National Competition Policy SECOND TRANCHE ASSESSMENT REPORT Volume II Progress and Outcomes of Legislation Reviews March 1999 VOLUME II Contents Legislation Reviews - Legislation reviews completed and responses announced - Completed reviews, where the Government response is still under consideration - Reviews that have commenced but are not yet completed - Reviews that are expected to be delayed - Reviews that have been removed from the timetable - New legislation that restricts competition 2 36 46 50 57 63 Page 1 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 Legislation · Accident Compensation (WorkCover Insurance) Act 1993 · Accident Compensation Act 1985 · Accident Compensation Regulations 1990 Associations Incorporation Act 1981 Audit Act 1994 Parts 1,2 and 6 (Part 7 is repealed) (the Act is otherwise administered by the Minister for Finance)} Australian Grand Prix Act 1994 Barley Marketing Act 1993 Chiropractors & Osteopaths Act 1978 Chiropodists Act 1968 · Guidelines for educational services to International Students under s.85 of the Vocational Education & Training Act 1990. · Governor in Council declarations under s.49 & State Training Board determination of training schemes under s.50, of the Vocation Education & Training Act 1990. · Ministerial direction on fees & charges under Adult, Community & Further Education Act 1991. · Ministerial direction on fees & changes 1994 under the Vocational Education & Training Act 1990. · Private Provider Guidelines under s.81 of the Vocational Education & Training Act 1990. · Adult, Community & Further Education Act 1991 to establish Adult Community Further Education Board, Regional Councils & make provision with respect to Adult, Community & Further Education · Tertiary Education Act 1993 to provide for promotion, development & co-ordination of post-secondary education in Victoria. · Vocational Education & Training Act 1990 establishment of State Training Board, TAFE college, Industry Training Boards, accreditation of vocational & training courses by TAFE institutions. Finance Brokers Act 1969 · Liquor Control Act 1987 · Liquor Control Prescribed Substances Regulations 1997 Motor Car Traders Act 1986 Optometrists Registration Act 1958 Physiotherapists Registration Act 1978 Psychologists Registration Act 1987 Prevention of Cruelty to Animals Act 1986 Petroleum Act 1958 · Residential Tenancies Act 1980 · Rooming House Act 1990 · Caravan Parks and Moveable Dwellings Act 1988 Portfolio Finance Fair Trading Premier Tourism Agriculture & Resources Health Health Education Fair Trading Small Business Fair Trading Health Health Health Agriculture & Resources Agriculture & Resources Housing 3 Second Tranche Report Volume II No. Legislation Section 1: Reviews Completed and Response Announced Portfolio 18 19 20 21 · Rooming Houses Act 1990 · then draft Residential Tenancies Bill Road Safety Act 1986 Second-hand Dealers and Pawnbrokers Act 1989 · State Trustees (State Owned Company) Act 1994 · Accident Compensation Act (1985) Division 7 of Part 4 Transport Accident Act 1986 Roads and Ports Fair Trading Treasurer, Attorney-General Treasurer Details on these completed and announced reviews follow. 4 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 2 3 4 5 · Accident Compensation (WorkCover Insurance) Act 1993 · Accident Compensation Act 1985, · Accident Compensation Regulations 1990 In-House (Department of Treasury & Finance) Release of issues paper and call for submissions Portfolio: Finance Date review completed: Date response released: Government Response Not accepted. Not accepted. Not accepted. Not accepted. Not accepted - however the approval criteria will be reviewed to promote more competition between providers. Accepted - VWA will monitor service provision outcomes and will use its ability to approve insurers, self-insurers and service providers to affect behaviour. Accepted - VWA will continue to collect and disseminate claims information and use it to analyse and improve performance by insurers, selfinsurers and service providers. Not accepted. January 1998 October 1998 Implementation By VWA Review Recommendations The Victorian WorkCover Authority (VWA) cease to be a provider of reinsurance and all underwriting risks be borne by private insurers. Premium setting should be more decentralised with insurers competing, at a minimum, on the basis of administrative costs and services such as risk and injury management. All premium funds be owned and managed by insurers. Insurers, underwriters and self-insurers be licensed by an independent regulator subject to satisfying ÒappropriateÓ prudential requirements. Current approval criteria for occupation providers be removed. 6 The quality of service delivery by insurers, self-insurers and occupational rehabilitation providers be monitored by the regulator with a focus on outcomes. By VWA. 7 The regulator facilitate the collection and dissemination of information with minimal burden on insurers and other parties. By VWA. 8 The Government undertake an industry review prior to implementation. This will be consistent with clause 4 of the Competition Principles Agreement regarding ÒStructural Reform of Public MonopoliesÓ. Inter alia this should consider: á the appropriate commercial incentives for participants; á the most effective means for separating policy regulatory and commercial functions; and á the need for, and form of, price and service regulations. These principles for the ÒStructural Reform of Public MonopoliesÓ have been applied - 5 Second Tranche Report Volume II No. Review Recommendations successfully in the electricity and gas industries. Restrictions on Competition Remaining Public underwiting, centralised premium setting and funds management. Section 1: Reviews Completed and Response Announced Government Response Implementation No. 1 2 3 4 Conditions on applicants to be approved as authorised insurers. Type of firms permitted to self-insure. Conditions on approval of occupational rehabilitation providers. Competition Policy Justification See Volume 1 for more detail. á The GovernmentÕs assessment is that the remaining restrictions on competition represent a lesser cost to the community as a whole than the benefits that are outlined above. The low and stable premium is clear and observable and represents benefits to employers and injured workers that the community rates very highly. The lack of competition in underwriting and the lack of consumer choice are a cost whose value cannot be readily measured. However over the period 1993-94 to 1996-97 workersÕ compensation costs in Victoria as a percentage of total labour costs fell by 19% while the national average increased by 11%. At the same time benefits in the Victorian scheme are at least comparable or better than the other States, some of which are privately underwritten. The costs of restricting competition are therefore judged to be less than the benefits that are provided by the existing arrangements. á The problems of adverse selection, the volatility in private insurance premiums and the inability of private insurers to capture the benefits of investment in accident prevention and long term rehabilitation, mean that the objectives of the legislation can only be achieved by restricting competition. Achievement of the objectives could be pursued through a system of competing private insurance companies which would require heavy handed regulation that imposes high compliance costs, which could result in increases in overall premiums. This approach would also involve substantial transition costs. The Government believes that there is a significant risk that the costs of such regulation would lead to an overall welfare loss rather than a gain. á The Government intends to carefully monitor reforms in other jurisdictions. Any experience that demonstrates scope for improvements will be analysed for possible incorporation in VictoriaÕs public monopoly workplace accident compensation scheme. Necessary to support first restriction. Necessary to support first restriction. In the absence of independent accreditation of these providers approval conditions set by the VWA are necessary to ensure cost-effectiveness and quality of return-to-work services. 6 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: Associations Incorporation Act 1981 In-House (Office of Fair Trading & Business Affairs) None Portfolio: Date review completed: Date response released: Fair Trading May 1998 Via passage of legislation in Spring 1998. Implementation Associations Incorporation (Amendment) Act 1997 No. 1 Review Recommendations Remove restriction on contestability of the administrative function(s) of Registrar. Government Response Accepted No. 1 Restrictions on Competition Remaining None. Competition Policy Justification - 7 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 2 Audit Act 1994 Parts 1,2 and 6 (Part 7 is repealed) (the Act is otherwise administered by the Minister for Finance)} Panel Public notice, Issues paper, Submissions, targeted consultation Portfolio: Date review completed: Date response released: Government Response Accepted Accepted Premier 1997 1997 Implementation Amendments to the Audit Act passed in 1997. as above Review Recommendations Make public sector audits contestable Separate the purchaser (Auditor General) from the public sector provider (Audit Victoria) to support competition for public sector audits Restrictions on Competition Remaining None No. 1 Competition Policy Justification - 8 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Australian Grand Prix Act 1994 In House Targeted internal consultation Portfolio: Date review completed: Date response released: Government Response Accept Tourism 1997 1997 Implementation None required Review Recommendations The review concluded that the Act did not contain any restrictions on competition. Accordingly, no options for reform of the Act were recommended. Restrictions on Competition Remaining None No. 1 Competition Policy Justification - 9 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Barley Marketing Act 1993 Consultant (Centre for International Economics) Release of issues paper and call for submissions, targeted interviews Portfolio: Date review completed: Date response released: Government Response Accepted. Agriculture & Resources November 1997 Completed in November 1998 Implementation Individual permits no longer required from July 1998. An Amendment Bill was introduced and Second Read in the Victorian Parliament during the Spring 1998 Sittings. It will remove the domestic malting barley single desk from July 1999. The above amendment Bill will remove the single export desk from July 2001. - 2 3 4 Review Recommendations That the domestic market for feed barley in South Australia and Victoria be formally deregulated. This can be achieved by abolishing the current permit system and exempting, in a regulation, feed barley destined for the domestic trade. That the domestic market for malting barley in Victoria and South Australia be deregulated. This can be achieved by removing the current requirements for maltsters and processors to have deeds of arrangements with the ABB and the need for licences for purchases of malting barley other than from the ABB. As for feed barley, malting barley for domestic sale can be exempted in a regulation from the current provisions to compulsorily deliver barley to the ABB. That the ABB retains its single desk for export barley sales for the shortest practicable transition period. That the oats market in South Australia be deregulated by removing oats from a new barley marketing act in South Australia. Restrictions on Competition Remaining The barley single export desk of the ABB will be retained until 30 June 2001. Accepted. Accepted. Not applicable to Victoria. No. 1 Competition Policy Justification The transition period was considered necessary in order to allow a fully commercial approach to marketing to be developed and to protect the current value of the Australian Barley Board (total net assets of $37.9 million as at 30 June 1998). 10 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: Chiropractors & Osteopaths Act 1978 In House (Panel) Discussion paper, Public consultation, Submissions received and further targeted consultation prior to report Portfolio: Date review completed: Date response released: Health 1996 1996 No. 1 Review Recommendations Restrictions on commercial practice that exceed that necessary for the protection of public safety should be removed Government Response Accepted 2 3 No. 1 2 Retain restrictions on use of title Retain restrictions on advertising (fair and accurate) Restrictions on Competition Remaining Use of title Advertising (fair and accurate) Accepted Accepted Implementation Act replaced by Chiropractors Registration Act 1996 and Osteopaths Registration Act 1996 (proclaimed on 1 July 1997) As above As above Competition Policy Justification Benefits of consumers information more than offset limited costs Limited restrictions on advertising should ensure an informed market. Provision mainly gives powers to the Board to investigate advertising. 11 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 2 3 No. 1 2 Chiropodists Act 1968 In-House (Panel) Discussion paper, public consultation Portfolio: Date review completed: Date response released: Government Response Accepted. Accepted Accepted Health 1998 1998 Implementation Via the Podiatrists Registration Act 1997 proclaimed on 1 July 1998. as above as above Review Recommendations Remove restrictions on types of work Retain restriction on use of title Retain restrictions on advertising (limited to fair and accurate) Restrictions on Competition Remaining Use of title Restrictions on advertising (limited to fair and accurate) Competition Policy Justification Benefits of consumers information more than offset limited costs. Limited restrictions on advertising should ensure an informed market. Provision mainly gives powers to the Board to investigate advertising. 12 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: · Guidelines for educational services to International Students under s.85 of the Vocational Education & Training Act 1990. · Governor in Council declarations under s.49 & State Training Board determination of training schemes under s.50, of the Vocation Education & Training Act 1990. · Ministerial direction on fees & charges under Adult, Community & Further Education Act 1991. · Ministerial direction on fees & changes 1994 under the Vocational Education & Training Act 1990. · Private Provider Guidelines under s.81 of the Vocational Education & Training Act 1990. · Adult, Community & Further Education Act 1991 to establish Adult Community Further Education Board, Regional Councils & make provision with respect to Adult, Community & Further Education · Tertiary Education Act 1993 to provide for promotion, development & co-ordination of post-secondary education in Victoria. · Vocational Education & Training Act 1990 establishment of State Training Board, TAFE college, Industry Training Boards, accreditation of vocational & training courses by TAFE institutions. Departments of Education, Treasury & Finance, Premier & Cabinet Advice of the review was given to and comment sought from the following organisations: · Australian Chamber of Manufacturers · Victorian EmployersÕ Chamber of Commerce and Industry · Association of Directors of Victorian TAFE Institutes · Australian Council of Private Education and Training · Victorian Students and Apprentices Network · Victorian Universities · Adult and Community Education Victoria · Association of Neighbourhood Houses and Learning Centres Portfolio: Education; Tertiary Education & Training Date review completed: Date response released: January 1998 January 1998 13 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced No. 1 2 3 4 Review Recommendations Retain the current system of setting fees and charges by Ministerial Direction Retain registration of private providers. Retain prohibition on institutions other than recognised universities or approved institutions offering higher education awards Other restrictions recommended to be removed, namely: · removing the requirement that Ôthe demand for skills provided by the course be considered by the State Training Board when considering an application for registrationÕ · removing the requirement that registered providers also require approval to deliver courses · confirming the system of approved training agents so as to give registered providers the option to seek the power to self-accredit courses · giving registered providers the option to seek endorsement to deliver courses to overseas students as part of their registration, subject to agreement with the Commonwealth Government · reforming apprenticeship and traineeship arrangements with respect to institutions applying for approval to deliver and authority to conduct individual courses leading to higher education awards, removing the requirement that applicants demonstrate the Ôthe need in Victoria for the course of studyÕ Restrictions on Competition Remaining Current system of setting fees and charges by Ministerial Direction Compulsory registration of private providers Prohibition on institutions other than recognised universities or approved institutions offering higher education awards Government Response Accepted Accepted Accepted Accepted Implementation Legislation amended in Spring 1997 sittings through the Vocational Education and Training (Training Framework) Act 1997 passed - the reform of legislation proceeded in consonance with the review which enabled the Government to anticipate its recommendations No. 1 2 3 Competition Policy Justification Ensures equitable access to vocational education and training and enables government to determine training mix and provision of training places. Benefits students by lowering transaction costs and protecting VictoriaÕs participation in the national system of recognised qualifications. Benefits taxpayers by ensuring public monies are directed only to appropriate institutions. Benefits students by ensuring minimum course standards and comparability with similar qualifications issued by other recognised universities. 