Competition and Consumer Amendment (Competition Policy Review)

I actually rise to support the government’s changes to the Competition and Consumer Act as defined by the Competition and Consumer Amendment (Competition Policy Review) Bill 2017. It’s interesting to hear the previous member talk about studies and all sorts of other things. I can talk about a lived experience, because it was the actual access to justice issue that helped to bring me into this place through a lived experience, not through some study. That is why competition policy and this bill is so important to small businesses just like my own. As someone who owns and built—absolutely built—a small business from the ground up, part of the reason that I came to this place was the access to justice issue and that is why I support the government’s bill. We were typical of the majority of small businesses right around Australia.

We actually bought our first business, a dairy farm, on the day that we got married. Yes, it was run-down. Yes, it had very little infrastructure, and it had a pretty mixed old herd. And, of course, it was tough going. We lived in two army huts joined together, and the simple economics of it were very interesting for us. We received about $2,000 a month, and our interest and payments were $1,300 a month. We basically had to grow a business, do all the development and live with that income. We bought this on the day we got married with just $12,000 worth of equity between us. We had $118,000 worth of debt. We took a huge risk as two young people—I was 18 and he was 21. I would really like a dollar for everyone who laughed at us and for everyone who said we would go broke and fail.

But like most small business owners know only too well: it takes courage; it takes debt, as the great motivator; and it takes sleepless nights. This is the real lived experience—not a study. It takes those sleepless nights wondering how you’re going to pay your bills and getting up to calve cows in the middle of the night, especially when at the time interest rates went from 17 per cent to 23 per cent. It takes hard work over many, many years. This is not a short-term investment when you’re a small business person. And, in fact, it was actually a separate contract, a hay-baling round, that my husband did in between milkings—with me raking and at times baling and mowing hay, as well as my husband—that kept us afloat. In fact, it was eight years before my husband and I could actually afford a holiday.

The Competition and Consumer Act was called the Trade Practices Act at that time. I saw immediately how competition, or the lack thereof, affected our business. We sold culled cows and sometimes dairy store cattle at the cattle sales. There was a limited number of buyers and they would frequently decide well in advance of the sale which pens of cattle each would buy and, therefore, they would not compete with each other. This of course meant that we, as the sellers, received far less than we should have in what should have been an open and fair marketplace. They were even brazen enough in those days to call out across the pens as to whose turn it was to buy and to not bid on my pen.

I learnt very early as a dairy farmer in a regulated environment. I learnt that government decisions had a major impact on my business, which is why I got so involved early. Following deregulation of the industry in 2000, there was the vulnerability of being a producer of the one of the most perishable products in what is a majority domestic market in WA, with very few buyers and a lot of sellers. One thing I learnt was that we actually had no bargaining power. In fact, we became absolute price-takers, as we see today with current contracts. That’s why measures in this bill continue to be so important. As chair and a member of Dairy Western Australia, we worked with dairy farmers to set up a milk negotiating agency, with the voluntary membership of the same dairy farmers. We applied to the ACCC for authorisation through a collective bargaining process. What blew me away was the attitude of the ACCC at that time. I remember vividly a meeting in Perth. I walked in to present the case for around 300 dairy farmers. I was really concerned about the need to change the ACCC because their disdain was palpable. A comment was made that they were particularly disappointed with the submission by me and Dairy WA because they’d previously had an inquiry into Air New Zealand and Qantas and expected something along those lines. I was representing a group of dairy farmers who were going through very tough times. I reminded the ACCC that they were small business people and that this was the best that we could do. When we walked out of that meeting, I knew that we were done. Our plans to set up the agency and then potentially attract manufacturing and export investment simply would not happen because, not surprisingly, the ACCC said that the action would substantially affect competition, and they refused for us to set up a milk negotiating agency.

