Hon Nick Smith National Party Environment Spokesman

1 September 2005

Fuel prices will continue to rise under Labour, Greens

National Party Environment spokesman Nick Smith says the election of a Labour-Greens Government would result in even higher fuel prices as policies like the carbon tax and a requirement to use a blend of biofuels are implemented.

"On Tuesday, Labour and the Greens announced that they would legislate for a biofuels sales target. The announcement suggested a 5% requirement for biodeisel and a 3% requirement for ethanol in petrol.

"This follows Labour's May announcement of a carbon tax of $15 per tonne, to take effect from 1 April 2007.

"The carbon tax will add 5c per litre to the price of diesel and petrol and this biofuels policy amounts to another 3c per litre for diesel and 2c for petrol."

Dr Smith says the public is already reeling from higher fuel costs.

"The last thing they need is an additional 8c per litre on the price of diesel and 7c a litre on the price of petrol.

"The additional hike in fuel prices will have a very negative impact on the economy. Rural communities and those on fixed incomes will be hit particularly hard.

"These extra government costs on fuel are not being imposed in Australia and will further drive talent and business across the Tasman.

"The environmental benefit of these policies is highly questionable. There is no evidence that the carbon tax will reduce emissions as evidenced by the negligible change in fuel use when Labour put the petrol tax up in 2002 and 2005. Nor is there any evidence that the use of biofuels will have quantifiable benefits to justify the costs.

"A vote for Labour or the Greens is a vote for even higher fuel costs," says Dr Smith.

ENDS

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