The Commerce Commission now has more powers to investigate competition issues in any area where it thinks there might be a problem.

In this week’s National Business Review, the Initiative’s Chair, Roger Partridge, argues this was a bad idea.

I, for one, welcome the Commerce Commission’s new powers to encourage more competition. Why? The Prime Minister this week reminded us that government is the country’s biggest monopoly. And the more powers the Commerce Commission has for dealing with this monopolist, the better.

This week, I joined in panel discussion session at Parliament on getting more consumer-driven government services.

Presenters went through a raft of ways that government services fail to live up to the expectations we have in normal consumer markets.

Prime Minister Bill English’s closing address helped explain why things are as they are.

He said that government is the land of perpetual, eternal monopoly. The Ministry of Education, the Ministry of Health, the Ministry of Social Development – none of them face any real competitive threat. And we get the kind of customer service that we expect from monopolists.

The Prime Minister – the Chair of the great New Zealand government conglomerate – admitted that Ministries have eternal monopolies. That should provide a prima facie case for the Commerce Commission to use its new powers to investigate the government.

When it comes to private business, there is at least the threat of competitive entry to discipline the New Zealand market. But even there, government policy works to stifle competition. And things are worse when we look at government-provided services.

A few starting questions for the newly empowered Commerce Commission:

• How much harm do New Zealand consumers suffer because of restrictions on foreign entrants?
   
• How much room do regulations, from the RMA through to liquor licensing, give for anticompetitive behaviour through objections and appeals processes?
   
• Do occupational licencing restrictions protect consumers, or harm them through higher costs?
   
• How much damage is done to competition, and to consumer welfare, when government uses sole-provider, non-competitive contracts with Ministries to provide most government services?

Any reasonable investigation would result in substantial liberalisation of regulations. And it would also open the Ministries up to more competition from NGOs for service provision.

It is high time to investigate, and to break up, the government’s monopolies.