Ai Group surveys assess impact of carbon tax six months in

The results of a series of surveys by the Australian Industry Group have found manufacturers, especially those in food and beverage, reporting a jump in energy costs.

The results of a series of surveys by the Australian Industry Group have found manufacturers, especially those in food and beverage, reporting a jump in energy costs.

The average increase in energy costs reported was 14.5 per cent for the 485 firms surveyed in June, July and November. There were also in-depth surveys of manufacturers undertaken in July and August.

Innes Willox, the Ai Group’s CEO, said that niche groups including food manufacturers were suffering a "probably greater than anticipated" impact from the tax.

A third of those in manufacturing and construction “did not yet have enough information”  to asses the impact of the tax on their businesses.

One company, electrical cabling maker Tycab Australia, estimated that it had seen its energy bill increase $120,000 to nearly $700,000 a year.

"We put out a letter to our customers and told them about the carbon tax effect and we were told quite clearly they were not going to accept price increases," Tycab’s owner Greg Northrop told News Limited.

Almost half (49 per cent) of respondents saw an immediate increase in their input costs when the tax was introduced on July 1 last year. 61 per cent of manufacturers reported an immediate increase in energy costs.

“Our broad survey results show food manufacturers appear to be facing the greatest profit squeeze as a result of the carbon tax, with over 90 per cent reporting price rises for at least some of their inputs, but only 10 per cent of food processing businesses being able to pass those costs on to their customers,” the report says.