We provide oversight of certain essential industries to ensure consumers are not disadvantaged by a lack of competition at particular points in the supply chain.

New Zealanders want to receive good value for money when they buy services that are essential to everyday life and the economy. These services include:

  • ​energy and telecommunications, which are part and parcel of modern life, and as such are a significant cost facing almost all homes and businesses
  • aviation and the airports in our three major cities, in particular, which offer gateways for millions of passengers and a large volume of cargo
  • dairy and raw milk, in particular, which is a core commodity in a sector that drives many rural economies
  • fuel, which is a significant item of household expenditure and a significant input cost for businesses.

Competition in these industries is usually limited at particular points in the supply chain. In fact, some of the markets are monopolies. For example, although you can choose from a range of retailers when you buy electricity, the price and reliability of the services on offer depends on:

  • the monopoly provider of the national transmission grid
  • the monopoly provider of the local distribution network in each region.

The fact that there aren’t many suppliers in some parts of the supply chain isn’t necessarily a problem. In fact, it is potentially a good thing because infrastructure can be very costly to duplicate, and ultimately someone has to pay for it.

But, when competition is limited somewhere in the supply chain, people might wonder whether the choices on offer could be better. When things go wrong, or household bills fall due, people often want to know:

  • am I paying too much?
  • is service quality reasonable?

And the problems that arise are frequently felt far and wide because the services are so integral to New Zealand society. Never is this more obvious than when significant disruptions occur, such as sustained power outages. National infrastructure is also critical at times of greatest need, including natural disasters.

As a result, the benefits to the public of additional oversight are often thought to outweigh the additional costs associated with greater levels of scrutiny.

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