I look at where the dairy industry in WA is today. Three farmers were put out of business last year when their contracts were not renewed: Graham Manning, Tony Ferraro and Dale Hanks. I wonder where the industry would have been today had the ACCC approved the application that we made back in 2005. I would suggest it would look entirely different. To add insult to injury, I presented to the ACCC some information about breaches to the Trade Practices Act that made us even more vulnerable, which is why I support so strongly the work of the government on this bill. There were four breaches of the Trade Practices Act that included third-line forcing. At the time, they were not acted on. One very salutary lesson for me was the fact that one of the processors who gave me information about what was actually going on in the marketplace with their interaction wouldn’t meet me unless it could be at a parking lot in Perth where there were no cameras. That told me a lot about where we were as an industry, and that is why we need the changes that the government is making. I note that the Harper review considered that secondary boycotts had not been vigorously enforced by the ACCC compared with other offences. In fact, the Harper review stated that, as with all competition laws, the secondary boycott laws will only act as a deterrent to unlawful behaviour if the laws are enforced consistently and effectively, which is what the government is intending to do.

I’m counting on the ACCC to be a completely different entity today. It has moved on—and with a lot of action from this government. I want to see the ACCC actually focused on small business. I’m looking forward to some very strong recommendations from their current inquiry into the competitiveness of prices, trading practices and the supply chain in the Australian dairy industry. And, of course, it is subject to intense focus by my dairy farmers. There are a number of the inquiry considerations that they’ll be very interested in, such as: the nature of competition between processors for both acquisition of raw milk and the supply of processed milk and dairy products; the nature of commercial relationship between dairy producers and acquirers of raw milk; the terms on which raw milk is acquired from dairy producers and the means by which such terms are agreed; and the existence of, or potential for, anti-competitive conduct and the possible impacts of any such conduct on businesses in the supply and dairy chain.

I want to talk, also, about other measures that this government is taking, not just the measures within this bill that I support. The government set up the Office of the Australian Small Business and Family Enterprise Ombudsman—not the Labor Party but our government set this us—as an independent advocate for small businesses like my own that went through those challenges. It supports small business efforts to be innovative, to employ and to thrive. That’s what it should be about. That’s what this agency is about. The key principles of a fair and competitive trading framework is exactly what I want to see as a small business owner and someone who has built a business.
One of the Small Business and Family Enterprise Ombudsman’s principles is adequate access to justice for small business where there is likely to be a significant imbalance of bargaining power. I look at the assistance, the pre-mediation and the alternative dispute resolution available through that office. It is looking at the payment times and practices inquiry, the small business loans inquiry and, of course, the impact of the Road Safety Remuneration Tribunal payments order. This had a huge impact—the RSRT—on small businesses in my electorate. I saw so many small businesses in absolute dire straits. These are small family-owned enterprises.

What were some of the key findings of the Small Business and Family Enterprise Ombudsman’s inquiry? One was that the payments order resulted in owner-drivers in the long-distance and supermarket distribution sectors being made uncompetitive. There was uncertainty and anxiety for owner-drivers about the impact of these. They were extremely complex and had a short implementation time. I note, with great regret and sympathy, that it was reported to the inquiry that some owner-drivers who found they were unable to cope with further hardship caused by the payments order took their own lives. When we talk about the real world of how decisions made in this place actually impact on small-business people and individuals, there is no greater indication than this one.

I want to thank every small-business owner, particularly those owner truck drivers, who came out and supported us while, often, under significant pressure from unions. And there was significant pressure from unions on those small business owners at the time. They had courage—the courage that it took them to actually start their own business in the first place, invest and mortgage their home. And they’ve been consistent in their efforts ever since. They understand exactly that it is this coalition government, the Turnbull government, that stood up for small businesses in the RSRT issue.

It was a very significant one, putting small business owners actually out of business and worse. I saw so many of them in my electorate, and I want to acknowledge the work they do as a transport industry. We take them for granted, but they are small businesses who do it tough and who are on the road. And, basically, Australia pretty well runs on the back of the trucks of those small business owners, and I want to acknowledge their efforts. I also want to, again, support the measures that the government is taking with this bill.

Small business is a key part of the reason the amendments in this bill are so important. As I have said, from personal experience and from building and developing a small business and facing the challenges that go with it, I want to acknowledge every small business out there that is investing and that is having a go. They know that this government is there supporting them through the changes in this bill.