14 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Finance Brokers Act 1969 In-House (Office of Fair Trading & Business Affairs) None Portfolio: Date review completed: Date response released: Government Response Accepted. Fair Trading Early 1998 Via legislation passed in Spring 1998 Implementation Consumer Credit (Finance Brokers) Act 1998 which repealed the Finance Brokers Act 1969 See above. See above. See above. See above. See above. See above. Review Recommendations Licensing of finance brokers and finance brokers' agents be discontinued. 2 3 4 5 6 7 Capping of finance brokers' commissions be discontinued. Restrictions as to the circumstances in which fees may be charged be retained, subject to recommendations 4 and 5 below. Brokers be permitted to give notice that a termination fee will be payable should the client withdraw from the broking agreement. Provision be made for the loan terms in the document of appointment, the securing of which determines the brokerÕs entitlement to a fee, to be varied by consent. Brokers not be permitted to accept payment of third party charges in cash or in any form which can be converted to cash by the broker. The provisions necessary to satisfy recommendations 3-6 above be housed in the proposed new Fair Trading Act, and the Finance Brokers Act 1969 be repealed. Accepted. Accepted. Accepted. Accepted. Accepted. Act repealed and necessary provisions included in the Consumer Credit (Finance Brokers) Act 1998 No. 1 Restrictions on Competition Remaining Negative licensing of brokers 2 3 4 Documentation of terms of finance sought required Up-front fees prohibited Taking of third-party fees in cash prohibited Competition Policy Justification The costs to individuals (other than those few disqualified from trading due to relevant offences etc) are very small, and numbers in the industry will be little affected. The benefits are preventive. The regulation will effectively combat dishonest operations whereby less sophisticated would-be borrowers are persuaded to make payments for sham services or are manoeuvred into accepting loans on unsuitable terms. While not quantifiable, it is reasonable to conclude that the benefits outweigh the costs. There is presently no potential for self-regulation. While the problem is largely one of information, it would be very difficult and costly to reach and influence the behaviour of at-risk consumers at the critical time. See above. See above. See above. 15 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: Liquor Control Act 1987, Liquor Control Prescribed Substances Regulations 1997 Semi Public (Panel) Issues Paper, Discussion Paper, submissions, public consultation, targeted consultation and meetings with industry, community and government groups Portfolio: Date review completed: Date response released: Small Business 1998 1998 No. 1 2 Review Recommendations Harm minimisation should be the principal purpose of the Act. The objects of the Act should be: - to encourage responsible attitudes towards the promotion, sale, supply, consumption and use of liquor, to develop and implement principles directed towards that end and minimise the harm associated with the consumption of liquor; - to ensure as far as practicable that the sale and supply of liquor contributes to, and does not detract from, the amenity of community life; - the facilitation of the development of a diversity of styles of licensed premises and related services; and - to regulate, and to contribute to the responsible development of the liquor, hospitality, tourist and related industries in the State. The type and number of licence categories should be modified to provide for: an on-premises licence; an off-premises licence; an on and off-premises licence; a club licence; a pre-retail licence; a vigneronÕs licence; and a limited licence The existing general (class 2) licence should be absorbed within the on-premises licence type, the existing residential licence should be absorbed within the onpremises or the on and off premises licence type defending upon individual requirements and the restricted club permit should be absorbed into the limited licence category. The existing provisions in respect of a vigneronÕs licence should be maintained except that the current provisions requiring that wine produced pursuant to a vigneronÕs licence must be at least 70% from fruit Ògrown or pressedÓ by the licensee should be replaced by the requirement that such fruit must be Ògrown or fermentedÓ by the licensee. Government Response Accepted Implementation Implemented through Liquor Control Reform Act 1998 The recommendation of the Review Panel is accepted except that: · for ease of recognition and continuity, the term Òpackaged liquor licenceÓ will be maintained rather than the proposed ÒoffpremisesÓ, and the term Ògeneral licenceÓ will be maintained rather than the proposed Òon and off premisesÓ licence; · the restricted club permit will be maintained to facilitate expansion of smaller clubs and migration to a full club licence (the cost and renewal period for See above 16 Second Tranche Report Volume II No. Review Recommendations Section 1: Reviews Completed and Response Announced Government Response such permits will be reviewed to facilitate their operation). The Review Panel further recommended that BYO be as of right for unlicensed restaurants and clubs. This recommendation is not accepted - see recommendation 27. Accepted Accepted Accepted Accepted Accepted Implementation 3 4 5 6 7 8 9 10 11 12 13 All liquor sellers should be licensed. All licence conditions should be prominently displayed in licensed premises. The current prohibitions on the licensing of petrol stations, convenience stores, mixed businesses and drive-in cinemas should remain. Restrictions on the sale or supply of liquor to persons under 18 years of age should remain. Restrictions that prohibit the presence of minors on licensed premises (for example, restaurants, cafes, packaged liquor outlets and similar) should be removed, except for bar areas in premises with on-licences or on and off-licences (for example, hotels, nightclubs and similar). Persons under 18 years of age should continue to be prohibited from selling liquor. Licence applicants should continue to be subject to suitable person criteria and that they have an adequate knowledge of the Act. All licensed premises having residents and guests should be permitted to sell liquor to them at any time. There should be no restrictions on the trading hours of licensees whose licences do not allow them to sell to the public ie. wholesalers. The restrictions on the sale or supply of liquor to intoxicated person should remain. The restriction that no licensee or associates can hold more than 8% of packaged liquor or general licenses should be removed. See above See above See above See above See above Accepted Accepted Accepted Accepted Accepted The recommendation of the Review Panel is accepted in respect of abolition of the 8% limit on general licences, but not accepted in respect of packaged liquor licences. Accepted Accepted See above See above See above See above See above See above 14 15 The Òprimary purposeÓ requirement of licence types should be removed. Packaged liquor sales in supermarkets, whilst separately stored and displayed on licensed area, should be able to be transacted through normal checkouts, provided the check-out attendant is at least 18 years of age. See above See above 17 Second Tranche Report Volume II No. 16 17 18 Review Recommendations The licensing of ÒBed and BreakfastÓ should be significantly simplified. The ÒneedsÓ criteria in assessing licence applications should be removed. Objections to licence applications on community interest grounds should be subject to: · only affected persons may object; · an objection must state the reason for the objection and how the objector is affected; and · an objection considered to have been made for the commercial advantage of objector may be rejected. Any matters that have or could be raised in relation to land planning approval should be excluded from liquor licensing consideration. Consideration of community interest in liquor licensing applications should not include local amenity planning issues. Contemporaneous processing and determining of planning permit and liquor licence applications should occur where possible A poll should be taken of Òdry areaÓ residents to assess whether they support modification or retention of the existing provisions. The requirement for approval for the sub-letting of food services by licensee should be removed. The restriction that restaurant licensees may only sell liquor without a meal in up to 25% of the licensed area should be removed. The prohibition on lodging a further application in respect of a refused matter within 12 months should be removed. Schedule 1 of the Act in respect of the mandatory provisions of club rules should be simplified and revised to ensure that all requirements are relevant and written in plain English. Schedule 1 should be incorporated into the constitutions of all clubs to ensure that this occurs. Whilst not anti-competitive, the Review notes that club provisions are quite burdensome. Requirements for forwarding amendments to club rules to the licensing authority are unnecessary and should be removed. New clubs should present their constitutions as part of their application for a licence. Initial licence decision-making should be made administratively without a hearing, with a right of appeal to a review tribunal. Common Òordinary hoursÓ should apply to all licence types, and that Òordinary hoursÓ be increased to 7 am to 1 am the day following, except in respect of Anzac Day and Good Friday when Òordinary hoursÓ of 12 noon to 1 am the day following should apply. Section 1: Reviews Completed and Response Announced Government Response Accepted Accepted Accepted Implementation See above See above See above 19 20 21 22 23 24 Accepted Accepted Accepted Accepted Accepted Accepted See above See above See above See above See above See above 25 26 Accepted The recommendation of the Review Panel was rejected. Regard was had to community concerns regarding amenity, effective enforcement and misuse and abuse of alcohol in rejecting the recommendation. The recommendation of the See above Not Applicable 27 Unlicensed restaurants and clubs should be able to offer BYO without the requirement Not applicable 18 Second Tranche Report Volume II No. for a BYO permit. Review Recommendations Section 1: Reviews Completed and Response Announced Government Response Review Panel was rejected. Regard was had to community concerns regarding the availability of BYO liquor in a range of inappropriate businesses if no regulating regime was maintained Repeal Implementation 28 Liquor Control Prescribed Substances Regulations 1997 Implemented through Liquor Control Reform Act 1998 No. 1 Restrictions on Competition Remaining Prohibitions on the licensing of petrol stations, convenience stores, mixed businesses and drive-in cinemas. Restrictions on the sale or supply of liquor to persons under 18 years of age. Restrictions that the presence of minors on licensed premises for bar areas in premises with on-licences or on and off-licences (for example, hotels, nightclubs and similar). Persons under 18 years of age should continue to be prohibited from selling liquor. Licence applicants subject to suitable person criteria and that they have an adequate knowledge of the Act. Restrictions on the sale or supply of liquor to intoxicated person. No licensee or associates can hold more than 8% of packaged liquor or general licenses Poll should be taken of Òdry areaÓ residents to assess whether they support modification or retention of the existing provisions. Retain ordinary hours 2 3 Competition Policy Justification On this basis that youth under the age of 18 years are often attracted to, or in proximity to, convenience stores, in response to the products offered for sale. at this time the potential for increased underage access to liquor through convenience stores, if licensed, would be contrary to its underage drinking policy. Special consideration would be given if there is no alternative supply of liquor available to the community. On the grounds that youth less than 18 years of age may not be sufficiently informed or mature enough to make appropriate decisions regarding alcohol-use. Youth under 18 years of age are to be permitted unaccompanied in licensed restaurants. However, existing restrictions remain in respect of hotels, bars, nightclubs due to their more volatile nature. 4 5 On the grounds that youth under 18 years of age selling liquor may be subject to peer pressure to engage in underage sales and may be not sufficiently mature to enforce liquor laws. On the grounds that the exclusion of the criminal element from the sale of liquor is an essential element of effective control. On the grounds that sales of liquor to an intoxicated (drunken) person promote misuse and abuse of alcohol. The recommendation of the Review Panel is accepted in respect of abolition of the 8% limit on general licences, but not accepted in respect of packaged liquor licences. On the grounds that it is appropriate that affected residents determine the future of Òdry areasÓ through a democratic process. On the grounds that community concerns regarding amenity, effective enforcement and misuse and abuse of alcohol in rejecting. The concept of Òordinary hoursÓ is maintained in order that targetted provisions may apply to problematic late night trading. On the grounds that to community concerns regarding the availability of BYO liquor in a range of inappropriate businesses if no regulating regime was maintained. 6 7 8 9 10 Requirement for a BYO permit. 