The Freight Transport Association has welcomed the Chancellor’s decision to cancel the fuel duty rise planned for 1 September, but has expressed disappointment that the pleas of industry and consumers to reduce fuel duty have been ignored.
In its pre-Budget submission to the Chancellor, FTA said that in order to ease cost pressure on domestic freight activity and stimulate economic growth through consumer demand, road fuel duty should be reduced by 3 pence per litre, with commensurate reductions in the duty rate for gas oil.
James Hookham, FTA’s Managing Director of Policy and Communications said:
"While we are relieved that the immediate danger has passed, in order to get the UK back on the road to economic recovery it is vital that we have a cut in fuel duty and a long-term strategy to prevent future rises and uncertainty.
"The Chancellor has once again squandered an opportunity to support UK industry, jobs and economic recovery, by failing to reduce fuel duty rates."
FTA has been at the heart of the FairFuelUK campaign to have all fuel duty increases scrapped and lobbying will continue for a reduction in the current level.
FTA acknowledged that duty rates for natural gas and biomethane relative to diesel rates have been fixed for a further year. However, the payback period for gas-powered trucks is at least 10 years and the fragility of the business case for these vehicles is such that uncertainty over even small increases in gas duty rates renders these investments uneconomic.
"The Chancellor has bought some time for discussions with the industry. However, there must be a long term fix in gas fuel duty rates to provide the certainty needed to stimulate investment in low-carbon fuelled vehicles to the benefit of businesses and the environment."