Although motorists may feel the effects of the State Government’s proposed abolition of the northern fuel subsidy scheme, local trucking companies say they won’t be affected as many vehicles are already registered in Queensland.

The removal of the northern NSW $44 million petrol subsidy was announced as part of last Tuesday’s mini budget.

The State Government currently pays a fuel subsidy in northern NSW to allow fuel suppliers and freight companies to compete with the subsidised Queensland prices. The subsidy ranges from 8.35 cents per litre in Tenterfield and other areas close to the border then scaled down to 1.67 cents per litre in Urunga and other areas further south.

To coincide with the removal of the Northern NSW fuel subsidy, from July 1 the Queensland government will restrict their subsidy scheme to Queensland residents only.

Australian Trucking Association NSW manager Jill Lewis said that trucking companies would be forced to increase their freight rates or reduce their profit margins to remain competitive with Queensland companies.

“From Easter next year, it’s likely the Queensland fuel subsidy will only be available to Queensland registered vehicles, so NSW operators won’t have the option of crossing the border to fill up there,” she said.

However Wayne Perkins of local livestock freight company StockTrans said 80 per cent of the StockTrans fleet were Queensland registered vehicles and that most carriers in this area were as well.

“I wouldn’t imagine that it would have a real big effect on our fuel prices, they don’t vary that greatly because we buy our fuel from Queensland,” he said.

Member for Northern Tablelands Richard Torbay has condemned the announcement, which will affect local fuel suppliers and motorists by increasing the price of fuel by approximately eight cents a litre.

“This State government has little understanding of regional issues and the impact of these cuts will be negative,” he said.

“With petrol prices higher in country regions already, this adds another layer of pressure which is not needed in the current economic climate.”