A plea to George Osborne from “the squeezed middle”
Hysteria in the local rag today with “Petrol crisis: Pump prices near record levels” painting a particularly bleak picture of the state of the nation, as “…prices across Edinburgh and the Lothians crash through the £1.40-a-litre barrier…”
From the horse’s mouth:
“You’ve got families and businesses at breaking point. You’ve got fuel hitting record levels and the economy’s on its knees.
“Our plea to the government is simply this – cutting fuel duty substantially is the easiest and quickest way to give the economy the kick it needs to get it growing.”
FairFuelUK via Scotsman.com
As you can imagine, I’ve got more than a few things to say about that…
Hands off the market, George!
Speaking as a motorist and concerned citizen, I don’t think there’s anything fair at all about cutting fuel duty. All that means is that instead of charging gas-guzzlers for their bad habits, all the rest of us find their taxes aren’t going as far as they used to.
Whenever the government cuts tax on fuel, the money has to come from all our pockets instead, in the form of general taxation.
If fuel prices are high, we can use more efficient cars, drive less, use companies that deliver smarter. We can’t choose to pay less tax.
Is that somehow fair, FairFuelUK?
You want our old people and hard working families who rely less on their cars to pay for the ones that think they can’t do without? Not in my name.
As a member of the “squeezed middle”, I like high fuel prices. It means fewer people sitting stationary in traffic jams, belching fumes into the air. It means there’s a big incentive for companies, councils and the government to get smarter and more efficient with the way they transport things.
In short, it provides a competitive market where companies (and consumers) are rewarded for doing the right thing, and penalised if they stick to their old fuel-wasting ways.
In a very real way rising fuel duty revenues take some of the strain off my income tax, NI, VAT (etc) payments, letting the government spend that money on schools and the NHS. I can’t even shed crocodile tears for people who insist on driving a few miles across town at 10mph and are now paying for the privilege of spraying families on the pavement with diesel particulates.
Make sure the market can be efficient, George
Just about the only thing that struck a chord with me was the comment by Central Taxis director Tony Kenmuir, who said that a 5p rise at the pump cuts £1,200 from the annual income of a taxi driver.
This is news to me. I don’t routinely travel by taxi but always assumed that prices went up according to inflation, fuel, and other costs like insurance.
For a concerned citizen such as I, it’s very bad news when fuel duty goes up but the costs aren’t passed directly on to the end consumer. If it gets more expensive to ship New Zealand lamb, I want it to cost more on the shelf (and buy local instead). If it costs more to get a taxi because the fuel costs a fortune, I’ll do less of that too.
You might not want to do this, but that doesn’t mean I should have to subsidise your inefficient lifestyle either!
The cost of delivering to supermarkets and depots should be passed on to customers as directly as possible; competitive companies already do this by striving to improve the efficiency of their logistics operations.
Let’s not stifle that by meddling with the market and cutting fuel duty in a misguided attempt to make things better. The economy is not dying because of the cost of moving things around (if it was, fuel wouldn’t have plunged to 75p/litre at the start of the recession).
I want it expensive and I want it passed on: that way I can choose to avoid it.