The ACCC has not produced a rigorous assessment of FuelWatch. Furthermore, the ACCC discouraged external assessment of their analysis. It made use of ‘secret data’, ‘secret econometric tests’, ‘secret analysis’, and ‘secret recommendations’ to government to propose a national FuelWatch scheme. Ultimately, the Australian population are being invited to believe that the national adoption of FuelWatch is good public policy simply because the ACCC asserts it to be good policy. Yet there is no corroborating evidence to support the ACCC’s assertion. Indeed, all the empirical evidence in the public domain rejects the ACCC’s position.

We argue FuelWatch will reduce the level of price competition in the petrol market. The present significant degree of price competition in the retail petrol market is likely to be translated into non-price competition. Non-price competition is likely to make petrol pricing less transparent rather than more transparent. That loss in transparency disadvantages those consumers who would prefer a lower price to an enhanced Loyalty Scheme. Thus, the unintended consequences of the FuelWatch scheme will be to increase existing barriers to entry, increase market power of existing retailers, and disadvantage those consumers who buy their petrol at the bottom of the pricing cycle. In order to protect the ‘integrity’ of the FuelWatch system, the ACCC would have to prohibit competition for petrol in both pricing and promotional terms. This highlights the fundamental problem with FuelWatch.