And while government tries to find that balance - they have put the gas stations into the mix, cutting into their dealers' margin. Yesterday afternoon, government unilaterally informed the dealers that - despite the objection to the proposal - government was going ahead to reduce the current levels of the Dealers Margins for "six months in the first instance."
The letter says, quote, "in the wider interest of the public at large the Government of Belize will proceed with implementing the proposed changes…" And, effective today, the change is that government has converted the Dealer's Margin from a Percentage Rate to a Flat Rate. That new rate according to the dealers will reduce their margin between 6 and 35% per gallon depending on the type of fuel being sold. They are up in arms - but today the PM told us that government has the share the burden:
Jo-
"The Fuel dealers were notified yesterday that their margin was being reduced by the government. They are saying this is unilateral and that a 2004 agreement with the government required that both sides agree to any change to the formula in writing. Can you comment?"
John Briceno, Prime Minister
"I am not aware of that 2004 agreement but what has happened is that in 2004 the government then decided to set the margin based on the cost of fuel. So, the higher the cost the more the margin increased. And so because the price of fuel has been going up, the margins continue to go up and all of us have to take a cut because when their margin increase who pays for that? The consumers. So if they can cut a little bit by setting their margin on a flat rate and then we are cutting into tax, all of us are doing a little bit, whatever bit we can to hold down the price increase, the increase in fuel as best as we possibly can."
Jo-
"Some of the dealers want to strike because they say the margin is too little. Will the government enter into discussions with them?"
John Briceno, Prime Minister
"As a government we are always ready to listen. We believe that dialogue is the best way to go and and we want to be able to meet with the government of course we are prepared to meet with them."
Jo-
"And will you disclose the fuel price formula with the landed costs and government's tax take. So that consumers can confirm the losses that the government says it is taking."
John Briceno, Prime Minister
"Well that has never been a secret, that is out there and if anybody wants it I'm sure you can call the Financial Secretary and get that information."
Reporter-
"We want it. Can you send it?"
John Briceno, Prime Minister
"Of course I can ask them to send it."
We did ask the Financial Secretary for that document but up to newstime have not gotten it.
Fuel Dealers we spoke to told us that the PM does not factor in to the equation that many fuel purchases are now made with debit and credit cards - those Card fees eat up about 22% of their total gross margin.
