Adjourned debate on second reading.
(Continued from 19 August. Page 647.
The Hon. R.I. LUCAS (Leader of the Opposition): On behalf of the Liberal Party, I rise to support this legislation, which is related legislation to the Essential Services Commission Bill. When we debated the last bill, I was going to suggest that, when the two bills are in commit¬tee next week, we could have most of the general discussion on one of the bills and just the detail of some of the specific clauses in this legislation.
I want primarily to address the issue of pricing, in particular pricing as we come into full retail competition. By way of background information, on 1 January next year, full retail contestability (FRC) will be introduced for the 730 000 tranche 5 customers (small customers) who consume less than 160/MWh electricity per annum. This bill inserts the new definition of small customers, which will be one of the issues we need to pursue in the committee stage as to the purpose of that change and the intent behind it.
It is important to place on the record that, when the previous government went through the privatisation process commencing in 1988, we established a framework which provided the greatest degree of protection possible for tranche 5 customers. Tranches 1, 2, 3 and 4 (the bigger and medium sized customers) who became contestable or competitive at earlier stages were treated differently. The households and the very small businesses in tranche 5—far and away the largest number of electricity consumers—were protected right through to 2003.
In 1998, we said we would protect households (the small customers) for approximately the next five years by ensuring that electricity prices did not increase more than the CPI. It is intriguing—a little like the point I made at the end of my previous contribution about blackouts and where people’s recollections of what has occurred are distorted significantly by what they hear and what they talk about with friends and neighbours—that during the last two years, I would often do talkback radio or read transcripts of talkback radio where (and I am sure they were not all Labor Party stooges and plants; I am sure some were genuine) listeners were genuine¬ly saying, `What’s this nonsense from the government about no increase greater than the CPI? My electricity this year is $100 higher than it was last year’ (or 40 per cent higher, or whatever it happened to be). As you know, Mr President, the reality is that for many customers electricity consumption was significantly higher in some of those periods compared to 12 months earlier. Also, people’s perceptions of what they paid previously change.
An honourable member: And the GST.
The Hon. R.I. LUCAS: Yes, after the introduction of the GST prices did increase, so it is right to point that out. As a consequence of what the previous government did there were no increases greater than the CPI, because prices were locked in. Again, this was a decision which impacted on the value of the assets. If we had sold the assets with all consum¬ers contestable within two years or 18 months, the assets would have had a higher value placed on them by potential bidders. However, for the reasons I will go into now—and for some of the reasons I canvassed in the previous second reading debate—the former government was conscious of the need to protect small consumers, in particular, and wanted the longest possible opportunity to learn from the experience of New South Wales and Victoria which were going contestable, I think, two years earlier in 2001.
We believed that there would be significant problems with metering and other similar problems and we therefore chose to deliberately delay contestability for small customers for the longest period possible. In addition to some of the things I outlined in the debate on the Essential Services Commission, we had to decide about disaggregation of the distribution side of the Electricity Trust of South Australia business. We consciously postaged stamped pricing by having only one distribution company in South Australia.
During consideration of the disaggregation process, we looked at what had occurred in Victoria where the distribu¬tion company had been disaggregated into five separate distribution companies. In regional communities in Victoria there were potentially more significant price increases because there was no postage stamping of the distribution costs within the one company. For companies in the western districts of Victoria, for example, the costs were higher. They were unable to offset those costs through postage stamping with lower cost city-based consumers.
We were seeing disparity in prices between city and country starting to become apparent in Victoria. At the time, we had advice that we ought to look at disaggregating into a couple of distribution companies. We looked at a number of complicated models of how we would carve up South Australia. One model was a bit like a distribution with spokes coming through Adelaide and taking in parts of the city and parts of the country to try to get over the problems occurring in Victoria, with each distribution company having some city consumers and some country consumers.
We looked at one which split half city and half country, north and south. In the end, a pro competition and pro consumer decision was taken and we decided to form only one distribution company. That did allow, and still does, postage stamping of prices and assists in reducing any potential disparity between country and city consumers. Again, that decision, together with many others, gives the lie to claims that have been made that the former government was interested in this process only in the value of the assets and was not interested in competition effects or the impact on consumers.
One understands the politics of all this. I have been around for a long time, and those claims are easily made and very hard to argue against in the heat of a period leading up to an election campaign. When other sympathisers, whether they be business leaders or supposed leading economists, hop on board the bandwagon, it makes it difficult to explain the logic of what occurred. I am hoping in these two contributions, albeit in some detail, to place on the public record what the former government did do and did go through, and the fact that it was considering consumer and competition issues.