19 Second Tranche Report Volume II 11 Liquor Control Reform (Prescribed Substance) Regulations 1999: The objective of these Regulations is to contribute to further minimise misuse and abuse of alcohol by persons under the age of 18 years by regulating the supply of food preparations that are intended for consumption in a frozen form e.g. alcoholic icy poles. Section 1: Reviews Completed and Response Announced The regulations have an impact on the wholesale and retail sale of the products in question in that such sellers are required to be licensed pursuant to the Act and sales of such products may not be made to youth under 18 years of age and drunken persons. Whilst the regulations will restrict the sale of frozen alcoholic food preparations, such a restriction is warranted having regard to public intent in respect of minimising the misuse and abuse of alcohol, particularly by youth under 18 years of age. 20 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Motor Car Traders Act 1986 In-House (Office of Fair Trading & Business Affairs) None Portfolio: Date review completed: Date response released: Government Response Accepted Fair Trading Early 1998 Via legislation passed in Spring 1998 Implementation Amendments made by the Tribunals and Licensing Authorities (Miscellaneous Amendment) Act 1998 See above See above 2 3 Review Recommendations The eligibility criterion for a trader to have Ôsuitable premisesÕ be replaced by a criterion that a trader have all relevant planning approvals for any premises at which the trader carries on business, or proposes to carry on business, as a motor car trader. The eligibility criterion for a trader to carry on a motor trading business ÔefficientlyÕ should be removed. The potential for unwarranted claims on the Motor Car TradersÕ Guarantee Fund should be reduced by: · ensuring that a financier cannot claim in relation to a traderÕs failure to cancel a security interest where the debtor was a motor car trader; · ensuring that a financier cannot claim where a vehicle has been repossessed from a traderÕs premises and sold at a loss; and · specifying the provisions in relation to which a claim can be made for loss incurred from the failure of a trader Ôto comply with [the] ActÕ as sections 36 (prohibition on consignment selling), 38 (prohibition on odometer tampering), 43(3) (disposal of a trade-in vehicle during the cooling-off period), s54(1) (tradersÕ obligations with respect to warranties), and s56(2) (special conditions purporting to limit or modify warranty obligations). Restrictions on Competition Remaining Licensing of Motor Car Traders Accepted Accepted No. 1 Competition Policy Justification Ordinary carbuyers lack information to assess the safety, quality and reliability of motor vehicles, particularly used vehicles. This information imbalance is compounded by the complexity of the product and the fact that cars are infrequently purchased and essentially experience goods. Third party vehicle testing is costly and only a partial solution to the problem. In an unregulated market, it will be more common for traders to avoid the investment of resources necessary to meet expectations they have created in buyers in relation particular vehicles. Licensing excludes: certain people with criminal records relating to dishonesty, drug trafficking or violence; insolvents; and traders without council approved trade premises. The Act imposes direct costs on traders (and therefore their customers) by requiring them to pay licensing fees and to comply with various conduct requirements. It benefits the community by: reducing the potential for unfair trader conduct (including odometer tampering); improving the chances of and reducing the costs to the buyer of obtaining a safe vehicle of reasonable quality having regard to price; providing for a fund of last resort, the Motor Car Traders Guarantee Fund, which compensates for losses incurred as a result of specified trader misconduct. The ActÕs 21 Second Tranche Report Volume II No. Restrictions on Competition Remaining Section 1: Reviews Completed and Response Announced Competition Policy Justification documentation requirements also make it harder for the trade to be used as a conduit for the disposal of stolen vehicles. While not quantifiable, it is reasonable to conclude that these benefits outweigh the costs. There is no potential for effective self-regulation at present, and lighter-handed regulation such as negative licensing or registration would not sufficiently reduce the threat of serious loss through trader misconduct. General law prohibiting misrepresentations, requiring services to be rendered with due care and skill, and requiring goods sold to be of merchantable quality, is not sufficiently clear-cut and straightforward of enforcement to constrain the types of misconduct observed in this industry. The development and continued availability of reasonably-priced commercial insurance products adequate to cover relevant consumer risks cannot be relied upon. Information strategies are already used where appropriate but are not a panacea. See above. 2 Statutory warranty on certain used cars must be honoured 22 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Optometrists Registration Act 1958 Panel Targeted consultation, Invitation to make submissions Portfolio: Date review completed: Date response released: Government Response Accepted Health 1996 1996 Implementation Act replaced by Optometrists Registration Act 1996 proclaimed on 1 July 1997. As above As above As above Review Recommendations Retain restriction on use of title (ÒoptometristÓ) 2 3 4 No. 1 2 3 Extend restriction rights to prescribe glasses to orthoptists (on referral from an optometrist or ophthalmologist) Extend prescribing rights to scheduled drugs to optometrists. Retain restrictions on Advertising (limited to fair and accurate) Restrictions on Competition Remaining Use of title (ÒoptometristÓ) Types of work (prescription or referral for prescription of glasses) Advertising (limited to fair and accurate) Accepted Accepted Accepted Competition Policy Justification Benefits of consumers information more than offset limited costs. Prescription by ophthalmologists and optometrists provide concurrent screening for eye pathologies. Limited restrictions on advertising should ensure an informed market. Provision mainly gives powers to the Board to investigate advertising 23 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: Physiotherapists Registration Act 1978 In-House (Panel) Discussion paper, public consultation, submissions received, and further targeted consultation Portfolio: Date review completed: Date response released: Health 1998 1998 No. 1 2 No. 1 2 Review Recommendations Retain restriction on use of title Retain restrictions on advertising (limited to fair and accurate) Restrictions on Competition Remaining Use of title Advertising (limited to fair and accurate) Government Response Accepted Accepted Implementation Via the Physiotherapists Registration Act 1998 proclaimed on 1 July 1998. As above Competition Policy Justification Benefits of consumers information more than offset limited costs Limited restrictions on advertising should ensure an informed market. Provision mainly gives powers to the Board to investigate advertising 24 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Psychologists Registration Act 1987 In-House (Panel) Targeted consultation Portfolio: Date review completed: Date response released: Government Response Accepted Health 1998 Pending\June 99 Implementation It is anticipated that a new Bill will be introduced in Autumn 1999. As above 2 3 4 5 4 Review Recommendations Restrictions on statutory registration, use of the title ÒpsychologistÓ, advertising and enquires into capacity and conduct were necessary to achieve the objectives of the legislation and should be retained Restrictions on specialist approvals, psychological tests and consent to use of certain titles by bodies corporate and similar entities were not necessary to achieve the objectives of the legislation. Specialist approvals were to be replaced by less restrictive provisions providing for endorsement of the register with post graduate qualifications and/or training In view of the substantial inconsistencies between the PRA and more modern health practitioner registration Acts, the PRA should be repealed and a new Act introduced incorporating the above recommendations and based on the model contained in the Medical Practice Act 1994 Amendments to model provisions which received endorsement as a result of reviews of the Medical Practice Act 1994 and Nurses Act 1993 were to be incorporated, where appropriate, in drafting of a new Act There are no practice restrictions contained in the current Psychologists Registration Act 1987, and none are contained in the proposal for the new Bill. The remaining restrictions are therefore those arising from the core provisions contained in the Medical Practice Act, as modified by the Physiotherapists Registration Act 1998 and Dental Practice Bill. In addition to the above recommendations, the proposal provides for: · replacement of the current PRB with a new incorporated Board of the same name · the Board to appoint its own staff and administer its own funds, subject to certain limitations · criteria for registration which facilitate mutual recognition · the Board to have the power to impose conditions, limitations or restrictions on registration of a practitioner · the Board to have the discretionary power to require a registered practitioner to have professional indemnity insurance as a condition of registration · inclusion of a provision enabling individuals or those concerned with or taking part in the management of bodies corporate to be prosecuted for use of testimonials or false, misleading or deceptive advertising Accepted Accepted As above Accepted As above Accepted As above Accepted As above 25 Second Tranche Report Volume II · inclusion of model provisions relating to disciplinary inquiries, including informal hearings and open formal hearings · the Board to notify complainants of action taken with respect to complaints. No. 1 2 Restrictions on Competition Remaining Use of title Advertising (limited to fair and accurate) Section 1: Reviews Completed and Response Announced Competition Policy Justification Benefits of consumers information more than offset limited costs Limited restrictions on advertising should ensure an informed market. Provision mainly gives powers to the Dental Board to investigate advertising 26 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 2 3 Prevention of Cruelty to Animals Act 1986 Consultant (KPMG) Release of issues paper and call for submissions, targeted interviews Portfolio: Date review completed: Date response released: Government Response Accepted Accepted Accepted Agriculture & Resources November 1997 September 1998 Implementation Regulations to be amended in 1999. A Code of Practice is being developed and will be tabled in Parliament in Spring 1999. See above. - Review Recommendations Retain requirement for a registered veterinarian to be present at rodeos. Retain requirement that a registered veterinarian inspect animals and remain on standby at rodeo schools. Remove requirement that an Australian Professional Rodeo Association (APRA) stock contractor supply animals to rodeos and rodeo schools. Stock contractors are to be any stock contractors subject to the introduction of a Code of Practice. Remove the requirement that rodeo school instructors are APRA accredited. Retain requirements on scientific establishments to adhere to minimum standards concerning animal housing, cleanliness, equipment, record keeping and reporting. Retain minimum space and other requirements contained in the animal farming and transport codes of practice. Retain requirement for minimum cage floor areas in egg production. Restrictions on Competition Remaining Requirement for a registered veterinarian to be present at rodeos. Requirement that a registered veterinarian inspect animals and remain on stand-by at rodeo schools. Requirements on scientific establishments to adhere to minimum standards concerning animal housing, cleanliness, equipment, record keeping and reporting. Minimum space and other requirements contained in the animal farming and transport codes of practice. Requirement for minimum cage floor areas in egg production. 4 5 6 7 No. 1 2 Accepted Accepted Accepted Accepted Competition Policy Justification No alternative as practitioner must be able to administer drugs and perform surgery. No alternative as practitioner must be able to administer drugs and perform surgery. 3 The requirements do not impose a burden on institutions above that which they would do as a matter of course. 4 5 The requirements do not have a substantial effect on competition in the market for production and transport of animals. Further, they contribute to reducing the chance of foreign markets imposing trade sanctions on animal welfare grounds under the relevant WTO agreement. Benefit of improved bird welfare outweighs small increase in egg prices. Previous voluntary code found to be ineffective. 27 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 2 Petroleum Act 1958 Consultant (KPMG) Call for submissions and targeted interviews Portfolio: Date review completed: Date response released: Government Response Accepted Accepted Agriculture & Resources February 1997 March 1999 Implementation Petroleum Act 1998 passed in Spring 1998 sitting. See above. Review Recommendations Retention of Crown ownership of petroleum resources, along with the overall permit lease system for petroleum exploration and production, to be justified under NCP. That a number of changes be made to the legislation in order to remove obstacles to exploration and production of petroleum and to increase administrative efficiency, i.e. a longer term for exploration permits and greater certainty for persons wishing to move from an exploration permit to a production licence. Restrictions on Competition Remaining Crown ownership of petroleum resource with access for exploration and production restricted via permit lease system. Two aspects of the permit/licence system may restrict competition due to increased compliance costs for permit and licence holders. The Act requires compensation to be paid to landowners for use and damage to freehold land. The Act also provides for the imposition of conditions on permits, leases and licences with regards to safety standards and protection of the environment. The Act also contains provisions to vary conditions upon consolidation and transfer of titles, at the request of the title holder and otherwise at intervals of not less than 5 years. This provision recognises that the basis of project progress or development may have altered and therefore a review of the ground rules is appropriate both in terms of orderly development and public benefit. No. 1 Competition Policy Justification The permit/licence system enhances security of tenure for potential investors without compromising safety and environmental considerations. The allocation process by which tenure is secured will almost exclusively be by a tender process that affords maximum opportunity for participation and hence enhances contestability for petroleum rights. The benefits to the community from the restrictions contained in the proposal will flow from the orderly development of valuable petroleum resources with due regard to public safety and environmental protection. The proposed legislation ensures that petroleum exploration and extraction activities are carried out with minimal effects on the environment and, as the value of recovery of petroleum is very high, that such recovery represents optimal land use without impacting substantially on other land uses. There is also provision for land to be readily returned to some alternate land use upon completion of petroleum activities. Costs to explorers or producers of petroleum arising from restrictions contained in the proposal will arise primarily through complying with requirements for safety and environmental protection, compensation to owners of land and the payment of royalties. Such costs are considered essential in deriving optimal community benefit and to achieve the objectives of the proposal. The costs of any restrictions contained in the proposal are considered to be outweighed in terms of returns to the operator and benefits to the community as a whole. Therefore the proposal satisfies the guiding legislative principle as it pertains to national competition policy considerations. 28 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: Residential Tenancies Act 1980, Rooming House Act 1990, Caravan Parks and Moveable Dwellings Act 1988, the Rooming Houses Act 1990, and the then draft Residential Tenancies Bill In House (Consultant) - Steering Committee had representation from the following departments: Premier and Cabinet; Treasury and Finance; State Development; Justice and Human Services Targeted - peak real estate industry, landlord and tenant groups submissions to and findings of the 1995 Ministerial Review into Residential Tenancies Legislation which undertook extensive community consultations and led to the development of new draft legislation Portfolio: Housing Date review completed: April 1997 Date response released: 1997 No. 1 2 Review Recommendations The existing and the then proposed new legislation has a negligible impact on competition, but that the legislation can, by setting the framework within which competition operates, have a significant direct impact on market efficiency and equity. Retain the six month period of notice for termination of a lease without a prescribed reason. Government Response Accepted Implementation - Accepted 3 4 No. 1 Retain the six monthly limit on rent increases. Retain the regulation of bonds. Restrictions on Competition Remaining The six month period of notice for termination of a lease without a prescribed reason The six monthly limit on rent increases The regulation of bonds Accepted Accepted The redrafted Residential Tenancies Act 1997 was passed by Parliament in November 1997. The Act came into operation on July 1 1998. See above. See above. 