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HM Revenue and Customs

Part of Supplementary Estimates 2009-10 — Department of Health – in the House of Commons at 6:12 pm on 10th March 2010.

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Photo of Robert Goodwill Robert Goodwill Shadow Minister (Transport) 6:12 pm, 10th March 2010

Well, time will tell. I should be obliged if the hon. Gentleman gave me a detailed run-down of those policies.

We welcome the scrapping of the scheme, but we worry that the Government may have thrown the baby out with the bathwater, given that the intention was to introduce a lorry road-user charging scheme. We are concerned about the uncompetitive situation that faces the British road haulage industry. The difference in diesel prices between the UK and the rest of the EU is marked, despite the fact that that has been addressed somewhat by the devaluation of sterling. In April 2009, the differential was about 10p in the nearest countries, but diesel was 26p cheaper on average in the 26 member states than in the UK. That has resulted in a very real problem for the British road haulage industry. In fact, when the vehicles entering the country through the ports and the tunnel were monitored, it was found that 81 per cent. of vehicles using those links were foreign trucks. That is a measure of the degree to which the British road haulage industry has had difficulty competing on this very unlevel playing field.

In 2001, when the price of fuel peaked, there were widespread demonstrations up and down the country-the fuel protests-and the then leader of the Conservative party, my right hon. Friend Mr. Hague, suggested a Brit disc-a vignette for which foreign trucks would have to pay. The Government of the day regarded that as being against European rules, but in the meantime countries such as Austria, the Czech Republic and Germany have introduced their own schemes for lorries, with Germany using a satellite-based scheme and the other two countries a tag and beacon scheme. As transit countries, they are able to regain the revenue from the trucks crossing their country, which often fill up outside their country.

It has been estimated by NERA Economic Consulting that the cost of foreign trucks running on British roads is £195 million in road wear, plus environmental costs of more than £35 million and costs of accidents of almost £33 million. We suggest introducing a lorry road user charging scheme in the UK-for all trucks, not just foreign ones, to meet the European rules-leading to a gain to the UK Treasury of about £400 million in fuel duty revenue that currently goes to other EU treasuries. In addition, we would gain the increase in tax, national insurance and corporation tax paid by UK haulage companies, which would benefit.