Archived press release

Fuel tax rises necessary, says friends of the earth

25 September 2003

Friends of the Earth said that fuel tax increases announced today by the Treasury are needed to help cut congestion and pollution. Higher fuel prices encourage drivers to buy more fuel efficient cars and to use them more sensibly. Revenue raised should be targeted at public transport improvements and alternatives to the car.

The Chancellor deferred the duty rise over fears that the Iraq war would destabilise world oil prices. As OPEC has today agreed to cut production to prevent a glut of oil from depressing world prices, this fear can no longer be justified.

Motoring costs have fallen in real terms both over the last 25 years, and also since Labour came to power in 1997 [1]. Government transport policy assumes they will fall even further this decade. The Government's own analysis shows that keeping motoring costs constant, by increasing fuel prices, will help it meet its targets to reduce congestion and pollution [2].

Tony Bosworth, Transport Campaigner at Friends of the Earth, said:

"Higher fuel prices help cut congestion and pollution by encouraging drivers to buy more efficient cars and use them more sensibly. But money raised should be used to fund public transport improvements and alternatives to the car. As world oil prices are expected to fall slowly, the Chancellor is right to increase duties to reflect inflation. If he didn't do this, lower fuel prices would just create more congestion and pollution."

Meanwhile, evidence from the European Commission shows that Britain is lagging behind other European countries in terms of fuel efficiency. The average new car sold in Britain in 2001 emitted 174 grammes of carbon dioxide per kilometre (g/km), as compared to the EU average of 164 g/km [3]. And car traffic in Britain is rising - by 2.6 per cent between 2001 and 2002 [4].

Notes

[1] Motoring costs fell by 1.3% between 1974 and 2001, and by 0.9% between 1997 and 2001 (House of Commons Written Answer 20th November 2002)

[2] Transport 2010: The Background Analysis, Figure 14

[3] European Commission Staff Working Paper `Monitoring of ACEA's commitment on CO2 emission reduction from passenger cars' 9^th December 2002

[4] Department for Transport `Road Traffic Statistics 2002' 31^st July 2003

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