Govt to further probe petrol prices and beef up Commerce Commission powers by enabling the consumer watchdog to undertake broad market studies

Minister of Energy and Resources Megan Woods has asked the Ministry of Business, Innovation and Employment to further investigate fuel prices, suggesting there has been a transfer of wealth from consumers to fuel producers to the tune of hundreds of millions of dollars since 2008.

And Minister of Commerce and Consumer Affairs Kris Faafoi has asked bureaucrats to fast-track work enabling the Commerce Commission to undertake market studies, which would compel companies to provide information to the Commerce Commission enabling it to better understand how markets are functioning. Faafoi says the Commerce Commission needs to be able to self-initiate these studies where markets are not doing a good job for New Zealand consumers.

“Having thorough information and shining a light on a market enables us then as Government to decide if we need to take any action,” says Faafoi.

Here’s a press release from Woods and Faafoi.

Govt pushing for fair deal for consumers

The Government is acting on key consumer concerns, with Minister Megan Woods asking the Ministry of Business, Innovation and Employment (MBIE) to further investigate fuel prices and Minister Faafoi moving to progress broad market studies powers for the Commerce Commission.

The decision by Minister of Energy and Resources Megan Woods follows an update by MBIE the on the Fuel Market Financial Performance Study released earlier in the year.

“The report highlights concerns about the price Kiwis are paying at the pump. This was based on the rising levels of importer margins since 2008 and a rising spread of retail prices between Wellington and the South Island and the rest of the North Island.

“The update notes that over the last nine years, New Zealand has gone from having some of the lowest pre-tax fuel prices in the OECD to the highest. MBIE notes that the rise in margins since 2008 represents a transfer of wealth from consumers to producers to the tune of hundreds of millions of dollars” says Megan Woods.

Minister of Commerce and Consumer Affairs Kris Faafoi has asked officials to fast-track work to enable the Commerce Commission to undertake market studies – this power compels companies to provide information to the Commerce Commission to fully understand how markets are functioning.

“I’m aiming to get legislation complete and to have market studies powers in place by the end of 2018. And the Commerce Commission also needs to be able to self-initiate these studies where they see that markets are not doing a good job for New Zealanders.

“Having thorough information and shining a light on a market enables us then as Government to decide if we need to take any action,” Mr Faafoi says.

“While these powers are being provided for, I have also instructed MBIE officials to continue to monitor the market and explore options for regulatory interventions to enhance competition as required,” says Megan Woods.

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