Canada targets gasoline pumps amid price worries

Mon May 12, 2008 4:42pm EDT
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OTTAWA (Reuters) - Canada's Conservative government says it can't do anything about the high price of gasoline but on Monday it promised to make sure consumers get what they pay for when they fuel up their cars.

Industry Minister Jim Prentice told Parliament he wants to impose fines of C$10,000 ($10,000) on gas retailers that overcharge customers due to faulty pumps, instead of the current fine of C$1,000, and make pump inspections mandatory every two years.

He has asked the agency responsible for inspecting retail gas stations, Measurements Canada, to prepare regulatory changes for later this year and to intensify inspections over the summer.

"So that consumers are protected over the summer and in the travel season, I've instructed that there be beefed up inspection and beefed up verification that pumps are honest and accurate," Prentice later told reporters.

The announcement came after a newspaper report showed that one in 20 gas pumps tested in Canada between 1999 and 2007 dispensed less fuel than it was supposed to.

The Ottawa Citizen story said the margin of error at the pumps was small, but it touched a raw nerve in Canadians feeling the squeeze from skyrocketing gasoline prices.

The Conservative government is increasingly battling a public perception that the economy is headed downhill, with high fuel prices being the most visible sign.

Two polls by Ipsos Reid last week showed that the economy has become a top issue for Canadians for the first time in 10 years and that one in four Canadians believe the economy is headed for a recession.

The tax-cutting Conservative government says it has done all it can to prop up the economy and has said it will not intervene in the market to alter the price of gasoline.

(Reporting by Louise Egan; Editing by Peter Galloway)