Rising fuel costs stoke inflation and unemployment, reveals FTA’s Kent survey
Tuesday 01 November 2011
Three out of four Kent-based transport operators have had to pass on increasing fuel costs to their customers, thereby stoking inflation. The Freight Transport Association asked its Kent-based members whether the rising cost of fuel over the last 12 months has influenced behaviour: over 70 per cent of respondents said they have increased their rates, with over one in five admitting to having reduced the number of drivers in their workforce.
Even more worryingly, nearly half are ‘likely’ and nearly one third ‘certain’ to pass on costs further in the following year. Natalie Chapman, FTA’s Head of Policy for Kent, said:
“These results demonstrate how much pressure Kent’s transport operators are under. With profit margins in the industry already wafer thin, the prospect of having to absorb two further planned fuel duty rises in 2012 does not bode well and we fear more redundancies and insolvencies in the sector.
“Fuel accounts for around 40 per cent of the cost of running a heavy truck, so rising fuel prices are an extremely daunting prospect for many in the industry.”
The annual claimant count statistics for HGV drivers in Kent has doubled since 2007, where it now stands at 120. As an international gateway for trade in the UK, the impact of foreign trucks on its roads is also a major concern in Kent. FTA’s survey revealed that three in four hauliers ‘strongly agreed’ and one in four agreed that ‘foreign lorries in Kent fill up on cheaper diesel and undercut local businesses.’
“The number one concern for Kent’s hauliers is the price they are paying to fill up their tanks, but around sixty per cent of this cost goes straight into Treasury coffers. While this is helping fill the deficit gap on the one hand, it is also doing irreparable damage to an industry that simply can’t compete in the face of cheaper foreign competition. The result is ultimately unemployment and insolvency which is not good news for the UK’s recovery.
“The results we have found in Kent are being played out across the whole of the UK; unless the government takes action to review its fuel duty policy, the situation will inevitably get much worse.”
Notes for editors
The survey was used exclusively as part of BBC Radio Kent’s Transport Day on Friday 28 October.
FTA Press Office