Today's decision to increase fuel duty from September could be the death knell for parts of the logistics sector, according to the Freight Transport Association (FTA), leading to business closures and widespread job losses.
James Hookham, Policy Director for FTA, said:
"The logistics sector is the lifeblood of the UK economy, and rather than the transfusion we need, Alistair Darling has turned Dracula. Insolvency in the logistics sector has doubled in the last year and the number of HGV drivers looking for work has almost quadrupled. What more evidence does the Government need that parts of the sector are on their knees?"
Figures released earlier this week by FTA showed that nearly half of its members have already laid off staff this year, with a further 40 per cent considering redundancies in the second quarter. Two fuel duty hikes in just five months have landed businesses with an additional £533m bill and the concern is that the increases announced today will make that burden too much for some businesses – in particular, those smaller, family-run operations – to bear.
Hookham warned that hiding behind environmental 'greenwash' was fooling no-one:
"The logistics sector has a strong track record of reducing emissions and investing in greener vehicles. Ironically, the Chancellor's announcement today has put the kibosh on many businesses being able to make that investment. It may be unpopular to tax motorists, but the fact is that private cars add far more to the UK's CO2 emissions than commercial vehicles. That's why the time has come for the Government to give serous consideration to different rates of duty for business users and private motorists."