“A drop in the ocean” – Sunderland hauliers and taxi driver react to Chancellor Rishi Sunak's five pence fuel duty reduction

“It’s welcome but will be a drop in the ocean” – Wearside hauliers and taxi drivers have been reacting to the Chancellor’s announcement that he is going to place a 12 month temporary five pence reduction on fuel duty.

Addressing Parliament, Rishi Sunak made the announcement to help alleviate the rapid escalation in the cost of petrol and diesel which in the last week hit record breaking highs of almost £1.70 and £1.80 per litre.

While the global cost of crude oil had already been on the rise, the situation has been compounded by the conflict between Russia and Ukraine which has created massive instability in the industry with fears Russia, the European Union's biggest oil trading partner, could retaliate to sanctions by restricting its oil pipeline supplies to Europe, creating a reduction in supply and pushing up demand.

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It’s a situation which has had a massive impact on businesses dependent on petrol and diesel. Last week, the city’s hauliers, taxi drivers and driving instructors spoke the Echo about the “unsustainable” cost of fuel and pleaded with the Government to provide support.

One of those was Seaham Express Light Haulage owner, John Adams, 64, who had decided he couldn’t take on long-distance contracts until the price of diesel fell.

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Responding to the news, John said: “Any reduction is welcome, but I don’t think it will make a big difference compared to how much the cost of fuel has gone up. Will it be passed on to the customer or will that five pence be swallowed up by the oil companies simply increasing their prices?

"I certainly won’t be able to reduce my prices for customers based on this decrease.”

MGW Transport manager Graham Welsh feels the five pence reduction in fuel duty will be a "drop in the ocean".

While the reduction will come into effect from 6pm tonight, the operating cost of duty levied on fuel has been 57.95 pence per litre in addition to the standard 20 per cent VAT.

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With such a significant proportion in the price at the pump still being taxation, Graham Welsh, whose family own MGW Haulage Ltd in Sunderland, feels more needed to be done.

Graham, 60, said: “Any little helps, and it makes a difference, but not a massive one - it’s still only a tiny fraction of the duty on fuel. Back in January I was paying £1.15 per litre and so even with this reduction we are still going to be way above that – it’s definitely not enough. It’s a drop in the ocean.

"I’d hoped the Government would do more as the more it costs us to transport goods and put items on the shelves then the more it costs the customer. The majority of things people buy come on the back of a truck.”

Seaham Express Light Haulage owner John Adams feels the Government needed to do more to support businesses in the haulage industry struggling with the soaring cost of petrol and diesel.
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Peter Phelan, who owns Phelan Haulage and Hiab Hire in Washington feels the reduction will not be enough to alleviate the threat to businesses.

He said: “It’s welcome and it will help, but it’s not enough to stop the real threat to people’s businesses.”

Another area to suffer the full impact of the increase in petrol costs are taxi drivers. The prohibitive costs had even led to John Kenny, who owns John’s Taxis in Houghton, to look to downsize his eight seat minibus taxi.

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John, 62, said: “It’s a step in the right direction, but more needs to be done.”

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