National Competition Policy
Overview
On 11 April 1995, all Australian jurisdictions signed up to the National Competition Policy (NCP) Agreements and in doing so committed to implementing the most far-reaching program of micro-economic reform that Australia has ever embraced.
The approach of Western Australia was to ensure that reforms are in the Public Interest and not reform just for reforms sake. This approach can be seen in Western Australia’s Public Interest Guidelines for Legislation Review, released in November 2001.
In Western Australia the reform effort addressed areas ranging from professional licensing to local government businesses, aviation policy to taxis policy, agricultural marketing arrangements to energy pricing and water policy to policy of government business activities - just to mention a few examples.
NCP has resulted in benefits to the Western Australian public and business sector. In many cases, these benefits are ongoing and helping promote greater economic efficiency in the State. For example, reforms to the dairy industry have resulted in a 30 per cent reduction in the price of milk purchased from supermarkets.
NCP related reforms in the energy sector have reduced the contestability thresholds in gas and electricity markets. Full retail contestability in gas markets occurred on 31 May 2004. This will mean that all Western Australian consumers are now able to choose who supplies their gas. This is likely to put downward pressure on gas prices in the same way that competition has resulted in savings in the price of phone calls.
Western Australia is progressing significant reform to the electricity sector in order to meet its competition policy obligations, and to create a more competitive industry with lower prices to consumers:
- Disaggregation legislation separating Western Power into four separate entities (generation, networks, retail and a regionalpower corporation ) is currently in Parliament.
The Electricity Industry Act 2004 has provided for the creation of a wholesale electricity market, established new licensing and access regimes to be administered by the Economic Regulation Authority, and established an Energy Ombudsman to protect residential and small business consumers. The reforms are aimed at encouraging increased private sector participation in the electricity market and sustainable lower prices for Western Australian electricity consumers.
Information available on the publications page includes:
Guidelines on how to conduct a legislation review;
- Western Australia's policy on competitive neutrality;
Information on Access arrrangements for Western Australia's rail network;and
Specific information for local government.
The NCC’s annual assessment reports and competition payments recommendations are available on the NCC website at www.ncc.gov.au.