Latest news with #CommerceCommission
Otago Daily Times
an hour ago
- Business
- Otago Daily Times
Warning Aurora power bills may rise $10
Household electricity bills for Aurora Energy customers could increase by an average of about $10 a month next year, the Commerce Commission says. Commissioner Vhari McWha said the commission was seeking feedback on its draft decision to allow the Dunedin City Council-owned lines company to recover up to $663.7 million over four years from 2026 to 2030. "We are conscious of the effect on electricity bills across Otago, and we've ensured this spend remains reasonable and limited to what's necessary to give consumers a safe and reliable network now and into the future," Ms McWha said. "It means Aurora can continue to renew ageing assets on its network while also meeting significant growth in demand for electricity in its regions." Aurora said yesterday its initial view was the draft decision outlined a level of cost savings that would "seriously inhibit" its plans to support economic growth and improve network resilience. Advocates for those struggling to pay bills said high electricity prices were already having a significant effect on some in the community. Ms McWha said the draft decision meant the average household electricity bills in the areas Aurora served could increase by about $10 a month next year and about $3 a month each year thereafter. Aurora's customised price-quality path (CPP) was put in place in March 2021 to allow the company to recover a set amount of revenue from customers over five years as it repaired and upgraded its network. However, the company's present revenue limits were due to expire in March next year, and new revenue limits would be set under general arrangements that applied to other price-quality regulated lines companies, Ms McWha said. "While Aurora has made significant progress during the CPP on the safety of its network, its investment catch-up was always planned to occur over a longer period. "In Aurora's CPP application, it anticipated investment would not return to a steady-state level until around 2030." In its draft decision, the commission had removed $16m related to projects with potential to be deferred by alternative solutions such as residential solar, Ms McWha said. Aurora Energy chief executive Richard Fletcher said the company would provide a formal response to the commission's draft decision. "However, our initial view is that the level of operating cost efficiencies referenced by the commission would be impracticable to achieve and, if not corrected in the final decision, would seriously inhibit the company's ability to deliver its published plan and improve network resilience. "It would also constrain the planned development of the company's network and operations to support customers' electrification transition and the economic growth of our operating regions." The draft decision appeared to be based on high-level benchmarking information from 2018 and did not appear to have been updated to reflect the company's current operating environment, Mr Fletcher said. He said the company was proud of what had been achieved over the past five years and found it "very disappointing" the commission had not raised concerns about the efficiency of the company's operating position in any of the formal annual progress reviews it had undertaken. Dunedin Budget Advisory Service manager Andrew Henderson said there was a lot of pressure on low to middle-income households at the moment — and the draft decision by the Commerce Commission "seems to fly in the face of that". The budget advisory service, which administered the Dunedin City Council's Consumer Electricity Fund, was processing between 80 and 90 applications each month from people struggling with the cost of electricity. "That's probably the tip of the iceberg. "It's just pressure from all angles on low to middle-income households," Mr Henderson said. A Grey Power Otago committee member, who asked not to be named, said people were already distressed due to increases in electricity bills. A woman had recently called Grey Power's South Dunedin office in tears after signing up with a new electricity supplier and receiving a power bill of $400 for her two-person household. Feedback on the draft decisions closes on August 22. A final decision is due to be published by the end of November.
Otago Daily Times
18 hours ago
- Business
- Otago Daily Times
Poll: Should Paywave costs should be passed on to customers?
