Queensland’s fuel subsidy will be abolished next month saving the state about $2.4 billion over the next four years.
Announcing the abolition of the subsidy today, Premier Anna Bligh said the move from July 1 would make a significant difference to the State Budget bottom line as the global financial crisis saw Queensland revenues take a huge hit.
"The simple fact is that we have a $14 billion hole in our budget bottom line caused by the worst global recession in our lifetime and we must think carefully about what we spend and get real value for Queensland taxpayers," Ms Bligh said.
"The simple truth is that the fuel subsidy is a luxury we can no longer afford.
"This is a move that will make a big difference for our budget, saving around $2.4 billion over the next four years in addition to $300 million in interest payments."
The fuel subsidy was due to cost $582 million in 2009-10 and $599 million in 2010-11, rising to $617 million in 2011-12.
Treasurer Andrew Fraser said the rationale for the decision to scrap the subsidy was also based on the fact did not represent good value for money.
"The recent independent Pincus inquiry indentified that Queenslanders are not receiving the full benefit of what taxpayers are spending on the scheme," Mr Fraser said.
"Queensland taxpayers should not be footing the bill for interstate motorists who are crossing the border to take advantage of our system - a proposal by the NSW government to abolish their tiered fuel subsidy scheme as of July 1 will only make that situation worse.
"This is not a decision that was taken lightly but in such tough times, our focus has to be keeping our record building program going and protecting Queensland jobs.
"This is part of our determined plan to regain our AAA rating and restore the Budget to surplus while at the same time protecting jobs and building the schools, hospitals and roads we need today and in the years to come."
2 June 2009
Media: Premier’s Office 3224 4500
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