The Crest of the Commonwealth of Australia Treasury Portfolio Ministers
Picture of Peter Costello

Peter Costello


11 March 1996 - 3 December 2007

Transcript of 02/03/01

Transcript No. 2001/016

Hon. Peter Costello MP

Friday 2 March 2001

SUBJECTS: Fuel, Budget


You’ve apparently listened to the people on this, now you are being criticised for it. Do you think that maybe it may backfire on you?


Oh look, it’s clear that Australians are concerned about petrol prices and so we have to have a system of taxation which takes that into account. The system which we’ve introduced is not just a reduction of 1.5 cents a litre, but it’s monitoring of the oil companies, it is very important to monitor the oil companies. This is a price reduction for the benefit of the motorist, not for the oil company. Now, the world oil price will still determine the overall price of petrol, but we want to make sure even though it is only 1.5 cents that that gets passed on to the motorist, and we’ve put in place a provision which will have fines up to $10 million if that is not passed on.


Are you surprised though at the level of criticism you have now received?


I think by and large the new arrangements have been received well, which is the reduction of 1.5 cents and the abolition in the future of indexation. But the important thing is to get the benefit out to the motorist. We’ve put in place strict fines if the oil companies don’t pass that on, and I say to them this is for the benefit of the motorist, not the oil company and they must be passed on.


Obviously we can’t have both, as you say, we can’t have higher spending and the lower fuel prices. Which areas will suffer in this budget?


Oh no, we’ll just take a very tight reign in the budget in relation to spending, if you lower taxes you have to restrain your spending and we’ll make sure we do that and you’ll find it all out on budget night.