Bligh ends Queensland fuel subsidy

QUEENSLANDERS will pay an extra 8 cents a litre for their petrol within weeks after the government decided to scrap its fuel subsidy.

Premier Anna Bligh told parliament the 8.3 cents a litre subsidy would end on July 1.

Announcing the move, she detailed her plan to renew Queensland's finances and reshape the State's economy.

Premier Bligh said the Renewing Queensland Plan was focused on ensuring the State comes through the global recession stronger, not weaker – and prioritises jobs and the Government's $17 billion building program.

"Mr Speaker, we currently spend more than $500 million a year in a fuel subsidy program," Ms Bligh told Parliament.

"But Queensland taxpayers and the motoring public are not getting value for money.

"The recent independent Pincus inquiry identified that Queenslanders are not receiving the full benefit of what taxpayers are spending on the scheme.

"We also know that NSW motorists are crossing the border to take advantage of this subsidy.

"And the proposal by the NSW Government to abolish their tiered fuel-subsidy scheme from July 1 will only make it more attractive for NSW motorists to cross the border to fill up their tanks.

"Queensland taxpayers should not have to subsidise interstate motorists.

"That does not represent value for taxpayers’ money.

"So Mr Speaker, the Government has taken the decision to end our fuel subsidy program as of July 1 this year."

The Premier said she did not want to diminish the burden the decision would place on motorists.

"But it will also save taxpayers more than $2.4 billion over four years and is part of our strong plan to regain our AAA credit rating and restore the Budget surplus...without jeopardising vital infrastructure like hospitals, schools and roads," she said.

"It is a sacrifice we are asking of Queenslanders to play their part in keeping the building program going and protecting the 119,000 jobs it supports.

"The fact is that at the moment and for the next several years Queensland would need to borrow the funds necessary to keep the fuel subsidy program going. And in times of difficult choices, that is a luxury Queenslanders can no longer afford.

"Paying off our debt faster is like paying off a home faster – this measure alone means we will save almost $300 million in interest payments over the next four years."

Should the fuel subsidy have been axed? Leave a comment below and tell us what you think.

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