Pedestrian Council of Australia & BicycleNSW

JOINT Media Release

Wednesday 21 September 2005

NRMA ON THE WRONG ROAD

The Chairman of the Pedestrian Council, Mr Harold Scruby and BicycleNSW CEO, Mr Alex Unwin said that tomorrow’s NRMA Petrol Price Summit was focused on the wrong subject.   The major issue facing our nation is not about reducing petrol prices, it’s about reducing car-dependency.

Mr Scruby said:  “Nowhere in the NRMA’s literature have they mentioned anything about car-dependency.  And they have not invited representatives from the public transport or active transport (walking and cycling) groups.  This is all about keeping petrol prices low so we can have more cars on the road.

For the last 2 days, 2GB’s Alan Jones has spoken openly about the need for rational debate on this vital subject.  Here are some quotes:

·          “But we can't turn the petrol pricing debate over to the alarmists.

·          “It is not the responsibility of government to make a scarce resource cheaper and oil/petrol is a finite resource.

·          “If the higher petrol prices make us think about public transport rather than driving the car, that is no bad thing.

·          “We need to drive less, drive more economically, share private transport and make better use of what public transport there is.”

·          Mr Jones quoted Robert Samuelson, a member of the Washington Post Writers' Group:  "What the United States needs is a petrol price of $4 to $5 a gallon.  Now, America currently pay $2.80 a gallon, (or 95 cents a litre). What America needs most is ‘a steadily rising oil tax.’  Elsewhere he argued that the traditional US car companies, General Motors, Ford and Chrysler are the least prepared for change.  He said, "They tied their fortunes to the biggest 4WDs and pick-ups, hence the need for a stiff oil tax."

Mr Unwin said:  “The fuel crisis is a perfect opportunity to encourage the community to seek more economical (and healthier and more environmentally sustainable) means of active transport like walking and cycling.

“Bike transport is a viable, environmentally efficient and inexpensive mode of transport that will also result in better health and well-being.  The issue is not petrol prices. It is educating Australians not to rely on motor vehicles; if we follow the European trend of using bikes as main form of transport, we would be a much healthier nation,” Alex Unwin said.

Mr Scruby added: “We must shake off our western culture arrogance and imagine the price of petrol and the effects of global warming, if the people of China and India were to be as car-dependent as us.  Petrol prices would go through the roof and the bitumen would melt.  We must start setting an example and reduce car-dependency immediately, before it’s too late.

“We therefore encourage all Australians to participate in Walk to Work Day on Friday 7 October 2005 and ‘Leave the Car at Home’.

See:  www.walk.com.au

Mr Unwin said: “And for people wanting to try alternative forms of commuting, Portfolio Partners Sydney Spring Cycle on Sunday 23 October 2005.” See  www.bicycle.nsw.org.au 

CONTACT:  Harold Scruby -  (02) 9968-4555 or (0418) 110-011

Or Alex Unwin at Bicycle NSW on (02) 9281-4099  (0425) 221-060 

Alan Jones - Today Show Editorial

PETROL - 21 September 2005

Yesterday I said something about petrol prices and argued that, most probably, we weren't being told the truth about petrol prices and why we should be paying what we are paying.

I said, "No government should responsibly encourage petrol guzzling."

Well, when I came off air, a piece lobbed on my desk by Robert Samuelson, who is a member of the Washington Post Writers' Group.

He opened by saying bluntly, "What the United States needs is a petrol price of $4 to $5 a gallon."

Now, America currently pay $2.80 a gallon, or 95 cents a litre.

He was arguing that what America needs most is "a steadily rising oil tax."

And he said, "Coupled with stricter fuel economy standards, higher pump prices should push reluctant auto companies and American drivers away from today's gas guzzlers. That should be American policy."

He said, "The deafening silence on this crucial subject from the White House, Congress and the media is a sorry indicator of national short-sightedness."

He said, "Katrina's message is clear. America is vulnerable to any major oil cut off."

I was arguing yesterday that this is the message WE must hear.

Samuelson argued, "Two thirds of the world's proven oil reserves lie around the Persian Gulf. The countries there, led by Saudia Arabia, now provide about a quarter of today's oil supply. The flow could be interrupted at any time for many reasons - terrorism, war, domestic upheaval or deliberate cuts."

But then he said, "Many other oil exporters are similarly unreliable - Russia, the number two exporter, Venezuela, the number 5, or Nigeria, the number 8."

He said, "A prudent society would respond to this unavoidable insecurity."

Now remember I said yesterday that price is a barometer of scarcity or that insecurity.

America has 225 million vehicles on the roads.

Samuelson said, "From 2003 to 2025, the number of vehicles may grow by 50%."

He said, "The upshot is, to keep total petrol consumption constant, average fuel efficiency would have to improve by roughly 50%."

Elsewhere he argued that the traditional US car companies, General Motors, Ford and Chrysler are the least prepared for change.