I do this not in the expectation that we will see a front page in the Advertiser but, rather, that the small number of people who look back on the history of electricity privatisa¬tion in South Australia will see some of the detail and some of the decisions that were being taken by the then govern¬ment; as I said, not solely driven, as some have claimed, by the value of the assets but, rather, by a consider¬ation for competition in our marketplace and protection for consumers to the extent that we could.
The other decisions that we were taking for the period pre 2003 for the last tranche of contestable customers was a rapid process of increasing generation capacity in this state. I will not go through the detail again, but it included an extra 37 per cent of increasing capacity in state generation in South Australia; fast-tracking Murraylink; support for Riverlink ultimately; support for SNOVIC of an extra 400 megawatts of power from the Snowy Mountains into Victoria and South Australia; and support for Basslink, which was an extra 600 megawatts of power coming from Tasmania into the com¬bined Victorian and South Australian markets.
Basslink is going through the same problems as Riverlink and SNI. There is huge opposition from landowners, Independent members of parliament and various other politicians, both Labor and Liberal, who oppose Basslink, yet the remarkable logic is that the national market requires Tasmania to be linked through Basslink into the national electricity market. Certainly, the Liberal Party supports all the proposals, and it will continue to support the government in anything it can do to try to see the Basslink and SNOVIC proposals and sensible interconnection proposals wherever they might occur.
Around December last year, as a result of the problems, the government was frank enough to concede that with the grace period customers it had not achieved the competitive market it desired by mid 2001. The advice provided to the government had been that, as a result of the establishment of Pelican Point, and hopefully with the establishment of an interconnector before June 2001, we would see a much more competitive electricity market in South Australia. We did fast-track Pelican Point, but growth and demand outstripped that. Murraylink was delayed. It was not ready by mid last year. As I said, energy is about ready to flow at the end of this month, so it is about 12 months late.
Riverlink, which was first suggested in 1998, still has not started. The Labor government has promised that it will build Riverlink within 18 months of its getting into office. We have 12 months left before we see the Premier proudly standing with the New South Wales Labor government minister by one of those big pylons in the Riverland and saying, `There you go; our special friendship with Bob Carr has allowed us to fast-track this Riverlink (or SNI) proposal.’ Mr President, I am sure that, like me, you will not be holding your breath waiting for that time line to be met. It may be built—it will depend on the National Electricity Tribunal—but, if it is, it will be delayed even further.
As a result of all those problems, the former government decided that it needed to do something additional for tranche 5 customers—the small customers and households. In December, the government made a decision in relation to activating section 35A of the Electricity Act, which provides prices regulation power for the independent Industry Regulator for small customers. Section 35A of the Electricity Act provides:
Price regulation by determination of Industry Regulator.
35A. (1) The Industry Regulator may make a determination regulating prices, conditions relating to prices and price-fixing factors for—
(a) the sale and supply of electricity to non-contestable customers or customers of a prescribed class;
That is the key provision. When it passed this legislation in 1998-99, the former government included a clause which provided that, if need be, the independent Industry Regulator could be given the power, if we described a certain class of customers, to regulate prices. I think in the Electricity Act amendments, which I do not have with me, this particular provision is changed marginally in the legislation that we see before us. It includes two or three words, and it changes `non-contestable customers’ to `small customers’. There is a new definition of small customers, which essentially will be the same group, that is, less than 160 MWh per annum. That is the only change.
So much for the much vaunted Labor government promise about fixing up electricity and providing greater powers for the regulator. When we go to the committee stage of these bills, the minister and his advisers will be forced to concede that the existing power in section 35A of the Electricity Act was sufficient for price regulation. There are other changes which would give the Industry Regulator additional powers if companies were not prepared to work with the independent Industry Regulator in providing information, for example.
The former government was going to have to amend the Electricity Act and the Industry Regulator Act to provide the power in the event that there were those problems with the independent Industry Regulator’s getting information from the power companies. In relation to the key power, the head of power, as to whether or not a particular class of customers could have their prices regulated, that power already exists in the Electricity Act introduced by the former government.
One of the issues we will be pursuing during the commit¬tee stage is why the government has basically done very little in its first six months. Unless there is a good reason, of which I am not aware at this stage, the existing powers could have been activated by this government back in March or April, with the knowledge that the government was going to introduce this legislation, should the independent Industry Regulator run into problems in terms of getting voluntary compliance with his inquiries.
