Fed: Beazley and Howard agree, petrol excise will not be cut

AAP General News (Australia)
08-06-2006
Fed: Beazley and Howard agree, petrol excise will not be cut

By Peter Veness and Tara Ravens

CANBERRA, Aug 6 AAP - There is one thing both sides of politics agree on - they won't
be cutting petrol excise.

Prime Minister John Howard and Opposition Leader Kim Beazley both today categorically
ruled out cutting the excise, agreeing it would bite too deeply into government revenue.

Mr Howard said his government would have to reduce the excise by as much as ten cents
to make any real dent in the petrol price.

"To make any difference at all you would need to cut it by ten cents, that's two and
a half to three billion (dollars)," Mr Howard told Network Ten.

"A lot of Australians might say, if you've got that to spend why don't you spend it
on more for the army or more for this or more tax cuts or just put it away for a rainy
day."

Mr Beazley said cutting excise would be irresponsible, adding: "The issue of economic
responsibility demands we take a different direction."

But that is where the agreement ends.

Mr Beazley has signalled he will be using the sky rocketing petrol prices to attack
the government as parliament resumes this week.

Increased use of biofuels and more power for the Australian Competition and Consumer
Commission (ACCC) are necessary, Mr Beazley told the Nine Network.

"We've got to start to get the ACCC riding shot-gun on the oil companies and on petrol prices.

"The government says it's got a responsibility there, it hasn't unless it's directed
to act on it, effectively and routinely by the government and they ought to get about
doing it."

The ACCC went before a parliamentary inquiry last week and said it had all the power
it needed to monitor retail petrol prices but admitted it was powerless to stop price-gouging
because it was not illegal.

Mr Beazley said biofuels such as ethanol would help Australians unhook from a dependence
on middle-east oil.

The price of pump petrol was unlikely to drop dramatically any time soon, Mr Howard
said but he did offer hope in the medium-term.

"What I'm really saying to my fellow Australians is that the era of very low oil prices,
petrol prices is behind us," Mr Howard said.

"We hope that we're not in an era of ever rising petrol prices and perhaps somewhere
in between, where that settles - $1.15, $1.20 - there's some hope of that."

Meanwhile, the NSW government has prepared a package of recommendations for their federal
counterparts on how to halt further price rises.

NSW Transport Minister John Watkins today said the government's recommendations follow
independent state government research and includes increasing the monitoring strengths
of the ACCC.

The report also advised the federal government explore biofuels, consider a productivity
commission inquiry and extend tax concessions for people using public transport, he said.

"Action should have been taken by the federal government years ago on this issue,"

Mr Watkins told reporters.

The Western Australia government has gone further than offering recommendations with
today's announcement it would double the subsidy given to motorists converting their cars
to gas.

With the cost of unleaded petrol at $1.30 a litre in Perth, Planning and Infrastructure
Minister Alannah MacTiernan said a $1,000 rebate could help to halve fuel costs for many
motorists.

"It's not going to be for everyone but our focus is on those West Australians who are
really copping it hard, Ms MacTiernan said today."

The government estimates the upfront cost of conversion, estimated by be around $2,500
per vehicle, could be quickly recovered, as many people were spending $100 a week on fuel.

AAP pv/jt

KEYWORD: PETROL NIGHTLEAD

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