
Known unknowns: competition, discovery and the limitations of CBA
Government economic service conference July 2008

Government economic service conference July 2008

We have been asked by the Civil Aviation Authority to comment on the Competition Commission (CC)`s paper on Assessment of Competition at Stansted Airport (ACP) and on a paper by Dr David Starkie and Professor George Yarrow in response to the CC`s paper. Our comments are on the general approach taken by the CC and by Starkie and Yarrow.

Australian Competition and Consumer Commission, Regulatory Conference, Queensland, July 2008

PRESENTATION TO CAVE REVIEW OF COMPETITION & INNOVATION IN WATER MARKETS
UNIVERSITY OF WARWICK
9 JULY 2008

Australian Competition and Consumer Commission Regulatory Conference, Queensland, July 2008

The Traffic Management Act 2004 (TMA) provided for the introduction of a number of measures intended to address problems associated with urban and inter-urban congestion on the road network. This included providing the potential for permit schemes to be introduced by highway authorities such that street works (for example, utility repair work that involves occupation of some part of the highway) could not be undertaken without a permit, and a fee could be levied for the provision of such a permit. Secondary legislation was required in order to allow for the introduction of permit schemes, and more detailed enabling provisions were subsequently introduced under the Traffic Management Permit Scheme (England) Regulations 2007 (hereafter referred to as „the permit scheme regulations‟).
This report provides a review of the Regulatory Impact Assessment that was prepared by the Department for Transport (DfT) in the development of the permit scheme regulations. Some comments are also provided on the relevance that the issues raised in this review have for ongoing and future policy developments with respect to permit schemes

The introduction of next-generation access networks (NGANs) in communications changes the market and technological context in which public policy operates. It does so in a way that, in terminology used in the economic analysis of innovation, can be said to be ‘drastic’ in nature. This poses a number of new challenges for the development of regulatory policy, some of which are identified and explored in this paper.
When new problems arise, one of the first analytical tasks for regulators is to discover perspectives that might be of assistance in thinking through the issues that emerge. These alternative ‘frames’, which will also be explored below, are not solutions to the policy problems, but rather are ways of approaching the issues to assist the development of policy positions.

Our main conclusion is that competitive discovery processes have potentially very important roles to play in the water sector, particularly at the wholesale level, where we know that we know relatively little about the economic value of water, including its spatial and temporal variations, and how to use it most wisely.

This Report is published as a contribution to the current debate in the UK on the prospects for the development of competition in water, sewage and sewerage services (henceforth abbreviated to ‘water services’), and on the forms that such competition might take. It does not seek to cover all aspects of relevant policy in the sector, but rather focuses on a number of key issues, concepts and trade-offs that appear to be of central importance for policy development.