Prices oversight

Essential Services Commission

In Victoria, the Essential Services Commission (ESC) is the independent economic regulator established by the State Government to regulate prescribed essential utility services supplied by the electricity, gas, ports, grain handling and rail freight industries, as well as regulation of aspects of the transport and insurance industries. Since 1 January 2004, the ESC also has a role in price regulation for Melbourne Water, the fifteen regional urban water authorities and the five rural water authorities (excluding catchment management authorities).

Established in January 2002, the ESC replaced the Office of the Regulator General as the economic regulator of Victoria’s utility services. Its objectives are to promote the long-term interests of the Victorian community.

In performing its advisory and regulatory functions, the ESC is required to act in a manner that provides incentives for dynamic, productive and allocative efficiency and promotes the long term interests of Victorian consumers.

In March 2008, amendments to the Essential Services Commission Act 2001 introduced several improvements including:

• introducing a simpler legislative framework;
• refining the objective;
• revising and recasting the facilitating objectives as matters the Commission is to have regard to when undertaking its functions;
• providing the Commission with the power to make codes and impose appropriate penalties for their breach;
• clarifying that the Commission is able to inquire into any matter referred by the Minister for Finance in consultation with relevant Ministers, and provide that when conducting inquiries into industries that are not regulated, the Minister for Finance is to determine the information powers available to the Commission;
• standardising the powers and penalties available to the Commission across the ESC Act to reduce the regulatory burden and increase regulatory certainty;
• providing the Commission with powers to access information from regulated and related third parties, and clarify processes and decisions on the release of commercial-in-confidence information;
• introducing a proportional penalty framework; and
• introducing new provisions relating to access regimes to ensure that, as agreed at the Council of Australian Governments, regulation of Victorian regimes is consistent with the nationally-agreed approach.

Australian Competition and Consumer Commission

The Australian Competition and Consumer Commission (ACCC) has three price oversight functions under Part VIIA of the Trade Practices Act 1974 that are applied to all other industries in Victoria which have been placed under price surveillance:

• to assess and approve or object to the proposed price rises of any business organisation placed under prices surveillance;
• to hold inquiries into pricing practices and related matters and report the findings to the responsible Commonwealth Minister; and
• to monitor prices, costs and profits of an industry or business and report the results to the responsible Commonwealth Minister.

Postal services of Australia Post and some aviation services are currently declared for prices surveillance by the ACCC.