Fuel duty frozen for another year

Fuel duty will be frozen for the ninth consecutive year, confirmed the Prime Minister today.

Speaking at the Conservative Party Conference, Theresa May said the party is on the side of “hard working families”.

Had the fuel duty escalator continued as planned from 2011 onwards, fuel duty today would be 83.33 pence per litre rather than 57.95 pence per litre, 43.8% higher.

FairFuelUK has been consistently lobbying the Government to reduce pump prices and welcomes the freeze.

“The ‘’just about managing’ will breathe a huge sigh of relief that duty is frozen for the ninth year. Thank you, Prime Minister, for seeing common sense. It’s now time for this fragile Conservative Government to work with 37m drivers to put together a long-term strategic road transport plan that motivates tax payers, the economy and the environment. Mr Hammond should also look into the mirror and ask why he is so out of touch with reality,” said Howard Cox, founder of FairFuelUK.

In September 2018, the Chancellor of the Exchequer suggested that the fuel freeze has been associated with lost revenue of approx. £46 billion over the eight years. However, CEBR analysis suggests that the freezing of fuel duty may help the Treasury to save for example approximately £14.5bn in yearly financing costs over the long term.

Had the fuel price escalator been in place, 37m hard working drivers would have been paying £1.70 per litre at the pumps, says Cox.

Ashley Barnett, head of consultancy at Lex Autolease, said: “The decision to maintain the freeze on fuel duty will be a welcome relief for UK businesses given rising prices at the pump and already-high vehicle running costs. Whilst we support the Government’s Road to Zero strategy, the choice of electric vehicles and the reach of the country’s charging infrastructure are still improving, which means new diesel and petrol vehicles remain the most practical option for many drivers at present.

“As we transition towards zero and ultra-low emission vehicles, a steer from Government on the longer-term and sustainable alternative for fuel duty would be welcomed by business.  We are hopeful that the Budget will bring more clarification around WLTP and company car tax post 2020/2021, as well as the support available for ULEVs and the implementation of Clean Air Zones.”

Patrick Gallagher, CEO at the CitySprint Group: “Today’s news that the freeze on fuel duty is set to continue is a welcome one and good news for business, particularly in this period of uncertainty while the final Brexit deal is being hammered out. But alongside this move, we need to see more investment in new infrastructure to support the wider adoption of green vehicles and funding or tax cuts to help make these vehicles easier to buy. Alongside new funding for research and development in this area, this will help encourage a wider shift towards low-emission vehicles.”

However, not all parties support the move. Greener Journeys has criticised the freeze, saying that this will have a damaging impact on air quality and public health in the UK, and lead to worsening congestion.

Claire Haigh, chief executive of Greener Journeys, said: “Extending the freeze on fuel duty is a disastrous move which will have a severe impact on air pollution and public health in the UK. Roadside air pollution is causing up to 50,000 early deaths a year, and we know that cars and vans are the primary cause.

“We urgently need a shift away from car use and towards more sustainable public transport, but today’s decision will do the opposite. We urge the Government to show leadership and make the right decision."  

The UK currently has one of the highest fuel duties in the world at 57.95ppl, despite the freeze in 2011 to date. At 25 September 2018 spot exchange rates, German fuel duty comes in at 50.5ppl, Australia is at 21ppl and while the USA’s average level is 10.4ppl.

Robert Halfon, MP for Harlow, added: "Motorists are safe for another year. Delighted that the Treasury has listened to millions of drivers across the UK. Fact remains lower fuel duty means a boost to the economy."