BUILDING a stronger and more resilient economy is the focus of the House of Representatives Standing Committee on Economics’ new inquiry into promoting economic dynamism, competition and business formation.

The inquiry will examine how encouraging healthy competition, stimulating the creation of more businesses and fostering entrepreneurship can enhance the well-being of Australians.

Committee chair Daniel Mulino MP said there had been two significant inquiries into competition over the past few decades – the 1993 Hilmer report and the 2015 Harper review.

"The committee does not plan to go over old ground," Dr Mulino said. "The economy has changed significantly over the past decade or so, particularly in digital technology and disruptive new technologies. We need to ensure we are harnessing this technology in the best way in the interests of consumers."

Dr Mulino said that while new digital technologies and approaches could be a very effective way to increase competitive tension, they could also create regulatory challenges.

"The committee will also investigate the continued market power of the Big Four banks, especially in the area of mortgages, retail deposits, and loans to small and medium enterprises, and whether more can be done to encourage competition through changes to macroprudential arrangements or other measures.

"In recent decades Australia’s productivity growth has stalled. The committee will examine the extent of market concentration, the fall in the establishment of new enterprises, the increase in mark-ups, and reduction in job mobility—and whether these have contributed to a decline in economic dynamism," Dr Mulino said.

The pandemic and the war in Ukraine had challenged supply chains and a diverse and dynamic business environment was one answer to that problem, he said.  

"It is also timely that as a committee we explore economic plans that better equip Australia in the face of global uncertainty. As the nation emerges from the pandemic it is critical that we renew our focus on competition and business dynamism, to boost our productivity and for the benefit of all Australian workers and consumers."

Dr Mulino said the committee "would scrutinise the extent to which the consolidation of market power had undermined productivity, stifled wages, created more fragile markets and led to higher mark-ups".

The committee will also examine:

• the degree to which anti-competitive behaviour and economic barriers — regulatory, as well as restrictions on access to finance, infrastructure, suppliers, customers, and workers — contribute to rising market concentration, and
• international examples of best practice and innovative policies that demonstrate how Australia could lower economic barriers to competition and business formation, further limit anti-competitive behaviour, and better manage changes in industry structure that affect market power.

The committee is seeking submissions addressing some or all of the inquiry terms of reference from interested groups and individuals by Friday March 31, 2023. Submissions can be made online via www.aph.gov.au/economicdynamism.

More details about the inquiry, including the full terms of reference, are available on the committee’s website.

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SCRUTINY of Australia’s four major banks -- Commonwealth Bank, ANZ, National Australia Bank and Westpac -- will continue, with the House Standing Committee on Economics to hold public hearings at least annually with bank executives.

Daniel Mulino MP, the chair of the committee, said given the banks’ key role in the functioning of the economy, ongoing scrutiny was vital.

"The Financial Services (Hayne) Royal Commission, which reported in 2019, showed that far too often the banks did not live up to the trust that Australians placed in them," Dr Mulino said.

The committee will consider a number of consumer protection issues, including:

• The financial position of borrowers and areas of potential vulnerability
• Interest rates paid on deposits and loans
• Ongoing implementation of recommendations from the Financial Services Royal Commission, and
• Actions to protect customers from scams.

Other matters that will be raised include:

• Supporting the flow of credit, including to small businesses
• Operational performance, and
• Responses to climate change and supporting Australia’s progress towards climate and other sustainability goals.

"And when it comes to scams, with evidence showing that Australians lost more than $2 billion to scams in 2021, a record amount, we need to hear what extra consumer protection the banks are planning," Dr Mulino said.

Dr Mulino said the government continued to work on implementing the recommendations of the Hayne Royal Commission and that the committee was keen to hear from the banks on their responses.

The banks will also face scrutiny by a parallel inquiry into competition to be held by the Economics Standing Committee. The inquiry into promoting economic dynamism, competition, and business formation will examine how healthy competition can enhance the wellbeing of Australians.

The terms of reference for the hearings into the Big Four banks are available on the committee’s website. Information about public hearings will be made available in due course.

The committee will not be seeking or accepting submissions for this inquiry.

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THE Joint Standing Committee on Implementation of the National Redress Scheme is currently inquiring into the operation of the scheme.

The inquiry will look closely into a range of areas, including The experience of First Nations applicants and applicants with disability in their dealings with the scheme; and accessibility, performance and effectiveness of support services and legal advice for survivors and their advocates.

Submissions from interested individuals and organisations on the inquiry’s terms of reference are encouraged by Monday, February 27, 2023.

The committee wants to hear from individuals and organisations on their experience with the scheme. Submissions can respond to some or all aspects of the inquiry terms of reference.

Full details of what the inquiry will examine can be found in the terms of reference on the committee’s website. An easy English guide is also available.

Chair of the committee, Senator Catryna Bilyk said it was imperative that the committee heard first-hand the experiences people have had when accessing the scheme.

“There are low rates of access in parts of our community amongst people who are eligible to access the scheme,” Senator Bilyk said. “We need to understand what the barriers to access are to ensure that everyone who is eligible to seek redress does so."

Further information about the Committee is available at https://www.aph.gov.au/redress.

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THE Joint Standing Committee on the National Capital and External Territories will examine restoring local government on Norfolk Island as part of a new inquiry.   

The committee will examine different models of local government and revenue collection to determine the most appropriate approach that accords with the culture of Norfolk Island and provides for a financially sustainable future.

“This inquiry is about the future of Norfolk Island, its governance and economic sustainability,” committee chair Alicia Payne MP said. “Most importantly, the inquiry is focused on improving democracy for people on Norfolk Island.

“The views of the local community will be central to this process,” Ms Payne said.

The committee plans to visit Norfolk Island over the coming months to hear directly from Norfolk Islanders about what they would like for their community. People seeking to participate in the inquiry can engage with the Committee in a number of ways including by making a submission, at an upcoming public meeting or confidentially.

Submissions to the inquiry will remain open until March 24, 2023. Further information on the inquiry, including the terms of reference and how to contribute, is available on the committee’s website.

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