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Diesel duty hike furore: the facts

10 June, 2016

Patrick McLoughlin

National press furore this week over proposed hikes in diesel fuel duty appear to have been over-hyped and full of misinformation, following some careless comments by transport secretary Patrick McLoughlin.

They stemmed from an article in the Evening Standard, which was then picked up by most national newspapers, and many articles appear to have copied the misinformation and vagueness of reporting.

The Evening Standard report was based on a series of quotes from transport secretary Patrick McLoughlin, in which he said former chancellor Gordon Brown had made a mistake in 2001 by “slashing” taxes to encourage take-up of diesel cars. However, it wasn’t clear which taxes were being referred to.

Gordon Brown cut duty on low sulphur diesel by 3ppl in his 2001 Budget, and many reports assumed this was the mistake McLoughlin believed should be corrected.

However, the Standard neglected to mention that duty on low sulphur petrol was reduced by 2ppl at the same time meaning the differential between the two fuels only improved in diesel’s favour by 1ppl.

Duty rates have also changed many times since then, and have been the same for both fuels for nearly a decade.

The Standard did mention that Brown also reduced taxation on diesel-engined company cars in 2001 – a factor which did drive diesel uptake and was probably what McLoughlin was referring to – but this appears to have been ignored in many other reports.

Since 2001 the proportion of diesel cars in the UK has risen from about 10% to 50%. However, it has since emerged that diesel engines produce more particulates and pollutants that have been linked to heart and lung problems, and the minister was discussing the air quality issue.

McLoughlin told the London Evening Standard: “It is something the chancellor will need to look at in due course.”

Traditionally only Treasury ministers are supposed to comment on tax and neither the Department for Transport nor the Treasury would comment on the press reports, or clarify what McLoughlin had meant.

The Department for Transport spokesman said: “As the secretary of state made clear, improving the UK’s air quality and cutting NOx emissions is a priority for this government. That is why we have committed more than £2bn for greener transport schemes since 2011 as part of our air quality strategy, with £600m over this parliament to support the uptake of electric cars. We are also investing in public transport, such as the Elizabeth Line, to help make journeys cleaner and greener.”

 





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Weekly retail fuel prices: 9 December 2019
RegionDieselLPGSuper ULUL
East130.4761.40138.28126.22
East Midlands130.01140.66126.05
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North East128.45138.66124.29
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Yorkshire & Humber129.21138.68125.42

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