2 3 Competition Policy Justification The consultants found that the potential restrictions on competition contained in the legislation apply generally to the market and thereby minimise distortions between existing market participants and do not raise significant barriers or disincentives to new entry. Many of the notional restrictions are in fact clarifications of property rights, and/or interventions designed to enhance efficiency and minimise disputes As above In relation to bonds the consultants found that bonds should continue to be regulated to protect low income tenants, but with some flexibility introduced in respect of guarantees. It was considered that the introduction of guarantees would require additional legislative controls and act counter to the proposed centralised bond fund. A subsequent consultancy (undertaken by the Allen Consulting Group) which primarily addressed the issue of investment in rental housing re-examined this matter in some detail. This consultancy concluded that existing regulations on bonds were not restrictive and compared favourably with arrangements in other states. The KPMG recommendation in relation to guarantees would not measurably increase returns to any potential investors in the private rental market and the common form of guarantee may add legal costs for market participants. 29 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Road Safety Act 1986 Semi Public (panel) Public notice, issues paper, submissions. Portfolio: Date review completed: Date response released: Government Response Accept Roads and Ports 1997 1997 Implementation No change necessary. Review Recommendations The review found that the Act did not contain significant restrictions on competition affecting commercial transport service industries.. Restrictions on Competition Remaining Licensing of motor vehicle inspections Prescription over equipment used for testing blood alcohol levels. Drink driving program providers. No. 1 2 3 Competition Policy Justification Road worthiness tests were found to be important to road safety. Licensing of private provides allows for competition. In accurate readings could contribute to road accidents involving third parties. Providers are used where a judge order attendance at a rehabilitation program. The review found that exclusion of less than competent providers was necessary to ensure that Court orders are effective in rehabilitating offenders. 30 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: Second-hand Dealers and Pawnbrokers Act 1989 In-House (Office of Fair Trading & Business Affairs) None Portfolio: Date review completed: Date response released: Fair Trading Late 1996 Via passage of legislation in Autumn 1997. Implementation Amendments made by the Law and Justice Legislation Amendment Act 1997 See above See above No. 1 2 3 4 5 No. 1 Review Recommendations The various licensing types for second-hand dealers and pawnbrokers be replaced by a registration system, with provision for prescribing requirements for notification of the type of business being conducted (e.g. dealing from business premises, dealing at markets, pawnbroking). The Òfit and properÓ test for applicants be replaced by a Òno serious offencesÓ test, using s.14(5)(e) of the Estate Agents Act 1980 as a model. The obligation to retain goods for seven days after acquisition no longer apply for metals except gold and silver (whenever obtained) and copper and brass (when acquired from a source not used in the preceding three months). The requirement on dealers to conduct particular transactions only at a registered business premises or a market be removed, and that instead dealers be required to register any place habitually used for holding goods acquired and, where goods subject to the seven day retention requirement are not to be kept at a registered place, to record on acquisition where they will be kept. Restrictions on the rates of interest chargeable by pawnbrokers be removed. Restrictions on Competition Remaining Registration Government Response Accepted Accepted Accepted Accepted See above Accepted See above Competition Policy Justification Second-hand dealers may Ð deliberately or inadvertently Ð become conduits for stolen property. Registration, together with documentation and storage requirements, are necessary to contain this problem. There is no potential for self-regulation (which would require industry-wide adherence to a code of practice without specific consumer pressure - it is victims of theft, not consumers of dealersÕ services, who benefit from regulation. Negative licensing is reactive rather than preventative and insufficient to deal with the problems. The compliance costs are slight and any anti-competitive effect is outweighed by the improved capacity for price comparison this affords. 31 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: State Trustees (State Owned Company) Act 1994; Accident Compensation Act (1985) Division 7 of Part 4 In-House (Department of Treasury & Finance) Targeted consultation Portfolio: Date review completed: Date response released: Treasurer, Attorney-General June 1997 Via legislation assented to in April 1998 Implementation Act amended by the State Trustees (Amendment) Act 1998 assented to in April 1998 See above See above See above See above No. 1 Review Recommendations Remove legislative preference toward State Trustees in the appointment of administrators of estates. Remove legislative preference for State Trustees to be appointed to administer childrenÕs funds. Remove legislative preference for State Trustees in the administration of CSOs Remove State Trustees Ô exclusive powers of administration of Òuncared forÓ properties. Allow all estate administrators to advance own monies to beneficiaries or represented persons in necessitous circumstances where there are insufficient estate or personal funds available at the time. Remove exclusive right of State Trustees to administer small estates in circumstances where an individual dies and there are no known next of kin. Remove exclusive rights to State Trustees to be appointed administrator of workerÕs (lump sum) compensation. Remove exclusive right of State Trustees to hold and manage death benefits payable to surviving children until age 18. Remove legislative preference for State Trustees or legislative rights to State Trustees providing them with the exclusive right to provide particular services (administrator of certain workerÕs compensation payments), by amending Division 7 of Part 4. Restrictions on Competition Remaining Exclusive reciprocal arrangements with public trustees in other jurisdictions for administration of estates for persons with disabilities. An explicit government guarantee to discharge liabilities incurred in respect of management of estates by State Trustees (resulting from negligence, wilful default or Government Response Accepted 2 3 4 5 Accepted Accepted Accepted Accepted 6 7 8 9 Accepted Accepted Accepted Accepted See above See above No. 1 Competition Policy Justification Private sector companies already have the ability to reciprocate orders through their own interstate links. Therefore, in practice, this section places the State Trustees on an equal footing with private competitors and does not provide a competitive advantage. If the guarantee was abolished, it would be necessary for any professional insurance to provide the same extent of cover. The current professional insurance held by State Trustees does not indemnify against a claim brought about by a dishonest or fraudulent act by State Trustees or its employees. 2 32 Second Tranche Report Volume II No. Restrictions on Competition Remaining fraud), to the extent that proceeds from any insurance contract and/or the assets of State Trustees are not sufficient to meet the liability. Exclusive arrangements for public trustees in other jurisdictions to facilitate the administration of deceased estates. Section 1: Reviews Completed and Response Announced Competition Policy Justification 3 This section provides State Trustees with administrative arrangements designed to overcome jurisdictional constraints and place them on an equal footing with the private sector. Therefore, this restriction in practice does not confer a practical competitive advantage on State Trustees. 33 Second Tranche Report Volume II Section 1: Reviews Completed and Response Announced Legislation: Reviewer: Consultation: No. 1 Transport Accident Act 1986 In-House (Department of Treasury & Finance) None Portfolio: Date review completed: Date response released: Government Response Not accepted. Treasurer December 1997 October 1998 Implementation - 2 3 Review Recommendations As a means of effectively achieving all of the objectives of the transport accident compensation scheme, the Government should remove existing statutory price setting provisions and allow the introduction of risk reflective premiums. This will enable the identification of existing cross-subsidies which should then be transparently funded or removed. In the medium to longer term, the Government should separate commercial from regulatory and other non-commercial functions in the delivery of transport accident compensation. Structural reform of the public monopoly should be consistent with the principles of structural reform contained in the Competition Principles Agreement. This report should be released for public comment to assist the Government in developing its response to these recommendations. Not accepted. - Not accepted - the Government reviewed the scheme intensively in its 1992 - 1996 term and hence is in a position to respond without further assistance. - No. 1 Restrictions on Competition Remaining The monopoly held by the Transport Accident Commission on the supply of transport accident compensation through the Transport Accident Fund. Competition Policy Justification See Volume 1 for more detail. á The GovernmentÕs view is that the no fault compensation including a provision for lifetime care, lower and more stable premium relative to the other StatesÕ average and the community rating in the premium, provide greater benefit to the community than the costs of restricting competition. The benefits have been provided by a stable scheme over a period in excess of 10 years. The costs of restricting competition in VictoriaÕs scheme are judged to be smaller overall than the benefits. The Government has therefore concluded that there is a net benefit to the community as a whole from the existing arrangements. á The Government considers that a competitive model with compulsory coverage, lifetime care and community ratings would result in the problem of high ongoing regulatory costs. Furthermore, the transitional costs that would be required to move from the existing scheme to a competitive model would be a very heavy burden on motorists and could not be justified unless the Government were confident that the benefits would outweigh the costs. á The Government has therefore concluded that at this stage the objectives of the existing scheme can only be achieved by restricting competition. á The Government intends to carefully monitor reforms in other jurisdictions. Any experience that demonstrates scope for improvements will be analysed for possible incorporation in VictoriaÕs public monopoly transport 34 Second Tranche Report Volume II No. 2 Restrictions on Competition Remaining Compulsory payment of contributions to the Fund by all motor vehicle owners. Section 1: Reviews Completed and Response Announced Competition Policy Justification accident compensation scheme. All vehicle owners share the risk burden associated with transport accidents and it enables cross-subsidisation to maintain premiums at affordable levels. It may be considered socially appropriate and with wide application may potentially reduce the overall cost to the community of compensating for transport accidents. These benefits are considered to outweigh the costs of potentially reduced incentives on the insurer for cost control and product innovation. The introduction of risk reflective premia is unlikely to modify driver behaviour more than the pain and suffering arising from personal injury. It would also be inequitable for road users such as motorcyclists who are usually innocent victims of accidents caused by other users. The Government must also have regard to ability to pay. 3 Governor-in-Council may make regulations prescribing fees. 35 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Section 2 Legislation Reviews: Completed but Response Still Under Consideration 36 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Reviews where the report has been released No. 1 2 3 4 5 6 Legislation Agricultural Industry Development Act 1990 and Orders made under that Act · Dentists Act 1972 · Dental Technicians Act 1972 Marine Act 1988 (& Notices made under Section 15) Mental Health Act 1986 Mineral Resources Development Act 1990 Pipelines Act 1967 Portfolio Agriculture & Resources Health Roads and Ports Health Agriculture & Resources Agriculture & Resources Details on these released reviews follow. 37 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Legislation: Reviewer: Consultation: No. 1 2 3 Agricultural Industry Development Act 1990 and Orders made under that Act Consultant (KPMG) Release of an issues paper and call for submissions, targeted interviews Portfolio: Date review completed: Agriculture & Resources January 1999 4 5 6 7 8 9 Review Recommendations The Murray Valley (Victoria) Wine Grape Industry Marketing Order 1994 not be renewed after it expires on 23 November 1998. The Murray Valley (New South Wales) Wine Grape Processing Industry Marketing Order 1995 not be renewed after it expires on 30 November 1998. Murray Valley Wine Grape Industry Development Order (Victoria) 1994 and Murray Valley (New South Wales) Wine Grape Processing Industry Marketing Order 1995: · remove the function prescribed in sub-clauses 8(a) regarding closer relationships between industry participants and 8(c) regarding provision of resources to the Murray Valley Wine Grape Growers Council; · retain the market information function prescribed in sub-clauses 8(b) and (d) in the short term while considering whether these could be undertaken by industry organisations; and · review the activities of the Grape and Wine Research and Development Corporation to determine whether it could undertake or fund the research and development currently undertaken by the Murray Valley Wine Grape Industry Development Council. Remove from the Northern Victoria Fresh Tomato Industry Development Order 1995 and the Victorian Strawberry Industry Development Order 1996 sub-clause 10(b) which provides a power for the respective Industry Development Council to act as a purchasing agent. Remove from the Emu Industry Development Order 1996 the discretionary function in sub-clause 11(b) of providing resources to the Emu Producers Association of Victoria. Review the effectiveness of the Northern Victoria Fresh Tomato, Victorian Strawberry and Emu Industry Development Councils in undertaking or funding research and development and promotion. Examine whether other statutory-based agricultural research and development and promotion bodies could undertake or fund these activities. Seek an explanation from each of these Industry Development Councils for the level of unexpended funds and examine the appropriateness of the investment of the funds. Remove from the Agricultural Industry Development Act provisions relating to price recommendation and payment terms and conditions functions of Negotiating Committees. Remove from the Agricultural Industry Development Act the power for an Industry Development Council to act as a purchasing agent. Consider amending the Act to provide that all Orders made must require reasons for any retention of funds raised from charges to be published in the Industry Development Council financial statements in annual reports; particularly in view of the fact that Orders are limited in time to four years. 