Rudd’s Quick Fix on Petrol Misses the Point

September 9, 2008

As bowser prices fail to match the fall in world oil prices, it was becoming increasingly obvious that the Rudd Government’s FuelWatch scheme completely missed the point, said Shadow Consumer Affairs Minister, Luke Hartsuyker, today (Tuesday).

Mr Hartsuyker was referring to comments by University of NSW associate professor of business, Frank Zumbo, that motorists were “being price gouged by up to 10 cents a litre” as world oil prices fell back to the levels of last May.  The price difference was “a windfall for the oil companies,” according to Professor Zumbo.

“Last year’s report by the Australian Competition and Consumer Commission, (ACCC) into the price of unleaded petrol recommend action to reform the wholesale market but to date nothing has been done,” said Mr Hartsuyker.  "Instead, Kevin Rudd has gone for the quick fix of FuelWatch, which the ACCC did not recommend in that report, to get himself off the hook with all those voters who he led to believe in the election that he would cut the price of petrol.  He’s opted for headlines, rather than doing the hard yards of reforming the wholesale market.

“Following the Senate Economic Committee hearings into FuelWatch, we all know that the scheme is a fraud and that motorists will end up paying more as result.  Kevin Rudd says it’s about empowering consumers but it will just empower them to pay more.  He’s wasting time and money on a scheme that won’t even cover most of rural and regional Australia, where people are more dependent on their own transport than those living in the cities.  He should act on the wholesale market, and he should take up the Coalition’s policy of giving motorists a 5 cents-per-litre cut in excise.”