Following an appeal from Ruapehu Mayor Weston Kirton earlier this month, the Commerce Commission has agreed to look into the state of competition among fuel retailers serving rural towns.
Weston’s calls for an inquiry, based on pricing of petrol and diesel in the regions, gained widespread media coverage and the response from the Commerce Commission was also a warm one, he said.
They had been looking at competition in cities but wrote to him agreeing there was now a need to monitor competition in rural areas as well.
However, Weston said he was afraid the situation for residents of towns such as Taumarunui would get worse before it got better.
“Regardless of the fact that rural New Zealand is exposed to elevated petrol prices due to a lack of competition, the country as a whole is experiencing a cost of living crisis,” he said.
“The anticipated lifting of a 25 cents a litre reduction of fuel excise duty (FED) due to expire at the end of June will cause a severe blow to many struggling families particularly in rural regions such as the Ruapehu district.
“Already some local people not by choice are paying up to $0.45/L more for petrol than neighbouring towns due mainly a lack of competition in the fuel retail market.
“If the FED tax is not extended beyond June, local motorists will have to bear the brunt of yet another increase of $0.65/L for petrol.
“Because of the fact the Commerce Commission is undertaking a review of fuel pricing in the regions currently, I believe it would be in the public interest to extend the FED tax reduction for a further six months to allow the Commerce Commission to complete its study on the behaviour of fuel companies.”
Weston said local Government needed to lead on the issue and speak with one voice highlighting that the cost of living crisis was alive and well.
“And therefore we must help those in need.”