38 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Legislation: Reviewer: Consultation: No. 1 2 3 Dentists Act 1972 Dental Technicians Act 1972 Semi Public (Panel) Release of an issues paper and call for submissions Portfolio: Date review completed: Health Jan 1999 Review Recommendations Retain restrictions on use of title (Òdentist, dental technicianÓ) Retain restrictions on types of work Retain restrictions on advertising (limited to fair and accurate) 39 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Legislation: Reviewer: Consultation: No. 1 2 3 4 5 Marine Act 1988 (& Notices made under Section 15) Semi-public (Panel) Public notice, submissions, targeted discussions. Portfolio: Date review completed: Roads and Ports 1998 Review Recommendations Clarify responsibilities of harbour masters Retain licensing of ships pilots Increase competition for ships pilotage services (NB this recommendation has been accepted and a Bill is in preparation) Establish performance based standards for crewing No changes on recreational vessels 40 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Legislation: Reviewer: Consultation: No. 1 Mental Health Act 1986 In House (Panel) Targeted consultation Portfolio: Date review completed: Health 1998 2 3 4 Review Recommendations In relation to community support services, the panel considered that the registration requirements were unnecessarily restrictive in their current form and were not necessary to achieve the objectives of the legislation. The panel recommended that the definition of Ôcommunity support serviceÕ remain in the Act (without a requirement to register with the Department) to ensure that the regulatory mechanisms in the Act continue to apply. The panel also considered that the current funding provisions of the Act should be removed and that community support services should be funded pursuant to the Health Services Act as are other non-government service providers. This allows streamlined and consistent funding across agencies. The panel considered that in relation to proclamation of services, ECT licensing requirements and the regulation making power, the benefits of the restriction on the market outweighed the costs to the community. In view of the above, the restrictions in relation to proclamation of services, ECT licensing requirements and the regulation making power remain in the Act. 41 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Legislation: Reviewer: Consultation: No. 1 2 3 4 5 6 7 8 Mineral Resources Development Act 1990 Consultant (Peter Day Consulting) Call for public submissions and targeted interviews Portfolio: Date review completed: Agriculture & Resources March 1997 Review Recommendations Reference to Òfit and proper, intends to comply and genuinely intends to do work or cause work to be doneÓ in relation to applying for a licence, should be revoked. Compensation provisions for assessment of the value of land for agricultural purposes should replace provisions relating to determination of economic significance of proposals on agricultural land. Reference to employment condition in relation to granting of a licence should be revoked. Any renewal of an exploration licence beyond 5 years should be limited to the area of interest to the licensee and not the total area covered by the licence. The requirement to give notice to the chief mining inspector prior to commencing work should be revoked. All entry requirements for certification of mine managers not related to health and safety skills, experience and knowledge should be deleted. An application for a small area mining licence should be able to be registered before the consent of a prior tenement holder is negotiated. It should be an offence for the holder of an exploration licence to seek or receive a financial incentive to grant consent for a mining licence without the agreement of both parties and the Minister. 42 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Legislation: Reviewer: Consultation: No. 1 Pipelines Act 1967 Consultant (Alex Dobes) Call for public submissions and targeted interviews Portfolio: Date review completed: Agriculture & Resources February 1997 2 3 4 5 6 7 8 9 10 11 12 13 14 Review Recommendations Victoria should initiate moves to introduce a consistent regulatory regime for pipelines throughout Australia. If national harmonisation is not possible, the next best option is harmonisation with neighbouring markets and with large markets. If full harmonisation is not possible, an initial step of harmonising elements such as safety regulations should take place. The exact definition of which pipelines fall under the Pipelines Act should be placed in the Act itself. Consideration should be given to formalising time limits for government assessment of pipeline projects. The system of separate permits and licences should be clarified and consideration given to a system of stages of approval. The restrictions on tradeability of pipelines, permits and licences should be relaxed in a way which removes possible delays from the mergers and acquisitions process, but which maintains safety and environmental standards. Unilateral powers on the part of regulators to alter permits or licences should be subject to appeal to the Victorian Civil and Administrative Tribunal. The restriction on transporting only authorised substances in pipelines should be retained. Open access provisions should be removed from the Act and open access should be governed by the forthcoming National Gas Access Code. If open access provisions are to remain in the Act, they should be clarified by specific regulations concerning the exercise of those powers, and those powers should be subject to appeal. Safety requirements within the Act should be based on future guidelines being developed by the Department of Treasury and Finance. Absolute prohibitions on damage should be modified to allow for prior agreed compensation for damage. The liability of operators for damages should be extended beyond two years. The Government should consider issues connected with future rehabilitation and compensation expenses, possibly through a detailed review. The Government should retain control over the development of permitted pipelines. This control should be clarified in regulations. The Government should examine the possibilities for the introduction of a standard electronic format for lodgement of maps and other documents. 43 Second Tranche Report Volume II Section 2: Reviews Completed and But Response Still Under Consideration Reviews where the report is yet to be released No. 1 Legislation Adoption Act 1984 Portfolio Attorney-General, Youth and Community Services Reviewer In-House (Departments of Justice and Human Services) Consultation Notice and call for submissions, targeted interviews (various organisations representing domestic and intercountry adoption agencies, birth mothers, adoptees and adoptive families) Release of an issues paper and call for submissions, targeted interviews Targeted Discussion paper released, extensive consultation undertaken. Targeted Release of an issues paper and call for submissions, public meetings and targeted interviews None Date Review Completed Late 1998 2 3 4 Agriculture and Veterinary Chemicals (Control of Use) Act 1992; Agriculture and Veterinary Chemicals (Victoria) Act 1994 Borrowing & Investment Powers Act 1987 Cemeteries Act 1958 Agriculture & Resources Consultant (PriceWaterhouseCoopers) January 1999 Treasurer Health In-house (Department of Treasury and Finance) Semi Public (Panel) July 1997 1998 5 6 Club Keno Act 1993 Domestic (Feral and Nuisance) Animals Act 1994 Gaming Agriculture & Resources In-house (Department of Treasury and Finance) Consultant (KPMG) August 1997 November 1998 7 8 9 10 Electricity Industry Act 1993 and State Electricity Commission Act 1958 Flora & Fauna Guarantee Act 1988 Food Act 1984 Forests Act 1958 Treasurer Consultant (Freehill, Hollingdale and Page) Consultant (KPMG) National Consultant (KPMG) January 1998 Conservation & Land Management Health Conservation & Land Management Gaming 11 Gaming & Betting Act 1994 (all, except Part 5, Div 2 of Part 6, Part 15 of Div 2, & Div 2 of Part 18, Consultant (Centre for International Economics) Issues paper and call for submissions, targeted interviews Extensive consultation by ANZFA Call for public submissions, public meetings and targeted interviews Release of issues paper and call for submissions 1998 April 1998 November 1998 44 Second Tranche Report Volume II No. Legislation which are jointly administered by the Office of Racing). Legal Aid Act 1978 Portfolio Section 2: Reviews Completed and But Response Still Under Consideration Reviewer Consultation Date Review Completed 12 Attorney-General Consultant (KPMG) 13 14 15 16 17 Museums Act 1983 Racing and betting legislation (Racing Act 1958, Rules of the Harness Racing Board, Rules of the Greyhound Racing Control Board, Lotteries Gaming and Betting Act 1966, Gaming and Betting Act 1994, Casino Control Act 1991) Surveyors Act 1978 Tattersall Consultations Act 1958 Wildlife Act 1975 Arts Sport and Gaming In House (Consultant) Semi Public (Consultant) Targeted (legal professional bodies, Federation of Community Legal Centres, and Victoria Legal Aid) Targeted Issues Paper, Discussion Paper, submissions, public consultation, targeted consultation and meetings with industry, and interested groups November 1998 1998 December 1998 Conservation and Land Management Gaming & Treasurer Conservation & Land Management Consultant (Southbridge) Panel (Michael Pryles and Peter Swan) Consultant (KPMG) Call for submissions, targeted interviews Targeted consultation Release of issues paper and call for submissions and targeted interviews July 1997 January 1998 November 1998 45 Section 3 Legislation Reviews: Commenced but not Completed 46 Second Tranche Report Volume II Section 3: Reviews Commenced but not Completed No. Legislation Portfolio Reviewer Consultation 1 Ambulance Services Act 1986 Health Semi Public (consultant) Discussion paper published in December 1998 and targeted consultation 2 Auction Sales Act 1958 Fair Trading 3 Broiler Chicken Industry Act 1978 Agriculture & Resources Consultant (Public Sector Research Unit, Victoria University of Technology) Consultant (KPMG) Release of issues paper and call for submissions. Release of issues paper and call for submissions and targeted interviews Public notice, issues paper, submissions, targeted consultation. Release of issues paper and call for submissions Release of issues paper and call for submissions and targeted interviews With respect to the registration of teachers and non-government schools, consultation was undertaken with the Catholic Education Office and the Association of Independent Schools in Victoria With respect to the setting of fees for overseas students, provision was made for consultation with the Association of School Councils in Victoria, the International Students Policy and Programs Unit of the Department and relevant parent/school council Expected Completion Date Report in April 1999. Any changes to the Act will proceed in Autumn 2000 June 1999 May 1999 4 Building Act 1993; Architects Act 1991 Consumer Credit (Victoria) Act 1995 Dairy Industry Act 1992 · Education Act 1958 · Ministerial Order No. 14 1998 (Payment of fees by overseas students) which has replaced Ministerial Order No. 3 1995, Ministerial Order No. 4 1995, and Ministerial Order No. 5 1995 Planning and Local Government Semi Public (Consultant) March 1999 5 6 Fair Trading Agriculture & Resources National review led by NSW and conducted by a consultant Consultant (Centre for International Economics) The initial part of the review was undertaken by a Department of Education Legislative Review Steering Committee comprising representatives of the Departments of Education, Premier & Cabinet and Treasury & Finance The review of school education policy is to be undertaken by a consultant (Melbourne Economics) working for review and steering committees comprising representatives from the Departments of June 2000 July 1999 7 Education June 1999 47 Second Tranche Report Volume II No. Legislation Portfolio Reviewer Section 3: Reviews Commenced but not Completed Consultation Expected Completion Date Education, Treasury & Finance, Premier & Cabinet. groups With respect to the school education policy review, consultation, as appropriate, will be conducted following receipt of the consultantÕs report Release of issues paper and call for submissions and targeted interviews or meetings None Release of issues paper and call for submissions, public meetings and targeted interviews Discussion paper published in December 1998. Submissions closed 26 February 1999. Targeted consultation, Discussion paper to be released in March 1999, there will be public consultation and submissions received. Public notice, issues paper, submissions, targeted consultation. Release of issues paper and call for submissions, targeted interviews No public consultation Release of issues paper and call for submissions, public meetings and targeted interviews Release of issues paper and call for submissions, targeted 8 Environment Protection Act 1970; Litter Act 1987 Estate Agents Act 1980 Fisheries Acts 1995 (including the remaining provisions of the Fisheries Act 1968) Health Act 1958 Conservation & Land Management Fair Trading Agriculture & Resources Consultant (The Allen Consulting Group) In-House (Office of Fair Trading & Business Affairs) Consultant (ACIL) July 1999 9 10 December 1999 April 1999 11 Health In-House (Panel) May 1999. 12 Health Services Act 1988 Health Semi Public (consultant) June 1999 13 Heritage Act 1995 Planning and Local Government Semi Public (Consultant) March 1999 14 Medical Practice Act 1994 Health In House (Panel) March 1999 15 16 Mines Act 1958 Murray Valley Citrus Marketing Act 1989 Agriculture & Resources Agriculture & Resources Victorian WorkCover Authority Consultant (Centre for International Economics) April 1999 April 1999 17 Nurses Act 1993 Health In House (Panel) March 1999 48 Second Tranche Report Volume II No. Legislation Portfolio Reviewer Section 3: Reviews Commenced but not Completed Consultation Expected Completion Date Nov 1999 18 Pathology Services Accreditation Act 1984 Planning & Environment Act 1987 Health In House (Panel) 19 Planning and Local Government Semi Public (Consultant) 20 Public Transport Competition Act 1995 Tobacco Act 1987 Transport Act 1983 - Part 6: Division 5 (Commercial Passenger Vehicles) Transport Act 1983 - Part 6: Division 8 (Tow Trucks) Transport Act 1993 - Schedule 7 (Covenants to be Included in Deed of Assignment) Travel Agents Act 1986 Roads and Ports Semi Public (Consultant) 21 22 Health Transport and Roads and Ports In-House (Consultant) Semi Public (Consultant) 23 Roads and Ports Semi Public (Consultant) 24 Roads and Ports Semi Public (Consultant) 25 Fair Trading National review led by Western Australia and conducted by a consultant (CIE) interviews public notice, discussion paper will be published in June 1999, submissions Public notice, issues paper, submissions, targeted consultation. Public notice, issues paper, submissions, targeted consultation. No consultation Public notice, issues paper, submissions, targeted consultation. Public notice, issues paper, submissions, targeted consultation. Public notice, issues paper, submissions, targeted consultation. Release of issues paper and call for submissions, targeted meetings late 1999 Dec 1999 1999 March 1999 April 1999 April 1999 December 1999 49 Section 4 Legislation Reviews: Completion Expected to be Delayed 50 Second Tranche Report Volume II Section 4: Reviews Where Completion is expected to be Delayed No. Legislation Portfolio 1 2 Ambulance Services Act 1986 Auction Sales Act 1958 Health Fair Trading Scheduled Completion Date December 1997 June 1997 Expected Completion Date March 1999 June 1999 Comment 3 4 5 Broiler Chicken Industry Act 1978 Business Names Act 1962 Civil Aviation (Carriers' Liability) Act 1961 Agriculture & Resources Fair Trading Industry, Science and Technology December 1998 June 1998 Dec 1998 May 1999 December 1999 unknown * 6 Corrections Act 1986 Corrections July 1997 - 7 8 9 Council of Law Reporting in Victoria Act 1983 Dairy Industry Act 1992 Drugs, Poisons & Controlled Substances Act 1981 Attorney-General Agriculture & Resources Health December 1997 December 1998 Aug 1998 December 1999 May 1999 Dec 1999 * 10 11 · Education Act 1958 · Ministerial Order No. 14 1998 (Payment of fees by overseas students) which has replaced Ministerial Order No. 3 1995, Ministerial Order No. 4 1995, and Ministerial Order No. 5 1995 Employment Agents Act 1983 Education June 1997 June 1999 Delayed due to reorganisation within the Department of Human Services. Delayed pending completion of general policy review. Terms of reference now approved and consultant appointed. Delayed to allow other reviews to be brought forward. Delayed due to resource constraints. This Act adopts Commonwealth legislation as part of a national uniform scheme. Due to the nature of this arrangement, unilateral action by Victoria is not feasible. A national review is being considered. A review has been delayed pending an assessment of whether the Act contains restrictions. Delay due to resource constraints. Terms of reference are being prepared. Delayed to allow other reviews to be brought forward. National Review, Cwth has delayed commencement until 1999. The end date for the review of this Act is specified in the Timetable as August 1998. This Act is part of a national review which is about to start. The legislation review was delayed for inclusion in a special policy review of the application of competition principles in the school education sector. Industry, Science and Technology Dec 1996 - The Act has never been brought into operation and as such is considered redundant. 