Articles and discussion: Fuel subsidy

[ozbob]

From the Sunday Mail click here!

Andrew Fraser looks at fuel subsidy as Budget measure

Andrew Fraser looks at fuel subsidy as Budget measure
Article from: The Sunday Mail (Qld)

Daryl Passmore

May 16, 2009 12:00am

MOTORISTS may take much of the pain in the upcoming Queensland Budget, with the Government considering scrapping the 8.35c a litre fuel subsidy.

Treasurer Andrew Fraser yesterday refused to rule out the move as he struggles to balance the books ahead of next month's Budget.

But the idea has brought an angry response from motoring groups, business leaders, the freight industry and agricultural sector.

Queenslanders have enjoyed cheaper fuel than other states since the subsidy was introduced by the Liberal-National Coalition in 1990, but it costs over $500 million a year.

As the Treasurer stares into a Budget blackhole of several billion dollars, it's an obvious target to make savings.

He has twice categorically ruled out scrapping the subsidy, but  in the wake of the Federal Budget, and with Queensland facing a $5.6 billion hit from shrinking GST revenue over the next four years, he yesterday refused to guarantee it would continue.

"We are facing a difficult Budget that just got billions of dollars harder. I don't intend to speculate on Budget deliberations," he told The Sunday Mail.

A source said: "If you were going to do it, now is the time. We've just had an election, so they don't have to face the voters for a long time, fuel prices are still relatively low and you have the excuse of the economic crisis."

But RACQ general manager Gary Fites said: "This is the same government which last year imposed an extra hike on motorists for vehicle registration and is about to impose another burden by legislating for the mandatory use of ethanol, which will increase the price of petrol for many.

"It's outrageous that having dipped into motorists to that extent, that they would consider this triple whammy."

Some in the Labor Party have pushed for the subsidy to be dumped for years. Former premier Peter Beattie tried to in 2000, but backed away after a huge public outcry.

And opponents are predicting an ever bigger backlash if the Government tries again.

"It would have a much more serious impact this time," said John Cotter, president of Agforce which represents beef, sheep and grain farmers.

"Agriculture is a major contributor to the economy at the moment and this would be very damaging to our industry as well as others, like mining and tourism."

Queensland Trucking Association chief executive Peter Garske said it would be "a crippling blow for the efficiency of the freight industry" and "another nail in the coffin of smaller operators".

Nick Behrens, general manager for policy with the Chamber of Commerce and Industry Queensland, said ditching the subsidy would only make it harder for the business community in difficult economic times.

But Queensland Council of Unions general secretary Ron Monaghan said the subsidy should definitely be in the mix of Budget options and "should be looked at hard".

The benefits of the subsidy paled in comparison with the 119,000 jobs resting on the Government sticking to its $17 billion infrastructure plan, he said.

Comment: 

I have always felt this so called fuel subsidy was a con, when one compared prices around the nation, other states don't have it and often their prices for fuel cheaper!     Much better to ditch, stop the smoke and mirrors with fuel prices and invest more into infrastructure for the long haul.  Real sustainable transport options not more of the same.

[ozbob]

This is relevant --> http://backontrack.org/mbs/index.php?topic=1447.0

[Dean Quick]

After having it so good for so long, it comes as no surprise that the trucking lobby is one of the first to squeal at the possibility of losing the fuel subsidy. Oh dear.........

 

[ozbob]

From the Brisbanetimes click here!

Qld Govt considers scrapping fuel subsidy

Qld Govt considers scrapping fuel subsidy
May 17, 2009 - 12:38PM

The Queensland government is considering scrapping the state's eight cents a litre fuel subsidy.

Premier Anna Bligh says the global financial crisis has ripped $14 billion out of the Queensland budget and she's prepared to make tough, unpopular choices if they're necessary.

Ms Bligh says the fuel subsidy costs the government over $600 million a year.

"In this year's budget I will do what I said I would do in the election campaign - I will prioritise jobs and protect our building program," she said.

"To do that we've got to look at some pretty tough decisions - and right now everything is on the table.

"As a state we have to make decisions about what our priorities are and what's important.

"The building program has to be number one because it creates jobs and builds the things we need now, and in the future.

"And that means things like the fuel subsidy have to be considered," she said.

Former Premier Peter Beattie backed away from scrapping the subsidy but Ms Bligh said if the state's building program is to be protected and jobs created, some hard decisions are going to have to be made.

"I don't think they're going to be popular decisions, whichever way we end up going, but I have to consider everything that's on the table and do the right thing," she said.

"The right thing, right now, is to keep building our infrastructure program and keep Queenslanders in jobs".

AAP

[ozbob]

From the Courier Mail click here!

Fuel subsidy may go with Bligh set to break pledges

Fuel subsidy may go with Bligh set to break pledges
Article from: The Courier-Mail

Patrick Lion

May 18, 2009 12:00am

ANNA Bligh has admitted she may break election promises, claiming some of the guarantees she gave Queenslanders are more important than others.

The Premier yesterday insisted pledges relating to her multibillion-dollar infrastructure program were most important because they protected jobs.

Ms Bligh conceded the first broken promise might be the scrapping of the popular 8c-a-litre fuel subsidy.

The subsidy is in peril despite repeated assurances before the March 21 poll that the scheme would be protected.

In a move reminiscent of John Howard's "non-core promises" after the 1996 federal election, Ms Bligh - only weeks after being returned to office - sought to rank her recent pledges as she softened taxpayers up for Budget pain next month.

"I want to keep every election promise, but the over-riding election promise I made was to protect jobs and to keep our building program going," she said.

"To do that we've got to look at some pretty tough decisions and right now everything is on the table. That means things like the fuel subsidy have to be considered."

The uncertain future of the subsidy, worth $600 million a year, comes as the Government faces gaping revenue holes after the global financial crisis stripped $14 billion from the state's finances. Other major promises, such as not raising or introducing new taxes, may also be in the crosshairs of the June 16 budget.

Opposition Leader John-Paul Langbroek yesterday insisted the fuel subsidy was a "core service", saying its removal would cost motorists between $200 and $300 annually on top of soaring power and water costs.

"It begs the question as to whether the Premier knew about these things when she went to the election," Mr Langbroek said.

"Why did she rush to polls six months early? Here we are less than two months after the election and she is walking away from these promises." In one of several pledges, Treasurer Andrew Fraser insisted back in January that the subsidy would remain untouched.

"Make no mistake about it," Mr Fraser said. "We'll be delivering a fuel subsidy scheme. It will stay in place."

RACQ spokesman Gary Fites suggested the fuel subsidy warnings may be a pre-Budget red herring, designed to scare Queenslanders before more favourable Budget-day decisions.

But, Mr Fites insisted, any tinkering with the scheme would be a broken promise.

"The kite may be being flown but the kite deserves to be shot down,"Mr Fites said.

"To scrap the subsidy would fly in the face of a pre-election commitment from the Government and very direct assurances from the Treasurer."

[mufreight]

If Premier Bligh is serious about scrapping the fuel subsidy then perhaps she should consider redirecting the 2/3 rds of the money that she estimates will be saved to new transport infrastructure projects on a 50/50 basis between rail and road.
Such a move would help her fight against unemployment, would reduce road transport costs as a partial offset for the loss of the fuel subsidy for motorists, and would provide much needed infrastructure for rail that would enable the provision of a better standard of rail services that would tend to take both freight and passengers off road to rail.
How about that one Anna and you still save 1/3rd of the estimated fuel subsidy bill.