Christian Kerr writes:

With one leap he was free? Not quite.
Yesterday’s energy statement will take some of the sting from petrol pain – but it’s typical Howard
Government b-ggering around.

Labor’s made much of the fact that money
for LPG conversions isn’t much good if you can’t get a conversion done. That’s
true – but what about the environmental aspects of this move?

The LPG conversion subsidy doesn’t do
anything to encourage people into more fuel-efficient vehicles. It seems to
benefit off road vehicles and larger cars, both of which can be dangerous fuel
guzzlers. What about incentives to use smaller, more environmentally friendly
vehicles – which have no room on board for LPG tanks?

Once again we seem to have typical John
Howard big government, toss money at the problem solutions on offer – solutions
that distort the markets.

Encouraging people to use LPG is a good
thing. Don’t get me wrong. Despite what some of Bob Brown’s hair-shirt Hezbollah
say, I’m pro-environment. Australia
has lots of LPG. It burns cleaner and produces less carbon dioxide per
kilometre driven than petrol.

But in true Howard Government fashion,
yesterday’s package takes with one hand and gives back with another – and adds
to the tax bureaucracy in the process.

Rather than cutting taxes on LPG and
biofuels, they’re raising them – then handing the money they raise back as a
rebate. The PM says this will result in a “transport tax regime that s both
efficient and fiscally responsible”. Pig’s a-se!

And equally specious is the PM’s reasoning why
global oil supplies are tight. “On the supply side, an extended period of under-investment in global
exploration and refinery infrastructure has limited the capacity of the
industry to respond quickly to the surge in world demand,” he says.

Only the most bullish oil analyst would say that underinvestment in
exploration and refining capacity is the whole story. The fact is that no one
is making big oil discoveries any more. They haven’t for 20 years. Maybe

Think about it. Oil exploration technology is vastly better that it was
back then. There are a lot more people out looking for the stuff. There’s money
to be made – but they are finding much less oil. Or certainly much less of the
cheap stuff that just gushes out of the ground.

But the tax revenues keep flowing strongly – and that means crass
handouts from the Howard Government do too.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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