51 Second Tranche Report Volume II No. Legislation Portfolio Section 4: Reviews Where Completion is expected to be Delayed Scheduled Completion Date Expected Completion Date Comment 12 Environment Protection Act 1970; Litter Act 1987 Estate Agents Act 1980 Conservation & Land Management Fair Trading 13 January 1997 and December 1997 respectively June 1997 July 1999 December 1999 14 15 16 17 Extractive Industries Development Act 1995 Gaming Machine Control Act 1991 Health Act 1958 Health Services Act 1988 Agriculture & Resources Gaming Health Health July 1999 June 1998 December 1998 December 1997 December 1999 June 2000 May 1999 Late 1999 18 Housing Act 1983 Housing January 1999 to be determined Consideration is being given to reviewing the Act for repeal. Review delayed due to proposed legislative amendments to Environment Protection Act in 1998. Review commenced February 1999. Delayed for consultancy on framework for assessing fair trading legislation. Review now underway. Delayed to allow other reviews to be brought forward. Postponed for inclusion in planned wider policy review of the Act. Minor delay. Delayed due to decision to include in a wider review of the policy framework underlying this legislation. The regulatory parts of the Act have been repealed. The Housing (Amendment) Act of 1996 removed regulatory control over standards of habitation (Part 7 of the Act) from the Director of Housing and transferred remaining powers to local government. Provisions relating to Rental Housing Cooperatives (and associated regulations) under part 6 of the Act were repealed under the Cooperatives Act of 1996. A scoping review of the remaining Housing Act was undertaken during 1998. This review found that the Housing Act generally provides enabling powers only (for the Director of Housing and the Commonwealth State Housing Agreement (CSHA)), has no significant regulatory functions, and that therefore the Act did not operate to reduce competition. Two issues were, however, raised in this 52 Second Tranche Report Volume II No. Legislation Portfolio Section 4: Reviews Where Completion is expected to be Delayed Scheduled Completion Date Expected Completion Date Comment 19 20 Labour & Industry Act 1958 Livestock Disease Control Act 1994; Stock (Seller Liability & Declarations) Act 1993 Long Service Leave Act 1992 (formerly Employee Relations Act 1992) Industry, Science and Technology Agriculture & Resources July 1997 April 1999 December 1999 review on which external advice has been sought. The issues related to insurance and the powers of the Director of Housing acting as an agent for CSHA matters, as set out in the Act. Preliminary external advice obtained from KPMG Consulting has raised some potential competition policy issues in relation to the delivery and administration of public housing. Such matters go beyond the provisions of the Housing Act alone, however, and involve the CSHA. These wider CSHA matters are under examination with other jurisdictions. Particular issues include subsidy arrangements and any potential monopoly market outcomes. It is expected the completion date will be extended until December 1999. This Act is largely redundant. Consideration is being given to reviewing the Act for repeal. Review delayed due to legislative changes in 1998 and 1999. Review of this Act was delayed due to makes provision with respect to long service leave entitlements of certain employees. The changes to the Act occurred at the scheduled time of the competition policy review resulting in the deferral of the review. The Act is listed as a low priority review. An assessment is now underway to determine whether or not any of the remaining provisions of the Act restrict competition. Delay minor. This review was delayed pending the completion of a competitive neutrality review of the Authority in 1998. The legislative review will be undertaken in 1999. 21 Industry, Science and Technology Dec 1997 1999 22 23 Medical Practice Act 1994 Melbourne Market Authority Act 1977 Health Agriculture & Resources December 1998 June 1998 March 1999 December 1999 53 Second Tranche Report Volume II No. Legislation Portfolio Section 4: Reviews Where Completion is expected to be Delayed Scheduled Completion Date February 1998 Expected Completion Date April 1999 Comment 24 Mines Act 1958 Agriculture & Resources 25 National Parks Act 1975; Water Industry Act 1994 (Part 4) Conservation & Land Management December 1998 December 1999 26 27 28 29 Nurses Act 1993 Partnership Act 1958 Pathology Services Accreditation Act 1984 Petroleum Retail Selling Sites Act 1981 Petroleum (Submerged Lands) Act 1982 Health Fair Trading Health Fair Trading December 1998 June 1999 June 1997 June 1999 March 1999 December 1999 Late 1999 30 Agriculture & Resources December 1997 July 2000 31 Pharmacists Act 1974 Health Aug 1997 Dec 1999 * This legislation is jointly administered by the Department of Natural Resources and Environment and the WorkCover Authority. This Act has largely been repealed. The few remaining provisions relate to occupational health and safety. Consequently the WorkCover Authority is undertaking the review. These Acts are to be reviewed concurrently with land legislation (Land Act, Crown Land Reserves Act and various minor land acts) to promote a consistent approach to competition issues in relation to leases, licences and permits on Crown land. Preliminary work has been done for this review but commencement has been delayed while preliminary work is done for land reviews. Delay minor. Delayed due to resource constraints. Delayed by difficulties of finding independent pathology experts for the review panel. Referred to Scrutiny of Acts and Regulation Committee of Parliament which will consider, in June 1999, the case for repeal. This is national legislation with mirror legislation in each state. Victoria is unable to review its legislation until the Commonwealth proceeds with its review or initiates a multijurisdictional review. National Review, Cwth has delayed commencement until 1999. The end date for the review of this Act is specified in the Timetable as August 1998. This Act is proposed to be part of a national review. Terms of reference have been circulated to jurisdictions and the Minister has agreed to the 54 Second Tranche Report Volume II No. Legislation Portfolio Section 4: Reviews Where Completion is expected to be Delayed Scheduled Completion Date April 1999 June 1998 Expected Completion Date December 1999 Comment 32 32 Plant Health & Plant Products Act 1995 Police Regulation Act 1958 Agriculture & Resources Police and Emergency Services 34 35 Private Agents Act 1966 Road Transport (Dangerous Goods) Act 1995 Therapeutic Goods (Victoria) Act 1994 Police and Emergency Services Finance (formerly Industry Science & Technology) Health June 1998 December 1998 June 1999 Unknown 36 Feb 1998 May 1999 * 37 38 Tobacco Act 1987 Trade Measurement Act 1995 Health Industry, Science and Technology November 1997 Dec 1998 March 1999 June 1999 39 · Transport Act 1993 - Schedule 5 (Provisions with Respect to Roads) · Transport Act 1993 - Schedule 4 (Further Particular Powers of the Roads Corporation) · Transport Act 1983 - Part 6: Transport and Roads and Ports Dec 1998 March 1999 proposed terms of reference. Delayed to allow other reviews to be brought forward. Delayed pending policy review of policing by the Police Board. Need for NCP review to be reconsidered. Delay due to proposal for national review. Terms of reference being prepared. This is mirror legislation to the CommonwealthÕs 1994 Act of the same name. Awaiting outcome of Commonwealth review. It is anticipated that the review will commence in February 1999. The end date for the review of this Act is specified in the Timetable as December 1998. This Act is scheduled to report in May 1999. It has not been started as yet as the Public Health and Development Division has a heavy program of legislative review and has directed available resources to other reviews to date. It is expected that this review will commence in March 1999 and report to the Minister on time in May 1999. Internal Departmental consultation only. This Act forms part of a national uniform scheme and requires a national review. The Ministerial Council for Consumer Affairs has proposed a national review to be undertaken by Queensland. The review is proposed to be completed by June 1999. Nominated for an in-house assessment jointly with the Powers of the Corporations, Financial and Traffic Regulations. Assessment delayed to accommodate the process of transport reforms. 55 Second Tranche Report Volume II No. Legislation Portfolio Section 4: Reviews Where Completion is expected to be Delayed Scheduled Completion Date Expected Completion Date Comment 40 (Traffic Regulation, Registration & Licensing) Division 1 (General Provisions) · Transport Act 1993 - Part 4 (Financial) · Transport Act 1993 - Part 3 (Powers of the Corporations) Travel Agents Act 1986 Fair Trading June 1998 December 1999 41 42 Trustee Act 1958 Wheat Marketing Act 1989 Fair Trading Agriculture & Resources June 1998 June 1999 December 1999 July 2000 Approval of the national review process was delayed. Terms of reference has been approved and a consultant appointed. Delayed due to resource constraints. The Commonwealth Act is the main wheat marketing legislation. Each state has complementary legislation. Consequently Victoria is unable to review its legislation until the Commonwealth proceeds with its review or initiates a multi-jurisdictional review. 56 Section 5 Legislation Reviews: Removed 57 Second Tranche Report Volume II Section 5: Legislation Removed from the Review Program No. 1 Legislation Victorian Plantations Corporation Act 1993 Dried Fruits Act 1958 Biological Control Act Portfolio Agriculture & Resources 2 3 Agriculture & Resources Agriculture & Resources 4 5 Veterinary Surgeons Act 1958 Rules of the Council of Legal Education 1993 Housing Act 1983 (Part IV) Agriculture & Resources Attorney-General 6 Attorney-General 7 8 9 10 Registration of Births, Deaths & Marriages Act 1959 Benefit Associations Act 1958 Alpine Resorts Act 1983 Range of forest agreement Acts (primarily for softwoods) including: Victree Forests Agreement; Australian Newsprint Mill Limited; Bowater-Scott Agreement; Laminex Industries Agreement; Pulpwood Agreement; and Wood Pulp Agreement. Order - authorises the Alpine Resorts Commission to act as a gas undertaking solely within the Mount Buller Alpine Resort Victorian Prison Industries Commission Act 1983 Business Investigations Act 1958 Trustee Companies Act 1984 Attorney-General Attorney-General Conservation & Land Management Conservation & Land Management Reason for Removal The assets of the Corporation were sold in December 1998. Consequently most of the Act will be repealed leaving only provisions related to the CrownÕs residual interests in the land, licence and legislated supply agreements. Act repealed by the Dried Fruits (Repeal) Act 1998 following industry decision to wind-up the Dried Fruits Board. National legislative scheme. Not considered to restrict competition because it requires a transparent public inquiry process and review to determine the net public benefit of a biological control release. Act repealed and replaced by the Veterinary Practice Act 1997. The Rules are to be replaced by proposed new Rules pursuant to the Legal Practice Act 1996, subject to an RIS review. Rules are being drafted for the RIS. The competition review and the RIS process will be combined. Part VI of the Act (relating to rental housing co-operatives) was repealed and replaced by the Co-operatives Act 1996. The Housing (Rental Housing Co-operative) Regulations 1994 are redundant and will be revoked. Act repealed and replaced by Births, Deaths and Marriages Act 1996. The new Act was assessed against Competition Policy and did not contain restrictions. Act is obsolete and no associations are registered under it. Some finalisation of outstanding matters is required before repeal can be progressed. Act replaced by the Alpine Resorts (Management) Act 1997. These are contractual agreements between the owner of the Victorian Plantations Corporation (VPC) and private parties. They were taken on by the newly privatised VPC on behalf of the Government. Several of these agreements have expired/terminated and the legislation will be repealed. These include the Victree Forests Agreement & Bowater-Scott Agreement. The Australian Newsprint Mill Ltd, Laminex Industries Agreement & Woodpulp Agreement remain and have been exempted from review as there is no scope for amendment without renegotiation and compensation. Order made under Gas & Fuel Corporation Act which is administered by the Department of Treasury and Finance. Amendments made by an order under the Gas Industry Act make this order redundant. Act repealed by the Corrections (Amendment) Act 1996. To be repealed. To be repealed and replaced by uniform national legislation currently under development. 11 Conservation & Land Management 12 13 14 Corrections Fair Trading Fair Trading 58 Second Tranche Report Volume II No. 15 16 17 18 19 20 21 22 23 Legislation Prostitution Control Act 1994 Building Societies Act 1986 Co-operation Act 1981 Financial Institutions (Victoria) Act 1992 Friendly Societies Act 1986 Industrial and Provident Societies Act 1958 Fundraising Appeals Act 1984 Construction Industry Long Service Leave Act 1983 Dangerous Goods Act 1985 Portfolio Fair Trading Fair Trading Fair Trading Fair Trading Fair Trading Fair Trading Fair Trading Finance Finance Section 5: Legislation Removed from the Review Program Reason for Removal No scope for change due to overriding social objectives. To be repealed once jurisdiction passes to the Commonwealth under financial sector reforms. This Act was repealed and replaced by the Cooperatives Act 1996. To be repealed once jurisdiction passes to the Commonwealth under financial sector reforms. Repealed and replaced by the Friendly Societies (Victoria) Act 1996 To be repealed once jurisdiction passes to the Commonwealth under financial sector reforms. Repealed and replaced by Fundraising Appeals Act 1998. Repealed by the Construction Industry Long Service Leave Act 1997. The Act prohibits the sale of prescribed goods. As no legal market is permitted this is not a restriction on competition. Various regulations made under the Act are being reviewed as they sunset over the next few years via a RIS process. Removed as, following various changes made by the [what] (Amendment) Act 1996, no restrictions on competition remain. Assessed as non-restrictive as compensation payments are no longer awarded under this Act. Withdrawn due to lack of scope for amendment without varying contractual arrangements with the existing casino operator and requiring payment of compensation. 24 25 26 State Superannuation Act 1988 Workers Compensation Act 1958 (Div 8 of Part 1) Casino Control Act 1991 (excluding sections 128H to 128L which are administered by the Minister for Major Projects, excepting section 128K(2), which administered by the Minister for Finance) Lotteries Gaming & Betting Act 1966 (all except Parts I, IA, II, III, IV & V which are jointly administered with the Office of Racing) Casino (Management Agreement) Act 1993 Fuel Emergency Act 1977 Finance Finance & Attorney General Gaming 27 Gaming Legislation related to minor gaming was amended in 1997. The amendments were essentially in the form of enabling legislation to set up a framework under which various forms of minor gaming are regulated. This replaced the previous enforcement-based approach. 