Have you heard about the new National Fuelwatch Scheme? I’m sure you have. It was announced yesterday; in all the newspapers today. What an absolute waste of time – not to mention taxpayer money.

Now I quite like Kevin Rudd, or K-Rudd as he’s known. Don’t forget the hyphen, otherwise it’s pronounced “crud”. Not that I’ve ever met K-Rudd, but he seems like a nice enough chap. I have to say though, after 5 months in power I’m a little disappointed with his first big policy announcement.

To quote from the media release put out yesterday by Chris Bowen (minister for competition policy and consumer affairs): “The establishment of Australia's first National FuelWatch Scheme will help ensure motorists are not paying a cent more than they have to at the bowser. The National FuelWatch Scheme will help motorists buy the cheapest petrol, at the cheapest petrol stations, at the cheapest times.”

Not only that: “No longer will a motorist drive past a petrol station in the morning only to return in the afternoon to find a 10 cent per litre jump in the price of petrol.

Importantly, FuelWatch will also see an end to Mums and Dads driving around on a Tuesday or Wednesday searching for the cheapest petrol.”

In theory it sound okay, although I don’t know why it’s only Mums and Dads who apparently drive around mid-week looking for cheap fuel. In fact I don’t actually know anyone who drives around mid-week looking for cheap fuel. That’s beside the point though.

The thing that really has me puzzled is that in my years of experience, both as a financial planner and in general life, you very rarely get a guarantee on anything without paying a premium, for it. If you want a capital guaranteed investment, you pay a premium for it. If you want guaranteed income, you pay a premium for it. So if you want price-guaranteed fuel (which is what this scheme enforces), I’m pretty certain that you are going to pay a premium for it. Because what the media release doesn’t say if that while there sometimes may be a 10 cents per litre jump in the price of fuel on any given day, there may equally be a 10 cents per litre FALL in the price of fuel on any given day. This scheme does away with that.

Mind you I could be wrong, because the Fuelwatch scheme has been running in Western Australia since 2001. Apparently it’s quite successful. Any WA readers out there, I’d love your feedback on the success (or otherwise) of the scheme on your budget’s bottom line. According to the authorities though, it’s made bugger-all difference to the fuel price. Less that 2 cents per litre on average.

While 2 cents per litre might sound better than nothing, it equates to about $1.25 for a tank of fuel for an average sized car. You would probably use more than $1.25 in fuel while the engine idles, waiting in line at the “cheap” service station. No to mention the wasted time: that’s time you could spend making or saving money in so many other ways like selling or buying something on ebay, shopping around for your car insurance, making a menu and shopping list so that you don’t buy unneeded food, getting a better deal on your credit card. I could go on and on and on and ON about the countless better and more profitable uses of your time than researching the daily fuel price.

Not only that, the whole scheme has already cost us a fair bit of money. After all, we pay the wages of these governmental whizzes who came up with the scheme, not to mention the salary of the new national Petrol Commissioner that they are going to appoint to oversee the whole thing.

I used a Woolworths discount docket thing today to fill my black beast, and the 4 cents per litre discount saved me $2.50. Better than nothing, but still…

Supermodel Linda Evangelista once said that she didn’t get out of bed for less than $10,000 a day. I get out of bed for considerably less than that, but I certainly wouldn’t drive across town for $1.25. How about you??

Justine xxx

Personally I think it is great.

I live in WA now and have 6 petrol stations around my area - I get an email everyday that tells me what the price will be tomorrow so I can figure where to get it cheapest. I have set it to send me only ULP and only in the suburbs I am interested in. I can also narrow that further and choose only the petrol station if I want. All this for free.

Also I get sent warnings when there is an expected price hike = just before Easter we were told prices would jump up to 12 cents so get petrol in the next two days. Now I know we all expect it to happen but that bit of a nudge certainly saved my family a bit of money.

