May 27, 2008

Hundreds of lorry drivers have started a protest convoy in Central London, and along the M4 in Wales, in a bid for governmental help with the price of fuel. 

Diesel prices, having topped 120p per litre are said to be driving haulage firms “to the wall”.  Protesters are demanding an "essential user" duty rebate for HGV drivers.
 
The eastbound A40 between the northern roundabout and Paddington will be closed from 1000 to 1600BST as lorry drivers leave their vehicles to head to 10 Downing Street to hand in a petition.

Fuel prices have increased by around 50% since January 2007 and the increases are having widespread effects across the economy.  There are a number of factors that are causing the rise in prices; including increased demand from emerging economies, supply fears and fall in value of the Dollar – in which oil is priced. 

The government currently add 56.94p per litre to the cost of diesel.  They then charge VAT on that total.  There have been calls for the VAT to be changed to be charged on the fuel rather than the fuel plus the tax, as drivers are in effect double taxed every time they fill up.

Mike Presneill, of protest group Transaction 2007, said: "Fuel is rocketing. The government has the power to act but appears not to be listening. Hundreds of UK transport firms are being driven to the wall."

Haulage company boss Peter Carroll, another of the protest organisers, told BBC News: "The main thing we're hoping to achieve is to get the government to recognise that this isn't a problem, or even a big problem, it's an absolute crisis."

Carrol commented that the cost of fuel to run a lorry has now reached £1,000 per week, with his bills up a staggering £40,000 per month, since October.  He claimed that hundreds of UK haulage companies would be made bankrupt if nothing was done to reduce costs.  These would be replaced with continental hauliers using cheaper fuel from abroad. 

Company bosses understand that the government cannot control oil prices, but are looking for an “essential user” duty rebate between 20p and 25p per litre to help firms compete with foreign hauliers.  Mr Carrol stated that a similar rebate scheme was already operating in the UK for bus companies.

He added: "If they do that, we keep in business, we continue to pay our taxes and play our part in UK business and also the government wins because we take some of the inflationary pressure out of the economy.
 
"Because all the time that our fuel is going up, we're trying to push those costs onto our customers, who in turn try to push it onto members of the general public."

These added costs make the UK haulage industry less competitive in an increasingly international marketplace.

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