The federal government's proposed petrol price monitoring scheme, which has its foundations in Western Australia, has been defeated in the Senate.
The federal government's proposed petrol price monitoring scheme, which has its foundations in Western Australia, has been defeated in the Senate.
The FuelWatch scheme would have forced service station around the country to advertise how much they would charge for petrol the next day, giving consumers the chance to compare prices and plan ahead.
The government argued the scheme would help improve competition and transparency in the retail fuel market.
But the government failed to secure the support of crucial balance-of-power senator Nick Xenophon, who joined with the opposition to vote down the legislation.
Before the vote, Senator Xenophon said he remained convinced FuelWatch was a bad idea.
He called on the government to tackle instead the big four fuel companies that dominate the market.
"There has been a political unwillingness ... to take on the big four oil companies and their cosy arrangements," Senator Xenophon said.
"I agree with the destination that (Consumer Affairs) Minister (Chris) Bowen has been seeking, that is to lower the price of fuel for motorists, but FuelWatch is the wrong road to achieve that.
"If you want to drive down fuel prices you need to tackle the wholesale market, you need to tackle the big four fuel companies, we must find better ways to help motorists but FuelWatch is not that way.
"I look forward to working with the government to finding the right road to cheaper petrol."
The Australian Greens and Family First Senator Steve Fielding voted with the government to allow the bills to go into the committee stage, when amendments are moved.
Government frontbencher Nick Sherry said it was a sad day for Australian consumers.
"We want to make shopping for petrol no longer a guessing game, we want to remove some of the uncertainties," he said.
FuelWatch was working well in Western Australia, and there was clear evidence it had forced down prices, he said.
But Liberal frontbencher Eric Abetz said FuelWatch, which he dubbed FoolWatch, was the "exemplar of spin over substance".
Nationals senator Barnaby Joyce said the government had rushed the legislation into parliament without doing its homework.
"The honeymoon is over today ladies and gentlemen, with the purposeful burial of FuelWatch," he said.