RHA and CPT suggest the government still needs to do more to help transport operators – despite the temporary measure announced in the House of Commons
Coach and bus trade bodies have reacted positively to the Prime Minister’s announcement today that a planned ending of the fuel duty freeze will be delayed until the end of the year.
RHA and the Confederation of Passenger Transport (CPT) both say the government’s decision to put off the 5p increase from 1 September is a step in the right direction.
However, RHA has repeated its call for an essential user rebate for hauliers and coach operators, while CPT has also called for short-term government intervention.
Chancellor Rachel Reeves announced in the last budget she would end the fuel duty freeze, which has been in place since 2011.
Calls for help for operators have been heightened by the war in Iran, which led to a rise of around 33% in diesel prices over the course of March.
However, Keir Starmer used Prime Minister’s Questions to tell Parliament he was making the move to help ease cost-of-living pressures.
Richard Smith, RHA Managing Director, says: “We are encouraged that the government is listening to industry concerns, and addressing cost pressures through measures they’ve announced today. But they should go much further.
“We acknowledge the extension of the fuel duty freeze from September to December, and a temporary cut in red diesel which will reduce some costs for operators in the agricultural sector. It’s good to see that the Chancellor is listening after we and other industry groups have long campaigned against fuel duty increases.”
Mr Smith also alludes to a one-year pause in vehicle excise duty for the HGV sector.
“A one-off 12-month HGV VED ‘holiday’ will offer some relief, but overall the Government’s action will have limited impact with many haulage, coach and van operators already on the brink,” he says.
“We are seeking clarity from the Chancellor on further measures she could introduce to significantly ease the pressure on businesses. In the longer term, we urge her to decouple fuel duty from RPI which is planned to start next April, which will see prices rise again.
“But the immediate picture is far more pressing. Cashflow is a huge challenge for transport operators against a backdrop of cost pressures, low margins, and the high rates of insolvency plaguing our sector.
“Businesses need help now. Our recent fuel survey revealed that only 10% of operators can pass on all the fuel cost increases they’re taking on as the price of diesel has soared by 35%.
“It’s never been more critical. This is why we urge the Chancellor to introduce an immediate essential user rebate – similar to schemes elsewhere – that would help haulage, coach and van operators substantially reduce their bills, and relieve inflationary pressures across the economy.”
CPT adds: “This welcome decision means bus and coach operators across Britain will avoid an additional tax bill of £14 million this year.
“A freeze in fuel duty is a step in the right direction. However, with diesel prices up by 30% since the beginning of the conflict in Iran, bus and coach operators are facing spiraling costs – even without an extra tax burden.
“There is an urgent need for a more radical intervention from the government to safeguard vital transport services up and down the country.”
The news follows the government’s announcement earlier today that it would delay the implementation of some planned sanctions on Russian oil as a temporary measure over fuel prices.