The Finance Minister says when a ban on contactless card payment surcharges comes into effect, businesses should pass on the cost to customers as they would any other business cost, if they can't absorb the bill. The government plans to ban surcharges on contactless card payments no later than May 2026. Commerce and Consumer Affairs Minister Scott Simpson announced the change on Monday afternoon, declaring: "That pesky note or sticker on the payment machine will become a thing of the past." "Shoppers will no longer be penalised for their choice of payment method, whether that's tapping, swiping or using their phone's digital wallet." The ban builds on the Commerce Commission's recent decision to reduce the interchange fees imposed on businesses for accepting Visa and Mastercard payments. Finance Minister Nicola Willis told RNZ that change has led to an average reduction in costs for a typical retailer - a small business - of about $500 each week. "So our concern has been, now that reduction has happened, how do we make sure that gets passed through to you, when you're at the shop. What's to stop the retailer just charging you the same fee even though their costs has dropped." Banning the paywave fee was the simplest and most transparent thing to do, Willis said. Businesses need to treat the interchange fee like any other cost in their business "and just include it in the price tag on the shelf", she said. "It'll make it easier for people to compare what they're really having to pay. Just think about how many times you've been at the counter and then suddenly you learn that it's a 2.5 or a 3.5 percent surcharge and that gets added to the price of whatever it is you're buying. That's not very transparent." The sector is warning prices may need to rise at restaurants and cafes due the ban. Retail New Zealand chief executive Carolyn Young told RNZ retailers were not happy with the change and have told them they will increase prices as a result. More people will use contactless payments as a result of the change, she said. "It means that a retailer, a higher percentage of their transactions will incur a fee so any savings that they may have seen from the interchange fee, they'll be countered by the fact that a higher percentage of transactions will incur a fee anyway." Young said retailers were already having a hard time trying to stay open. Matthew Lane is the general manager of 54 Night 'n Day shops around the country and has never put a surcharge on payments. "We fold it into the... overall cost of business, we never charged it... we like to keep things consistent to the customer," he told Nine to Noon. While Lane welcomed the ban on paywave surcharges, he said it was the interchange fee which was a massive cost to business. "For context, one of our stores paid over $80,000 to the merchant provider over the last year and that's just a massive cost to business for simply a set payment in store." Paywave being used more as a result of a surcharge ban would further diminish savings, he said. He questioned whether the reduction of the interchange fee went far enough and said it was likely some businesses would revert back to offering only Eftpos for transactions. Asked if she thinks the ban will lead to inflationary prices, the minister said "I think that overall, people will charge the price that they think they can get away with". The change doesn't include international credit card payments or online payments. Willis said these payments were usually much more expensive to process and people using these systems have to pay a bit more because they are protected from things like online scams and fraud. Commerce and Consumer Affairs Minister Scott Simpson told RNZ the interchange fee was a cost of business. "I think that the price you pay at the tills should be the same price that's on the shelf when you go to buy something." The "vast majority" of businesses don't currently charge surcharges, he said. When questioned on that statement, the minister said this was something he knew from his personal experience when shopping and information from the Commerce Commission. Consumer NZ chief executive Jon Duffy told RNZ with a reduction in the interchange fee, businesses would be making a profit off the surcharges if they remained in place. "Retailers still pay a small amount ot offer those services, we think that once... the decrease comes into effect it will be less than 1 percent of the total cost of the transaction," Duffy said. Many businesses would absorb this into the prices though there may be some who need to increase prices to cover the cost, he said. "But it would be just the same as if their... power bill or their rent went up." Consumer NZ was a bit disappointed online transactions were not included but it was understandable for now, he said.
