Thank you for contacting me about fuel prices.
I understand drivers’ concerns regarding fuel prices and the cost of living. Therefore, I welcome the Chancellor’s decision to maintain fuel duty at current levels until spring 2024, spending £5 billion on a tax cut worth £100 per driver this year. This will be achieved by keeping the 5p cut in fuel duty introduced last year, as well as cancelling the scheduled 11p increase in fuel duty. This continues the policy of successive Conservative Chancellors dating back to 2011 of freezing fuel duty.
To further support drivers, I welcome the Government’s boost for the budget for pothole repairs. The Chancellor has increased funding for pothole repair by £200 million this year, on top of the £2.5 billion pothole repair fund, which runs from 2020/21 – 2024/25. The increase is expected to fix the equivalent of up to 4 million additional potholes across the country.
CMA Fuel Report
Following the publication of a report by the Competitions and Markets Authority (CMA), the Government will change the law to force retailers to publicly fess up to how much they are charging at the pump. In a win for consumers, they will be able to compare prices in real time in any area of the UK, through a new fuel price reporting scheme. Drivers will be able to easily identify those charging fair prices and those failing to pass on savings from falling wholesale costs. New powers will be handed to a public organisation - yet to be decided - to closely monitor the UK road fuel market, scrutinise prices, and alert the Government if further intervention is needed.
I welcome the Prime Minister's proportionate and pragmatic decision to delay the ban on new diesel and petrol cars from 2030 to 2035. This decision will support manufacturers and families in making the switch to electric, providing flexibility while also helping to grow the economy. The Government's zero-emission vehicle mandate means the country will have the most ambitious regulatory framework for the switch to electric vehicles in the world. This requires 80 per cent of new cars and 70 per cent of new vans sold in Great Britain to be zero emission by 2030, increasing to 100 per cent by 2035. The 2035 end-of-sale date puts the UK in line with other major global economies, including France, Germany, Sweden and Canada.
Promoting the uptake of electric vehicles and future revenue
I am aware that the Government currently uses the tax system to encourage the uptake of vehicles with low carbon dioxide emissions. This is why zero-emission cars and electric vans are liable to pay no vehicle excise duty and why users of zero and ultra-low-emission cars have favourable company car tax rates in comparison to conventionally-fuelled vehicles.
I welcome the steps being taken towards achieving net zero carbon emissions by 2050. The widespread uptake of electric vehicles and the phasing out of new petrol and diesel cars and vans will make a vital contribution to this. People are already choosing electric vehicles to such an extent that a new one is registered every 60 seconds. Nevertheless, I believe it should be you - the consumer - who makes that choice, not the Government forcing you to do it. This is because the upfront cost is still high, especially for families struggling with the cost of living.
As this transition gathers pace, we will need to ensure that revenue from motoring taxes keeps pace with this change to ensure that investment in road infrastructure can meet future demands and challenges.
Direct Air Capture and CO2-neutral fuels
The potential impacts of Direct Air Capture and the possibilities of CO2-neutral fuels are exciting and I know my ministerial colleagues are committed to ensuring our future tax regime encourages innovation and contributes to Britain’s net zero ambitions.
Van Benefit Charge and Car & Van Fuel Benefit Charges
From 6 April 2023, Car and Van Fuel Benefit Charges and van benefit charge increased in line with Consumer Price Inflation.
Clean Air Zones
Clean air zones are defined areas in which targeted action is taken to improve air quality. A clean air zone is not the same as a congestion charge zone, where all or most vehicles are charged to drive.
Clean air zones have been introduced with a specific focus on tackling NO2 concentrations in areas that are breaching legal limits. Local authorities monitor NO2 reduction measures in collaboration with the Joint Air Quality Unit hosted by the Department for Transport and the Department for Environment, Food and Rural Affairs.
Clean air zones have been grouped into four classes (A to D) covering different vehicle types. The types of vehicles covered by a zone broaden from class to class. Private cars are not impacted in clean air zone classes A, B or C.
Decisions around the introduction of clean air zones, including whether to adopt charging or a non-charging policy, and the types of vehicles affected, are the responsibility of local authorities, in consultation with residents and local businesses.
Under the Transport Act 2000, the net proceeds of any charging schemes made under the Act can be retained but are only available to the local authority for reinvestment to deliver local transport policies. Local authorities are required to give an indication of their plans for use of net proceeds in the Charge Scheme Orders that establish their road user charging schemes. Further, local authorities should set the level of charge for vehicles entering a zone appropriate to their local circumstances.
Thank you again for taking the time to contact me.
Craig Whittaker MP