The current 5p per litre cut in fuel duty must be maintained in the Chancellor’s Budget next week to protect haulage operators working to “incredibly narrow margins”, Logistics UK has warned.

The business group said maintaining the existing cut in duty would prevent additional inflationary pressures, which have led to a raft of administrations and insolvencies already this year.

“Removing the current fuel duty cut, at a time when logistics businesses face a wide range of economic pressures from rising wage bills to the cost of investing in the green transition, would place a huge additional burden on our sector and the wider economy,” said David Wells, chief executive at Logistics UK.

“Logistics as a sector is committed to switching to greener vehicles and methods of delivery, but this cannot be achieved without creating some financial certainty for future planning. We are urging the Chancellor to take this into account when making his final Budget calculations, for the good of the UK’s supply chain and the wider growth of the economy that our members can help to drive.”

Paul Holland, UK MD at card provider Fleetcor, pointed to KPMG research which found that while EVs were significantly cheaper to run than fossil-fuel vehicles, they cost much more to buy and this was likely to be “doubly true for budget-conscious fleets”.

He added: “If we reintroduced more incentives then we could see EV use speed up again, and the UK’s fleets and motorists alike would spend far less on fuel, benefitting everyone.

“With Labour backing away from their climate pledge there is a gap in the political market for leadership on climate that also benefits companies and drivers, but I am sceptical that this will happen in the forthcoming budget.”