Commuters are bracing for a hit to the pocket, with fuel tax and full-priced public transport fares set to be reinstated from 1 July.
The government’s move to reduce fuel excise duty and road user charges by 25 cents a litre was initially introduced in March 2022 for 3 months, in recognition of the volatility of the global fuel market and cost of living pressures. It was later extended into 2023.
As the scheme ends and the 25 cents per litre discount is added back on, once GST is added, customers are expected to see a price rise of about 29 cents a litre for petrol, and road user charges (RUC) will go back up by 36 percent.
In Porirua, several savvy consumers had beaten the queues and already filled up their cars. But with the tax expected to hike the price up from midnight Friday, many were already anticipating the pinch.
“I’ll probably be a bit more careful about the number of trips I do, or the reason for them, and trying to combine things a bit,” Theresa told RNZ, while filling up her car on Wednesday.
“I’ll definitely be doing more walking, et cetera, and stuff now rather than using my car,” said fellow driver Kristy.
Others, like Allison, have already started cutting back.
“We’ve definitely cut down on our groceries,” she said. “[We’re] trying to grow more food at home, but you know, that’s a lot weather-dependant.”
Waitomo Group owner Jimmy Ormsby told RNZ because it was a tax, it was a cost that would be completely passed back to consumers.
“Let’s be clear that the government took the tax off that product and they’re reinstating it,” he said.
But Ormsby said there was still a variance in the price different retailers offered fuel at, and recommended consumers shopped around to make sure they were getting the best price.
Douglas also had some tips on how to get more out of the tank.
“You use a remarkable amount of fuel accelerating and braking,” he said.
He also recommended checking the tire pressure and taking off unused roof racks to maximise efficiency.
At the same time as petrol goes up, train and bus tickets will also double for adult users.
Free public transport for under-13s and half price for those under 25 will remain, as was announced in the 2023 Budget.
Busy day expected with race to fill up, but calm prices predicted after the rise
Fuel company Waitomo said they were stocked up on fuel and ready for a busy day.
Big queues were expected at stations across the country on Friday, as people fill up, with their last opportunity to get cheaper petrol.
Jimmy Ormsby said this week had already been busy, and his stations were bracing for even higher demand on Friday.
“We will see a bit of a spike today as well, and obviously do our best to keep all our tanks full and keep the forecourts clear of our tanker trucks, but yeah – I think it will be a busy day.”
The Automobile Association predicted that after the initial price rises due to the fuel taxes being reinstated, prices would not go up much in the short term.
AA principal policy advisor Terry Collins said the market appeared to be stable right now.
“In the next few months I can’t see much increase in price, unless something significant happens in Russia – but even then I’d be a bit wary of that [leading to an immediate jump].”
Collins said companies may even introduce discounts next week, to attract customers.
“There will be probably discount offers in the coming week where the oil companies offer some form of attraction to buy their product, because they know if everybody tops up this week, there may be not so much sold next week.”
‘It’s just wrong’ – motorist
Lines at Costco and NPD were building today, with some people waiting about 20 minutes to get to the front of the queue.
Some motorists told RNZ they came last night but the lines were already too long.
Many shared the same fears that these fuel increases would make a bad situation worse.
One man shared his anger the subsidy was ending, despite him using diesel.
“I’m worried about the government being so greedy, they don’t need to put it back on when they already make GST on the petrol. It’s just wrong” he said.
Another woman feared it would hit some households hard.
“A lot of people are struggling at the moment as it is.
“I would use public transport but that’s no better, you got no choice really” she said.
West Auckland resident Izzy said she has no other option but to continue to use her car, commuting to the south of the city every day.
“We aren’t really that well connected out here with public transport, so I’m gonna have to trim down in other areas to get through” she said.
South Auckland resident Alex said he would try and share rides more often.
“This will have a big impact on me personally, I will probably have to spend 15 to 20 more [dollars] on fuel a week.”
“That means even less money towards my other expenses like groceries,” he said.