Thank you, Mr. Chairman. This year the price of fuel, diesel fuel in particular, which is used for home heating fuel, increased by approximately 40 percent. We were unable, as a program, to absorb those kinds of increases without putting ourselves into a serious deficit situation where we wouldn't really recover without having to impose more drastic price increases that we just saw recently.
As the Minister indicated, we were able to use the surplus funding, half of it approximately this year, to mitigate the increase in the price of fuel by 10 cents a litre. So we are charging right now about 10 cents per litre less than the full cost across the board. FMB made the decision to target home heating fuel as it's really a requirement for shelter.
As time goes on, if nothing changes and we continue to subsidize heating fuel, then eventually we will have no more surplus left and we would be in a deficit situation, which would require another decision as to whether or not we wanted to continue to provide that type of relief for people in the small communities.
Before we went to full-cost pricing, I guess we were imposing a blended approach whereby some communities, or for some products, we would be making a profit and use that to offset the costs in the higher-cost communities. As long as the price of fuel was in a relatively narrow range, as it was over the past four previous years, we were able to do that. Since the price of product has spiked dramatically, we would really have to increase the price in those communities by such an extent that it would be really unfair to ask them to provide that type of a subsidy to the other communities.
That leads us back to the approach of going back to full-cost recovery. In terms of the matter of using the stabilization fund to mitigate these prices into the future, it will depend on what the price of product is in each community and also what the community contractors are charging us to dispense the delivery in the communities. Those are the two cost differences between communities in terms of the cost components of the price. So as long as those two continue to move, then the price will move in accordance. Depending on how high the price of fuel goes, then we will have to make a decision on how much of the stabilization fund into the future we want to use to mitigate or offset those increased costs. I guess one way you could look at it is what is really affordable in terms of home heating fuel versus gasoline which is a more discretionary product. Hopefully that answers your question. Thank you, Mr. Chairman.