COMMERCE and Industry Minister George Lillikas yesterday hit back at reports that he had admitted behind closed doors on Thursday that the government had increased fuel prices in order to cover other expenses.
According to yesterday’s Phileleftheros, the income from the fuel rise will generate £21 million in the next four months, of which £11 million will go to subsidise heating fuel for pensioners and residents of villages in mountainous areas, £7 million in compensation after the shutting down of the Petroleum Refinery in Larnaca, and £3 million as commission to 254 fuel station owners on the island.
Lillikas yesterday categorically denied the report and insisted that the price rise was in reaction to an increase in international crude oil prices.
But New Horizons deputy Christos Klerides confirmed Phileleftheros’ report, saying Lillikas had informed parties that the price hike included budgets for compensating petrol station owners and the refinery.
Klerides said the increase was unjustified, and called on the government to explain how it had calculated the fuel price increases.
“He (Lillikas) admitted that there were costs that included commissions to petrol station owners, which are being negotiated by fuel companies, the cost of operating those companies and other things for which he did not submit any evidence,” Klerides said.
“Under normal circumstances, we should have had a reduction in fuel prices. How can it be that a month earlier they suggested a 0.08 per litre rise and now, without a dramatic rise in oil prices, they increase it by two cents?”
Klerides’ comments were echoed by Green Party deputy George Perdikis, who said the increase would cover other expenses.
DISY deputy chairman Averoff Neophytou yesterday slammed the government’s actions, saying that raising fuel prices to cover other expenses was unacceptable.
Neophytou said evidence presented by former Commerce and Industry Minister Nicos Rolandis proved that the increase was unjustified.
“DISY has been vindicated,” he said.
“We have proved beyond any doubt that the increase of fuel prices by the government was inexcusable.
“In January 2003, the international price of crude oil was £15.20 a barrel and the price of diesel was 23 cents a litre. Today, when we buy oil with £14.88 per barrel – 30 cents cheaper – diesel prices have gone up from 23 to 36 cents a litre.
“And this is the most amazing thing: they will make £11 million by raising the prices and then appear as the saviour and return £200-£300 to some homes,” Neophytou added.
Neophytou’s comments were met with a scathing attack by Lillikas, who accused DISY of irresponsible politics, and denied the reports in Phileleftheros.
“All those who have told reporters those reports are lying through their teeth,” he said.
“The £6 million are the deficit that we have to cover after the increase in international oil prices – it has nothing to do with the refinery loans, with compensation to refinery staff and the Iranian company who had undertaken the upgrading of the refinery, (before the decision by the government to shut it down and turn it to a fuel import terminal last year),” Lillikas added.
He said he had other proposals that did not include price rises.
“I had another suggestion but we didn’t prepare it in time, and I will submit it to the House in a couple of weeks and wait for a reaction from the parties; this is a suggestion that doesn’t foresee any extra increase, i.e. would convert this increase into a tax, and includes the commitment by the government to reduce and subsidise heating fuel, while also partly subsidising diesel for industry and trade,” he said.
“That would be a permanent regulation that is feasible because the refinery will shut down.
“But what I don’t understand why Mr Rolandis and DISY are wailing when they supported a system that benefited companies and not the consumer for 10 years,” Lillikas added.
