Steane Klose | Nov 14, 2008

The national Fuelwatch scheme has been defeated in the Senate and the Victorian Automobile Chamber of Commerce (VACC) has come out in support of the Senate action in rejecting 'this flawed scheme’.

Claiming it ‘a victory of commonsense’, the VACC claims that the scheme, purported to save motorists money on fuel, would actually have resulted in higher prices at the pump.

“While the Government may decide to re-introduce the proposed scheme at a later date, for now, the message is clear. Fuelwatch is finished,” VACC Executive Director David Purchase said.

In August, VACC made a submission to the Senate Economics Committee, on behalf of independent service station owners in Victoria and Tasmania, stating it was ‘opposed to regulation of prices in the retail fuel market'. The VACC is of the opinion that the Fuelwatch scheme would have disadvantaged independent retailers and given even greater control of the market to the oil majors and their supermarket partners.

The VACC believes that increasing competition and greater transparency at the wholesale level, is the most effective way to see price reductions at the pump. This would entail allowing independent service station operators “fair and equitable access to competitive fuel supply at the terminal gate”, which they are currently denied by a wholesale market completely controlled by the oil majors.

“VACC believes the proposal by the Service Station Association (SSA) to force the oil majors to share port facilities with competing importers will introduce greater competition at the wholes level," Mr Purchase said.

With Fuelwatch off the agenda for the time being, the VACC has recommended that the ACCC’s and its new Petrol Commissioner, Mr Joe Dimasi, turn their attention to the operation of the wholesale fuel market, the buy/sell arrangements and the relationship between the oil majors and their supermarket partners.

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