He said, "They tied their fortunes to the biggest 4WDs and pick-ups, hence the need for a stiff oil tax."

Samuelson said, "The US government needs to foster a market for fuel efficiency. One way or another, America should know the era of cheap petrol is over."

Well that, too, is our message.

As I said yesterday, by world standards, we have had it pretty good.

And even now, our petrol price is still lower than most developed countries.

We need to drive less, drive more economically, share private transport and make better use of what public transport there is.

We currently spend $15 billion on imported crude oil and refined petroleum products.

17% of our overall consumption is imports and, by 2020, it's said the figure will rise to 46%.

I call that fairly vulnerable.

As one writer here put it yesterday, "Whenever it begins losing domestic, political or economic arguments, the Howard government flicks the switch to terrorism. But around the world, experts are beginning to ask whether energy insecurity is the greater threat of the 21st century."

It might be time we took note.

Alan Jones - Today Show Editorial

PETROL PRICES - 20 September 2005

Everything these days seems to be a virus.  The political virus overtaking all of us seems to be petrol prices.

And suddenly there are calls for the Federal government to cut the 38 cent a litre excise.

Or, make fuel exempt from the GST.  Or, grant special relief to small businesses and those in the bush.

Now, much as I would like to recommend all or some of these, I can't.

It is not the responsibility of government to make a scarce resource cheaper and oil/petrol is a finite resource.

That said, most of us have reservations about the behaviour of oil companies.

And it's clear that retail margins and refining margins have grown substantially as the price of a barrel of crude oil has climbed.

Consumers are entitled to ask whether oil companies can justify their current profit margins.

Is profiteering taking place on the back of a tragedy like Hurricane Katrina?

Certainly, oil companies are raking in millions of dollars as a result of bloated refining margins.

There is more than a strong suspicion that the consumer is being dudded.

And, quite frankly, it would do no harm for the Federal government to haul oil company executives down to Canberra to face some legitimate questions.

After all, the Prices Surveillance Act is meant to "Vet the proposed price rises of any business organisation" and "to hold inquiries into pricing practices and related matters."

It may be time for the Price Surveillance dogs to be let loose.

But that is separate from the way in which the issue of petrol prices is currently being presented.

The reality is, price is a barometer of scarcity.

If potatoes are scarce, you will soon find the price goes up.

So the headlines say, basically, the government must step in and reduce the price of petrol.

Such an argument is less than honest.

Apart from Hurricane Katrina and the problems it has created with supply, there have been massive increases in the demand for oil from India and China as their economic growth rates climb.

But the reality is, we are being sent a signal.  The signal says scarcity.

Quite frankly, no government should responsibly encourage petrol guzzling.

If the higher petrol prices make us think about public transport rather than driving the car, that is no bad thing.

Or, if we learn that big cars are less affordable so we choose something smaller, that's no bad thing.

If we decide we have had enough of petrol prices and will convert to LPG so that we can drive from Sydney to Brisbane for about $80, that's no bad thing.

And if the government were to mandate at least a 10% ethanol component in all petrol, then that would make sense.

Though it appears that the Federal government have already caved into the oil companies on that front and I believe we will shortly get an announcement to prove that we are miles behind the rest of the world on mandating ethanol.

How that fits with the current climate, who knows.

But we can't turn the petrol pricing debate over to the alarmists.

As the respected finance writer, Alan Kohler wrote the other day, since 1980, the oil price has gone up 75%, but milk has gone us 262%.

The price of a Commodore, 326%. The average weekly wage, 351%. And the average house price, 708%.

So, at the end of the day, we aren't doing too badly.

And the screaming headlines about a petrol pricing crisis bear little relationship to either the truth or what may be in our long term best interest

Media Release
12 September 2005

NRMA will today invite the Federal and NSW governments, oil companies, the Service Station Association, the Australian Consumers Association and the Australian Consumer and Competition Commission to attend a crisis meeting in Sydney.

NRMA has proposed a detailed agenda which will examine:  Ways to provide relief for motorists from the highest petrol prices in more than a decade.

Improving accountability by the petrol industry and government for revenue they receive.

Whether the Australian Competition and Consumer Commission needs widened powers to ensure motorists pay a fair price.

NRMA President Alan Evans said the Summit would focus on practical ways of providing relief for motorists.

“Families are now paying up to $100 every week to fill up the car - the public needs a proper explanation for the prices they are paying,” Mr Evans said.

“All the parties that receive petrol revenue – including the oil companies, service stations and Government – need to be more accountable.”

Mr Evans said the State and Federal governments must look again at some means of giving motorists relief.

“The spike in petrol prices has provided both governments with a windfall in GST revenue – all means of delivering of relief ought to be considered, including petrol subsidy schemes and a review of fuel tax,” Mr Evans said.

The NRMA also plans to include representatives of alternative fuel organisations to ensure LPG, ethanol and other options are also canvassed.