Petrol rise this week unconfirmed

Press, Volume CXV, Issue 34009, 25 November 1975, Page 1

Petrol rise this week unconfirmed

(Parliamentary reporter) WELLINGTON, Nov. 24 Although it has been tipped by the Minister of Finance (Mr Tizard) that petrol prices must rise, and probably before Saturday, there is no other indication at Ministerial level that this will happen.

Neither in the Department of Trade and Industry nor in the Treasury’ have moves yet been made that would indicate an immediate rise in petrol prices.

It is suggested that if the increase, estimated to be 20c a gallon, were to occur so close to voting day on Saturday it could produce a reaction at the polls. The timing and extent of the petrol rise are directly reiated to the price now being charged by O.P.E.C. countries for their product, which New Zealand receives in the form of “enriched crude.” As Mr Freer has indicated, New Zealand stocks were high when the further rise in costs began, but the lower-cost petroleum is being exhausted.

The Labour Party’s intention is similar to that of any other Government — to go on buying petroleum as necessary, and at O.P.E.C. prices. This means that a rise must be imminent. This was made clear today by officers in the Department of Trade and Industry. Price structure It is not clear yet whether the Minister of Finance has any intention of changing the petrol tax structure — either downward to give some relief to the beleaguered motorists, or upward to provide more funds for the National Roads Board, with which to maintain and improve the roading system. At present, taxation represents 39.5 cents on a gallon of petrol. It has been argued that in 1965 taxation represented 56.6 per cent of the total petrol price, whereas now it represents only 34.4 per cent. The suggestion is that to provide more Roads Board funds the taxation content should be increased. A stronger counter-claim has been made that to ease the motorists’ problem, and to keep down general costs in industries which depend on oil and road haulage, the taxation content should be

reduced. Mr Tizard has given no indication about this, but it is believed that a reduction in the taxation content is highly unlikely. Neither Mr Freer nor Mr Tizard was available for comment today. Treasury sources indicate that petroleum prices are beyond mere politicking. New Zealanders, they say, are still getting their petrol at lower rates than most countries. In Australia the cost of petrol is slightly less — but Australia now provides close to 70 per cent of its own petrol and oil.