It benefits the 23,000 businesses that operate as independent motor vehicle maintenance outfits and repairers. It supports the 150,000-plus workers that are engaged in that sector. But, ultimately, it really benefits Australian consumers and households, because it means that car owners have more choice when it comes to getting their car repaired or maintained.
Mr Wilson (4:38pm) – I’m pleased to speak in support of the Competition and Consumer Amendment (Motor Vehicle Service and Repair Information Sharing Scheme) Bill 2021 and to acknowledge, as the previous speaker did, the work that the member for Fenner has done on this issue over a period of time, considering the kinds of changes that were needed and how they might be framed and advocating for them in the media and in the public domain. I think it was good that the member for Cowper acknowledged that work, and it would be good if we could do that a bit more often in this place. There are a lot of things the parliament achieves through collaborative effort in the committee process and we probably don’t draw attention to that enough, and that contributes to the view that people have that we all just shout at each other and don’t apply ourselves always in the best spirit for the purpose that we are here to serve, which is to improve things for the women and men of Australia.
But this is an important change, because it essentially takes away what could be rightly described, up to a point, as a monopoly. It’s probably better to describe it as an ineffective and obstructive kind of vertical integration. We essentially had a situation where car manufacturers and related dealers controlled access to information that was necessary to allow vehicles to be repaired. They denied the ability for independent repairers to undertake that work. The best way to understand that is by listening to a quote from a member of the industry. In speaking about this some time ago, he said:
The modern motor-vehicle is just basically a computer on wheels. Even simple things like changing a tyre, changing a component on that vehicle, checking the oil level and what have you is all now computerised. And the car companies are controlling the computer gateway into and out of the vehicle and how you communicate with that vehicle. And at the moment, they’re shutting independent local mechanics out.
It started off with intermittent issues on older vehicles, but as each model year has come out, the situation is getting more and more dire. Our industry are having to use workarounds sometimes it might take them four, five hours to find the information for an issue they should have got in 10-15 minutes. That’s a loss of productivity and a loss of profitability.
As the member for Cowper said, in some cases, it has probably resulted in people just not getting their cars repaired. That would have been particularly the case in rural and regional areas, where access to a large dealership just might not be possible—you’ve got your local business in country, rural and regional Australia and you want to get your car repaired but you can’t, because the critical information in the computerised data and the various gateways, as just described, are denied to those businesses.
It absolutely makes sense that we now change from what was a failed experiment. It was a voluntary arrangement that this government wanted to try back in 2014. It didn’t work, as those kinds of voluntary arrangements generally don’t. There’s no natural encouragement for big business, who see a competitive advantage for themselves in squeezing out competitors and making more money as a result. There’s no natural imperative for them to want to change that. If you ask them nicely or leave it to some sort of voluntary arrangement, nothing will really change. It’s time that we made the change mandatory, and that’s what this bill achieves.
Who does it benefit? Of course, it benefits the 23,000 businesses that operate as independent motor vehicle maintenance outfits and repairers. It supports the 150,000-plus workers that are engaged in that sector. But, ultimately, it really benefits Australian consumers and households, because it means that car owners have more choice when it comes to getting their car repaired or maintained. It is a matter of choice. It’s a matter of a fair, open and competitive market. In fact, I’d go a little bit further than that. I’d say that, when it comes to the kind of vertical integration that this bill takes away—the exclusivity of that vertical integration—there’s an argument to be made that we actually want motor vehicles to be looked at by independent repairers; people who don’t have a vested interest in the way that a particular make and model of car works. We know that motor vehicle products, like lots of products, are designed to be fit for purpose, but that’s not always the case. We sometimes find that the airbag or the brakes or something else don’t work. In the case of a motor vehicle, if that’s the reality, the likely outcome is that someone is going to get very badly hurt. I know that the dealers who are associated with manufacturers would undertake their service and repair obligations with the utmost seriousness—I know that’s the case. But it’s actually healthy to have a service ecosystem that includes lots of independent repairers, who may be, on some occasions, just a little bit quicker to pick up on the kinds of inherent faults that need to be addressed on a larger basis. That’s just a matter of having a system that works better, with some better checks and balances, than it might if the only people who are repairing and maintaining cars are the people who are also selling them and essentially depending, for their profits and their livelihood, on those vehicles being seen as problem free. I think that’s another benefit this bill will deliver.
It bears saying, on this issue, that properly effective and fair markets don’t naturally occur. A mistake we make too often, and it’s a view that some people would like us to have, is to think that markets are a bit like the law of gravity or other natural laws—they exist without human influence and the best thing we can do is just let them get on with their inner workings. Markets are created by us. They are something that human beings have brought into existence, and they only work well, and for the ends that we need them to deliver, if we take an active interest in how they’re operating. The reality is that, if you want fair, open and competitive markets, you need to have carefully, rigorously and properly overseen markets, because participants in a market don’t necessarily, as individual entities, have an interest in those things.
