Many price rises likely

Press, Volume CXV, Issue 33779, 27 February 1975, Page 2

Many price rises likely

(X Z. Press Association) WELLINGTON, February 26. Higher prices for petrol and diesel fuel will cost farmers an additional $2.5m, the senior vice-president of Federated Farmers (Mr Allan Wright) said today. And if the Government agreed to higher cartage rates, the two higher costs would take a big bite out of the ssom assistance to farmers announced four weeks ago. he added. The 9.6 c a gallon rise for petrol would mean an increase of at least Sl.sm in on-farm costs. This, he said, was in spite of recent assurances by the Under-secretary for Trade and Industry (Mr Macdonelb that farmers would not suffer from further increases in the price of fuel for onfarm use. Mr Wright said that though the Government had made some concession for

!the productive use of diesel, the 2.27 c a gallon increase would raise on-farm costs for diesel by a further Sim. OTHER PRICES Spokesmen- for the manufacturing and retailing ini dustries agree that the petrol price increases will be . reflected in prices in general. While the increase in the price of fuel was probably unavoidable, it would still add to inflationary pressures, the director-general of the j Manufacturers' Federation s (Mr H. E. J. Martin) said ?i today. It would certainly increase I manufacturers’ costs, and ■ they in turn would have no ’■option but to reflect this in prices. The secretary of the Retailers’ Association (Mr B. I. i Purdy) said the fuel price increases would immediately : be reflected in costs, “but when these will be reflected- > in prices is anyone’s guess." > MILK PRICES 1 The increased fuel costs 1 will eventually mean either ’ increased subsidies for milk — or higher prices. : The general manager of i ■ Wellington City Council r Milk Department (Mr Arthur [

Thomas) said: “Ultimately, it, must become a burden on the taxpayer. There are applications for increases in subsidies at annual or more frequent intervals and this is bound to come into that., Whether it will affect prices is purely for the politi-I cians.” FREIGHT RATES I Price increases are also due in the freight industry. The', Road Transport Association: will meet the Ministry tomorrow to discuss an application for rises, and the fuel rises will be added to the agenda. The association’s executivej director (Mr B. P. Gresham); said: “We would expect car-' tage costs to rise by about 1 per cent. This will be incorporated into our application, which covers truck, prices and the January wage! order to drivers, mechanics and office staff." Any increases. if approved, could come early in March. TAXI COSTS Soaring petrol costs may force some Wellington taxidrivers off tne road. Unless the Government [grants an immediate fare in-*

,crease, the taxi service in, , Wellington will suffer, according to the general manager of Wellington Taxis : (Mr Les Gill). “I imagine between two to.three per cent of our 150; fleet will come in today and put their cars up for sale. These are the men on the edge of survival,” he said'. “If I was a taxi-driver, 'this petrol increase would ; reduce my profit by 3 per Cent RESELLERS Petrol resellers plan to, /argue with the Government ’ over a fractional loss in their percentage mark-up. I Part of the 9.6 c a gallon 'lrise in premium grade petrol goes to service stations. Garages get 0.236 c a gallon — all but maintaining their percentage margin. The; ■-resellers’ margin is now '' 6.48 c a gallon, or 8.24 per 1 cent. They plan to pre_ss the ’ Government — not for res--1 toration of their old. margin — but for an increase to 10 per cent, according to Mr H. W. Fairhall, a spokesman for the Waikato Retail Motor Trade Association. s36m LOSS -* The Minister of Energy-

(Resources (Mr Freer) said; the Government’s delay over) !the holiday period in imple- : :menting the latest petrol! price rise had forced oil: companies to sustain a loss! (of more than s36m. He said the companies had] to be allowed to increase! their prices. He emphasised] that New Zealand’s petrol' prices were among the low-! est of non-producer nations. TAX RUMOUR The Opposition spokesman! on industry and commerce] (Mr L. R. Adams-Schneider)] I today called on the Govern-! ment to give a full public: explanation of the state of (the petrol pool account to: clarify the situation sur-! rounding future increases in petrol prices. “The Opposition is very 'critical of suggestions from: a variety of sources that the Government might increase . the tax on petrol. “These suggestions, which are never substantiated, are ’alarming. “If the Government is serious in its wish to stabilise prices then it cannot deliberately consider raising I consumer taxes," he said.