6 Monday June 13 2022 | the times
News
The competition watchdog has been
told to carry out an “urgent review” of
the fuel industry amid concerns that
retailers are not passing on the 5p cut in
duty to motorists.
Kwasi Kwarteng, the business and
energy secretary, has written to the
Competition and Markets Authority
(CMA) days after the cost of fuel set
records.
The average price of petrol hit 183.1p
a litre last week and diesel 188.8p a litre,
according to Experian Catalist, the data
company. It means that, for the first
time, filling an average 55-litre family
car costs more than £100. Figures today
are expected to show that prices rose
further over the weekend.
In his letter to Dr Andrea Coscelli,
chief executive of the CMA, Kwarteng
says there is “widespread concern
about the pace of the increase in prices
at the forecourt”.
The watchdog has been told to make
recommendations on how to strength-
en competition and transparency on
prices in the retail fuel market. It must
present an initial report by July 7.
The move has been welcomed by
motoring groups, although experts are
calling for a further cut in duty.
Jack Cousens, head of roads policy
for the AA, said: “We are pleased that
the CMA has been tasked to report on
the cost of fuel. However, more urgent
action is needed. To relieve pressure at
the pumps we need an immediate 10p
cut to fuel duty. That would help restore
some balance.”
Sir John Redwood, the Conservative
former cabinet minister, has also called
for an urgent cut in VAT. “The chancel-
lor needs to limit the amount he plun-
ders from us at the pumps,” he said.
Last week a BP garage on the A1 near
Sunderland was selling a litre of
unleaded and diesel for 202.9p and
204.9p respectively. A Gulf garage in
Essex and a forecourt on the M6 in
Cumbria were also charging more than
£2 a litre.
Last night the Liberal Democrats
said the fuel duty cut should be raised in
rural areas to 10p to help people who
are more reliant on the cars. The party
claimed that households in rural areas
had transport costs of £114 a week, al-
most £40 more than those in urban
areas. It means that rural households
are shelling out almost £2,000 more a
year on transport. Tim Farron, the Lib
Dem rural affairs spokesman, said:
“People in rural communities are
bearing the brunt of devastating fuel
price hikes, yet the Conservative
government is refusing to lift a finger to
help. Instead ministers have overseen a
steady decline in rural bus services that
has left people even more dependent on
their cars to get around.”
Louise Haigh, the shadow transportsecretary, accused the government of
spending too much time “tearing
themselves apart” instead of tackling
the “brutal price hikes facing working
people”. She said: “Motorists are being
taken for a ride, and this hapless gov-
ernment is too distracted to do any-
thing about it. The Conservative gov-
ernment needs to tackle the brutal pet-
rol hikes and support Labour’s call to
put money back in the pockets of work-
ing people with an emergency budget.”Petrol stations to be investigated
Ben Clatworthy
Transport Correspondent
A growing number of people are
considering switching to more
economical cars as the prices of
both petrol and diesel hit all-time
highs (Ben Clatworthy writes).
Polling by AA Financial Services
found that 40 per cent of drivers are
exploring ways to reduce costs by
changing vehicles. The proportion
rose to 50 per cent among drivers
under 35.
The poll by the AA found that of
those considering switching
vehicles, nearly half planned to
switch to more economical cars,
with a third specifically considering
an electric vehicle or one with lower
taxes.
About a fifth were planning to
switch to a car that was less likely to
break down, and 15 per cent were
planning a switch from a new car to
a used one.
“What people want from their
cars versus what they need has been
brought into sharp focus by recent
cost hikes,” James Fairclough, the
chief executive of AA Financial
Services, told The Times.
“The car is a key part of a
household’s finances and in times
like this many are thinking clearly
in terms of ‘need to have’ as
opposed to ‘nice to have’. Saving
money, lowering taxes and charges
and reducing fuel consumption are
absolute priorities both at the
moment and in coming months.“During turbulent times, people
naturally want to take control of
their finances and ensure they are
not exposing themselves to any
unnecessary risks. This desire is
clearly reflected in these figures,
with a substantial proportion
wanting to protect their savings and
avoid overextending financially.”
In a sign that households are
tightening their belts, 82 per cent of
respondents said they had been
affected by rising costs of motoring.
Almost 40 per cent said they were
actively seeking the cheapest petrol
prices, and 29 per cent were using
their car less.
Simon Williams, a spokesman for
the RAC, said it was “becoming
clearer by the day that the
government must take further
action to reduce the enormous
financial burden” on the country’s
32 million motorists.
He accused the government of
being fixated on ensuring that
retailers pass on March’s 5p duty cut
fully, claiming that this was
“ignoring the fact that wholesale
costs of fuel have absolutely
rocketed since then”.
Williams added: “A temporary
cut in VAT on fuel, or a deeper
duty cut, are surely what is needed
now.”
Fuel duty is levied at a flat rate of
53p per litre for both petrol and
diesel. VAT at 20 per cent is then
charged on both the product price
and the duty.
Edmund King, AA president,
said: “This is the worst week of
pump pain so far for drivers. We
would urge drivers at the moment
to cut out shorter car journeys if
they are able to do so, and walk or
cycle to save money.”Drivers look to
cut costs with
greener cars
News Transport
On the roads
Boris Johnson is facing demands to
do more to tackle rising fuel costs,
which the RAC has said is becoming
a “national crisis” for the country’s
32 million motorists. The average
price of petrol hit 183.1p a litre last
week and diesel 188.8p a litre.Planes, trains
and automobiles