John MacDonald: Targeted approach to fuel prices misses the mark

There are two ways you could look at the Government's fuel relief package. On one hand, you could say it shouldn't have bothered at all. On the other, you could say it should have bothered, but not the way it's doing it. Either way, it's got it wrong in my book.

But, despite what I might think, about 150,000 families with kids on low to middle incomes are going to be getting $50 a week in tax credits to help them deal with increased fuel costs due to the Iran war.

But these 150,000 families are families that the Government has no idea whether they actually need this support or not. It's just assuming they do. For example, what about those families that bike everywhere? What about the families who homeschool the kids? They don't need to drive far in the mornings and afternoons, do they? What about families who can't even afford to run a car? Why should they get another $50 a week to pay for fuel that they don't even buy?

And then we get to those who aren't getting anything. Nothing in the package announced yesterday for beneficiaries, no relief for retired people, nothing for students. And most importantly, there is no help for the sectors and the industries that rely on diesel to supply us with food and other essentials. Which, if the Government was going to do anything, that's where it should be focused on.

The Government should be thinking about the wider consequences of higher fuel prices, however long they continue. And, instead of paying a few bucks to people on the lower pay grades, what it should be doing is providing support or interventions for the likes of food manufacturers, the transport industry, the logistics people, all of those.

Because all of those groups are paying higher fuel prices, paying way more for the diesel, but they don't suck them up like your average motorist does. They pass them on.

And all it's going to mean is your low and middle income families will be compensated for, apparently, spending more on fuel - but they'll be paying more for the bread and the fruit and the veggies.

Which is why I've come to the conclusion that, if this is the best approach the Government can come up with, it shouldn't be bothering at all.

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Episode Transcript

Speaker 1 (00:06):
You're listening to the Canterbury Mornings podcast with John McDonald
from newstalk z'b.

Speaker 2 (00:13):
I reckon. There are two ways you could look at
the government's fuel relief package. Two ways. On one hand,
you could say it shouldn't have bothered at all. On
the other you could say, well, yeah, it should have bothered,
but not the way it's doing it. Either way, it's
got it wrong. In my book, government's got it wrong.

(00:35):
But despite what I might think about, one hundred and
fifty thousand families with kids on low to middle incomes
are going to be getting fifty dollars a week in
tax credits to help them deal with increased fuel costs
due to the Iran War. Could go on for as
long as a year, could cost somewhere in the vicinity
of three hundred and eighty million bucks. But it won't
cost that much if the price of ninety one petrol

(00:56):
goes below three bucks a liter for four weeks in
a row, for four consecutive weeks. But that happens, bingo,
it's all off. But these one hundred and fifty families
are families that the government has no idea whether they
actually need this support or not. It's just assuming they do.

(01:18):
For example, what about those families that bike everywhere they're
out there? What about the families who homeschool the kids.
They don't need to drive far in the mornings and
afternoons today? What about what about families who can't even
afford to run a car? I mean, why should they
get another fifty bucks a week to pay for fuel
that they don't even buy. And then we get to

(01:41):
those who aren't getting anything. Nothing in the package announced
yesterday for beneficiaries, no relief for retired people, nothing for students,
and most importantly, there is no help for the sectors
and the industries that rely on diesel to supply us
with food and other essentials, which, if the government was

(02:04):
going to do anything, where it should be focused on
I'm in no doubt about that. The government should be
thinking about the wider consequences of higher fuel prices, however
long they continue. And instead of paying a few bucks
to people on the lower pay grades. I mean, this
was my view last week, I'm even stronger on it now.

(02:25):
Instead of paying money to people on the low pay grades,
what it should be doing is providing support or interventions
for the likes of food manufacturers, the transport industry, the
logistics people, or all of those because all of those
groups are paying higher fuel prices, paying way more for
the diesel, but they just don't suck them up like

(02:45):
your average motorist does. They pass them on and all
it's going to manage your lower and middle income families
will be compensated for apparently spending more on fuel according
to the government, but they'll be paying more for the
bread and the fruit and the veggies. So any savings.
Don't know why the government doesn't get this. Any savings
are going to be canceled out the costs passed on

(03:07):
to them from the food manufacturers, the outfits that deliver
the food, the logistics people. Which is why I've come
to the conclusion that if this is the best approach
the government can come up with, it shouldn't be bothering
at all. It is, in my book, a misguided waste
of money, a misguided waste of money that we don't

(03:29):
actually have.

Speaker 1 (03:31):
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