The ACT Government is prepared to bring out the big stick against petrol companies in Canberra who continue to price gouge, with Chief Minister Andrew Barr indicating he would use special legislative powers to enforce a retail margin on operators.
The Chief Minister has the power to determine the maximum wholesale price, retail price and retail margin of fuel on the recommendation of the fair trading commissioner, powers he said he will use if petrol companies continue to price gouge Canberrans at the bowser.
“A quick scan of petrol prices in the ACT sees the majority of outlets charging 90 cents a litre for E10 fuel. There are one or two that are charging nearly double that, [which] seems to me to be price gouging and is unacceptable and without justification,” he said.
“I recognise that the volume in sales has halved, demand has effectively fallen, which is why petrol prices have fallen and why that should be flowing through into lower petrol prices.
“If we did not see a response in terms of further significant reductions in price in the coming weeks, we could look at triggering that retail margin legislation, but I will give the retailers advanced warning and put them on notice today.”
Mr Barr has written to every major petrol retailer in Canberra demanding an explanation as to why prices have dropped in other major metropolitan cities like Sydney but not across the ACT.
Additional transport and operating costs to get the petrol to Canberra should, at most, add an extra six to seven cents a litre, Mr Barr wrote in a letter to 7-Eleven CEO Angus McKay.
“Given this, I can see no justification for the current differences in prices between Sydney and Canberra,” he said.
Chairman of the ACCC Rod Sims also received a letter from Mr Barr last week, requesting that the consumer watchdog investigate petrol prices in the ACT.
“Despite crude oil prices falling to near record lows, and wholesale prices reducing substantially as a result over the last few months, we are not seeing similar outcomes for retail fuel prices in the Territory,” Mr Barr wrote.
“At a time when the economy is being severely affected by the COVID-19 pandemic and many households are struggling due to job losses and restrictions placed on the community, this outcome is not acceptable.
“Any action taken by the ACCC would help increase pressure on retailers operating in the ACT market to do the right thing and reduce retail prices to a level more commensurate with broader market trends.”
Opposition leader Alistair Coe also wrote to the ACCC requesting an investigation and he said the Canberra Liberals are prepared to consider reforms on the next Assembly sitting day in May.
“Canberrans have always been ripped off at the bowser and we stand ready to end the petrol price rip-off affecting so many families,” Mr Coe said.
“There are a range of measures the ACT Government can implement such as real-time petrol price monitoring, improving business competition, reducing taxes and stopping daily price gouging.
“We stand ready to implement reforms and if the ACT Government is prepared to come to the table, I see no reason why we cannot deal with this when the Assembly returns.”
If they come to power, the Canberra Liberals say they will trial real-time petrol price monitoring and price caps.
According to the Canberra Liberals, Canberrans pay an average of $450 more for fuel per year than households in NSW.