Independent servos say they are battling to match the prices of discount fuel retailers while grappling with rising commercial rates, after the ACT Chief Minister threatened an unprecedented intervention in the territory’s fuel market.

Scott Desmond, manager of Caltex Independent in Fyshwick. Mr Desmond says the idea small servos are making $800,000 in profit per year is ‘laughable’.

While the Independent Competition and Regulatory Commission’s draft report on fuel prices found Canberra’s service stations were making nearly double the profit of those in nearby regional towns, Caltex Independent manager Scott Desmond said most small operators were “not trying to print money or drive Porsches”.

“We’re not making $800,000 per year, that’s laughable. I’m not Coles or Woolies, we don’t have the negotiating power of 50 lawyers, we’re just a family business trying to make an existence,” Mr Desmond said.

“As small guy I’m getting strangled here. I can’t overlook the fact when I do my monthly reports, it literally goes through my head ‘Do I have enough to cover the next fuel delivery?’.”

Despite the name, Mr Desmond’s only link with Caltex is that he buys fuel off them.

He said the use of discount sites like Costco and Metro as fair comparisons was “total insanity” as they sold their petrol cheaper than he could buy it.

“Yes I’m an independent and I want to do the best price possible but I can’t compete with Costco because effectively they’re a fuel wholesaler that’s providing their own fuel 15-30 cents cheaper a litre than even I can buy it,” Mr Desmond said.

Getting fuel delivered to Canberra added 3-4 cents per litre compared to about 1 cent in Sydney, he said.

But the real killer was his commercial rates, which have risen about 130 per cent in the past five years.

“The theme from the fuel inquiry is that independents will save the day but our rates are about $86,000 an annum – 66 per cent more than two kilometres over the road in Queanbeyan. That’s 66 per cent more I have to make on fuel sales and that’s before wages and expenses,” Mr Desmond said.

“I don’t benefit from the payroll tax cuts. I’m a service station. I have massive amounts of concrete for trucks to pull up on and park and two staff.”

A parliamentary inquiry into fuel prices will hand down its draft report soon.

Extracted from Canberra Times