Having spoken to representatives of AGL and some of the power companies, I would be very surprised to hear that those companies would not have assisted the Independent Industry Regulator in his inquiries, because they would know that at least these particular provisions in legislation would be supported by both the Labor and Liberal parties, given that we had announced similar policies during the election campaign.
Of course, the current government did not want to acknowledge that the policies were virtually the same. It has been wanting to claim that its was a much tougher, more robust, more powerful policy package that had been put together to protect consumers. Frankly, this legislation shows that those claims are a lot of rot. There is no substance at all in those claims. And, as I said earlier, when the fairy floss minister from another place was probed on this issue of what were the greater powers, he was unable to indicate where these greater powers were in relation to a proclaimed class of customers under the old section—or existing section 35A of the Electricity Act.
In talking about pricing—which is obviously critical to this whole electricity amendment bill and also to the debate that has ensued for the past couple of years—it is interesting to look at the scare campaign that had been run by the Australian Labor Party in opposition and by some of its fellow travellers and sympathisers. Literally dozens of similar pieces of electoral material were circulated by Labor candi¬dates and members, but I want to refer to only one of the more gross forms of electoral distortion that we saw. It would not surprise members to know that it came from that welsher from the west, the Labor candidate for West Torrens, Mr Koutsantonis.
I might say, one of my friends tells me that a potential name for one of his horses coming up is `Koutsie’s a welsher’ and, hopefully, if that comes to fruition, the fact that the member for West Torrens is welshing on a bet will be known to all and sundry, particularly those who follow the races closely here in South Australia. I am sure that Mr Koutsantonis will read Hansard and have a chuckle. This letter, circulated in the first week of the campaign by Mr Koutsantonis, begins:
“Dear Mr and Mrs [I will not mention the name of the couple], Can you afford an 80 per cent increase on your electricity bills? Thanks to the Liberal government, we have paid more for our power and water since they were sold to foreign companies. South Australian small businesses have suffered a further increase in electricity prices and household bills are next.”
I repeat, the letter continues:
“Can you afford an 80 per cent increase on your electricity bills?
Various other shadow ministers and Labor members claimed 30 per cent to 90 per cent increases in electricity bills for households post 2003, in an election campaign based on a gross distortion of the facts. Whilst it is easy to make the claim, it is very hard to rationally argue and disprove.”
I want to look at some of those other statements that have been made by Labor Party members and, in particular, by the minister. I have lost the exact page reference in Hansard, but during the recent debates the Minister for Energy again placed on the public record that there would be a significant increase in price for household customers post 2003. Consistent with that, in an interview on ABC Radio on 3 May this year, the minister talked about how he wanted to make sure that the shock of the introduction of FRC is cushioned as much as possible; he made statements on 25 July high¬lighting significant increases in electricity prices; and the Treasurer and the Premier made a number of statements about significant increases in electricity prices for households post 1 January 2003.
In addition to those statements that have been made by Labor government ministers—firstly as shadow ministers prior to the election and then as ministers since the election—I want to place on the record some of the statements that have been made by the South Australian Independent Industry Regulator in relation to the possible price increases. In an interview on 5AA on 21 June this year, when he was asked about what would be the price for consumers post January 2003, Mr Owens said:
“I can’t promise any good news. . . the news that is around of possible increases of 20 per cent, 30 per cent or more. . . is probably a fair reflection of those market prices that I mentioned. . . what we’ve gone from is a system where there was an incentive on the old ETSA to try and control its costs to keep them down as low as possible and to pass that on, recovering its costs over time to a system now where there is a market that encourages generators to get the highest possible price, not the lowest possible cost. . . that’s what we consumers are now going to be paying for. . . ”
That was Mr Owens talking of 20 per cent, 30 per cent or more as being a fair reflection of those market prices that were possible. In an article in the Advertiser written by Melissa King either Monday or Tuesday of this week, I think, the headline reads:
“Power prices cold comfort for the poor.”
In that article the Independent Industry Regulator, Mr Owens, was interviewed. The article states:
“In response to the report Independent Industry Regulator Lew Owens said low income earners whose power was low should be rewarded with lower tariffs. People on fixed incomes did not have the capacity to pay expected rises of 20 or 30 per cent.”
Then there is a direct quote, as follows:
“The numbers that are being bandied about, I can tell you, are true,” Mr Owens said.
