Collins Judith; Woods MeganHon JUDITH COLLINS (National—Papakura): I follow on from my good colleague and friend Stuart Smith who's asked some really sensible questions. While the Minister's considering how to answer those perhaps she could also let the committee know where in the world the imposition of price regulation on a commodity product that we now import entirely has ever worked. She might recall that in the COVID lockdown times we actually ended up at the bottom of the supply chain and that we lost supply not only so much of fuel but also of many commodities where we were the last ship coming in. All our ships went off to Australian ports rather than ours because they had more cargo on board. What's the guarantee that price fixing by the Commerce Commission would actually not lead to some commodities such as fuel suddenly not turning up when it should?I would have thought that given that the Government has decided in its—I would have said wisdom" but that's just too generous—has decided on a whim to end the offshore oil and gas exploration and to allow the Marsden Point refinery to close without a whimper—not even a whimper the company told me. But they are actually now putting us in a difficult position of saying "And now we're going to be one of the very few liberal democracies in the world that thinks that a commerce commission a Government entity as such has the right to determine the price of an internationally traded commodity."She might be well aware too that in some parts of the world where this has been tried it can lead to all sorts of issues around supply. But also as my colleague Stuart Smith pointed out the issue around not actually encouraging competition because certainly I am one of the many people who has the Gaspy app on my phone and I look at the fuel prices of various places when I'm going to fill up my car and I make an informed decision based on the prices and what it is that I'm paying for and where I am and where those fuel companies are based. I'd like to hear from the Minister about where this has been tried and where it has worked. Has it led to less competition or more competition? Has it led to more supply or less supply?The other thing while the Minister is thinking of answers to these questions she might like to answer: since the fuel taxes that are paid on fuel are in fact such a large proportion of the cost of fuel and also to those of us who buy our fuel she might want to ask whether the Government is going to continue down the path of taxing it at the level that it is given that I note from 1 July that the rebate that had been granted on the fuel taxes is coming off and we are all expecting those of us who pay for our own fuel that our prices are going to go up around 29c a litre. None of that is money that is going to the fuel companies; all of it is money going to the Government's coffers. So I think if we're going to have a restriction or any threat of restriction from the Commerce Commission—not always an entity that has always covered itself in glory on these matters—perhaps we might wonder whether or not they might consider as the Government for the few months that they're going to be there whether or not they'd like to bring their own taxes down.Hon Dr MEGAN WOODS (Minister of Energy and Resources): There are a couple of questions in there that I'd like to address with this contribution. A member asked about the principles and methodologies that lie behind this.But before I get into that I think it's important to go through exactly what the purpose of this bill is where it came from and why it is happening very briefly. This of course is not about a regime to set and to have Government setting the price of petrol in the ordinary course of events; what it is is providing a regulatory backstop where there is a consideration that the market is not functioning in a competitive way to the benefit of consumers. Of course what we're doing here was a recommendation of the fuel market study that the Commerce Commission carried out. Mr Smith talked at length about the Gull effect. Well Gull have said that they wouldn't be able to operate in parts of the country without the terminal gate pricing regime that was put in place under the original piece of legislation. They've come out and explicitly said that. The ability for us to actually have a more competitive South Island fuel market is down to the changes that have been affected by the legislation that has been put in place.In terms of the questions around the principles and methodology there was a piece of work that consciously decided that you could not get too prescriptive around what that would be. I'll go through the section of the Act that sets out what the criteria for decision making of when to trigger the backstop comes through. But in terms of being able to anticipate every set of circumstances and prescribe that in the legislation it was not the best way through.But I will advise Mr Smith to turn to new section 29L inserted by clause 4 of the bill and about the commission determination about how the regulation applies. So in (1A) of that new section it talks about "In considering whether the Act's purpose is promoted in making a determination the Commission must take into account the outcomes that would be expected in a competitive market including wholesale suppliers' incentives to invest to meet the demand of end users of engine fuel products." So the scenario that the Hon Judith Collins was talking about in terms of the driving out competition wouldn't apply because this is triggering if there is a situation where it is demonstrably that a company is working outside of what you'd expect in a competitive market. It gives the Commerce Commission the ability to investigate that to use the tools that it has at its disposal and see whether that is the case.I'll also briefly address the points that the Hon Judith Collins made about security of supply. I guess the other important piece of work that we have been doing since the commercial decision was made to close down Marsden Point of course is about our onshore stockholdings. That's not in this bill; that is a separate piece of legislation. But as that honourable member will know who herself is a former Minister of Energy that Marsden Point simply was not set up to refine the light crudes that we produce here in New Zealand. In order to do that there would have had to have been a substantial reconfiguration of Marsden Point. I'm always interested when I hear the National Party discuss this because I never once heard them suggest that they were going to put up the hundreds of millions of dollars to buy it and make that conversion. But if that's a point of debate that they want to continue through I think it would be an interesting one for us to have. Thank you Mr Chairman."