The haulage industry comments on yesterdays budget

Published: 09 July 2015

Here is what the road transport industry had to say about yesterday’s budget.

Richard Burnett, RHA chief executive: "The freeze on fuel duty continues the very positive policy of the last government and will give a massive boost to business confidence not only in the road haulage industry but the economy as a whole.

We would have preferred a 3p a litre cut in duty, to boost both jobs and growth but it was essential that duty was not increased. Our hauliers already pay by far the highest diesel duty in the EU and twice as much as many of our competitors."

Burnett also hoped the Chancellor would have at least recognised the shortage of HGV drivers by adding “This Budget does nothing to help solve the crisis, despite strong representation from across the industry. He has even failed to support the structure put in place by the RHA and JobCentre+ to get unemployed people into driving.

“By the end of 2016, we will be some 60,000 drivers short if action is not taken now. We are working hard to address the problem and we have a quality process in place for getting unemployed people work experience in the industry and if suitable, a route into full time employment. We need specific targeted funding before it is too late.”

James Hookham, FTA deputy chief executive: “The Chancellor has listened to the voice of industry by keeping fuel duty at current levels, which is to be welcomed.  However, the Government has emphasised that its primary objective is to protect the UK economy.  We believe that reducing fuel duty would make a huge contribution to this objective and we will continue to campaign with FairFuelUK for a 3 pence per litre cut in order to stimulate economic growth.”

RAC spokesperson Jenny Powley: “The changes to VED bands will have an impact on the total cost of ownership, which will have to be picked up by the company when fleet managers are purchasing new cars from 2017.

Fleet managers have been proactive in encouraging drivers to think about cleaner cars by going for vehicles with low C02 emissions which have zero or very low rates of road tax. 

But there is now a big question mark over how the new changes will affect company car drivers’ inclination to go for low carbon dioxide emitting, fuel efficient vehicles. 

For the first year of ownership of a new vehicle, incentives will still exist to select low emitting vehicles but thereafter, a flat rate will apply to most vehicles. This may raise questions about how companies will make purchasing decisions when it comes to new vehicles in the future. 

We hope the new regime doesn’t undermine the major progress that we are making in reducing carbon dioxide emissions.”

James Stamp, head of transport at KPMG UK: “In the last budget, the Government announced a major road investment program worth £15billion. Today, the Chancellor announced that road tax (VED) income will be "ring fenced". This provides some clarity about where funding for the ambitious road projects will be found.

However, we note that while road tax raises around £6 billion per year, this is dwarfed by income collected from fuel duty which is around £27 billion. We believe that more of this income should be reinvested in roads and transport infrastructure in line with the Chancellor’s statement that money raised from drivers should be spent on the roads they drive on.”

Ashley Sowerby, managing director at Chevin Fleet Solutions: “Fleets should probably take a good look at the way in which the proposed increase in the first MoT from three to four years affects their risk management.

For those that operate on replacement cycles of more than three years, it could create a potential weak spot. For example, you might have a high mileage vehicle that has covered perhaps 75,000 miles after three years which, while it has undergone regular maintenance, will not be required to pass a MoT for another year.

From a duty of care point of view, that vehicle would represent an increased risk and fleets would perhaps need to ensure that they had procedures and arrangements in place that recognise that fact.”

Mike Danby, CEO of Advanced Supply Chain: “We work with some of the country’s largest retailers, delivering products direct to their stores and offering robust and efficient supply chains, so the potential loosening of Sunday trading laws is of particular interest.  

Additional capacity for product sales can only be beneficial to ourselves, and other suppliers to the retail sector. A small change in government policy can have substantial ramifications for a wide-range of industries and businesses, and that is why any Budget announcement is always of interest to business leaders.”

Anne Preston, Prestons of Potto: “We were anxious about the fuel freeze, but this is good news for the economy, our business and our customers, who won’t have to pay more for their haulage. Our industry has fought a very hard battle with the Fair Fuel Campaign, but we still have the highest fuel duty in Europe.”

Kyle Truman, marketing director at Epyx: “Potentially the most interesting development in the Budget from a fleet point of view is the proposed extension of the first MoT from three to four years. Effectively, this would mean that the majority of cars owned by fleets would never need to be MoT’d because they are on shorter cycles than four years, which is a definite gain in terms of both costs and reduced hassle surrounding defleeting.”

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