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National leadership, not populist proposals, required on fuel crisis: Greens.

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Media release

Christine Milne Australian Greens Senator for Tasmania

National leadership, not populist proposals, required on fuel crisis: Greens Senator Milne 12th October 2005

Long-term answers needed to fuel price rises Calls by Australian politicians for cuts in fuel excise or greater tax advantages for business in the face of rising petrol prices are a failure of political leadership, Australian Greens energy spokesperson Senator Christine Milne said today.

"Instead of this populist approach, Australia needs an action plan so that as the oil crisis bites deeper and deeper into the pockets of Australian families and businesses, the nation is made as resilient as possible," Senator Milne said in Canberra.*

"Political leaders who are suggesting that high petrol prices are a temporary problem fail to understand the oil crisis and expose Australia's economic future to an increasingly unstable fuel market.

"Reducing excise to provide temporary price relief is also socially inequitable. Research by the Greens shows that the poorest 20 per cent of households account for only eight per cent of retail consumption of petrol.

If excise were reduced by 10 cents, they would receive $336 million in benefit, at a cost to revenue of $3.8 billion. Those who rely on public transport, often the most disadvantaged, would receive no direct benefit from reducing excise.

"On the other hand, the richest 20 per cent of households, who spend a disproportionate amount on petrol, would receive a benefit of nearly $1.2 billion per year, or more than three times the benefit received by low income households.

"The Australian Greens are the only party willing to admit that oil prices are likely to continue to rise and that the sooner we take actions to protect ourselves as much as possible from such increases, the lower the costs to Australian families, businesses and the Australian economy will be.

"The Senate will have the opportunity tomorrow to establish an inquiry proposed by the Greens to look at the future of oil supply and demand in Australia, the likely impact of these pressures on petrol prices, and the impact on society of price rises.

"This is a challenge to the old parties, to abandon their short-term thinking and help set Australia on a course for a sustainable future."

• Senator Milne's speech to the Senate today on this topic is available on request.

Contact: Katrina Willis 03 6234 4566 or 0437 587 562