ALI MOORE: Well we know, because of a leak to Channel Nine, that the Federal Government rejected advice from not one, but four of its own departments, and of course at least one minister, and went with the ACCC. The Government department advice about FuelWatch was warning that it could in fact lead to increased prices. Lindsay Tanner is the Federal Finance Minister.
Lindsay Tanner, what does it say about your confidence in the bureaucracy. Four departments, including your own, all rejected in favour of the ACCC.
LINDSAY TANNER: Ali, it doesn't say very much at all. What you need to understand here is that the advice in each case, consisted of about one page. It's a commentary that all cabinet submissions have, from any department that wishes to comment on it, before it comes to cabinet. And it's quite common to get different views expressed in that commentary, conflicting views, often, and it's not unknown for departments to put forward a view that their own minister disagrees with. I haven't agreed with everything my department has put forward, for example. You put that on one side, literally, four pages, and on the other, hundreds of pages of ACCC research, modelling, and very forceful advocacy on the part of the expert body that's in charge of these issues, and we weighed up all these things.
It's a difficult issue. It's not an obvious answer here. We weighed up all these things and came down firmly of the view that FuelWatch was the way to go.
ALI MOORE: At the same time, if the Government departments didn't do any modelling or any real analysis, how did they come up with their conclusions. I mean, your own department, for example, said, quote, may result in higher average petrol prices over time.
I mean, they didn't pick that out of thin air.
LINDSAY TANNER: Well, the operative word there, Ali, is may. That's the crucial word. In other words, they're doing an analysis, a quick rough analysis based on their understanding of these issues. And of course, other departments have made similar comments. But this is simply part of the deliberative process of government, where different public service departments put forward thoughts, put forward views, that are not based, necessarily, on detailed research or inquiry into the issues, but simply based on their existing knowledge and view about the world and about the area that's involved, and it's very helpful because it helps to raise lots of different questions when you're dealing with these issues.
But it's not uncommon for that advice to be rejected. And as I say, it's not uncommon for there to be conflicting opinions between departments and even a department having a different view from their own minister.
ALI MOORE: But given that there's not just conflicting opinions between departments, there's also widespread debate among, for example, in Victoria, the RACV is adamant that it's not going to help. And given that putting it into context, we're talking about, around, $74 saving a year for a family, why pursue it?
LINDSAY TANNER: $74 for a lot of families actually matters, Ali. It's quite a significant saving. The only...
ALI MOORE: But that's only if you're right. And many people say you're wrong.
LINDSAY TANNER: The - well, yeah. Many people in the Liberal Party actually say we're right as well. It's an interesting issue that is producing divergent opinions right across the country. The New South Wales Leader of the Liberal Party supports the scheme. It was introduced by a Liberal Government in Western Australia, and we had a Liberal Senator, Judith Adams, only a day or two ago saying that she supported the scheme. So it is producing divergent views. There are motoring clubs and organisations in other parts of the country that have a different view from the RACV.
We believe that its worth pursuing. We don't see it as a magic bullet that's going to solve petrol price problems. We do think that, you know, $70, $75 a year does actually matter for ordinary motorists, and the research by the ACCC suggests that the effect of the scheme in Western Australia has been to, on average, lower prices by up to two cents a litre, compared with where they would have been.
Now this is very difficult stuff. It's not easy to prove these things. It's all debatable and disputable, inevitably, because there are all kinds of things that influence petrol prices.
ALI MOORE: So you were saying there that it is possible the ACCC is not right, and that others are right? That you're not going to hang your hat on this 1.9 cents? You're not going to guarantee it?
LINDSAY TANNER: It's one of the unfortunate realities of human existence and government that on the issues that you make decisions on, there are usually no certainties. You don't confront a question with an option that says it is absolutely certain there is no possibility of anything different happening from what we are saying will happen. That is the case with most government decisions. You have to make judgements based on the evidence before you, based on the advice you've got, as to what you think is the best policy position.
The ACCC has been very persuasive on this issue. They have done a lot of detailed work. A lot of serious analysis of the Western Australian scheme.
ALI MOORE: But Lindsay Tanner, do you fill up the family car on a Tuesday? Do you like Tuesday cheap days? Are you going to miss them?
LINDSAY TANNER: I don't fill up the family car on any specific day because my driving patterns are erratic, Ali, because of course I'm out of Melbourne so much that...
ALI MOORE: But you can understand those who like cheap Tuesday.
LINDSAY TANNER: Look, time will tell as to what the impact will be in terms of the smoothing of prices. The key thing is that consumers will get more information. They will have a greater ability to shop around. They will have greater opportunity to make choices to go for the lowest possible prices. We believe it will put downward pressure on prices on the margins. It's not going to suddenly change $1.50 a litre to $1.10 a litre. Nobody is claiming that.
But we believe, on balance, in net terms, it will be helpful for consumers, and it will have an impact downward on prices for people at the pump.
ALI MOORE: Minister, this is your second leak from the government. You've got four department briefs that are - you know, they might be one page, but they're now leaked. What does it say about the integrity of the Cabinet process?
LINDSAY TANNER: Look, it's obviously very disturbing when leaks occur, but its hardly unusual over the years to...
ALI MOORE: Are the police being called in?
LINDSAY TANNER: See the - look, I can't answer that, Ali, because I'm not responsible for those matters. But it's hardly unusual for leaks to occur in government. Over the years, from time to time, we've seen them happen. Obviously, it's unfortunate, and we are concerned about that. But inevitably, even within the Cabinet process, there is a substantial number of people who have access to documents - ministers, their staff, the various public servants involved.
So there is always going to be some degree of risk. Sometimes things happen inadvertently, even, so these things are a fact of life. It is very worrying that it has occurred in this instance, and obviously, everything possible is done to ensure that these things don't occur. But I don't think we need to be distracted from the business of governing the nation because of it.
ALI MOORE: I think it might be too late for that, but Federal Finance Minister Lindsay Tanner, thanks for joining us this morning.
LINDSAY TANNER: Thanks very much Ali.
ALI MOORE: Lindsay Tanner there. We are talking FuelWatch.
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