Acting on a direction by the Minister for Communications, Information Technology and the Arts, Senator Richard Alston, the Australian Competition and Consumer Commission (ACCC) is undertaking a review of the price control arrangements on Telstra, which are administered by the ACCC. The ACCC today released its Discussion Paper for the review.
The ACCC must determine whether there is a need for price control arrangements to continue after 30 June 2001, and, if there still is a need for price controls after this time, the direction requires the ACCC to report on what form future price control arrangements should take.
"The issues to be considered in this review are broad-ranging and complex, and we want as much input from interested parties as possible", ACCC Chairman, Professor Allan Fels, said today.
"Following the Minister's direction, we are particularly interested in determining how the price controls affect users and suppliers of telecommunications services, including the impact on users across different locations and income groups and the effects on investment in telecommunications infrastructure by both Telstra and other industry suppliers.
"An important part of the ACCC's work will be to determine how well developed is competition in the various telecommunications markets and how the retail and wholesale price regulations interact", Professor Fels said.
At present, Telstra is subject to a series of retail price controls. Some of the price controls on Telstra that will be of relevance to this review include a cap on a broad basket of basic services; the requirement on Telstra to cap local calls at 22 cents per call (GST inclusive); and the local call parity requirement which requires Telstra to ensure residential, charity and business customers in non-metropolitan areas pay broadly the same price for untimed local calls as those in metropolitan areas.
Despite the tight schedule for this review the ACCC is seeking the greatest possible public consultation. Interested parties have until the end of October 2000 to make submissions addressing the issues.
After considering these submissions, and conducting the public consultation process, the ACCC aims to release a draft report in mid-to-late December 2000. Interested parties will then be provided with an opportunity to make comments on the draft report by mid-January 2001. The ACCC expects to finalise its review of the price control arrangements by late January 2001, as directed by the Minister.
The requirement for Telstra to provide untimed local calls is found in Part 4 of the Telecommunications (Consumer Protection and Service Standards) Act and this is not included in the review.
Copies of the Discussion Paper are available on the ACCC's website at www.accc.gov.au or by contacting (03) 92901813.