NZ govt extends cost of living support for families, businesses, opposed by climate advocates

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Wellington, Feb 1 (IANS) The New Zealand government is providing extra cost of living support to families and businesses to combat the ever-increasing inflation and address people’s concerns, while the Green Party is calling to stop subsidising fossil fuels during a climate crisis.

Prime Minister Chris Hipkins has promised to put a greater focus on the “bread and butter” issues the citizens are facing right now as he was sworn in last week, reports Xinhua news agency.

The petrol excise duty cut will be 25 cents per liter until the end of June.

Half price fares for public transport will be extended until the end of June, after which they will be made permanently half price for people with community services cards as previously announced.

“This is our first step in dealing with some of the persistent cost pressures on businesses and families,” Hipkins said on Wednesday.

Fuel excise, road user charges and public transport is a major cost for nearly everyone, he said, adding that transport is the third biggest expense on households after housing and food.

“The floods in Auckland and Northland are putting extra stress and financial pressure on families. Cutting fuel excise and keeping half price public transport give some extra relief as Auckland goes through a difficult period,” Hipkins said.

The cut in fuel excise reduces the cost of filling up a 40-liter tank of petrol by around $NZ11.5 ($7.4), and for a 60-liter tank around $NZ17.25.

The extension of all measures is estimated to cost about $NZ718 million, according to Finance Minister Grant Robertson.

Transport Minister Michael Wood said reducing the road transport sector’s fuel costs will keep the cost of food and essential goods lower.

However, one of the opposition Green Party is calling on the government to stop subsidizing fossil fuels during a climate crisis.

Instead, it should provide direct support to low-income households.

“Auckland has just experienced first-hand devastating impacts of climate change. It just doesn’t make sense to be extending subsidies for fossil fuels,” James Shaw, Green Party climate change spokesperson and co-leader, said in a statement.

“Subsidising petrol for everyone, including the highest income earners, is not the answer,” Shaw said, adding that the fuel tax cut is very poorly targeted.

The impact of inflation is not felt equally. It is people living on the lowest incomes who are hit the hardest. And yet, it is the top earners who benefit most from petrol subsidies, he said.

The subsidy is also a poor use of the transport budget, with Auckland’s transport infrastructure damaged so badly from the ongoing climate-fuelled flooding, Shaw said.

“The money spent on a fuel tax cut would be far better spent making half-price public transport permanent, along with sustained and permanent investment in more reliable and efficient public transport infrastructure,” he added.

–IANS
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