By Pip Hinman
The tax on petrol in last week's federal budget received a mixed response from environmentalists. Hailed by the Australian Conservation Foundation as a long-overdue environmental and health reform, Greenpeace and the Environmental Youth Alliance, however, remained sceptical of the government's motives saying the proposed five and 10 cent price rises for unleaded and leaded petrol would not necessarily cut leaded petrol usage.
Following an immediate 3% petrol price hike, leaded petrol is due to rise by 10 cents by next February and unleaded by five cents by next August. It is estimated that the rises will cost the consumer an extra $5-$10 a week from which the government hopes to make a revenue gain of $790 million, rising to $1.5 billion by 19961997.
Greenpeace's chief executive, Lynette Thorstensen, described the lead tax as a grab for revenue under the guise of an environmental initiative. She said that the federal government had used the leaded petrol debate to tax leaded petrol when the environmental focus should be on getting lead out of petrol.
"The government has imposed this price hike yet failed to produce a package of action to reduce lead in our environment. In doing so the government has mortgaged the mental health of Australian children on a tax which will simply go into government coffers", Thorstensen said.
Greenpeace has called on the government to raise the leaded fuel tax by no more than two cents a litre and to spend the revenue it raises on greater public transport funding, financial incentives to force the petrol industry to produce high octane unleaded petrol, and financial assistance to encourage greater use of unleaded fuelled cars.
Environmental Youth Alliance national co-ordinator Sam Wainright told Green Left that the tax on leaded petrol would simply penalise the consumer, while allowing the petrochemical companies off the hook.
"If the federal government really was serious about the health and environmental impact of lead, they would have moved to offset the price increases in petrol with a massive injection of funding into public transport. As it is, public transport has been allowed to deteriorate to such an extent that the public is forced to rely on the most polluting form of transport, the car", Wainwright said.
"While the budget allocated some extra money to fund a few niche environmental studies including grassland conservation and waste management strategies, EYA considers that it is still a far cry from being described as a 'win for greens'. Removing lead from cars will not stop people from using them. The fundamental problem is that this budget, in effect, ends up encouraging the use of cars."
Three million cars use leaded fuel — about 55% of petrol consumption — spewing an annual 4000 tonnes of lead into the air. .3-0.8 grams per litre, has the highest lead content in petrol of any industrialised country. Most European countries allow only 0.15 grams per litre. Health studies have linked lead in blood to impaired intellectual development in children as well as damage to kidneys and reproductive organs.
The rise in leaded and unleaded petrol excise was originally muted at a round-table convened by the federal environment minister Ros Kelly with state ministers, the ACF and the ACTU and petrochemical industry representatives in late July. An ACF recommendation to impose a five cent levy on leaded petrol which would raise more than $1 billion a year in government revenue was agreed, despite faint rumblings by state ministers worried about electoral flack.
The conference agreed that lead levels in petrol had to be reduced; Victoria and NSW agreed to reduce their lead levels to 0.2 g/l by the end of next year and other states to 0.3 g/l by 1994, aiming for 0.2 g/l by 1995. This was the government's compromise position struck with industry representatives who made it clear that it would not be profitable for them to move more quickly to reduce lead in petrol.
According to a Financial Review report of the conference, the refinery lobby was not prepared to make the necessary capital investment ($350 million) to produce greater volumes of higher-octane unleaded fuel for older cars even though these make up the bulk of current fuel consumption. A Mobil spokesperson told the Financial Review that he was happy with the outcome of the meeting, as it required little change to meet the new lead level requirements.
Community group representatives however were critical of the outcome. Denys Correll, executive director of the Council on the Ageing, expressed concern at the price owners of older cars would have to pay for fuel, and Elizabeth O'Brien of the Consumers Health Forum said she was disappointed that the conference accepted the petrol industry's position as the bottom line.