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Monday, 7 November 2005
Page: 17

Mr GIBBONS (1:32 PM) —There are several options available to drive down fuel prices. Rather than increasing our reliance on imported oil, Australia’s vast reserves of natural gas should be developed to make us more self-sufficient in transport fuels and less vulnerable to future global oil shocks—or perhaps ‘sheiks’ might be a better word; maybe not today. Australia’s competitors in the gas industry are way ahead of us, particularly in the Middle East, where countries like Qatar already have major gas-to-liquid projects making refined products for the global market. The federal government should direct the ACCC to ensure effective competition in the industry to make sure Australians get the lowest possible prices at the bowser by strengthening the Trade Practices Act, especially section 46, to prevent the abuse of market power and other unfair practices which drive out competition; directing the industry to declare petrol prices under the prices surveillance provisions for monitoring purposes; and having the ACCC report six-monthly on movements, particularly in regional Australia. With its $13.8 billion budget surplus, the government should give all Australians a decent tax cut, making them better off and better able to cope with the rising fuel prices.

Bendigo region motorists have paid a staggering $22 million more in petrol taxes since the introduction of the GST. The Howard government had claimed the GST would lead to a drop in some indirect taxes but, when it came to petrol taxes, the GST had been used to conceal a grotesque petrol rip-off. If the government had stuck to pre-GST fuel taxes, it would have reaped $41 billion in the past four years. Instead, it was estimated it had collected more than $44 billion. Spread evenly across the nation, this made Bendigo’s share of the secret windfall more than $22 million. And I suspect our true share of that vile amount is even more than $22 million, given that country people pay more per litre for their fuel and, according to transport economists, make more long car trips than city motorists. Country people are even worse affected by the secret taxing because of the transport cost component in absolutely everything they consume.

In 2000-01 total petrol tax revenues were $8.38 billion. In 2004-05 it was estimated the tax take would be $9.32 billion—almost a billion dollars more than in 2001. By July 2005, the Howard government collected an estimated $44 billion in petrol taxes since the GST came in. We have seen the results of that, especially in regional Australia. Even allowing for the 1.5 cent per litre cut in March 2001, and for revenue forgone as a result of non-indexation of petrol excise, the Howard government is still over $3 billion better off in petrol taxes since the introduction of the GST. This rorting was from a government which first promised that it would not introduce a GST and then claimed its GST would reduce indirect taxes.

The most common explanation for fuel price rises is that they reflect the exponential increases in the international fuel benchmark over the previous week, forcing immediate price increases. However, this situation is in stark contrast to the lengthy lag for benchmark decreases to be passed on to Australian motorists at the bowser. Labor has continually argued on behalf of consumers and asked why consumers have to cop international benchmark petrol price rises immediately when they are expected to accept a lag of 10 days or more when the benchmark goes down. The Australian Competition and Consumer Commission used their own data to make this point in Senate estimates hearings in February, when they suggested that consumers should expect to experience a lag of approximately 10 days to two weeks for prices to fall within the international benchmark.

The question to be answered by the federal government, oil companies and the ACCC is: why isn’t there a lag at the bowser when the international benchmark increases? This government has ripped off central Victorian motorists on fuel taxes but refuses to use the proceeds to pay its final commitment to fund and complete the Calder Highway. The Howard government walked away from its responsibility to fund and maintain Australia’s National Highway network while its AusLink Strategic Regional Roads component was used as a $93 million slush fund in coalition held or coalition targeted seats during the last election campaign. Bendigo motorists in particular are entitled to a fair go from revenues ripped off by this government on fuel taxes while they continue the 25-year wait for the Calder Highway duplication to be completed.

The Howard government is recognised as the highest taxing federal government in our history and is awash with taxpayer funds with excise and GST on fuel a major source of government revenue. Yet it refuses to put pressure on oil companies to structure their pricing on a fair and equitable basis. All Australians expect and are entitled to a fairer go on fuel prices.