Competition watchdog bites infrastructure critics

<p>The Australian Competition and Consumer Commission (ACCC) has rebutted accusations that it is to blame for Australia’s infrastructure woes &#8211 and points to the Hunter Valley coal industry as an example of its good work.</p> <p>Commissioner Ed Willet said a smear campaign by "certain gas and electricity sector vested interests" is wrong.</p> <p>Mr Willett said the commission-regulated infrastructure had suffered no shortfall in investment but in many cases the regulation had stimulated "very high levels of investment".</p> <p>"Many investment problems have been caused not by regulation, but by a lack of regulation in some areas of monopoly infrastructure," Mr Willett said.</p> <p>The Hunter Valley was one example where access regulation was promoting further investment, he said.</p> <p>"The ACCC is working with coal miners, rail service providers and the operators of Port Waratah to, initially, limit the costs of existing capacity constraints and, over time, expand capacity by joint investment by coal miners in alleviating capacity constraints," Mr Willett said.</p> <p>The shared funding and use of infrastructure reflected the reasoning behind the Part IIIA of the Trade Practices Act and would bring about higher levels on infrastructure funding and capacity expansion than any "pandering to monopoly interest could ever achieve", he said.</p> <p>"The great irony of this experience is that the infrastructure owners in the Pilbara are among the keenest advocates of share use of infrastructure in the Hunter Valley," Mr Willett said.</p> <p>There are similar examples in the shared development of 3G (third generation) mobile phone infrastructure improving both investment and competition outcomes.</p> <p>While monopoly control of copper wire network continues to require heavy regulation to promote investment in dependent infrastructure, the commission said.</p> <p>Two simple lessons can be learned from these examples the commission believes:</p> <p>&#8226 Shared use of infrastructure is likely to promote greater investment in monopoly infrastructure and lead to better market outcomes than monopoly control and</p> <p>&#8226 Regulation under Part IIIA might be necessary to facilitate access to the infrastructure, including funding capacity expansions and address monopoly problems.</p> <br />