Direct-buying plan mooted

Press, Volume CXV, Issue 33783, 4 March 1975, Page 17

Direct-buying plan mooted

(N.Z.P A.-Reuter—Copyright)

WASHINGTON, March 3.

Congress is studying a plan to establish a U.S. Government purchase authority to negotiate with oilproducing countries rather than leaving such talks to the oil companies, it was disclosed yesterday.

A Democrat, Mr Al Ullman, chairman of the powerful House of Representatives Ways and Means Committee, said that he expected the committee to recommend such a plan. He said that a national purchase authority, would be better able to force down oil prices by putting pressure on oil-producing countries “directly in the market place.” “Our free enterprise system has limited negotiating capacity in reducing that price,” he said on television.

Mr Ullman is a leading Democratic proponent of a tough national policy to make the United States less dependent on foreign oil. His committee opens hearings on energy policy today with the United States Treasury Secretary (Mr William Simon) as the first witness. He said the outline of an energy plan which House and Senate. Democrats presented

to President Ford on Friday had been “watered down to the point where the Ways and Means Committee and I don’t believe that it will adequately do the job.” That programme was being studied by Mr Ford during a week-end at his Camp David mountain retreat, with a view to a possible compromise with his own energy plan. Mr Ullman proposed the imposition of oil imports quotas as soon as the United States economy improves, so as to cut foreign oil consumption from 40 per cent to 25 per cent of total use. He hoped that this could be done in six years.

He also suggested a tax on petrol used by motorists above a certain basic allocation, the tax might start at five to 10 cents in the first year of the plan and rise eventually to 25 or 40 cents. President Ford is due to announce today whether he will postpone a controversial tax on oil imports as part of a compromise with Congressional Democrats.

One dollar of the planned $3-a-barrel was imposed on February 1. The second dollar was imposed on Saturday and the third dollar is due to be imposed on April 1. Mr Ford said that he might postpone the second and third dollars if there were grounds for compromise.