Fuel duty rise ‘will push businesses over the edge’ Wed Apr 01 16:16:00 BST 2009

"Today’s fuel duty increase is the latest in a shower of hammer blows dealt to the logistics sector by the Government. What they are saying by their actions is that they don’t care about the more than two million people up and down the UK who work in this sector and keep the economy moving"

Theo de Pencier, FTA Chief Executive

Today’s increase in fuel duty – the second in just five months – will push many businesses already struggling with the economic downturn over the edge, according to the Freight Transport Association (FTA), which is warning of a sharp increase in insolvencies and job losses in the logistics sector.

Insolvencies in the logistics sector have already shown a marked year-on-year increase and FTA fears that this steady flow of firms going out of business will become a deluge in 2009. And with the number of HGV drivers claiming Jobseekers’ Allowance already rising by an incredible 236 per cent in 2008, the sector is bracing itself for further job losses.

Theo de Pencier, FTA chief executive, said:

“Today’s fuel duty increase is the latest in a shower of hammer blows dealt to the logistics sector by the Government. What they are saying by their actions is that they don’t care about the more than two million people up and down the UK who work in this sector and keep the economy moving.”

FTA also sounded a warning that this may not be the Government’s last attack on the logistics sector. With the Budget in just three weeks, there is every chance that the Chancellor may announce further rises. FTA is strongly urging the Chancellor not to take this path which will almost certainly sound the death knell for businesses – and jobs – across the country.

De Pencier continued:

“The Government has another bite of the cherry on 22 April when the Chancellor presents his Budget. If they take that bite, they are as good as signing the death warrants for some businesses and putting yet more workers onto the dole queue. At a time when jobless figures are already sky-rocketing, the Government needs to understand that such their actions will only add to them – and they will have been responsible.”

Last month, FTA, alongside its partners the British Vehicle Rental & Leasing Association, the Federation of Small Businesses and PetrolPrices.com, launched the Every Penny Counts campaign, urging the Government to rethink its plans to increase both fuel duty and the fees levied by the Department for Transport’s executive agencies. Sadly those calls fell on deaf ears and it was announced last week that test fees levied by the Vehicle & Operator Services Agency (VOSA) alone would increase by an eye-watering nine per cent.

While FTA continues to resist calls from some parts of the logistics sector for direct action, it concedes that frustration with the Government is high.

De Pencier concluded:

“While we would never advocate – or support – direct action, we fully understand the frustration felt by those in the logistics sector. That much of the damage is being done by our own Government only makes it worse.”

Notes to Editors

1. The 1.84 pence per litre increase alone will add almost £1,000 to the running cost of each truck, which, for operators of even smaller fleets, soon adds up to the equivalent of someone’s wages.

2. According to Office of National Statistics figures, claims for Jobseekers’ Allowance have risen markedly within the logistics sector in 2008:

HGV drivers up by 236 per cent
Transport managers up by 114 per cent
Van drivers up by 60 per cent

3. The Every Penny Counts campaign was launched on 19 March. Supported by the Federation of Small Businesses, the British Vehicle Rental & Leasing Association and PetrolPrices.com, those working in the logistics sector are being encouraged to send a special postcard to their MP. Postcards have been distributed through Commercial Motor, Motor Transport, Truck & Driver and FTA’s own publication Freight. A Facebook group has also been established to support the campaign. It can be found at www.facebook.com/group.php?gid=52505287514

4. The decision to increase VOSA test fees by nine per cent was announced in a ministerial statement on 26 March.

5. To date, more than 50 MPs from across the political spectrum have signed Early Day Motion (EDM) 994 to show their support for logistics companies across the UK.

6. An image of the postcard is available in various formats on request from Jackie Langridge on 01892 552253, email jlangridge@fta.co.uk or Liam Northfield on 01892 552255, email lnorthfield@fta.co.uk

7. The Freight Transport Association represents the transport interests of companies moving goods by road, rail, sea and air. FTA members operate over 220,000 goods vehicles – almost half the UK fleet. In addition they consign over 90 per cent of the freight moved by rail and over 70 per cent of sea and air freight.

 

FTA Press Office

01892 552255
press.office@fta.co.uk