RACQ calls for FuelWatch rethink
RACQ external relations general manager Gary Fites said no clear evidence existed to show that FuelWatch would lower petrol prices.
“In fact, it is more likely that under the proposed scheme competition will decrease and prices will rise, leaving motorists worse off,” Mr Fites said.
In a submission to the Senate Standing Committee on Economics’ inquiry into FuelWatch, the RACQ acknowledges that motorists throughout Queensland would benefit from access to more comprehensive fuel price information.
“But under the proposed national FuelWatch scheme, the marginal benefits of price transparency and decreased consumer search costs will come at the risk of higher petrol prices and reduced competition,” Mr Fites said.
“A modified scheme – one which removed the regulatory requirement for retailers to fix daily prices – would be preferable and of greater benefit to motorists.
“All the evidence available to RACQ points to the 24-hour price rule, as it applies under the current West Australian FuelWatch scheme, disadvantaging independent retailers against larger, multi-site operators, who would be better placed to manage the risk of incorrect pricing reducing their sales volumes or margins.
“That’s a concern to RACQ, since the viability of independents is vital to strong competition – and keen pricing – in fuel retailing.”
Mr Fites said that in south-east Queensland, motorists knew that Mondays and Tuesdays were the cheapest days in the weekly petrol price cycle – to the extent that around two thirds of total petrol volumes were sold on those two days.
“Under FuelWatch as proposed, there’s the risk the weekly cycle may stretch to two weeks, as has happened in Perth, leaving the most price-sensitive motorists with less opportunity to buy their petrol at or near wholesale price when the price cycle hits bottom.
Mr Fites said the Federal Government’s intention to make the scheme optional in regional centres pointed clearly to its being more about reducing price volatility in capital cities than actually making petrol cheaper.
“Many country motorists would gladly trade off the certainty of uniformly high pump prices throughout the week for a ‘cheap Tuesday’,” he said.