Oh and I did actually look for the cheapest fuel when I lived over east - I would drive past a station if I thought I had seen it or could get it cheaper. Some of us find that every little be helps and are happy for the heads up.

Perhaps you might like to have a look at the website?

fuel watch system

Thanks for the WA fuelwatch link, much appreciated. And don't get me wrong, I absolutely agree that every little bit helps, just so long as there really genuinely is a little bit of saving.

Interestingly, looking at the WA Fuelwatch figures for today, the unleaded best price on the website is about 10 cents more per litre than I paid in Brisbane this morning. That might be due to different taxes or transport costs or something else, I'm not sure. It's something that I'll be interested to compare again when the scheme becomes national.

I used to live in WA and it was great. Now that i'm in VIC I can't wait for it to start in December.

It really does work.

Do people actuall do this? Don't they realise that driving around to find cheaper fuel ends up costing them more because they are using more anyway? he he

just got this email yesterday

this is where I think fuelwatch is very handy.

All that FuelWatch does is flatten out the pricing cycle, and lengthens it over two weeks. So there will not be an opportunity for people who fill up once a week on cheap Tuesday to get the same discounts. And if they can get them, they will only be able to get the discount every second week. But it does also reduce the top price people pay. Usually the people who pay this price are the time poor who don't car about what the price is - they just fill up regardless.

The ACCC released a report into petrol pricing in December 2007. The report showed the following (based on data collected through 2006-07)

Sydney, Melbourne, Adelaide and Brisbane all experienced a very, very similar pricing cycle - cheap Tuesday, expensive Thursday.

In these markets, 65% of petrol was sold on the four days when the price was below average, and the lowest price in Sydney for example was $1.20. The average across the week was around $1.23.

In Perth, only 40% was sold onto he three days when the price is below average. The average was $1.225 and the lowest price in the cycle was $1.22. So Perth motorists are not able to get hte $1.20 price that Sydney motorist got. And you must remember that it is cheaper to ship petrol to Perth as it comes from Singapore (1.3 cents per litre) and typically Perth service stations were cheaper to build as the land was a lot cheaper (up until a few years ago). The reality is is that Perth is one of the most profitable markets for petrol companies.


The practical impact is that fuel is cheaper for wealthier people and more expensive for poorer people - the reverse Robin Hood scenario.

It sure helps having members of the family with good knowledge on this issue

Hey I don't think Contumely likes you much.

I am really pleased to see all of your success with the writing of your first book, impending publication of your second plus your blog and newspaper stuff. Good on you Juz.

A far cry from your originally intended genre of authorship but undoubtedly one which is much better and one of which you can be much more proud.

I remember our conversations from years ago, in Brisbane, Perth and Melbourne and your passion to be a writer. I am so happy for you that you have achieved your goal, you were always going to and have always been very committed and focused.

You've actually inspired me a bit Justine, but then that is nothing new either.

Thanks Calmanut, that's nice.

For the benefit of other readers, my "originally intended genre of authorship" was romance novels. I decided, based on having read exactly three Mills & Boon novels in my life, that I should try to write one. I duly wrote and sent away a scintillating story of lust and betrayal. Unfortunately Mills & Boon didn't find it all that scintillating and promptly sent it back with a "thanks but no thanks" note.

Mind you, this was about 15 years ago. My writing style has improved somewhat over the years. The moral of the story (if there is one) is to never stop trying!

Justine

Fair enough.

We moved to WA in January and one of the first things I did was sign up to the Fuelwatch website, it's a great idea, reminds me that the servo near us is always about 10cents a litre more than anyone else and lets me decide which of the other 6 servos on the way to the shops to go to. When we were in Qld, even though it's subsidised (or was, I think they stopped it) I still wished that we'd have something like this, used to drive me nuts to drive past the servo in the morning then in the afternoon find they'd put their prices up by 12c a litre. I only wish that it would let you know how much the prices were going to be for the whole week rather than day by day.