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Pump prices spike after political fumble

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Politicians were falling over themselves to correct a costly mistake that pushed petrol prices up by almost 10 cents per litre after Parliament failed to pass a government extension on the consumption tax freeze.

Despite the outgoing government approving the extension last week, the House could not approve it, with MPs attributing the delay to the government changeover.

In comments to state radio CyBC, Christiana Erotokritou chair of the House Finance Committee, said an extraordinary meeting would happen Thursday, followed by the Plenum vote to fix the matter.

Erotokritou argued that the bill needed to be officially tabled promptly to be approved by the plenary, attributing the omission to the Finance Ministry for failing to follow well-worn procedures.

The House had been in recess since mid-December, ahead of Christmas and the Presidential Election in February.

“Parliament is not a post office; it is not always in session; the constitution stipulates that bills must be submitted to the plenary,” she told CyBC.

The apparent oversight concerns a freeze on consumption tax on fuel introduced in March 2022 to buffer a hike in fuel prices powered by the war in Ukraine and sanctions on Russia.

These reduced rates were to be valid until June 2022 but were extended until 15 January 2023, with a reduction of 7 cents per litre in the price of petrol, 8.3 cents for diesel and 6.4 cents for heating oil.

The cost-of-living measure was again extended until 1 March, with the government convening on 22 February to extend it until 30 April.

Marios Drousiotis, the head of the Consumer Association, wondered how it could be possible for the outgoing cabinet not to have foreseen the situation and taken the decision earlier.

He said the ‘unnecessary’ oversight adds more problems when households are financially squeezed.

Erotokritou said the emergency meeting of the committee had been called for 3 pm Thursday, to be followed at 4 pm by the plenary.

She noted that the next scheduled plenary was on 9 March, but “MPs will not allow Cypriot consumers to pay even one cent more for the next nine to ten days”.

According to the Consumer Protection Agency’s Retail Fuel Price Observatory, the average price for 95 octane unleaded is €1.479, the average price for 98 octane unleaded is €1.544, diesel is €1.64, and the average price for heating oil is €1.126.