RNZ News
a day ago
- Business
- RNZ News
Businesses should pass Paywave costs on through prices, Nicola Willis says
Photo: RNZ / Samuel Rillstone The Finance Minister says when a ban on contactless card payment surcharges comes into effect, businesses should pass on the cost to customers as they would any other business cost, if they can't absorb the bill. The government plans to ban surcharges on contactless card payments no later than May 2026. Commerce and Consumer Affairs Minister Scott Simpson announced the change on Monday afternoon, declaring: "That pesky note or sticker on the payment machine will become a thing of the past." "Shoppers will no longer be penalised for their choice of payment method, whether that's tapping, swiping or using their phone's digital wallet." The ban builds on the Commerce Commission's recent decision to reduce the interchange fees imposed on businesses for accepting Visa and Mastercard payments. Finance Minister Nicola Willis told First Up that change has led to an average reduction in costs for a typical retailer - a small business - of about $500 each week. "So our concern has been, now that reduction has happened, how do we make sure that gets passed through to you, when you're at the shop. What's to stop the retailer just charging you the same fee even though their costs has dropped." Banning the payway fee was the simplest and most transparent thing to do, Willis said. Businesses need to treat the interchange fee like any other cost in their business "and just include it in the price tag on the shelf", she said. "It'll make it easier for people to compare what they're really having to pay. Just think about how many times you've been at the counter and then suddenly you learn that it's a 2.5 or a 3.5 percent surcharge and that gets added to the price of whatever it is you're buying. That's not very transparent." Photo: The sector is warning prices may need to rise at restaurants and cafes due the ban. Asked if she thinks the ban will lead to inflationary prices, the minister said "I think that overall, people will charge the price that they think they can get away with". The change doesn't include international credit card payments or online payments. Willis said these payments were usually much more expensive to process and people using these systems have to pay a bit more because they are protected from things like online scams and fraud. Consumer NZ chief executive Jon Duffy told Morning Report with a reduction in the interchange fee, businesses would be making a profit off the surcharges if they remained in place. "Retailers still pay a small amount ot offer those services, we think that once... the decrease comes into effect it will be less than 1 percent of the total cost of the transaction," Duffy said. Many businesses would absorb this into the prices though there may be some who need to increase prices to cover the cost, he said. "But it would be just the same as if their... power bill or their rent went up." Consumer NZ was a bit disappointed online transactions were not included but it was understandable for now, he said. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Newsroom
a day ago
- Automotive
- Newsroom
Mobil hit with warning over ongoing disclosure problems
The fuel industry regulator has issued a warning to Mobil over repeated and ongoing failures to comply with disclosure requirements under the Fuel Industry Act. As an importer of fuel, Mobil has to disclose information to the Commerce Commission on a regular basis.
Scoop
2 days ago
- Business
- Scoop
Scrapped Surcharges A Win For New Zealanders
Hon Scott Simpson Minister of Commerce and Consumer Affairs Surcharges will be axed to put money back in Kiwis' pockets, says Commerce and Consumer AffairsMinisterScottSimpson. 'Surcharges are a hassle and an unwelcome surprise when shoppers get to the till. That pesky note or sticker on the payment machine will become a thing of the past. 'We're banning surcharges so consumers can shop with confidence knowing how much they will pay for their purchases. 'New Zealanders are paying up to $150 million in surcharges every year, including excessive surcharges of up to $65 million. That's money that could be saved or spent elsewhere. 'By May 2026 at the latest, we will ban surcharges for in-store payments. Shoppers will no longer be penalised for their choice of payment method, whether that's tapping, swiping or using their phone's digital wallet.' The ban follows the Commerce Commission decision to reduce interchange fees paid by businesses to accept Visa and Mastercard payments, a move to save businesses around $90 million a year. 'Surcharges cover the fees businesses pay for accepting contactless payments and credit cards, but we know these are often excessive. 'In some cases, the retailer doesn't even make it clear what the percentage is. 'A ban on surcharges means no more surprises for people who currently feel like they're being charged to use their own hard-earned money. It means they can make a purchase knowing exactly what they'll pay, and how they'll pay it.' Notes: The Retail Payment System (Ban on Surcharges) Amendment Bill is expected to be introduced by the end of this year. The ban will apply to most in-store payments made using domestic Mastercard, Visa debit, credit cards and EFTPOS. Transactions through the Visa and Mastercard networks and by EFTPOS are the main method of card payment in New Zealand. The Commerce Commission estimates New Zealanders pay about $150 million in surcharges annually including $45-$65 million in excessive surcharges. The Commerce Commission has already announced lower interchange fees paid by businesses to accept Visa and Mastercard payments. Interchange fees make up approximately 60% of merchant service fees. In the United Kingdom and across the European Union, surcharges for debit and credit cards for designated schemes are banned. Australia currently has surcharging on debit and credit cards, but this must be no more than the cost to retailers of accepting these cards. The Reserve Bank of Australia has recently proposed banning surcharges altogether for EFTPOS and Visa and Mastercard debit and credit cards.
