Is there a need to change our current competition institutions and establish new ones to reinvigorate competition policy and help Australia meet its economic challenges?
This was a key question debated by panellists at the Competition Policy Review (CPR) International Conference in Canberra on 23 October.
The draft CPR Report proposed establishing a new body, the Australian Council for Competition Policy (ACCP), to provide leadership and drive implementation of the evolving competition policy agenda. Its central role would be to advocate for competition across the national economy and to advise governments on how to adapt competition policy to changing circumstances facing consumers and business.
The ACCP would also act as an independent assessor of progress of reform undertaking an annual analysis of the developments in the competition policy environment, holding governments at all levels to account. In the event that competition policy payments were to be made again, it may also have a role in assessing the actual implementation of reform measures by jurisdictions which would be part of the eligibility criteria for any payments.
Notably, the panel proposed that the ACCP have a market studies function as well. This would enable it to examine why particular markets are not working well for consumers, by looking at patterns of consumer and business behaviour and an overview of regulatory and other economic drivers in the market.
Panellists at the Conference discussed a number of issues that need to be addressed to ensure the ACCP would be effective in fulfilling its intended role, including the importance of:
- an agreed detailed agenda for the ACCP through inter-governmental agreements;
- the ACCP's governance arrangements given its broad remit including the question of who it should report to within COAG;
- the structures needed to ensure the ACCP has sufficient independence and the ability to innovate;
- the states and territories having dedicated competition policy units focused on reform and the reform agenda to complement the work of the ACCP;
- co-ordinating the ACCP's advocacy role with the useful competition policy advocacy role played by many existing state and territory economic regulators; and
- deciding how the ACCP would interact with other competition institutions such as the ACCC. For example, could there be cross-representation on both bodies or an ex-officio member?
The key message was that a new institution such as the ACCP could play a very valuable role in reinvigorating competition policy in Australia both in terms of leading the policy debate and assessing the implementation of competition reforms by governments. Careful consideration will need to be given to the establishment and governance of the ACCP to ensure that it has the means to fulfil its envisaged role.
The CPR panel will release its final recommendations on the ACCP early next year. Submissions on this issue and others in the draft report can be made until 17 November 2014.