Monday’s national cabinet meeting of the commonwealth with state and territory leaders is highly unlikely to mandate compulsory “Covid-style” measures to manage Australia’s fuel shortages and rising prices. Nor should the states, acting individually, mandate working from home, although it may be encouraged in some instances, especially where long commutes and lack of public transport are problematic. Other nanny state measures also need to be resisted, with the economy encouraged to function as strongly and freely as possible.
Fuel rationing could be on the agenda, although fuel imports continue to flow, but improving distribution, especially to regional and farm areas, is one of the most important tasks for governments, with prices soaring and more than 600 service stations nationwide running out of at least one type of fuel. Krowera farmers in southern Victoria, who have also been robbed of diesel, told The Australian last week it was costing them $1000 to fill a tractor for a single day’s work. Many are being forced to choose between buying fuel and fertiliser. Such dilemmas will inevitably flow on to prices for shoppers, and to export revenue. The impact of the conflict on fuel and fertiliser supplies and prices probably partly explains why Australians are emphatically opposed to the US action in Iran, with 72 per cent disapproving (including 50 per cent who strongly disapprove) in the latest Newspoll released on Monday. More than two-thirds disapproved, in every age group. The poll also found just 30 per cent support among Australians for deploying naval vessels to keep the Strait of Hormuz open, less than half the 63 per cent who disapproved.
While the Prime Minister is leaving open the option to match the Coalition’s push for a temporary cut to the fuel excise, it is not the preferred approach of some senior government MPs, Greg Brown and Geoff Chambers report. And Australian Chamber of Commerce and Industry chief executive Andrew McKellar cautioned Labor against adopting the Coalition’s policy to cut excise because doing so would be more expensive and less targeted. Nor would doing so address supply chain problems. Long term, Australia also needs to review its policy on fuel reserves in light of the crisis. Japan, in contrast, keeps 250 days’ supply in reserve.
The war, the fuel and fertiliser supply crises and the economic fallout will do much to shape the May budget, depending largely on how long the conflict continues. In view of the $1 trillion national debt, inflation, rising interest rates and weak productivity, business is correct to urge Jim Chalmers to hold firm and deliver a reforming budget, as he has foreshadowed.
The economic climate also demands spending restraint, including tightly means-testing any new cost-of-living measures.
Extracted in full from: https://www.theaustralian.com.au/commentary/editorials/nanny-state-measures-need-to-be-avoided/news-story/d325721285977568df8ed2eabdd20ccd
Ahead of a serious nationwide crisis in fuel supply – which is not yet the current position and depends on the war – the Albanese government is taking a sensible step in underwriting the purchase of fuel by the private sector. The new power, Anthony Albanese announced, will allow the government to help guard against future supply chain disruptions by working with suppliers to keep fuel flowing to Australia. It will be used if the cost of additional cargoes would be prohibitive for private suppliers to source on commercial terms. Much depends on the progress of the Iran war and the regime’s actions in maintaining its blockade of the Strait of Hormuz, and the actions of its terrorist proxy, the Houthi rebels, holding up shipping in the Red Sea.