SUBMISSION TO ACT GOVERNMENT TREASURY PANEL
Note: ACTEW Corporation (ACTEW) owns and operates the water and sewerage assets and business in the Australian Capital Territory.
14 May 2014
Industry Panel Secretariat
GPO Box 158
Canberra ACT 2601
ACTEW STATEMENT OF FACTS AND CONTENTIONS
I wish to refer the Panel to my previous submissions over many years to both the Independent Competition and Regulatory Commission, the Productivity Commission, the Queensland Competition Authority and other regulatory inquiries. I am happy to provide copies.
The fundamental problem the Panel faces is that the system of regulating monopoly utilities in Australia is fundamentally institutionally corrupt.
It is a corruption of economic thought in that it mistakenly assumes that maximisation of profits in a monopoly situation has some relationship to economic efficiency. That is the reverse of the truth. Economic efficiency requires that society obtain satisfaction of its needs at least cost.
In a competitive market, profit maximisation is valuable because it drives the search for least cost solutions: in a monopoly market, profit maximisation really represents the imposition of a toll or tax upon the community.
It is a corruption of legal process in that hardly ever is evidence tested on oath and the victims of monopoly abuses are forced to pay through their tolls and charges for the expensive legal and technical advice used to justify the abuses perpetrated against them. There is no equality of funding in any of these matters and the illusion that independent regulatory commissions are consumer watchdogs is false. They cannot be. They are meant to be independent decision-makers, not advocates for consumers.
The result of this one-sided system is that consumers are never properly represented. It was indeed remarkable that ICRC actually tried to do something sensible.
Terence M. Dwyer
FTIA, B.A. (Hons), B.Ec. (Hons) (Sydney) M.A., Ph.D. (Harvard), Dip. Law (Sydney)