New Zealand halves public transport fares as petrol prices soar amid Russian-Ukrainian war | New Zealand
New Zealand is cutting public transport fares in half to ease the pain of soaring petrol prices as fuel prices soar after Russia invades Ukraine.
Prime Minister Jacinda Ardern has announced the country will cut fares by 50% amid a series of other changes to try to mitigate steep increases in the cost of living. The government is also reducing excise duty on petrol and road user charges by 25c a liter – changes which will come into force at midnight on Monday.
Finance Minister Grant Robertson said the changes would last three months initially and then be reviewed.
“The global energy crisis has rapidly become acute,” Ardern said. “We can’t control the war in Ukraine or the continued volatility in fuel prices, but we can take steps to reduce the impact on New Zealand families.”
Petrol prices in New Zealand are above NZ$3 ($2) a liter and have risen sharply in recent weeks. Unleaded gasoline has increased by 15% since the start of the year and is expected to continue to increase.
“In the long term, we need to build the resilience of our transportation system to be less vulnerable to gasoline price spikes,” Ardern said. “But for now, halving the cost of public transport will give some families an alternative to filling the tank.”
Even with the changes, the government expected gasoline prices to continue their upward trajectory, Robertson said.
“We have to recognize that gasoline prices are expected to continue to rise,” he said. “The Russian invasion of Ukraine continues to undermine and destabilize global energy markets and, added to the other inflationary pressures the world is facing due to Covid supply chain disruptions, it is not unfortunately not finished yet.”
The Ardern government is under increasing pressure to deal with the rising cost of living in New Zealand, where households have faced significant increases in the cost of living and supermarket essentials.
Inflation in Aotearoa reached a three decades high, and shows no signs of slowing down. Inflation reached 5.9% at the end of 2021, and ANZ, the country’s largest bank, expects it to keep going up in 2022. In February, fruit and vegetable costs increased by 17% year-on-year.
The New Zealand opposition has said the country is going through a “cost of living crisis”. In a recent poll, Ardern-led Labor fell behind centre-right opposition National for the first time since the pandemic began.