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June 09, 2021

NDP leader promises gas price cap if elected

A few months back, when pump reads were really getting out of hand, MSN wondered if Canada should consider regulating its gas prices.

In effect: capping what the price of gas can max-out at if oil prices spike, though exposing Canadians to the risk of paying more than usual should oil prices sink.

It’s a radical ebb-and-flow strategy – it sounds great on the one hand, readers responded, but other commenters weren’t thrilled about paying a locked-in price if oil prices dropped – and at least one political leader is trying to make it reality.

NDP’s Ontario leader Andrea Horwath has come out and announced her plans to institute a weekly gas price cap should she be elected this fall.

“Filling up your car shouldn’t be like pulling the handle on a slot machine,” she said Thursday.

“We will give the Ontario Energy Board the power to set a weekly price cap for gasoline,” she continued. “The price of gasoline won’t go over that ceiling and drivers will know what they’re going to pay that week. No surprises. No shocks.”

While Horwath hasn’t discussed further details of her plan, the weekly cap limit isn’t the worst idea in the world. By being able to manipulate the gas price cap each week, you protect yourself against oil prices bottoming out and consumers paying too much more for gas than they normally would.

In fact, gas prices don’t move all that much week-to-week in Canada, excluding the precipitous, unusual fall over the last four months of 2008, when our nation’s average price fell from about $1.40 per litre in September to 73 cents per litre by New Year’s Eve (a dip of about four cents a week on average).

So Horwath may be onto something. And, it bears mentioning, Ontarians are notorious suckers for these kind of “direct results” promises. Ontario voters like when they can see a fast, immediate impact from the promises of politicians, like Dalton McGuinty’s Family Day creation in 2008 – a brilliant political move that no doubt helped the Liberal get re-elected.

Whether the gas price cap will be enough to land Horwath the Premier seat is another story, but mix this with the increased profile of Jack Layton from last month’s federal election and it’s a good start.

By Jason Buckland, MSN Money

*Follow Jason on Twitter here.



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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...