Sunday, October 06, 2013

To regulate or to deregulate - that is the question...

Communications Minister Malcolm Turnbull appeared on ABC's Insiders today.  In the midst of semi-predictable gumph about the NBN there was a short exchange about the Government's deregulation agenda.  Mr Turnbull said;

Well, we have got an overall policy right across the government of cutting regulation and red tape and both telecommunications and the media, the broadcast media, obviously, are very heavily regulated. What we are undertaking or commencing now is a study of the level of regulation, so the question is what objectives, what is the policy objectives these regulations seek to serve? Is that objective relevant any longer? If it is not, the regulation should go. If it is still relevant, can we achieve the objective more cost effectively?
I am very focused on reducing the cost of doing business in my area and all of my ministerial colleagues are doing the same thing in theirs.
His colleague, the Minister for Foreign Affairs Julie Bishop meanwhile was having a good old spray, reported in the Sunday Tele and other News Corp papers by Sam Maiden, about mobile roaming charges.  Ms Bishop said:
Since I have been travelling more extensively, I have received some extraordinarily high bills for global roaming, running into the thousands and thousands of dollars. [The regulator should] have the power to carry out a market investigation but also to determine what was a reasonable price.  In Australia I understand that we actually need to enhance the ACCC's powers. I will be talking to Malcolm Turnbull about this.
Ms Bishop was apparently aware of the moves already taken by the ACMA - at the direction of the former Government - to insist travellers are informed of the cost.  Despite this Ms Bishop seems to still have been shocked by her bill.

Ms Bishop praised the approach of New Zealand and suggested they had seen good results from a threat to regulate.  She might like to note that the "threat" was made bilaterally by PMs Gillard and Kay in February 2013.

She might also note that the Gillard Government proposed to bring this legislation forward in the Winter sitting period, appearing on the list as

Telecommunications (International Mobile Roaming) Bill
-          amend telecommunications legislation to clarify that international mobile roaming services are services that can be regulated where reciprocal arrangements apply with another country
Reason for legislation:  to implement coordinated action with New Zealand on measures to address the prices to consumers of trans-Tasman mobile roaming
 By recollection the Bill wasn't introduced in June, but it should be already prepared.

So the challenge for Mr Turnbull is whether he dusts off the Bill and introduces it in the first sitting week of the new Parliament - or whether he decides that is not a good look with the overall deregulatory flavour.

Note:  the case is a fascinating one in regulation theory, because the market position with high roaming charges is stable...there is no simple way for competition to solve the problem.

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