Hands off fuel subsidy, LNP tells Bligh

Trucking operators forced to pay more for fuel if Queensland's subsidy is axed may not receive better roads in return

By Brad Gardner

Queensland-based trucking operators forced to pay more for fuel if the State’s 8.35 cent subsidy is axed may not receive better roads in return.

The Bligh Government’s decision to review the Fuel Scheme Subsidy has sparked a backlash from the Liberal-National Party, which has warned fuel prices will rise by 9.2 cents due to GST if the scheme is axed.

And despite the extra millions that will pour into government coffers from the scheme’s demise, opposition spokeswoman on transport Fiona Simpson claims the Government will not use it to support the trucking industry.

"They will never put it back into roads," Simpson tells ATN.

Although the Government is looking at measures to restore the Budget’s bottom line, Simpson says scrapping the fuel subsidy is not the answer.

Seizing on claims made by the Queensland Trucking Association that operators’ fuel costs will jump $15,000 without the subsidy, Simpson says the Government may send small businesses into bankruptcy.

"They're bearing the brunt of huge hikes in vehicle registrations and now everyone will be slapped with Labor's new fuel tax," Simpson says.

Like the QTA, the LNP expects any changes to the subsidy will have wide-ranging effects because trucking operators will be forced to raise freight charges to compensate for increased fuel costs.

"Households will struggle with an increased fuel bill, and tight budgets will be stretched even further when the cost of food, clothing and other goods rise to cover the truckers' growing expenses," Simpson says.

The QTA has sought a meeting with Bligh’s office in an attempt to convince the Government to maintain the $541 million subsidy, saying businesses should not be hit with higher charges during the economic downturn.

QTA Chief Executive Peter Garske says there is no justification to end the scheme because Queensland’s finances are not as dire as other economies.

According to Queensland Treasury’s mid-year fiscal outlook released in January, the State’s surplus is expected to plummet to $54 million as opposed to the original figure of $809 million.

Revenue from taxes was also forecast to fall $884 million due to a slowing property market, pushing the Budget into deficit for the next four years.

The fuel subsidy was introduced following a High Court decision banning the states and territories from collecting a fuel excise. Queensland never had a fuel tax, leading it to reach an agreement with the federal government to provide a subsidy.

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