28 29 Gaming Industry, Science and Technology Withdrawn due to lack of scope for amendment without varying contractual arrangements with the existing casino operator and requiring payment of compensation. The review of the Fuel Emergency Act 1977 was undertaken in conjunction with other emergency powers legislation by the Department of Premier and Cabinet Legislative Review Steering Committee. The other Acts being the Public Safety Preservation Act 1958, the Vital State Projects Act 1976 and the Vital State Industries (Works and Services) Act 1992. The Committee concluded that the Acts did not entail restrictions on competition and recommended that they be removed from the legislative review timetable. The Premier subsequently agreed on 18 November 1997 with the assessment and the removal of the Fuel 59 Second Tranche Report Volume II No. 30 31 32 33 Legislation Local Government Act 1989. Cultural & Recreational Lands Act 1963. Impounding of Livestock Act 1994 Building Control (Plumbers Gasfitters & Drainers) Act 1981 No. 9720 Environment Effects Act 1978 No. 9135 Subdivision Act 1988 No. 53/1988 Urban Land Authority Act 1979 No. 9320 Bourke Street Mall Act 1982. Public Authorities Marks Act 1958. City of Greater Geelong 1993 (excluding Part 5). City of Melbourne Act 1993. Project Development & Construction Management Act 1994 Ministerial Direction No.1, Tendering Provisions Land (Goonawarra Golf Course) Act Planning Authorities Repeal Act 1994 Firearms Act 1958 Control of Weapons Act 1990 Vital State Projects Act 1976 {excluding ss 5 to 16 (these provisions are administered by the Attorney General)} Vital State Industries (Works and Services) Act 1992 Superannuation (Public Sector) Act 1992 {Part 2 (the Act is otherwise administered by the Minister for Portfolio Planning and Local Government Planning and Local Government Planning and Local Government Planning and Local Government Section 5: Legislation Removed from the Review Program Reason for Removal Emergency Act (and the other emergency powers Acts) from the review timetable. Assessed as non-restrictive Assessed as non-restrictive Assessed as non-restrictive Act repealed by the Building (Amendment) Act 1996 34 35 36 37 38 39 40 41 Planning and Local Government Planning and Local Government Planning and Local Government Planning and Local Government Planning and Local Government Planning and Local Government Planning and Local Government Planning and Local Government Assessed as non-restrictive Assessed as non-restrictive Act replaced by the Urban Land Corporation Act 1997 Act repealed Assessed as non-restrictive Act repealed Act repealed Assessed as non-restrictive 42 43 44 45 46 47 Planning and Local Government Planning and Local Government Planning and Local Government Police and Emergency Services Police and Emergency Services Premier Assessed as non-restrictive Assessed as non-restrictive Now Part 3(8) of the Planning and Environment Act Repealed and replaced by the Firearms Act 1996 No scope for change due to overriding social objectives. Assessed as non-restrictive 48 49 Premier Premier Assessed as non-restrictive Assessed as non-restrictive 60 Second Tranche Report Volume II No. 50 51 Legislation Finance)} Public Safety Preservation Act 1958 Parliamentary Salaries and Superannuation Act 1968 {excluding: Part II (this part, concerned with the superannuation scheme, is administered by the Minister for Finance)} Transport Act 1983 - Part 6: Division 7 (Hire & Drive Omnibuses) Transport Act 1983 - Part 6: Division 9 (Commercial Goods Vehicles) Transport Act 1983 - Part 6: Division 6 (Private Omnibuses) Pollution of Waters by Oil & Noxious Substances Act 1986 Chattel Securities Act 1987 - Part 3 (Registrable Goods) South Australian & Victorian Border Railways Act 1930 Railways (Standardisation Agreement) Act 1958 Transport Act 1983 - Part 6: Division 10 (Passenger Ferry Services) Transport Act 1993 - Schedule 8 (Classes, Kinds or Descriptions of Goods) Gas Industry Act 1994 Portfolio Premier Premier Section 5: Legislation Removed from the Review Program Reason for Removal Assessed as non-restrictive Assessed as non-restrictive 52 Roads and Ports Repealed by the Transport Acts (Amendment) Act 1997 53 Roads and Ports Repealed by the Transport Acts (Amendment) Act 1997 54 55 Roads and Ports Roads and Ports and Conservation and Land Management Roads and Ports and Fair Trading Transport Transport Transport Repealed by the Transport Acts (Amendment) Act 1997 Assessed as non-restrictive 56 57 58 59 Assessed as non-restrictive Act repealed Act repealed To be repealed in the 1999 Autumn session. 60 Transport Repealed by the Transport (Amendment) Act 1998. 61 Treasurer 62 Snowy Mountains Hydro-Electric Agreements Act 1958 Treasurer The Act has been very substantially amended over the past two years in order to progress reform of the industry and to facilitate privatisation. These amendments were subjected to the Competition Policy Test. The Act is expected to be repealed upon proclamation of the legislation corporatising the Snowy Mountains Hydro Electric Scheme. This legislation has been passed in Vic, NSW and the Commonwealth but proclamation has been delayed pending satisfactory resolution of environmental and other concerns. 61 Second Tranche Report Volume II No. 63 64 65 Legislation Business Franchise (Tobacco) Act 1974 Energy Consumption Levy Act 1982 Electric Light & Power Act 1958 Portfolio Treasurer Treasurer Treasurer Section 5: Legislation Removed from the Review Program Reason for Removal Following High Court ruling on excises the licensing provision of this Act no longer operate and the Act will be repealed. Repealed by the Gas Industry (Amendment) Act 1997. Repealed by the Electricity Safety Act 1998. 62 Section 6 New Legislation that Restricts Competition (other than that implementing a Government response to an NCP Legislative Review) 63 Second Tranche Report Volume II No. Legislation Alpine Resorts (Management) Act 1997 Building (Plumbing) Act 1998 Drugs Poisons and Controlled Substances (Amendment) Act 1997 Electrical Safety Act 1997 Fisheries (Further Amendment) Act 1997 Gas Industry Act 1998 Gas Safety Act 1997 Hire Purchase (Amendment) Act 1997 Introduction Agents Act 1997 Legal Practice (Amendment) Act 1998 National Parks (Amendment) Act 1997 National Parks (Amendment) Act 1998 Parks Victoria Act 1998 Police and Corrections (Amendment) Act 1997 Road Safety (Amendment) Act 1998 Shop Trading Reform Act 1996 Transport Acts (Amendment) Act 1997 Travel Agents Regulations 1997 Wildlife (Amendment) Act 1997 Section 6: New Legislation that Restricts Competition Portfolio Conservation and Land Management Planning and Local Government Agriculture and Resources Treasurer Agriculture & Resources Treasurer Treasurer Fair Trading Fair Trading Attorney-General Conservation & Land Management Conservation & Land Management Conservation & Land Management Police and Emergency Services Roads and Ports Industry, Science and Technology Transport Fair Trading Conservation & Land Management 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 16 17 18 Details on restrictions contained in the above new legislation follow. 64 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Alpine Resorts (Management) Act 1997 Conservation & Land Management Date passed: Assented to on 9 December 1997 Restrictions on Competition Introduced Planning controls may restrict the commercial activities of resorts and the smaller business units within these resorts. Competition Policy Justification In 1983 the Alpine Resorts Act was enacted to establish a common management regime for VictoriaÕs alpine resorts. The Act also established the Alpine Resorts Commission (ARC). The Alpine Resorts (Management) Act 1997 repealed the original Act and replaced it with new legislation which disaggregated the functions of the ARC. It placed some broader regulatory functions, such as land use planning, within the ambit of normal state-wide controls, and other functions, such as day to day operations, within the management of resort-specific management boards. The Crown, as landowner, will continue to be the sole supplier of the resource and resorts will be subject to planning control under the State-wide regime and guidelines issued by the Minister. While these controls operate consistently between resorts, they may place some restrictions on the commercial activities and management of resorts and the smaller business units operated within resorts. The restrictions imposed by Crown ownership and environmental requirements may have some effect on the prices charged within alpine resorts. However, it is considered that the creation of a competitive market between resorts will tend to minimise any impacts. Further, there are benefits to the community from the assurance of sustainable management of the land resource. The alpine resort areas are contained within some of the most environmentally sensitive land areas in Victoria and are consequently best retained in Government ownership. As such, the alternative of relinquishing the Government ownership of the land resource would not be in the public interest. Consequently the benefits of the restrictions outweigh the costs. 65 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Building (Plumbing) Act 1998 Planning and Local Government Date passed: 1998 Restrictions on Competition Introduced Removal of the exemption from licensing or registration of refrigeration mechanics. Competition Policy Justification This exemption was anomalous and could not be justified. The costs and benefits of the regulation of refrigeration mechanics had been fully assesses and it was concluded that the removal of the exemption is justified in the public interest. The benefits to the public of this regulation overwhelmingly outweigh the costs. 66 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Drugs Poisons and Controlled Substances (Amendment) Act 1997 Agriculture and Resources Date passed: Assented to on 21 October 1997 Restrictions on Competition Introduced Authorisations for producers to cultivate, possess and supply low-THC hemp are limited to persons who are determined to be fit and proper. Further, the costs associated with meeting the authorisation criteria and the authorisation application fees may limit entry into the market. Competition Policy Justification Previous provisions of the Drugs, Poisons and Controlled Substances Act 1981 prohibited persons from possessing low-THC hemp without a permit, cultivating low-THC hemp without an authorisation, and manufacturing and selling low-THC hemp products without a licence. Consequently, processed products containing hemp material would have been deemed to be Cannabis within the meaning of the Act. Given that Cannabis fibre can be readily identified in hemp products such as paper and fabric, any person purchasing such products would have been committing the offence of being in possession of a drug of dependence. The Drugs, Poisons and Controlled Substances Act 1981 was amended to remove disincentives to investment in the development of a hemp industry. The amendments exempt from the provisions of the Act, processed hemp products, which do not pose a drug risk or jeopardise the ability to effectively police illegal activities associated with Cannabis. They also empower the Minister for Agriculture and Resources to authorise and impose conditions on fit and proper persons to cultivate, possess, process and sell low-THC industrial hemp for commercial or research purposes. The amendments increased competition by deregulating the sale and possession of processed hemp products which do not pose a drug risk. However, authorisations to cultivate, possess and supply low-THC hemp are limited to persons who are determined to be fit and proper persons on the basis of documented evidence, including a national police records check, and those who can provide documented evidence of bona fide research plans or a commercial end use for their products. Costs are imposed on potential market entrants in meeting the criteria required for authorisation. In addition to these costs, authorisation application fees are to be imposed to meet administrative costs associated with the scheme. Some producers may view these costs as prohibitive. Restrictions on entry to the market and conditions imposed on the cultivation and disposal of low-THC hemp material and hemp seed ensure that unauthorised possession and use of Cannabis remains an offence which can be effectively policed without costly evidence procedures. They are also necessary to minimise the risk of: · cultivation of low-THC hemp being used as a cover for illegal cultivation of high-THC plants for drug purposes; · low-THC plant material being diverted and sold for drug purposes, with consequent "pay-back" action by purchasers when they discover that it is low-THC material; · low-THC Cannabis becoming naturalised in favourable environments and becoming a serious weed; and · low-THC cannabis varieties reverting over time to high THC levels. 67 Second Tranche Report Volume II No. Restrictions on Competition Introduced Section 6: New Legislation that Restricts Competition Competition Policy Justification There are no alternative means of achieving the desired outcome without statutory restrictions on competition. The economic and social benefits arising from the restrictions would far outweigh the costs to market participants and the community as a whole. Benefits are gained through minimising the risk of criminal activity associated with the production and processing of low-THC hemp. Unregulated production of low-THC hemp would inevitably result in criminals using the low-THC crops as a cover for the production of high-THC Cannabis for drug purposes, with consequent additional high costs of drug law enforcement. This would ruin the opportunity for Victorian farmers to develop a profitable hemp enterprise and the development by processors and manufacturers of domestic and export markets for hemp pulp and manufactured end products. 68 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Electrical Safety Act 1997 Treasurer Date passed: May 1998 Restrictions on Competition Introduced The Office of the Chief Electrical Inspector licences electrical workers and persons contracting with customers to carry out electrical wiring work. Competition Policy Justification The benefits of the restrictions are to enable the easy identification of specific areas of work for specialist licensing and competencies and to encourage high standards of electrical work. The need to ensure safety standards and hence a high level of safe use of electrical goods and safe conduct in the provision of electrical services in the community is paramount. In the event of an electrical accident, the negative externalities placed on the community could be substantial in terms of disruption to households and businesses. Assurance of safety standards also helps overcome an information asymmetry, whereby relatively uninformed consumers (in a technical sense) may be unable to properly assess the safety implications of complex products. Similarly, consumers may be unable to assess the competencies and expertise of electrical tradesmen. In this sense, setting minimum standards of safety for equipment and licensing electrical workers meets consumer protection objectives. It is recognised that there may be some cost to the restrictions in terms of diminished competition. However, it was assessed that the imperatives of assuring public safety and enhancing consumer protection outweighed any anticompetitive element. See above. 2 3 The Office of the Chief Electrical Inspector may introduce provisions enabling identification of specific areas of work for specialist licensing and the competencies required by persons working in those areas; and The Office of the Chief Electrical Inspector may set minimum safety standards for all electrical equipment for sale or hire (or that can be advertised). See above. 69 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Fisheries (Further Amendment) Act 1997 Agriculture & Resources Date passed: Assented to on 22 April 1997 Restrictions on Competition Introduced Limiting the number of commercial fishing licences in particular categories and limiting the total catch for prescribed fisheries potentially restricts competition in the short term. Competition Policy Justification This act amends existing commercial fishing licensing provisions. It limits the number of licence holders and limits some catches to enable the harvesting of fisheries resources to be managed at a sustainable level. It also allows for other uses of the resource (eg recreational fishing). Such regulation is considered necessary to ensure sustainable commercial harvesting of those fisheries concerned. Without these restrictions, fisheries would be over exploited and subsequently collapse. A major review of the Fisheries Act 1995, including the amendments made under this Act, is being undertaken in 1999. 