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Budget draws fire from hauliers

12 December 2012

FTA fumes over "squandered opportunity" for growth and labels the much heralded Fair Fuel Stabiliser as a damp squib.

The Freight Transport Association says that the Chancellor of the Exchequer's failure to cut fuel duty rates has condemned UK industry to suffer the consequences of even higher fuel bills and operational costs at a time when the world price of oil stands at a four year high, with every prospect of further price rises in the coming months.

But the Chancellor has not cut fuel duty, nor frozen it - he is going ahead with his plans for a 3p per litre increase this August. FTA says that for the sake of UK industry and consumers Mr Osborne must reconsider his decision before the proposed increase comes into effect.

FTA's Chief Economist Simon Chapman says:

 “The Chancellor has squandered a very real opportunity to support UK industry, jobs and economic recovery, by his Budget policy on fuel duty. Independent research has shown that a cut in diesel duty of 2.5p per litre would have created an additional 175,000 jobs with no loss of revenue to the Exchequer.

"But, by contrast, the fuel duty increase of 3p per litre scheduled for August will increase the average cost of lorry operation by around £1,200 per vehicle per year - all on top of other price rises which are inevitable as a consequence of the current and anticipated increases in the world price of oil. Higher commercial vehicle operating costs inevitably impact on the price of everything we use or consume, and contribute to inflation and higher consumer prices. 
Mr Osborne has lost an opportunity to benefit every household in the UK and he must be persuaded to change his policy.

"FTA cannot accept this situation and will join with colleagues in the FairFuelUK Campaign with the intention of reversing this decision.

“In addition, the much heralded Fair Fuel Stabiliser has emerged as a damp squib. All it does is to formalise fuel duty increases above inflation if world oil prices fall below $75 per barrel. At the very least, what he should have done was to commit to freezing fuel duty when world oil prices were above $100 per barrel.”

On a more positive note, FTA has welcomed the announcement that Vehicle Excise Duty levels for commercial vehicles will be frozen.

Palletline response
The Chancellor drew further criticism, with Kevin Buchanan, managing director of Palletline saying the fuel duty hike yet again showed the Government's contempt for the haulage industry.

He added: "The country needs to recover from reckless spending, but reckless taxing is not the way to do it. Hauliers are being targeted because they do not have a voice in Westminster equal to their importance.

The Government only heeds big business, ignoring the fact that hauliers are vital to the UK economy. They serve, and are part of the backbone of the Britain - SMEs. These are the companies that employ and innovate and generate wealth. They depend on hauliers to survive and thrive in challenging times.

"Unlike private individuals, the UK haulage industry has no viable alternative to diesel. The Government should recognise this fact and distribute the tax burden more fairly.

"Farmers have long enjoyed the benefit of reduced fuel costs, in red diesel. Hauliers deserve similar recognition - whether access to cheaper fuel on the forecourt for vehicles exceeding a certain size, or a simple VAT claim and rebate system."