Competition and Consumer Amendment (Australian Energy Regulator Separation) Bill 2025
Senator DARMANIN (Victoria—Deputy Government Whip in the Senate) (18:29): The purpose of the Competition and Consumer Amendment (Australian Energy Regulator Separation) Bill 2025 is quite straightforward. It is clear and specific in its purpose to establish the AER as a standalone Commonwealth entity, separating it from the Australian Competition and Consumer Commission.
Whilst that's a pretty simple and straightforward proposition, and perhaps not as exciting as some of the other bills that we debate in this place, it is absolutely essential for good governance. Unlike Senator Duniam's remarks just then around it being a back-end bureaucratic exercise, we on this side think that good governance is extremely important for our public institutions.
To have better outcomes for families, businesses and industries, we absolutely need good governance to meet the challenges of today and tomorrow. When the AER was created in 2005, it was a very different organisation from what it is today. Then it had just 15 staff and a budget of $6.5 million.
Today it has almost 400 staff, a $96 million budget and the responsibility for enforcing more than three times as many laws, monitoring four times as many participants and regulating 58 retailers. The scale of the AER has transformed, yet its governance structure, still linked to the ACCC, has remained unchanged. The board is currently responsible for regulatory decisions, but the ACCC chair retains authority over staff and funding.
Responsibility and accountability must sit together, and that is long overdue. It's hardly some back-end bureaucratic tidy-up. This reform has been recommended in review after review over more than 10 years—the Vertigan review, the Finkel review and the Energy Security Board review—and it has been unanimously agreed to by state and territory ministers.
Some might say this is long overdue. Most recently, the Senate economics committee also examined the bill and reported strong, broad and consistent support. We heard evidence from both the AER and the ACCC.
The AER want this. The ACCC want this. This bill will bring the governance practices for the AER into 2025, and it will make the AER board the accountable authority and its chair the head of the agency.
The bill will allow the AER to source shared services flexibly, and it will also guarantee that staff can transfer without any loss of pay or conditions under the existing enterprise agreement. What the bill does not do is just as important. It will not alter the AER's core functions.
The bill will not change how its board is appointed, and the bill will not have a negative effect on energy prices. What this bill will do is simply give the regulator the governance structure that it needs to do its job effectively in 2025. The benefits are quite clear and straightforward.
The bill will resolve the disconnect between responsibility for regulatory decision-making and organisational budgetary and governance authority more broadly. It strengthens the AER's culture and also its independence. Importantly, it makes the regulator more agile as it guides Australia through the clean energy transition.
Ultimately, it will deliver better outcomes for consumers, households and businesses alike. Without this reform the AER would remain tied to the ACCC. Its board would continue to make regulatory decisions without control over staff or budgets, which is absurd.
That would mean duplication, inefficiency and weaker results for consumers. The truth is that the AER has outgrown its origins as a small branch of the ACCC. Today it is a regulator of national significance with responsibilities that reflect the scale of the energy transformation that is underway in this country.
This bill is about good governance. It aligns responsibility with accountability, and it gives one of Australia's most important regulators the independence that it needs. Above all, it ensures that Australian households and businesses are served by a regulator that is fit for the challenges ahead.