Last month to the collective relief of the road transport industry, chancellor George Osborne froze duty once again, announcing September’s 3ppl increase would not happen.
He said the decision in the past two years to freeze duty meant fuel was 13ppl cheaper than it would have been if no action had been taken, equivalent to £6bn in tax revenue not taken.
However, the mood quickly turned to palpable, if tempered disappointment among FairFuelUK (FFUK) and its backers, including the RHA and FTA.
Operators felt the same. Lancashire courier firm Same Day Delivery told MT that irrespective of duty changes, 6.5ppl has been added to its fuel bill since January as fuel prices continued to climb.
Owner Tracey Hoather said: “The real issue is that fuel prices are still far too high and as a delivery business we can’t avoid it as a cost. And there are many small businesses in the same boat as us.”
Popular sentiment
Exclusive research conducted recently for MT's sister-title Commercial Motor by ComRes shows clear, unambiguous support for the industry and its attempts to get a permanent reduction in fuel duty. The question then, is how this popular support can be best harnessed.
Nigel Parkes, MD at Pallet-Track, one of the seven members of FFUK backer the Association of Pallet Networks (APN), said the industry must keep its foot on the pedal. “In reality, the government is deceitful regarding the price of fuel. It could have put a stabiliser in but when the price of crude goes up, it loves it [because it makes more money].”
Parkes believes getting the public on its side has been important in terms of political clout, especially as they understand freight’s challenges as they are bluntly reminded of the cost of fuel filling their own vehicles day-to-day. He also dismissed the government’s line, stated post-Budget by Treasury minister Danny Alexander, that it is not yet convinced a duty cut would stimulate the economy.
“There are too many in the government who have not been involved in commercial life. They are scared to do it in case it fails. Businesses reduce profit to invest in future growth. The economy is ultimately a business and tax cuts [such as duty] when it is stagnant is what we need. Wages are not keeping up with inflation – they are being squeezed. Give them more money and they will spend it,” said Parkes.
Elddis Transport MD Nigel Cook agreed but feared that with the UK drowning in national debt, such a dramatic change in policy may remain tantalisingly out of reach. “Fuel is still a major issue in the industry and the government needs to help support, but I am not sure whether it would be prepared to or have the ability to do in this climate,” he said.
Realistic rates
Peter Tattersall, director of Goole-based PD Tattersall, said pushing for more realistic rates from customers could be the answer. “If we could pass the rates on, they could put fuel to what they want. We have had some increase in haulage rates but they are nowhere near where fuel’s gone up to.”
The fight must go on APN chairman Paul Sanders, said the latest freeze is the perfect staging post to intensify the attack. “FFUK had a strong result in securing the cancellation of the September rise in duty; we will take that for now. We must increase the voice of FFUK and use this result as a spring board to increase our lobbying driving for an overall reduction in fuel duty at the earliest opportunity,” he said.
FTA MD of policy and communications James Hookham said it was the only way to get the economy on track. “It is vital that we have a cut in fuel duty and a long-term strategy to prevent future rises and uncertainty,” he said.
