Key confirms Government will increase household power bills by $200-plus this year


Prime Minister John Key's admission on television this morning that National’s ETS will add 5 per cent to household power bills on July 1 will pile even more pressure on family incomes, Labour’s Energy spokesperson Charles Chauvel says.

“John Key’s admission confirms that households will be hit with an extra $200 per household per year to the cost of power,” Charles Chauvel said.

"Generators have already told Parliament's Finance and Expenditure Committee that they will need to increase power prices by 5 per cent per annum in order to continue to meet demand.

“If you add the 5 per cent increase from the ETS to that amount as well as the 2.5 per cent increase in GST from 1 October, this means an increase of 12.5 cents in the dollar.

"Assuming a $150 per month power bill, this will result in an addition annual cost of $225 over the next year. For those with a $200 monthly bill, that means an extra $300.

"This comes at a time of nil wage growth, continuing upwards pressure on those on fixed incomes and forecast inflation of nearly 6 per cent.

“For a single income household earning $50,000 a year, the jump in power prices represents a quarter of the value of the tax cut in last week's budget – and that’s before you take into account the wider impact of GST, inflation and higher ACC levies. It will wipe out in one hit the tax cut for those on the minimum wage.

“Also worrying are Finance Minister Bill English’s comments yesterday that he wants to get a ‘better performance’ out of New Zealand’s publically-owned assets, including power companies. That can only mean one thing – further price rises,” Charles Chauvel said.

"An ETS is meant to price the use of carbon. Labour's ETS would have provided transitional relief for low and middle income households. National has failed to design a scheme that does this.

“At the same time that taxpayers and consumers are being asked to pay higher power prices, the National government is increasing eleven-fold, to 800, the number of companies it is prepared to subsidise to continue polluting,” Charles Chauvel said.

ENDS

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