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I woke up pretty excited the other morning.

Driving to my local café to order my latte — extra hot, one sugar — I was excited at the prospect of paying slightly less.

And let’s face it… when the cost of anything goes down these days — even if only by a few cents — that’s cause for celebration.

The $1.6 Billion ‘Saving’

My excitement was only heightened when I opened up social media and found this message from the Federal Treasurer waiting for me:

BREAKING: Card surcharges are now banned

And this:

From today, card surcharges are banned, saving Australians $1.6b

Now I have to admit, I was initially sceptical.

I mean, how does $1.6b of banking fees simply vanish into thin air when the card processors are still charging for their services?

But hey… it’s Dr Jim Chalmers. He knows what he’s doing, right?

And I haven’t written a PhD thesis on the life and times of Paul Keating… so what do I really know?

Andrew Leigh was on my social media feed as well — waving around a cup of coffee while promising the $1.6b in fees was “going away”.

And again, I was sceptical.

But he is the Assistant Minister for Productivity.

And his serious tone, not to mention the dramatic musical score in the background, gave me confidence to believe all of this, though unlikely, must be true:

“Ever noticed that when you tap your card, the price is slightly higher than what the coffee was meant to cost on the menu. Every year Australians pay $1.6b in credit card fees. From the First of October those fees are going away”

Maybe the Albanese Government really is able to make costs disappear by simply declaring them disappeared on social media posts.

Anyway, the Prime Minister said it was all true. And he wouldn’t lie…

“Every time you tap those little surcharges add up. Right now they’re costing Aussies $1.6b each and every year.

“But from today, they’re banned, saving you money every time you tap. So whether you’re at the supermarket, paying bills, or paying a cup of coffee, the price you see is the price you pay.”

So that’s what I was being told as I made my way to the cafe.

The PM and his ministers promising that — from now — on I’ll save around 10c on my cup of coffee. Which will go a LONG WAY to helping offset yesterday’s interest rate rise.

When Banning Fees Makes Coffee More Expensive

Can you imagine my surprise… when I paid for my coffee… I didn’t save money at all.

Because while the café is not allowed to charge me a card processing fee, they’re still having to pay those fees.

So instead of putting a card processing fee on my bill, they just added it to the price of my coffee.

Who could have seen THAT coming!

Turns out the PM and his Treasurer confused ‘hiding costs’ with ‘lowering costs’. Which is a bit of a worry since they’re running the entire economy.

A random bloke, interviewed on the street by News24, seemed to understand the difference rather better:

I think it’s just built into the price, so I don’t think it’ll change much really. But it’s nice that we don’t feel it every time. So it’s more about an emotion when you go to pay rather than an actual financial benefit.

Too right. Albo was offering us nothing more than an emotional saving.

The kind of saving you can feel in your heart, while your bank account remains completely unimpressed.

But it gets worse.

Paying For A Transaction You Never Made

When my local café added the bank’s processing fees to the price on the menu, it meant that all of their menus — not to mention their signage — was immediately wrong.

So they added the cost of updating all of their menus and their signage to the price of my coffee as well.

So the PM’s promise of cheaper coffee actually made my coffee more expensive.

By now, I was thinking this policy must have originated in Chris Bowen’s office. But I digress.

If you can believe it, things got even worse…

Sometimes — when I’m organised — I pay cash for my coffee. That way, I avoid the card surcharge altogether.

But now I don’t even get that advantage, since the bank fees have been added to food and drink prices generally.

So whether I pay by card or cash, I’m paying for the card transaction.

Even if I never made one.

So now my coffee is more expensive — and for what? So I can subsidise a transaction I never made!

So an Albanese Government policy promising cost-of-living relief does nothing but bring more cost-of-living pain.

The Government’s Endless Rescue Cycle

And then it dawned on me.

This is how the Albanese Government works.

They portray themselves as our saviours, promising to rescue us from economic doom — usually economic doom that their policies have created.

So they rush in with some amazing subsidy or scheme, promising it’ll take the pressure off.

But, of course, someone has to bear the cost of that policy. And in the end… it inevitably gets passed back to you and me.

We end up paying more than we used to pay BEFORE the Albanese Government’s most recent grandstanding gesture.

So we’re worse off than before they got involved.

And you know what happens then?

They portray themselves as our saviours, promising to rescue us from the latest economic doom that they just created.

The more they rescue us, the worse off we are. And the worse off we are, the more they rescue us.

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Republished thanks to The James Macpherson Report. Image courtesy of Adobe.