Dialogue: Pump up the volume and lower the prices

By TONY GEE

Petrol price movements occur so often now that they rarely rate more than a passing mention in the national media.

But whichever push-button excuse the oil companies trot out to justify a price rise, or to concur with competitors that it's time for a decrease, main city petrol prices are almost always the only figures quoted.

That's unfortunate because it gives the bulk of the motoring population no idea of prices paid at the pumps by people living in relatively remote regions.

The term remote is used simply to indicate the extra distance oil tankers have to travel from main cities to deliver to service stations further up and down the track.

But it's a great excuse for the oil barons to use as an opening shot in defence of why prices at small town, provincial and rural petrol pumps often bear little relation to what city-dwellers pay.

In the Far North, petrol prices at pumps for unleaded and premium petrol are generally 7c to 9c higher than in Whangarei.

And prices there may be a couple of cents higher than in Auckland.

No wonder some city visitors from north and south of the harbour bridge fall about when they fill up for the first time in the Far North.

Apart from extra distance and transport costs, oil companies have in the past also wheeled out the Far North's low population and market factors when excusing themselves for prices of $1.21 to $1.25 for unleaded 91 petrol and anything from $1.26 upwards for premium 96.

A $20 note tendered at most Far North petrol pumps will buy about 16.5 litres of 91 and about a litre less of premium. Until, that is, one of the big four gets edgy and its price goes up, followed within 48 hours by all the others. You know how it works.

Low volumes and not enough people using too little product have been the stock answers when Far North groups have occasionally challenged the barons and queried prices.

One company really took the excuses cake a year or so ago with an argument that stunned Kaitaia.

The reason prices were so high in the town and nearby was that people were prepared to pay that price for petrol, and as long as they were prepared to pay, nothing much was going to change.

What are Far North people supposed to do? Pay what they think is reasonable, confront service-station staff on the forecourt, drive away and be arrested?

Or boycott the pumps en masse? Leave their vehicles at home and take virtually non-existent public transport? There are no trains or local bus services around here.

Cry for a Gull station? We'll cry a long time.

Retailers have also copped some blame because of their margins on top of the product-delivered price. Retailers set their own margins, we're told; it has nothing to do with the oil companies.

Some of us get the impression the oil companies don't really want to be bothered with us up here. We're all too much trouble and maybe we squeeze those all-important profit margins a bit too tight.

But do we? One or two longtime Far North campaigners on this issue have claimed that the reverse is true, and that at least one or two of the big four are doing very nicely out of Far North margins.

We'll probably never know, but one thing that is obvious is the state of many Far North local and secondary roads after heaps of petrol tax money is generated specifically for roading.

In 1999-2000, the Government reaped a total of $413 million in petrol taxes for its national roads fund. This came from a 13.6c tax on every litre of petrol sold.

Into the Crown account during the same period, as a general excise tax, was poured $568 million from an additional 18.7c-a-litre petrol tax.

Money from that account, of course, is for general Government spending. And that's what makes a lot of people everywhere, but particularly in the Far North, extra grumpy.

The region has more than 1800km of unsealed and often substandard roads out of a total district network of 2500km (excluding state highways), so some Far North heavyweight with a loud mouth needs to make a lot of noise in Wellington about getting a bit more of that petrol tax.

Many here might be more inclined to accept some of the country's highest petrol prices if we knew that a little more of what we pay at the pump was going towards upgrading or sealing local roads.

We're getting slugged and we've got nothing to ease the pain.