He was clearly referring to this 20 per cent or 30 per cent number. The reason why I place those statements on the record is that I have been approached in recent weeks by a number of people, one being someone who works with a senior interstate regulator, or regulatory authority. I also have been approach¬ed by a number of executives who are working within the electricity industry. Those people have expressed concern to me about the comments that have been made by the Independent Industry Regulator.
I say at the outset that the former government appointed Mr Owens to the position of Independent Industry Regulator. It is a thankless task, and he has worked very hard and assiduously in that role. He will continue to have a real challenge as he looks at the price regulation authority for the final tranche of customers. We certainly wish him well in that challenge. The concern that has been put to me is that these people say they have never seen an independent regulator who has to make a judgment about the size of a price increase when his views on the size of the potential increase is indicated on the public record weeks or months beforehand. I refer to that direct quote in the Advertiser and the quote on 5AA as an indication that the Independent Industry Regulator has been talking about price increases of 20 or 30 per cent or more even though he will have to make the decision about the correct level of price increase.
Some people have put the argument that AGL will be very happy with the current approach being adopted by both the Labor government and the statements being made by the Independent Industry Regulator, that is, putting out a large number. Eventually whatever is finally agreed—which one would assume will hopefully be significantly less than this number—will be a number regarding which perhaps people will breathe a sigh of relief, and AGL will not attract as much of the odium as it might have in other circumstances if the increase had been speculated, for example, as being 10 or 15 per cent.
As I said, they are the concerns that have been put to me. I must say that I share those concerns, and I place that on the record. All my experience with regulators in my 20 years in the parliament tells me that, if you are going to be making a judgment about a level of price increase, you are not normally in the marketplace talking about what the expected level of the market increase might be and putting numbers on it. Certainly, from the government’s viewpoint, again I do not think it assists consumers in South Australia if they continue, as members of the government do, to put in the marketplace significant numbers that indicate a significant price increase prior to any decision that might be taken by the Independent Industry Regulator.
It may well be that that is what the companies bid for, because that is what occurred in Victoria under similar powers. The companies asked for significant increases, and the Regulator there gave them much smaller levels of increase. Our regulator will have similar powers to look at claims from the companies and then to come back with a decision. Our legislation makes clear that the Regulator must look at not only the interests of the consumers but also the ongoing financial viability of the companies in South Australia. The government has made the point—and we support it—that we do not want to have a situation similar to that of California where retail companies go broke because their retail price is too low and their wholesale contract price is too high. That is a recipe for disaster, and none of us would support it.
So, as gently as one can put these things (because it is certainly in nobody’s interest for there to be a war waged with the Independent Regulator; and that is certainly not my intention), I place on the record the concerns that some power industry executives have put to me. But, more importantly, the judgment of someone who is familiar with the operations of a regulatory authority in another state—in terms of what is the normal practice for a regulator—was that it is most unusual (which was an understatement) for a regulator to be out there in the marketplace in this way.
Given that we have had claims of 80 per cent increases, and now the regulator and government ministers are talking of 20 or 30 per cent increases or more, I want to place on the public record in broad terms the nature of some of the advice with which the former government was provided prior to its decision to say that we would introduce prices justification powers.
I say at the outset that, with price modelling and forecast¬ing, I am the first to put on the public record that one can never guarantee the accuracy of the advice that the very best forecasters and modellers might provide to the govern¬ment. I therefore ask the following question. What further advice has the government had since 5 March to update the advice that the former government had on potential price increases for small customers?
I put that caveat on all this, Mr President: that, whilst I will put on the public record some of the advice that the former government received, I acknowledge that in no way can anyone ever guarantee that somebody’s best work and estimates will necessarily follow through. I will be interested to see, given that it is almost six months now since the Labor government took office, what follow-up work the government has done in this area.
Through last year the government had established a National Electricity Market Task Force and also appointed consultants named Intelligent Energy Systems, who provided estimates of the wholesale price in the electricity market for 2003 to the National Electricity Market Task Force, and it was obviously also then provided to the South Australian cabinet.
As the minister responsible at the time, in an excess of caution, I also got two further consultants to provide inde¬pendent advice on the work that IES had undertaken. So, IES did all the hard work. I then asked Price Waterhouse Coopers and Charles River Associates, two groups with significant expertise in the electricity market, to provide commentary and advice on the calculations from IES which had been provided to the task force and to the government.
