The Royal Commission on Pollution: Business warns of price increases as costs are passed on
Thursday 27 October 1994
The report says higher fuel duty would cut profits and employment in car and component manufacturers and hit road hauliers, but there would be more jobs in public transport. It also argues that the impact on prices would not be large. Although transport costs account for about one-tenth of final prices, fuel makes up only a fraction of total transport costs and represents a quarter of the cost of running a car for the average driver.
The commission calls for subsidies for manufacturers who switch from road movement of bulk goods to inland waterways or coastal shipping. It wants more grants awarded to encourage a shift from road to rail and sets a target for trebling the railways' share of freight from 6.5 per cent last year to 20 per cent in 2010.
Most businesses saw little scope for switching from road haulage to rail and water transport. John Guttridge of the Freight Transport Asssociation said modern manufacturers needed the flexibility and wide coverage road freight provided. 'We're not going to see a return of the heavy industry and coal mining which favoured rail,' he said.
Airlines said that if they lost their exemption from tax on fuel, it would seriously reduce their ability to compete against overseas carriers. British Airways said fuel made up 11 per cent of its costs and any tax would be fully passed on to customers.
The Confederation of British Industry argued that halving the spending on the roads programme would increase congestion and damage competitiveness.
Howard Davies, its director-general, said: 'The fear is that the short, sharp, shock treatment proposed by the commission will in the medium term make road transport in the UK very expensive but offer little in terms of realistic alternative ways for individuals to travel and for businesses to transport their goods and services.'
The CBI argued that the Government should bring Britain's infrastructure up to the same standard as in other European countries to aid competitiveness.
Mr Davies said: 'Although our main competitors in Europe face similar environmental concerns, they are still planning improvements to their road networks.'
The car industry did not expect higher fuel costs alone to cut demand, but was critical of the targets for improved efficiency. Geoff Whalen, deputy chairman of Peugot, said a 10 per cent improvement in fuel efficiency would be possible by the end of the decade, but a 40 per cent improvement by 2005 was not feasible.
The commission argues that tax revenue from road users may not be covering the total bill for society. The real costs of road transport in Britain, including damage due to air pollution, climate change, noise and accidents, is running at between pounds 10bn and pounds 20bn a year. Total tax revenue from road vehicles at pounds 20.4bn a year equals this upper estimate, but it also has to cover the pounds 6.9bn annual spending on roads.
Oscar Pistorius trial: Defence's own witness contradicts athlete's version of events
Oscar Pistorius trial: The case against Oscar Pistorius – and why the prosecution claims his story doesn't add up
South Korea ferry: Captain could face criminal investigation as warrant is sought
Peaches Geldof dead: Private funeral for the family and friends of the socialite will take place next week
Shropshire criminals ‘using unmanned drones and infrared cameras to find illegal cannabis farms’ – and then steal from the growers
The food poverty scandal that shames Britain: Nearly 1m people rely on handouts to eat – and benefit reforms may be to blame
US Navy christens huge $3 billion destroyer ship USS Zumwalt that appears as a fishing boat on enemy radar
Scottish independence: It is the English who should be on their knees, begging the Scots to vote ‘No’
Nigel Farage fatigue? Half of voters ‘immune’ to Ukip’s appeal
Nigel Farage on Have I Got News For You: Ukip leader ridiculed over expenses and party 'fruitcakes'
Nigel Farage: I’m taking on the status quo, and the Establishment’s fighting back
- 1 Poveglia: 'World's most haunted island' up for sale...is anyone brave enough to buy it?
- 2 The Hobbit: There and Back Again set for possible title change
- 3 Video of British Muslims dancing to Pharrell Williams's hit Happy attacked as 'sinful'
- 4 24 people applied for the 'world's toughest job', here are their interviews
- 5 Andre Johnson: Wu-Tang Clan-discovered rapper severed his penis and jumped from LA building
£150.00 per week: QA Apprenticeships: This company is a company that specializ...
£153.75 per week: QA Apprenticeships: This company is an innovative outsourcin...
£150.00 per week: QA Apprenticeships: This company has been providing on site ...
£150.00 per week: QA Apprenticeships: We've been supplying best of breed peopl...