By Mr N Singh MP

National Assembly 6 May 2008

Madame Speaker,

Tomorrow the price of petrol and diesel will rise for the umpteenth time in recent months. The cost of fuel is now so high that even the petrol pumps cannot keep up anymore!

Of course, this is no laughing matter as high fuel prices drive a range of other prices upwards. The worst of these for the poor is the cost of food where recent increases have far outstripped the average inflation rate leading to a situation where more and more already poor people are struggling to feed their families.

It is so that external factors are driving fuel price increases and that we have little control over those factors. However, the IFP believes that it is time for our government to investigate pro-active measures that could assist motorists and the economy as a whole to cope better with high fuel prices.

One such measure could be the reactivation of the Equalisation Fund which previously was used to smooth out price fluctuations and lessen the immediate shock to the economy and the public at large. This government has done so in the past.

We know that the fund is dormant and that no levy is being collected at the moment, but the legislative framework is still in place and the Minister of Finance could reactivate the fund if studies show that it would be beneficial in the long run.

The IFP therefore calls on the Minister of Finance to launch an immediate investigation into the possibility of using the Equalisation Fund to smooth out fuel price increases to lessen the short-term shock of recurring sharp price increases. Perhaps one of the ways of accomplishing this would be quarterly implementation of increases or decreases in the fuel price.

Thank you.