Radio 4 listeners were told emphatically this week not to blame the “poor fuel retailers” for high prices at the pumps, as RMI Petrol chairman Brian Madderson took to the airwaves once again on
behalf of the petrol retailing industry, as part of an ongoing campaign to scrap the next fuel duty rise.
“Our members have a very difficult year ahead,” he said. “They are having a really tough time as volumes shrink and fuel margins disappear.”
Madderson featured on Radio 4‘s Today programme, set against Paul Ekins, Professor of Energy and Environment Policy at the UCL Energy Institute, University College London, who argued that to cut fuel duty would be entirely the wrong thing to do at the moment. “World oil prices have been on an upward trend for about 10 years, and just to put this in some kind of perspective we would need to cut fuel duty by about 11p a litre in order to take fuel prices back where they were in December 2009,” he said.
“That would cost the treasury about £6bn. So what taxes should be increased to make up for that revenue at a time when the Government is struggling with a very bad fiscal deficit?”
Madderson replied: “Having accepted the duty rises in October and January, and the recent VAT rise, what we want now is that the next fuel duty increase be scrapped. It is only six weeks away and could increase fuel prices by around 5ppl which would amount to a tax bludgeon which could severely impact the economy. It’ll push up inflation, and is absolutely impossible for the motorists and small businesses particularly to absorb.
“I think there is widespread disbelief among businesses, motorists, consumers – our customers who come to our filling stations every week – that the government, so soon after these other duty and VAT increases, are going to roll out a further fuel duty rise. As the global prices of crude push up the pump prices, so they’re going to get a windfall tax from the extra VAT that they’re now putting on the pump prices. They can’t have it all ways, otherwise they will put a stop to this re-growth of the UK economy the prime minister and his cabinet are so keen to see.”|
Ekins responded that it is intended fuel duty should increase in real terms, year-on-year. “I think that’s a very good policy – a good place to get revenue from. It means we don’t need to put taxes up to the same extent on other things, like income tax and national insurance, both of which are effectively taxes on jobs,
“The overall knock-on effect on the economy is not large. Obviously there are some sectors hit worse than others – Mr Madderson is speaking for one of them! But in terms of the government getting the revenues it needs, taxing petrol and diesel is a very good way to do it.”
Meanwhile Brian Madderson will be chairing a breakout session entitled ’Fuels of the Future’ at Summit11, the Association of Convenience Stores’ annual conference, which is running alongside the National Convenience Show and Internationl Forecourt and Fuel Exhibition.
Speakers will include Janet Ashdown, formerly UK retail manager for BP Oil,
and now chief executive of the Harvest Energy brand; Mike Waters, head of Market Insight for Arval, the fleet cards subsidiary of BNP Paribas; and Dr Peter Snowdon, head of UK Downstream Communications at Shell International.