RHA announces 3-point plan for haulage industry survival

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Friday, 18, Apr 2008 12:00

The 2008 Commercial Vehicle Show at Birmingham's NEC provided the perfect opportunity for RHA Chief Executive Roger King to call publicly for Government to support the UK's beleaguered haulage industry.

The price of diesel has now reached record levels and is seriously distorting the economics of the industry. If no action is taken, this could lead to serious consequences for the UK plc in general but particularly for the haulage sector. "The Prime Minister has urged stability within the economy but we haven't got that with fuel prices. Haulage rates cannot keep up with costs and operators are gradually falling into a financial trap; even if they have a fuel escalator in their contract, this does not make up for the even faster increase in prices. Therefore I have urged the Government to adopt the following proposals to help the industry.

"Firstly, the Chancellor should withdraw his increase in tax scheduled for 1 October 2008. This would send a clear message to the industry that Government is not going to use it as cash cow and at least give some stability in the tax burden.

Secondly, we urge Government to consider the amendment in the Finance Bill, currently before Government and tabled by the Scottish National Party from a proposal by the RHA which would seek to establish a bench price for oil at, for example, say $110 a barrel with any further price increases offset by a fuel duty reduction. The Chancellor would not lose revenue because the extra VAT he is recovering from the rapidly escalating price of fuel would more than pay for any reduction targeted at the road transport industry.

We know partisan politics might influence a Labour Government in its view of an SNP proposal but we urge that these be put aside in the interests of the UK economy.

Our third proposal is to bring about a significant cash injection into the road transport industry by asking the Chancellor to bring reduce the VAT repayment period for fuel from the current four months to two. Such an action would not only be easy to achieve, it would represent a lifeline for the thousands of hauliers struggling to pay their fuel bills.

These are three very positive proposals to help the road haulage sector, the bedrock of the UK economy, to withstand the cash flow pressures it currently has to face. We will be writing to the Chancellor to urge their very careful consideration and, hopefully, their introduction."

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