70 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Gas Industry Act 1998 Treasurer Date passed: November 1998 Restrictions on Competition Introduced Licenses issued to a retailer may be made subject to a condition requiring the licensee to meet specified standards in relation to the supply of gas. Competition Policy Justification The benefits of the restriction are that all customers in Victoria have a safe supply of gas and that there is a smooth transition for customers as the industry is reformed and privatised. It is paramount to the successful operation of industry that peak deliverability standards for gas supply can be met. Unlike electricity, significant safety and operational issues arise from an interruption to gas supply. In addition, the continuation of the requirement will be at the discretion of the Office of the Regulator General. If, having regard to the competitiveness of the market, the ORG considers the measure inappropriate, the measure can be removed. The measure should, therefore, be seen as predominantly transitional, to preserve the safe supply of gas in the move to a competitive market. Although it is acknowledged that there are costs associated with this measure (namely the inhibition of competitive behaviour of gas retailers), it is considered that the benefits of the restriction outweigh the costs. 71 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Gas Safety Act 1997 Treasurer Date passed: December 1997 2 Restrictions on Competition Introduced Equipment that may be sold or installed must be approved as meeting safety standards set by the Office of Gas Safety. Under certain circumstances, customers are able to develop their own safety standards and use safety equipment which matches the particular risks of their own organisation. Persons carrying out upstream gas work must be approved by the Office of Gas Safety. Approval criteria are educational and experience appropriate to the work. Competition Policy Justification The new legislation was introduced to accompany the introduction of competition in the supply of gas. Previously, the government Ðowned entities had been responsible for the safe supply of gas. The benefits of the new legislation are to maintain public confidence in the safe supply of gas under the new competitive arrangements governing the supply of gas. Ensuring high safety standards in the provision and installation of gas equipment is the main benefit from the restriction. The sale or installation of faulty gas equipment could potentially result in significant externalities for the community. The costs of the restriction include, arguably, restricted choice, higher prices and lack of competition on the supply side. These benefits were assessed to outweigh these costs. See above. 72 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Hire Purchase (Amendment) Act 1997 Fair Trading Date passed: Autumn 1997 Restrictions on Competition Introduced Retains the principal ActÕs special consumer protection measures for new hire-purchase agreements for farm machinery for two years, (while removing all other new hire-purchase agreements from coverage). Competition Policy Justification There is benefit in continuing to use the Act to address rural sector difficulties in relation to hire purchase for two years while a more comprehensive policy is developed in relation to finance in the rural sector. 73 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Introduction Agents Act 1997 Fair Trading Date passed: Spring 1997 Restrictions on Competition Introduced Imposes disclosure requirements and a cooling-off period. Competition Policy Justification Regulation was only introduced after other forms of intervention had demonstrably failed to correct problems in the market for introductory services: large advance payments were frequently being extracted for services which did not meet the expectations created in clients; consumer complaints were not being heeded, and civil action by aggrieved consumers was not deterring further malpractice. The benefits of better informed consumers and reduced consumer loss due to poor service delivery following advance payments outweigh the compliance costs imposed. No less restrictive alternatives would achieve the objective of deterring dishonest operators and promoting effective competition in the industry. See above 2 Restricts the acceptance of advance payments to 30% of the total contract price. Provides for certain operators to be excluded from the market (negative licensing). 3 See above 74 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Legal Practice (Amendment) Act 1998 Attorney-General Date passed: Spring 1998 Restrictions on Competition Introduced Retention of statutory mutual fund monopoly on supply of compulsory professional indemnity insurance for solicitors. Competition Policy Justification The benefits of lower and more stable premiums outweigh the costs flowing from reduced incentives for product innovation and tailoring to different solicitorÕs needs (and those of their clientele). In addition the objectives of comprehensive cover for legal service consumers, and access to the services of sole and small firm practices, cannot be met without restricting competition. See Volume I for further information. 75 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 National Parks (Amendment) Act 1997 Conservation & Land Management Date passed: Assented to on 22 April 1997 Restrictions on Competition Introduced The reservation of areas as national parks may preclude certain activities, such as mining and forestry, which may otherwise be permitted. Competition Policy Justification The National Parks Act 1975 provides for the reservation, protection and appropriate use of certain areas of Crown land. Various activities, such as mineral exploration, mining and timber harvesting, are mostly not permitted in areas reserved under the Act depending on special provisions and the category of the park. The National Parks (Amendment) Act 1997 reserved an additional 23,000 hectares of Crown Land under the National Parks Act and changed the status of several parks already reserved under the Act. Included in the new reservations is land at Arthurs Seat. The Act also provides for the existing Arthurs Seat chairlift to run its term and for the Minister to grant a new lease to the successful tenderer upon its expiry. The reservation of areas as national parks may preclude certain activities which may otherwise be permitted. However, as the mining and forestry sectors have access to resources from elsewhere, the impact on competition of this restriction is minor. Further, the reservation of additional areas under the National Parks Act will provide long term statutory protection to significant parts of the StateÕs natural and cultural heritage. The exclusion of activities that may negatively impact on those values is necessary to achieve this protection. There are no workable alternatives to this statutory restriction. The non-reservation of land does not provide the long-term and accepted statutory protection which reservation under the National Parks Act provides. Any new tenancy of the Arthurs Seat chairlift will be open to competitive tendering. However, providing for a 20year lease may be considered to have some impact on competition by restricting the frequency of which firms can compete to enter the market. The potential restriction is justified as the operation of a chairlift at Arthurs Seat State Park requires a tenancy provision to be included in the Act and the 20-year lease ensures that appropriate private sector investment in the facilities can be attracted. 2 The provisions relating to the tenancy of the Arthurs Seat chairlift provide for a 20-year lease. This may be considered to have some impact on competition by reducing the opportunities for firms to compete to enter the market. 76 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 National Parks (Amendment) Act 1998 Conservation & Land Management Date passed: Assented to 4 November 1998 Restrictions on Competition Introduced The Act restricts the provision of park management services to one provider. Competition Policy Justification This Act includes provisions that will empower the Secretary to the Department of Natural Resources and Environment to enter into an agreement with Parks Victoria only for the management of land under the National Parks Act. This is considered a deemed restriction as it limits the provision of services to one provider. Areas reserved under the National Parks Act have special environmental attributes that require expert and careful management. The proposal aims to ensure that all of these areas are managed by the StateÕs expert management authority (Parks Victoria) to ensure consistent and appropriate management across the state. The Government considers that the alternative of allowing other service providers to manage national parks would not provide adequate protection of these parks and their resources. Further, given the environmental management expertise required for these areas, the opportunity for other providers to enter the market is considered limited. The private sector can, and does, provide a range of secondary services in these areas. 77 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Parks Victoria Act 1998 Conservation & Land Management Date passed: Assented to 26 May 1998 Restrictions on Competition Introduced The merger of the National Parks Service (NPS) and Melbourne Parks and Waterways (MPW) potentially restricts competition by reducing (by one) the number of potential providers of park management services and giving Parks Victoria an advantage compared to other providers. Competition Policy Justification Parks Victoria was established in 1996 by combining NPS and MPW. The main purpose of the Parks Victoria Act is to establish Parks Victoria as a statutory corporation. The benefits of this potential restriction outweigh the costs as the formation of Parks Victoria allows for the skills and resources of the two leading and complementary, park management agencies to be combined to deliver an enhanced service to the State. The alternative of retaining MPW and NPS as separate organisations would be less efficient and impede resource re-allocation for the benefit of the StateÕs national parks and conservation reserves. 78 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Police and Corrections (Amendment) Act 1997 Police and Emergency Services Date passed: Autumn 1997 Restrictions on Competition Introduced Pursuant to a national agreement between Police Ministers only certain persons may use body armour. These are: · classes of persons specified by order of the Governor in Council (the military, enforcement personnel, licensed security agents) may use specified types of body armour; and · individuals approved by the Chief Commissioner of Police for temporary purposes (e.g. witnesses, stalking victims, persons attending dangerous situations) Competition Policy Justification Exemptions will be available for authorised users and export markets, which largely covers the existing market for body armour. The amendments implement an agreed national approach, so there will be no effect on competition between suppliers in different States. The benefit to the community of restricting the availability of body armour to persons requiring it for recognised purposes and preventing criminals gaining access to it is considered to outweigh any negative impact on activity in this market. 79 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Road Safety (Amendment) Act 1998 Roads and Ports Date passed: 1998 Restrictions on Competition Introduced The introduction of the registration scheme with mandatory minimum standards restricts competition by imposing additional costs on entry to the market for the provision of driving instruction for hire or reward and by excluding potential entrants who do not meet the standards. Competition Policy Justification The costs relate to the requirements to attain minimum competency standards and to undergo criminal and driving record checks and to the administration of the scheme by a Government agency. However, the overall public benefits outweigh the compliance costs. 80 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: Shop Trading Reform Act 1996 Industry, Science and Technology Date passed: October 1996 Note: The Shop Trading Act 1987 and the Capital City (Shop Trading) Act 1992 were listed for review in the Victorian Government Timetable for Review of Legislative Restrictions on Competition of June 1996. The review period was listed from July 1996 to January 1997. However, the Government undertook a review of shop trading laws before these dates and before the release of the Victorian Government Guidelines for Review of Legislative Restrictions on Competition under a commitment given to the community prior to the March 1996 election. The Shop Trading Act 1987 and the Capital City (Shop Trading) Act 1992 were listed for review in the Victorian Government Timetable for Review of Legislative Restrictions on Competition of June 1996. The review period was listed from July 1996 to January 1997. However, the Government undertook a review of shop trading laws before these dates and before the release of the Victorian Government Guidelines for Review of Legislative Restrictions on Competition under a commitment given to the community prior to the March 1996 election. The major restriction to competition removed by the new Act was the repeal of times in which shops could not trade. These times included Sundays, public holidays and the hours on a Saturday between 5.00 pm and midnight in metropolitan areas and 1.00 pm and midnight in non-metropolitan areas. No. 1 Restrictions on Competition Introduced The only times that shops, except exempt shops, are now not permitted to trade are on Christmas Day, Good Friday and Anzac Day until 1.00 pm. The new Act also provides that a municipal council may make a local law requiring shops, other than exempt shops, to close on Sundays or between certain hours on Sundays. Competition Policy Justification The restriction is minimal. 2 Such a local law can only be made if a poll is conducted and carried in the local area. 81 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Transport Acts (Amendment) Act 1997 Transport Date passed: 1997 Restrictions on Competition Introduced The provisions introduced in this amendment do no restrict competition, with the exception of the amendments to the Public Transport Competition Act 1995 relating to accrediting hire and drive and courtesy bus services. Competition Policy Justification These restrictions were justified on public safety considerations. 82 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Travel Agents Regulations 1997 Fair Trading Date passed: January 1997 Restrictions on Competition Introduced Prescribed qualifications for managers of travel agency offices. Competition Policy Justification The prescribed qualifications are minimal but provide some assurance that bookings made through a travel agent will not miscarry due to incompetence on the part of the agency and that the national compensation fund remains viable. The Travel Agents Act 1986 and these regulations are currently subject to a national review. 83 Second Tranche Report Volume II Section 6: New Legislation that Restricts Competition Legislation: Portfolio: No. 1 Wildlife (Amendment) Act 1997 Conservation & Land Management Date passed: Assented to on 2 December 1997 Restrictions on Competition Introduced Limitations to the number of permits made available to whale and dolphin tour operators in Port Phillip Bay. Competition Policy Justification Limiting the number of permits for whale and dolphin tour operators restricts entry into the dolphin tour market. However, this restriction is justified on the grounds of protecting the welfare of the animals and maintaining sustainable tourist access. Too many tour boats in close vicinity of dolphins in the Bay are likely to stress the animals and encourage their departure from the Bay. This in turn would result in the collapse of the industry. Consequently there are no alternatives to restricting entry into this market. 84