Every little helps. Or does it?

Though justice be thy plea, consider this,
That, in the course of justice, none of us
Should see salvation

So that nice Mr Darling has listened to, well everyone, really, and decided to postpone the planned 2p a litre hike in fuel duty.

OK thanks Mr D. I suppose, as Tesco so succinctly put it, “every little helps”, but what a very little and how very little it will help. It’s like turning the tap off when the bath is already overflowing, it might not be getting any worse, but your floor’s still ruined.

Fuel costs impact on everyone. Every business and every customer. So fuel duty is such a lovely little earner for the government. And like VAT it’s one of those things that the ordinary punter doesn’t really notice very much. We just keep going along to the pumps and filling up because that’s how we live our lives.

So for organisations from the BMF and Freight Transport Association to the AA and the RAC who have been campaigning for the hike to be cancelled at the very least, this is a start and a welcome start. But it surely doesn’t go far enough. Duty on fuel in this country is twice what it is in Europe. It shouldn’t be. How can businesses expect to be competitive in the wider economy when they start out with a handicap like this? It’s not like manufacturers really have any alternative when it comes to transporting their goods. Even if you send them by train they still have to go by road for some of the journey.

For merchants too, the inflationary pressures caused by huge fuel costs cannot be ignored. The rising cost of fuel is messing up the whole UK economy in general and this sector in particular – BMF sales statistics showing material sales to this April declining by 2.2% year on year.

So, we are grateful, Mr D, for your generosity in not screwing more money out of us just yet. But the Treasury is a hungry beast. The government isn’t just going to leave a little hole in their revenue plans. That money has to come from somewhere. What worries me is where.

About Fiona Russell-Horne

Group Managing Editor across the BMJ portfolio.

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