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Monday, October 05, 2009

Letter to the Prime Minister
re: Marine Atlantic Fuel Surcharges

October 5, 2009
Right Honourable Stephen Harper
Prime Minister
Government of Canada
Office of the Prime Minister
80 Wellington Street
Ottawa, Ontario
K1A 0A2

Dear Prime Minister;

In June of 2009 I wrote to your office expressing some concerns as regards to the placement of fuel surcharges on the Marine Atlantic ferry route between Newfoundland and Labrador and Nova Scotia. At the time, fuel surcharges of almost six per cent was placed on the movement of goods and services across the Gulf of St. Lawrence that was meant to recover the added costs of marine based fuels necessary as a result of increasing prices. My concern at the time was that there would be an added inflation rate placed on any goods and services coming into the province, or on exports leaving the province bound for mainland destinations. This issue still has not been addressed.

The concern is still there and it has now resulted in another increase coming to Marine Atlantic ferry users of an additional 7.8 per cent to be placed on ferry usage starting on October 26, 2009. Total surcharges have now escaladed to almost fourteen percentage points on goods and services both coming and leaving Newfoundland and Labrador. As of today’s release from Marine Atlantic, there is still no input by the Federal Government to have Marine Atlantic’s problems with fuel purchase prices being passed to consumers and business here.

While it may be true that energy costs are based on what happens on the open trading markets, I believe that the addition of fuel surcharges can be readily addressed on the part of the federal government by adding additional funds, as needed, to the budget of Marine Atlantic on a quarterly basis to help prevent any added increases in prices to consumers or businesses in Newfoundland and Labrador. While the automotive industry can avail of federal government investiture of funds to help support business in both Ontario and Quebec and consumers see the benefit of that, consumers here, as well as business, are now susceptible to an added and artificial cost to goods and services that help keep our economy sustainable in this tough economic time.

The last thing consumers and business need here is an added cost to goods and services and what amounts to an “export tax” on goods and services to consumers on the mainland. Business here already faces tough choices with the recent economic downturn and now faces extra costs to keep goods, services and jobs going here in the province.

While the federal government has chosen to allow Marine Atlantic to run itself as a separate entity, sometimes this “corporation “ has the responsibility, as does the federal government, in aiding economic stimulus wherever and whenever it can. In this, the federal government has a choice by either leaving us susceptible to extra pricing pressures or it can alleviate and participate in our economic recovery in Newfoundland and Labrador by adding additional funds to the Marine Atlantic budget by covering off the additional costs to Marine Atlantic as a result of added fuel pricing pressures. While the cost of fuel has added pricing pressure amounting to an added 3.8 million dollars for the next quarter, it seems miniscule compared to the massive 10.7 billion to the automotive industries of Ontario and Quebec.

I hope to persuade the government to do the latter and absorb the extra costs, thusly preventing the necessary increase in prices to consumers and business immediately before the important Christmas season. Again, I am asking you to consider this move to show the federal governments participation in the recovery of the Newfoundland and Labrador, and the Canadian economy.

Yours sincerely,

George Murphy
Group researcher/Member
Consumer Group for Fair Gas Prices

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