Ardern: fuel increase not a tax, it’s an excise

When asked about it being a proposed 10% increase in fuel prices, Ardern is on RNZ trying to avoid saying it is a tax, she says it’s an excise.

This sort of playing with semantics is high risk for Ardern.

Especially when they made claims like this during the election campaign: Labour – no new taxes in first term

Labour won’t implement any tax changes until after the 2020 election, finance spokesman Grant Robertson has announced.

“To avoid any doubt, no one will be affected by any tax changes arising from the outcomes of the Working Group until 2021,” Mr Robertson said at Parliament on Thursday morning

“There will be no new taxes or levies introduced in our first term of Government beyond those we have already announced.”

Robertson made it clear there would be no new taxes or levies – but didn’t mention excise increases, so he’s off the hook there. Maybe.

Oxford dictionary: excise

[mass noun, usually as modifier] A tax levied on certain goods and commodities produced or sold within a country and on licences granted for certain activities.

Labour are still ok on this, it won’t be a new excise (tax), it would just be an increase in an existing one.


Fuel pipeline and Plan B

Should we have a ‘Plan B’ for everything? Some have said we should have had a backup to a bust fuel pipeline.

This has caused major disruption at Auckland Airport in particular.

Stuff:  Possibility of prosecution after leak closes crucial jet fuel pipeline

The Northland Regional Council said it was investigating the circumstances that led up to a fuel pipe line from a Northland refinery being temporarily shut down.

The 168-kilometre pipeline – which carries jet fuel, petrol and diesel directly from the oil refinery at Marsden Point in Northland to tanks in Wiri, south Auckland – has been out of action since Thursday afternoon, when refinery workers noticed a drop in pressure.  A jet fuel leak was located on a rural property 8km south of the refinery later that afternoon.

Refining New Zealand spokesman Greg McNeill said on Monday initial investigations showed a digger “scraped” and “cut” the pipe.

Prime Minister Bill English said that a contingency for this type of incident had been previously been looked into but wasn’t economically viable.

“There have been a couple of studies done that looked at different alternatives for backing up the current infrastructure, and the decisions were made that the investment that would be required to double up would be too much to be passed onto consumers.

“But I expect that after this that they’ll go back and have another look at it.”

Airport chief executive Adrian Littlewood said some 27 domestic and international flights were cancelled over the weekend, while others travelled via other airports to refuel.

McNeill said they believed it would be fixed between September 24-26.

“Getting the product down to Wiri where it is stored is the key to us, we’re working toward a definite timeline,” he said.

Once the jet fuel is back at Wiri it will undergo about 30 hours of processing before it is certified and taken on to the airport.

It happened during an election campaign so it is more political than usual: Government knew of jet fuel supply concerns: Labour party

Labour leader Jacinda Ardern says the Government has known for years there were serious risks to the supply of fuel to Auckland International Airport.

In a statement this morning, Ardern says Air New Zealand raised the issue about additional jet fuel supply storage in 2012 but the Government instead set up a raft of “mishmash of minor initiatives”.

It goes back further than that – the Clark led Government also considered pipeline options in 2005.

But the fuel supply and pipeline are privately owned.

Deputy Prime Minister Paula Bennett was grilled by Guyon Espiner on Morning Report over a cabinet paper from 2012 in which officials advised then Minister of Energy and Resources Simon Bridges of the serious impact of a shutdown.

“It’s not owned by the Government, it’s owned by the fuel companies and it is their job to get their product to the source where it’s needed.

“I’m sure that we will now look at that and make sure we’ve got it all lined up properly …there’s other alternatives to a second line, and there might be things like extra storage needed in Auckland that goes beyond the eight days.”

Stuff Editorial: Burst pipe shows importance of having a plan B

There is a sense of deja vu in all this. New Zealand has seen before how failures in small but critical parts of its infrastructure can lead to disproportionate disruption.

In 1998, central Auckland suffered a five-week power cut after four electricity cables failed. The outage started with one old and obsolete cable, which triggered another, and then two more.

In 2011, a landslide caused a leak in the Maui gas pipeline north from Taranaki. It was fixed within six days, but the failure is estimated to have cost the economy $200 million.

The interdependence of some of the country’s networks was demonstrated in 2012, when a power cut in a Wellington control centre crippled the entire Auckland railway network.

We haven’t even begun to consider massive disruption caused by large earthquakes, the continued closure of the Manawatu Gorge, or damage caused by weather events – such as the failure of stopbanks protecting Edgecumbe – which are likely to become more frequent.

For all the talk about how infrastructure development fuels national growth, sometimes not enough care is taken to protect the assets that we have, even when the risks are known. Lip service is given to building resilience, but the truth is this is expensive.

Yes, expensive.

The vulnerability of the 30-year-old Marsden Point to Auckland pipeline was highlighted in a report by the Ministry of Business Innovation and Employment in 2012. It seems nothing was done about it.

I don’t know if nothing was done, but a new pipeline wasn’t installed, a tanker ship wasn’t put on permanent standby, the storage tank capacity at Wiri wasn’t doubled, the 170km of pipeline wasn’t continuously patrolled.

Winston Peters didn’t even suggest moving Auckland Airport to Whangarei.

How important, or feasible, is it to have back up plans for everything?

They could have a second pipeline from Marsden Point to Wiri – that would have to follow an entirely different route to be safe.

Auckland could have stand by motorways in cash a crash disrupts traffic.

They could re-introduce rail ferries from Wellington to Lyttleton in case there’s another Kaikoura earthquake – but what if the next earthquake is in Wellington?

We could all have two cars and two houses and two jobs, just in case.

The Government could make us have a plan B for everything.

Or we could have infrastructure that makes economic and practical sense, and risk the occasional bit of disruption.