To outline how they went about their work, IES said that they looked at a range of scenarios. First, they said that a credible assumption would be that the maximum energy pricing contracts for FRC would be comparable to the current level of contestable energy prices in South Australia as set out in the five-year contract offers made by AGL to South Australian grace period customers last year.
That assumption was made by IES on the basis that the gross pool market was non-discriminating; hence, retailers would not be seeking higher energy prices from household customers than they received from other tranches, although the margins might need to be covered to cover the cost of billing systems for the increased number of customers.
IES, in using the energy prices included in the AGL contract offer for 2003, with a peak energy price of $122.84 per megawatt hour, and an off peak price of $39.86/MWh, which is an average load weighted energy cost of $78.65/MWh using year 2000 demand figures with 47 per cent peak and 53 per cent off peak, was the first scenario.
So they thought the worst possible set of circumstances was the first five-year contracts that AGL managed to work into the marketplace during the grace period of time, at the time when they believed they had the maximum power and they believed for a variety of reasons that the pressure would come off prices through 2003 and into the future, but those would be the highest possible prices—and that was, as I said, an average load weighted price of $78.65/MWh.
They looked at a series of households—and I will not go through all the detail. For the average usage household, using 5 137 kilowatts per annum, the annual bill without hot water, if the AGL offer prices stayed in the marketplace in 2003, would increase by on average an estimated 12 per cent—the average means that there are some lower and some higher. The annual total bill, including hot water, estimated percent¬age increase was 14 per cent. So, without hot water, the increase was about 12 per cent.
IES looked at three other scenarios: what additional capacity might be provided into the market, what additional competition there might be in the marketplace and what impact there might be in each of those scenarios. IES provided pool price estimates for six scenarios ranging from no new supply capacity in South Australia to a high capacity scenario, with all scenarios assuming that 450 megawatts of new capacity would be developed in Victoria. I will look at three of those.
IES scenario 1 calculations are what they call the no development of new capacity in South Australia scenario. IES estimated that the pool price estimate in 2003 would be $58 per megawatt hour, with a retail margin of 5 per cent. Under that scenario—that is, no further capacity development in South Australia but some developments which are online in Victoria—instead of the average 12 per cent increase that I talked about earlier for the average household, under this scenario IES estimated that the price increase in South Australia would actually be a 1 per cent price reduction for the average household.
IES then looked at scenario 2, which is what it calls medium development (hot summer) scenario, and it incorpor¬ated a pool price estimate of $45/MWh and a retail margin of 5 per cent. This medium development scenario assumed that there were 220 megawatts of extra peaking plant, which it said was likely to be operating by 2003, as well as the Murraylink development—which, as I said, will be operation¬al by the end of this month according to the proponents. Under IES scenario 2, for the average household, IES estimated a price reduction of 11 per cent for the average household in 2003.
Finally, IES scenario 3, which is called medium develop¬ment (hot summer) scenario, has a pool price estimate of $45/MWh but also assumes a higher retail margin based on the AGL-SA offers to grace period custom¬ers. Under that scenario, IES estimated for the average household the annual bill without hot water would result in a 9 per cent price reduction.
There are many other estimates, all of which are available to the task force and which were also available to the current government, as they were to the former government. We then asked Price Waterhouse Coopers and Charles River Associ¬ates to look at the estimates that IES had done and said, `Okay, you are independent from them and they have given you these calculations.’ Frankly, when I looked at them I thought, `Are they accurate? And how can we provide greater confidence that they might be close to the mark?’
The advice provided to the government—I do not have the exact words—is something to the effect that they do not disagree with the estimates done by IES. In particular, the advice from Price Waterhouse Cooper refers to the key drivers on energy prices and other factors that would impact on retail prices after January 2003. The government has a copy of Price Waterhouse Cooper’s report, which concludes that the majority of the drivers were providing downward pressure on energy prices for 2003. They highlight that there are some unknowns associated with the retail costs and load profiles for small customers. According¬ly, the Price Waterhouse Cooper report provides support for the view that the AGL SA five-year contracts are likely to be at the higher end of possible price outcomes for full retail contestability with actual price outcomes possibly being lower due to the factors highlighted in the Price Waterhouse Cooper report.
