Fuel Duty: Hauliers

Oral Answers to Questions — Treasury – in the House of Commons on 9th April 2019.

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Photo of Maggie Throup Maggie Throup Conservative, Erewash

What estimate he has made of the average annual savings to hauliers from freezing the level of fuel duty since 2010.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

Fuel duty has been frozen for nine consecutive years, saving money for all those who regularly use our roads. I can confirm that the average road haulier has saved £23,300 per vehicle on fuel since 2010 compared with the pre-2010 escalator plan. However, the benefits to hauliers and motorists of freezing fuel duty must be balanced against the cost to the Exchequer in the context of our need to fund our public services, so we continue to keep it under review.

Photo of Maggie Throup Maggie Throup Conservative, Erewash

Hauliers have definitely been a major beneficiary of the duty freeze, but will my right hon. Friend consider helping the industry further by investing in a new motorway junction between junctions 25 and 26 of the M1 to help improve connectivity throughout the east midlands?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

From 2020, all English road tax will be spent on our roads via a dedicated national roads fund—that will be £28.8 billion between 2020 and 2025, including £25.3 billion for strategic roads. We have spent £120 million on the recently opened smart motorway between junctions 23a and 25 of the M1, which will reduce congestion, but we will, of course, continue to take into account the need for connectivity in planning future roads investment in the east midlands.

Photo of Daniel Zeichner Daniel Zeichner Labour, Cambridge

The Chancellor says this needs to be balanced against the needs of the Exchequer, but what about the needs of the environment? What effects have we seen during the period of the freeze, with the failure to tackle emissions and with the road transport sector in particular failing compared with others?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

We have an extremely good track record on decarbonising our economy. We have set extremely ambitious targets, and we are ahead of all our significant competitors in delivering them.

Photo of Priti Patel Priti Patel Conservative, Witham

The freeze in fuel duty has helped hauliers across Essex, but of course there is another measure that could help our hauliers and businesses even more, which would be to dual the A120. Will my right hon. Friend have a word with the Department for Transport to see how we can use the taxes raised to get this road dualled?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

Never a Treasury questions goes by without my right hon. Friend raising the dualling of the A120. Of course we have a very large fund available, with £25.3 billion for strategic roads, and I am sure my right hon. Friend the Secretary of State for Transport is well aware of the compelling arguments in favour of dualling the A120.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health)

What tax breaks is the Chancellor putting in place so that hauliers are able to continue through the uncertainty on contracts during the transition period as we leave Europe?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

As I have already mentioned, hauliers have benefited very significantly from the freeze in fuel duty, but the hon. Gentleman asks a wider question. If we were to find ourselves leaving the European Union without a deal—a situation that I sincerely hope will not arise—we have a full range of tools available to us, including all the usual tools of fiscal policy. I have headroom within the fiscal rules of just under £27 billion, as I set out at the spring statement, and the Government will work closely with the Bank of England in those circumstances to ensure that fiscal and monetary policy are used to support the UK economy.

Several hon. Members:


Photo of Kirstene Hair Kirstene Hair Conservative, Angus

Thank you, Mr Speaker. Of course, hauliers and motorists warmly welcome the fuel duty freeze, but they are concerned about the disparity in fuel costs across the country and the impact of the cost of oil—they are not seeing that at the pumps. Will the Chancellor, or a member of his ministerial team, meet me to discuss an independent fuel price regulator and to see whether we can sort out these issues?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

We have a marketplace in fuel in this country, but I understand my hon. Friend’s point. I am sure the Exchequer Secretary would be very happy to meet her to discuss it.

Photo of Barry Sheerman Barry Sheerman Labour/Co-operative, Huddersfield

I chair Labour’s Back-Bench environment, food and rural affairs committee.

The Chancellor always impresses me. He is thoughtful, and I like him a lot. He is thoughtful on Europe and on the environment, but can I take him back to what my hon. Friend Daniel Zeichner said? Is it not about time we had a modern taxation system that encourages sustainable transport? We are killing kids and poisoning pregnant women. We know that air pollution is of the utmost importance. I appeal to the Chancellor’s radical instinct: let us have a new form of sustainable taxation.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I am bemused by the disappearance of Mr Angry, who I am quite used to dealing with at the Dispatch Box. As I said earlier, we have a good track record on decarbonisation and addressing air quality challenges. We provide substantial support for ultra low emission vehicles, we have a highly differentiated vehicle excise duty and company car tax regime, which encourages the purchase of the cleanest and most efficient vehicles, and we will go on seeking to change behaviour through a carefully constructed tax system.