2018-03-06 S&O Agenda - Attachment 1 to Item 2 - Public Interest Test Report

Noosa Council - Public Interest Test Report: Proposed Local Law No. 7 (Waste Management) 2017
                                                                                                                                                   36



Table 2 – Key matters and responses

 Issue 1 – The proposed local law is anti-competitive as it allows Council to create a monopoly over commercial waste collection
 services and will result in higher prices for consumers without a commensurate increase in quality or innovation.
 Council response:
Attachment A to the Public Interest Test Plan (the Plan) provides a list of the likely anti-competitive provisions included within the proposed
local law. The provisions replicate the current heads of power the Council has under the Environmental Protection Regulation 2008 and the
Waste Reduction and Recycling Regulation 2011, (the Acts). To the extent that the provisions of the proposed local law are anti-competitive,
Council is undertaking a review of the anti-competitive provisions in compliance with the requirements of the Local Government Act 2009 and
the Local Government Regulation 2012.
It was also stated in the responses received that the proposed local law violates the competitive neutrality principle. In that regards:
       Waste Services is considered a significant business activity for the purpose of section 45 of the Local Government Act 2009 (the
        LGA). Under section 44 of the LGA, the local government can apply the competitive neutrality principle through either
        ‘commercialisation of a significant business activity, or full cost pricing of a significant business activity’. Council applies the
        competitive neutrality principle through Waste Services being a full cost pricing business unit of Council.

       Waste Services applies the competitive neutrality principle in accordance with section 28 of the Local Government Regulation
        2012 (the LGR). The replication of the powers contained within the Acts into the proposed local law has not changed the nature of
        how Waste Services applies the competitive neutrality principle. For clarity, there is no intention on the part of Council to change its
        current approach in providing waste services within its local government area.

The claim that all businesses located in Councils jurisdiction currently pay on average 30 percent more for their waste services is unfounded.
Although some occupiers of commercial premises (most likely businesses considered attractive to private waste collection contractors due to
the volume and/or nature of waste generated) may enjoy reduced service costs under increased competition, for remaining occupiers utilising
Council’s service, service costs would inevitably increase because the same level of fixed costs would need to be recovered from a smaller
collections base. Owners of domestic premises which includes retirees, aged and invalid pensioners, should not be funding these increased
fixed costs which would be avoided by commercial premises serviced by private contractors.