If the Government is so certain motorists are being fleeced, what is it waiting for?

Monday, 8 October 2018

Prime Minister Jacinda Ardern claims NZ consumers are being fleeced by petrol prices. (Video first published in October 2018)

OPINION: Prime Minister Jacinda Ardern is convinced that Kiwis are being 'fleeced' when they pay for petrol.

'As a moral stance, I think New Zealanders are paying too much,' Ardern said.

With motorists paying close to $2.50 a litre for petrol in many parts of the country, it is understandable that the issue is back in the headlines, and that the Government wants to be seen to be taking action.

The problem is, the action being taken is to ask the Commerce Commission - effectively the referee on whether consumers are being ripped off - to investigate. These studies tend to take around a year.

A dozen people protested increasing fuel prices outside a Timaru service station on Sunday.

* Petrol prices rise by another 3.5 cents per litre as new tax comes in

* Minister says ACC will have to make 'very, very' strong case to hike petrol levy**

If Ardern is already convinced that a rort is taking place and Energy Minister Megan Woods believes the market is 'broken' as she said in May, why are they bothering to investigate?

Not only is the Government putting immense pressure on the independent competition regulator to give it the answer it wants, Ardern may be stalling for time because her Government does not know what it will do to fix the problem.

If Ardern thinks public or political pressure on the fuel industry will make a difference, she is likely to be disappointed.

BP admitted that when emails detailing its pricing tactics north of Wellington emerged this year - showing it increased prices at several stations to stem losses at another - its staff faced abuse from motorists.

This did not stop the company increasing prices in the days following a week of unprecedented attention.

On September 30, a hike in excise tax pushed petrol prices another 4c; in the days following threats of a boycott of fuel companies began spreading on Facebook. Yet again, the industry hiked prices.

The petrol companies have long denied motorists are being ripped off and proven to be prepared to stare down the Beehive before.

A BP station near the Basin Reserve in Wellington, charging $2.489, an all time high.

National says the real reason for the recent increase in prices is tax imposed by the new Government.

Not only is that flat out wrong in most parts of the country, it ignores the fact that National too increased tax on petrol and would almost certainly have continued to do so if it had continued to govern.

Simon Bridges also criticised Ardern for announcing 'yet another inquiry', when for years National failed to give the Commerce Commission the teeth it needed to investigate a market it also believed was flawed.

Had it acted earlier, we may be closer to a definitive answer.

But the Government's urgency has a rich irony. Ardern has described climate change as New Zealand's 'nuclear free moment'.

Her Government seen fit to crack down on the oil exploration industry, ending new offshore permits, purportedly as a means to take action.

Prime Minister Jacinda Ardern, with Minister of Commerce Kris Faafoi and Minister of Energy Megan Woods, announced the Government will rush through changes to the Commerce Act to allow the competition watchdog to investigate the margins on fuel, as the pump price hits a record high.

But the reason the climate is warming is not because fossil fuels are being extracted, it is because people are burning them.

If Ardern was really serious about tackling the issue, surely she would do something about demand.

Leaving aside whether the petrol companies are making too much profit, the best way to get Kiwis to drive less is by ensuring they pay more.

But on Monday, Ardern's 'moral stance' was that Kiwis are paying too much to do the very thing she surely believes threatens the planet.

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