If you’re a market participant, you would actually rather get larger, have fewer competitors and dominate the area you’re in, because there’s a whole series of advantages that come from that. So that’s what happens. You get people, in whatever market it is, who try to grow, outdo their competitors—and swallow them up if they can—and get bigger and bigger and bigger. When that happens, all the things that are supposed to help markets deliver efficient outcomes get taken away. As in so many areas of Australian life, you end up with two big players and they reach a relatively comfortable accommodation where they can maximise their own interests, which are not often the same as the interests of ordinary women and men in Australia.
This is a case in point. Of course car manufacturers, with the dealerships they operate and the services they provide, would rather keep that all in-house; they would rather make it part of their large, vertically integrated business. It allows them to control the product, and it allows them to control price. That’s not in the interests of ordinary women and men in Australia, and that’s why we need this market intervention that comes along and says: ‘You don’t get to achieve that market power and inflict that market inefficiency on all of us. We’re not going to have that. You need to provide that information on a fair, open basis so we can have proper competition and the market can do what we need it to do. And you will be paid fairly for that,’ because that’s how the bill works. ‘You have to provide the information, and you’ll be paid fairly for it, but then independent operators get to service the vehicles of people right around Australia, particularly in rural and regional Australia, and they get to have the benefits of that.’
That market issue leads on to a broader issue termed the ‘right to repair’. In a way, this piece of legislation is the first of what I hope will be more instances of government stepping in and seeking to provide an expanded right to repair. There are a range of reasons why that should be the case. There’s a consumer interest in it; we can’t have a situation where companies decide to design a product in such a way that the only choice a consumer has is to buy it, use it until it fails and then buy another one. That cannot be the way that the consumer world works. We cannot allow producers to design their products and then to operate in a way where the outcome is planned obsolescence, on the one hand, and then, on the other, the requirement to simply go and buy a new one because the battery’s dead and you can’t replace the battery. Surprise, surprise—the battery was only ever going to last 18 months. It probably could have been designed to last longer, but 18 months is what the focus group testing told them people would be prepared to tolerate before they’ll have to go and buy a new one.
We can’t allow that to happen. It’s not fair to consumers, but it’s also not sustainable—in every sense. It’s not sustainable for our environment. We can’t just have a linear economy of using raw materials to make products that are thrown into landfill, are burnt or end up in the ocean. We can’t have that in terms of the environmental impact, but, in fact, we can’t have it from the point of view of resource sustainability. There’s just not a limitless amount of stuff in the world. We need to use the materials that are here, at a time when the population is very large and is continuing to grow and at a time when resource consumption per capita is continuing to grow. It’s not some weird Left alarmist statement to say that if we keep going on the path we’re on then we’re going to hit a brick wall or we’re going to run off a cliff, because there simply, logically, isn’t going to be more of everything for the way that we’re using it and wasting it.
The broader concept of the ‘right to repair’ fits within some of my responsibilities as the shadow assistant minister for the environment in terms of waste and recycling, because at the top of that hierarchy is that you reduce waste in the first place. You design goods so that you don’t throw them away if you don’t have to. You use them for as long as possible by repairing them as much as possible and by making sure that they’re designed to be repaired. You ensure that manufacturers are obliged to consider that in their design process and that they make sure there are parts available. We need to make sure that there are processes whereby things within an object that are likely to wear out, which might represent only a tiny proportion of the object itself, can be replaced, rather than having the object designed in such a way that, when the one little thing comes to the end of its functional life, the whole object—the other 98 per cent of that material—just gets thrown away. We need to ensure that that sort of product stewardship gets stronger. Then we need to enable opportunities for other kinds of businesses and waste and resource management participants to be part of ensuring that we waste less, that we reuse more and that we recycle as much as we can those things that can’t be repurposed, repaired or reused, so that, at the end of all of that, we are only left with the barest minimum of residual waste. Obviously there are going to be some things where, because of their hazardous nature or other aspects, we may need to consider something like waste to energy, but that should be for the tiniest, tiniest residue of the productive process.
This fits into that, and I welcome that it’s happening, but it’s disappointing that it’s taking so long. The voluntary arrangement was entered into in 2014. The issues with it were acknowledged in 2017. The Productivity Commission began to have a look at it in 2017 and said that the voluntary arrangement was not working, that the dealers and manufacturers were not cooperating and that independent businesses, including business in my electorate of Fremantle, were not being given access to the information they needed to repair cars for ordinary Australian citizens. Then, in 2018, thanks to the work of the member for Fenner and others on this side of the House, there was a commitment to making the change that we now see. But that was in 2018. It is now 2021, and this won’t be introduced until 1 July.
It would be nice for things like this—which is ultimately being done in a way that, I think, we on both sides of the House agree on—that the issue and the solution could be seen more clearly earlier and that we could make the kind of progress that this bill represents without the seven-year delay that has occurred between 2014 and now. I would like to see the principles at the heart of this bill around the right to repair considered more carefully in the future, and I would like to look at other ways in which we can ensure that we have a much more sustainable approach to resource use and a fairer approach to consumer rights.