Finance Minister Katy Gallagher has spoken about the fuel efficiency standard, and accepted people were concerned that it could increase car prices.

The standard applies only to new car sales and limits the average emissions of a carmaker’s overall fleet of vehicles sold each year, measured in grams of CO₂ per kilometre.

“I accept that … concerns arise, I’m not pretending otherwise,” Gallagher said on ABC Radio this morning.

It comes as the Coalition claims the standard is a “new family car and ute tax” and will drive up prices of popular vehicles.

Gallagher said the Liberal Party brought in a fuel efficiency standard while in government, but didn’t follow through.

“Russia and Australia are outliers on having a fuel efficiency standard … I accept the opposition have never seen a scare campaign they don’t want to jump on, so they are stirring up the politics trying to scare people around it,” she said.

“Our job as government is to do the right thing, in terms of the policies that we implement, and that fuel efficiency standard is actually about generating choice for car owners and also driving down the costs of running a car over the long term.”

She said people deserve a choice, along with the option of more fuel-efficient cars.

The minister was also probed on whether the timeframe for the implementation was too short.

“I’ve certainly heard that coming from the National Party … and a couple of car companies, I think some of the small players … that’s why we’re consulting.”