Thursday, July 10, 2008

Government to review car tax plan

Following the revelation yesterday that the Prime Minister 'mis-spoke' when he said in Parliament that the majority of drivers would benefit from proposed car tax changes, Chancellor Alistair Darling has appeared in Parliament this morning to answer questions about the plans.

Finally confirming what other ministers and backbench MPs had already been pushing for, he indicated that the plan will be reviewed before the Pre-Budget Report, due in the Autumn.

Official estimates given yesterday to Conservative shadow Treasury minister Justine Greening in a Parliamentary answer revealed that vehicle excise duty will rise for 44% of vehicles made since 2001 - by up to £245 for the most polluting ones - but will fall for 33%.

An estimated nine million car users would have to pay more under the reforms.

Answering for the Treasury, Angela Eagle MP also admitted that five of the UK's 30 most popular cars would pay more.

So if you drive a 2.2l diesel Land Rover Freelander, a 1.6l unleaded Toyota Auris, a 2.2l diesel Honda CR-V, a 1.8l unleaded Vauxhall Vectra or a 1.6l unleaded Vauxhall Zafira, prepare for a wallet-bashing.

Most interestingly, the government's difficulties with getting the plan through Parliament seem to be greater than first envisaged.

Complaints from Labour backbenchers don't just seem to relate to the backdating of the changes to older cars made after March 2001 - thought to be the most contentious part of the proposals.

Speaking on the BBC News channel, Martin Salter - far from among the most rebellious of Labour MPs - complained that even "two years" was not enough time to give people a chance to change their car-buying behaviour.

This would suggest that the government faces problems getting the proposals through Parliament if they make the changes applicable to anything other than brand new cars.

But then, that would mean people are given a chance to dodge the higher charges by making alternative choices, and make the proposals actually 'green' - rather than the great fundraiser for the Treasury that they are actually designed to be.

What a dilemma, Darling!

Tuesday, July 08, 2008

The man's on a roll

The Evening Standard reports today that London's new mayor Boris Johnson has scrapped Ken Livingstone's plan to hit 'gas-guzzlers' with a £25 congestion charge.

The news follows
reports that, in September, Boris will consult the public on scrapping the westward extension of the zone.

According to the Standard, the High Court has confirmed today that the paperwork needed to end former London mayor Ken Livingstone's key policy had been completed.

Band G injustice

The scheme was due to change in October this year. But now there will be no increase in charge to £25 for drivers of Band G vehicles.

Band G doesn't just include expensive sports cars or 4x4s but many typical mid-size family cars, including estate cars and people carriers. So the £25 daily charge would have hit families the hardest.

Targetting Band G for excessively punitive charges would also have threatened the jobs of tens of thousands of people working in Britain's sports and executive car industry, by making their products financially unviable to run.

The discount for cars in Bands A and B, which would have resulted in thousands of cars driving into the zone for free and adding to congestion, has also been removed.

TfL study slammed plans

As we
reported back in October, Livingstone's proposed changes to the congestion charge scheme were slammed by Transport for London's (TfL) own study into the plans.

Their Impact Assessment, authored by environmental consultants AEA, pointed out that not only would the effect of the changes be "an increase in cars moving within the zone" - defeating the purpose of an anti-congestion scheme - but that "Increased congestion would mean that all vehicles would move more slowly leading to increases in CO2 emissions."

Outbreak of sense

So Boris's actions are a welcome sign that he is being guided by the advice of experts in the best interests of limiting congestion and, therefore, emissions.

Rather than the pursuit of blinkered class warfare, or the twisted idea of a link between emissions and 4x4s exclusively, demonstrated by his predecessor.

TfL commissioner Peter Hendy said: "We will be working with the Mayor to strive to cut CO2 emissions from transport in London by promoting cycling and walking, encouraging people to drive in a more efficient way and by cutting Transport for London's own CO2 emissions."

Let's hope this new outbreak of sense in London starts to spread throughout the country. But what next for Boris? May we suggest another look at this.

Sunday, July 06, 2008

UK fuel cheapest in Europe without taxes

According to a recent Evening Standard report, fuel in Britain would be the cheapest in western Europe if it wasn't for taxes piled on top by the government.

Official figures published by Business Secretary John Hutton show that Britain has the cheapest diesel in western Europe once taxes are excluded, with unleaded petrol being the second cheapest.

The revelations expose the fallacy of the prevailing view that nothing can be done about high fuel prices because of the rising price of oil - a piece of government spin that's increasingly being retailed by the mainstream media.

In reality, factors under direct control of the government such as the huge percentage of the retail price that is down to fuel duty and VAT could affect the price we pay at the pump a great deal, and do much to ease the pain being suffered by hauliers and car users struggling to pay their fuel bills.

Consumer fuel prices have rocketed in recent months as the cost of oil spirals. While fuel duty has remained the same at 50.3p per litre, the government has profited from the extra VAT on the increased prices.

Yet the government remains disinterested in giving any of that extra cash back to ease the growing burden on car users.

Chancellor Alistair Darling has signalled that he may postpone the 2p fuel duty rise due in October, but hauliers are demanding a 25p a litre rebate and a government struggling to maintain popularity should more seriously consider actually cutting duty.

The AA has called for the tax on fuel to be published at forecourts so drivers can keep track of how much we're paying the Treasury, which sounds an extremely sensible idea and one way that fuel companies could extricate themselves from the blame for higher prices.

Thursday, July 03, 2008

Boris consults over scrapping C-charge extension

The new Mayor of London, Boris Johnson, has announced a public consultation on the future of the western extension of the congestion charging zone, which will include an option to "scrap it".

The news that the London scheme may be shrunk comes at a particularly inopportune moment for the government, as it continues to push for congestion charging to be introduced in other major British cities, like Manchester.

Criticising his predecessor's February 2007 expansion of the central London invisible toll scheme in the face of overwhelming local opposition, Boris Johnson says he has an "open mind" towards making changes and promises it will be "a genuine consultation".

The consultation will not be a 'yes/no' referendum on the extension but will include various options such as changing the hours of operation.

The plan will also include the carrying out at the same time of an attitudinal survey, factored to match the population of London as a whole.

Local residents and businesses will have a five-week opportunity to express their views on the westward extension, starting in September, with Transport for London particularly keen to hear from those within or on the borders of the extension.

Boris Johnson said: “This will be an opportunity for everyone with experience of the extension to tell me whether they want to see it removed, improved or if they are simply unmoved.”