Government looks at ways to reduce fuel costs

In response to mounting calls from Barbadians to address the rising costs on fuel, Government intends to implement significant changes to the current excise tax normally placed on the product.

Speaking on Sunday’s edition of VOB’s Down to Brass Tacks, Minister of Energy, Small Business and Entrepreneurship, Kerrie Symmonds, said the Government was currently in talks with the social partnership about ways in which fuel prices can be less burdensome on consumers.

“One of the things that the Ministry is recommending to the social partnership, which must determine their position on some of these things, is that we feel that that is an area where there could be some adjustment made to assist consumers, within the area of the excise tax,” Symmonds said.

“There is room, we believe, for us to recommend a sensible adjustment, and we think that adjustment perhaps should be best located at the exercise,” he said.

Another suggestion made, according to Symmonds, was for the fuel marketers on the island, namely Sol and Rubis, taking on some of the burden associated with the costs, in order to help drive prices down.

“There is also in the pricing structure a thing called the margin, which is given to the marketers … and I believe that there is a principle in these matters that is called burden sharing. In accordance with the principle of burden sharing, part of the discussion that we have to have with the social partnership must be whether or not there can be some shared burden on the part of the marketers.

“If the state is going to say in the interest of consumers that we will intervene at a specific point … then we are equally saying that there should be a look taken at the margin for the marketers because they too should be expected to share a little bit of the burden.”

The Energy Minister also revealed that one additional policy option on the horizon is for Government to purchase a larger supply of fuel, more than is currently done, and store the island’s reserve fuel in Trinidad, where they currently have the capacity and infrastructure required to keep this energy source stored in a safe manner.

“If you can get a larger supply at your disposal, then you probably will be getting in the end on a per litre basis, a better deal for the dollar. It may well be one of the options that we have at our disposal that we never explored before.

“The difficulty in that, as you would appreciate, you then have a relationship with another country over your energy supply. It would not be a totality of control, but it would be a sharing of the capacity that we have. There are those who would reflect on relationships within CARICOM from time to time and say that sometimes they are turbulent, and sometimes they are not turbulent… but it is an option.” (SB)