it basically robbed him of his soul jumping through the hoops that were expected of him. And during the time between lodging the DA in the first place and finally starting to be able to break the ground yesterday, the anticipated cost of construction has more than doubled during that time. It’s an uphill battle to get anything built?
Leigh:
It’s certainly a big challenge. I was speaking to planning Minister Chris Steel, who was walking me through a range of the challenges that they’re trying to tackle through the ACT’s Missing Middle plan. Now Chris is somebody who’s strongly committed to getting more done. Working through the really precise detail as to how we can streamline that process, how we can ensure that developers are doing more online applications and not having to go back to square one as changes are inevitably made to designs, but able to get on and doing what they got into the industry to do – to build apartments and homes.
Delaney:
Absolutely. Very quickly, you mentioned the road user charge there. Now, apparently that looks like that is something that will be introduced following the roundtable over the last few days. It’s still very controversial, though. And Andrew, I must insist I already pay a road user charge – it’s called registration! Why do I need to pay again?
Leigh:
Yeah, it’s a conversation we have with states and territories. They’re largely leading the work around this Leon. We do know that at the moment, we’re funding a lot of our roads through fuel charges and ultimately that source of revenue is going to dry up. So, it makes sense to think about the future. But as I said, this will be an ongoing conversation that’s aiming not to increase the overall tax burden, but instead to transition to a modern approach. And the heavy vehicle one really is where the rubber hits the road, if you like. We haven’t been able to get those heavy EVs out there, which means more noisy, polluting trucks than we need to have.
Delaney:
How many more cliches can we throw in? We’re talking road user charges, and you’ve got the rubber hitting the road, and earlier we were talking about Qantas, and you said prices are sky high. I mean, let’s, let’s…
Leigh:
It must be Friday afternoon Leon!
Delaney:
It must be Friday afternoon, just about cocktail time. Andrew, thanks very much for your time today.
Leigh:
Thanks so much, have a beaut weekend.
Delaney:
Thank you. That’s Dr Andrew Leigh, the federal Member for Fenner and Assistant Minister for Productivity, Competition, Charities and Treasury.