Price Waterhouse Cooper looked at a number of drivers such as: forward price level; forecast spot price level; availability of hedge contracts; anticipated spot price volatility; level of retailing costs; degree of retail competition; customer load shape; and AGL pricing strategy. With the exception of level of retailing costs and customer load shape, which they saw as being negative, and the degree of retail competition, which they saw as being neutral, all the other drivers (five of them) they saw as being positive in terms of seeing a reduction in energy prices post-2003. Their overall assessment was `neutral to positive’, that is, given that all but two of the drivers are positive it is considered likely that the energy price outcome would be lower than that included in the AGL offers to grace period customers and hence unlikely that energy prices will be worse.
The other thing that needs to be checked in my question to the Leader of the Government and his advisers is that we have a problem in that these particular figures that I have quoted are load-weighted. Another measure of electricity costs is a volume-weighted spot price. We will need to ensure that we are comparing apples with apples so that there is no confusion. I want to place on the record some information from NECA web sites. This is a volume-weighted spot price which shows that, since February 2002, which is when Pelican Point was fully operational at maximum capacity, in South Australia, the volume-weighted spot price was $45/MWh. Prior to Pelican Point it was $64/MWh. So, we have seen about a 30 per cent price reduction post the establishment of Pelican Point.
Obviously, all that is not due just to Pelican Point but, nevertheless, it is a significant factor. The reason I put the $45/MWh figure there while the other figures I quoted earlier in the Essential Services Commission Bill debate show around $36/MWh is that they are all less than the assump¬tions in the IES calculations that went to cabinet, which were between $45, $58 and $78/MWh. As I said, there is a difference between load weighted and volume weighted calculations and we need a consistent series to be able to make some sensible judgments. I hope that in the committee stage or during the minister’s response to the second reading his advisers can go through the IES scenarios and compare what exists now to try to see which of the scenarios we are closest to, and will look at the capacity increases likely to be achieved. I think that in the peaking capacity we have met those changes.
From the end of this month we look as though we will have MurrayLink operational, so we need to look at the pool price numbers to see which of those scenarios we are in at the moment. That is the sort of work that I hope the government has done since 5 March to check the information that has been provided to the government. The advice that the former government had for the average household was that, if you took what we were told was the worst possible case, the average household might be looking at a 12 per cent price increase without hot water and 14 per cent with. If you took the various IES scenarios, instead of an increase there was actually a 1 per cent reduction, an 11 per cent and a 9 per cent reduction for the average household. Again, some will be higher and some lower with all the qualifications that one puts into these estimates.
I put those estimates on the public record because I am concerned that the market is being softened by these contin¬ual claims that we have to expect a 20 or 30 per cent price increase. I do not think that it is in South Australia’s best interests that either the government or, frankly, the Inde¬pend¬ent Regulator continue to use those sorts of numbers, even if in the end, for a variety of reasons, that is actually the case, because I think that that plays into AGL’s hands in relation to this process. I think that the minister should not be speculating about the size and extent of the price increase and the independent regulator should not be doing media interviews on the size of the increase. He is there to make the judgment.
As a member of the task force he would have some of this information available. I am sure he would probably have all of it now as the regulator, if he has been working with Treasury officers and with the government. Certainly, with all the caveats about the potential for error and the difficulty of estimating—and I accept all of that—it is a reasonably strong indication that there must have been many other unpredicted factors to have headed in a different direction to justify the claim that we should be looking at 20 or 30 per cent or more price increases for customers after January 2003. The reason I placed on the public record for the first time the advice that was provided to us as a former government is that I hope to put some rational basis back into this debate about price increases for customers.
It might suit the government of the day to want to continue to play politics with privatisation and to blame the former government, but I am more interested in ensuring that the electricity companies can earn a reasonable rate of return and, more importantly, our consumers in South Australia reap the benefit of some of the changes that we have put in place over the past three years and are not unduly penalised by a public debate and an acceptance that there will be price increases of 20 or 30 per cent or more, so that if someone comes in with a figure of 15 per cent everyone will think that is a huge improvement and a huge benefit.
The final point I will make is that there has been publicity this week in relation to the problems of low income earners. The Liberal government acknowledged that during the election campaign. We approved through cabinet an increase in pensioner concessions of $20, or just over 30 per cent and the concession of $70 was to go up to $90. We announced a policy of introducing a $70 concession for self-funded retirees for electricity for the first time and for some cold, cruel and callous reason the Premier, Treasurer and this government have gotten rid of those concessions for self-funded retirees and pensioners. They were funded and certainly a Liberal government saw them as being important as we prepared for full retail contestability. I intend to explore that issue also in committee.
The Hon. G.E. GAGO secured the adjournment of the debate.