Victory! Huzzah! Alistair Darling decided not to put another 2p per litre on diesel fuel from next month after all. Well, that’s all alright, then, isn’t it?
Rather like giving first-time buyers a leg-up or a stamp duty holiday, the decision to defer the fuel duty escalator demonstrates the government’s ability to adapt policy objectives to political expediency. But, like so many government expediencies, it still only treats the symptoms.
The argument for the fuel escalator is that it fulfils both the polluter pays principle of environmental taxation and the desire to reduce private car journeys in favour of more carbon-efficient forms of transport.
But the movements of efficiently-laden vehicles associated with the delivery of timber and building materials are fundamentally different from consumer decisions to drive kids to school. Thus, we at the BMF have argued that, in the same way that bus operators receive a fuel duty rebate (currently 25p per litre), so the movement of building materials should be seen as a necessary public good, and attract a similar rebate.
Those who operate professional haulage fleets already pay for an Operator Licensing regime. We are shortly to have a professional driver competence CPC scheme with increased stringency in the awarding of licences. This draws a costly and visible distinction between professional business drivers and consumers, so are we not also at a point where we can draw a permanent policy distinction between fuel duty paid by the two?
The simplest method would be to extend the bus and coach rebate scheme to all businesses with an up-to-date O licence. It would be comparatively easy to administer as VOSA knows who has an O licence, and the industry already keeps the records necessary to monitor fuel purchases and vehicle consumption as a matter of course – usually via fuel cards.
Increased fuel costs feed directly into suppliers’ and importers’ resale costs, fuelling inflation right down the supply chain. It is possible and desirable to reduce the price of fuel to those of us who move goods for a living. And it can be done without compromising policy objectives of getting consumers to drive responsibly. All it requires – as so often with government – is the will.
