Fels said the consumer watchdog needed more power,and that competition law should be strengthened. Ideally,he said,a law should be introduced that would allow the Australian Competition and Consumer Commission to break up big businesses where a court had found there was a serious breach of competition law.
“Changes to the competition law could be done very quickly,” he said. “That could be done,introduced into parliament within two or three months.”
The ACCC is restricted in what it can investigate,and there is no set of government policies on excessive pricing. Fels said that must change,and it could be legislated within months if the government was willing to address the issues.
He said Qantas dominated the nation’s airline duopoly,and the airline’s price rises coupled with fewer services had economy-shifting effects.
“Qantas’ ability to reduce supply while increasing prices,and suffering no material loss of market share,may have affected CPI[inflation] in December 2022,and therefore may have impacted the Reserve Bank’s inflation expectations and rate increases,” Fels said in the report.
He saidthe Department of Infrastructure should use its review of the sector to remove “unnecessary restrictions” on competition in domestic and international aviation.