The Labour Party is being urged not to increase fuel duty if it forms the next Government.

In a recent speech to the Institute for Government, Labour’s Shadow Secretary of State for Transport, Andy McDonald, argued that a New Social Contract for Transport is needed.

Noting that fuel duty has been frozen since 2010 at a cost of more than £50 billion, with air passenger duty broadly frozen over a similar period, and rail and bus fares both having increased, Mr McDonald described the current approach to transport policy as not sensible.

However, responding to the speech, the Freight Transport Association (FTA) pointed out that rising fuel costs are already forcing logistics businesses to freeze recruitment, lay-off staff and delay vehicle upgrades.

Any rise in fuel duty would only make the issue worse, the FTA argues.

Recent research by FairFuelUK (FFUK) shows that 19% of 17,231 respondents reported that rising fuel prices had forced them to freeze staff recruitment, while a further 9% said it has forced them to lay off staff.

A significant 80% of respondents told FFUK they were planning to keep vehicles for the next 12 months rather than upgrading them to more environmentally-friendly models. More than half (52%) confirmed that their decision was influenced by rising fuel prices.

The FTA has campaigned “relentlessly” over the past few years to prevent an increase in fuel duty, the Association’s Christopher Snelling claimed, and so far the Government has listened.

It has, he went on, understood the impact a fuel duty rise would have not just on logistics businesses, but the wider UK economy.

It is of vital importance, Mr Snelling added, that the Labour Party understands how linked the rate of fuel duty is to the performance of the economy given that increasing fuel duty directly adds to the cost of doing business in the UK.

Note:

Mr McDonald is mistakenly described by the FTA as the Shadow Chancellor — that post is held by John McDonnell.

Last reviewed 10 April 2019