Government postpones planned 3p fuel duty increase

The government has announced it will postpone its 3p-a-litre rise in fuel duty in August until January next year.

The move follows a campaign by road users' groups, who argued the increase would damage the economy.

Fuel duty will be frozen for the rest of the year, Chancellor George Osborne told MPs, adding that this would benefit families and businesses.

Labour, the SNP, Plaid Cymru and MPs from other parties had threatened to force a Commons vote on the issue.

The Sun newspaper and several Conservative MPs have also been pushing for a change of heart, amid concerns that prices at the pumps are squeezing living standards.

Announcing the postponement of the duty rise, Mr Osborne said: "We are on the side of working families and businesses and this will fuel our recovery at this very difficult economic time for the world."

'Difficult decisions'

The government was "doing everything we can", he told the Commons, adding: "The one-off cost of this change will be fully paid for by the larger-than-forecast savings in departmental budgets."

In last year's Autumn Statement Mr Osborne cancelled a scheduled 3p rise in fuel duty for January this year but said another planned rise this August would proceed - although it would be cut from 5p to 3p.

Labour has called for the increase to be delayed until next January, saying the cost - between £500m and £600m - could be covered by the underspend on the Olympics budget or by closing tax loopholes and reversing changes to tax allowances for pension contributions for those earning more than £150,000.

In the Commons, Mr Balls told the Commons that Mr Osborne was a "part-time, U-turning chancellor" who would "not assume responsibility for his own decisions".

But Mr Osborne said road users would be paying 10p a litre more in taxation had Labour still been in power.

SNP Treasury spokesperson Stewart Hosie MP said: "This is a great result... the chancellor's cave-in comes on the day that our Budget clause, supported by 54 MPs from across nine parties, was due to be tabled ahead of the Finance debates next week."

Plaid Cymru's Westminster leader, Elfyn Llywd, said: "This latest in a string of government U-turns will offer people some relief as they struggle to make ends meet - at least until the end of the year as the chancellor has noted...

"Plaid Cymru alongside the SNP have been calling for a genuine fuel duty stabiliser for nearly a decade and that is yet to be achieved, but at least this further damage has been avoided."

'Sigh of relief'

RAC Foundation director Professor Stephen Glaister said: "This is good news for drivers and good news for the country. Given that tax makes up around 60% of the pump price, falls in the price of oil were only ever going to go so far in easing the financial burden on motorists."

Quentin Wilson, national spokesman for FairFuelUK, said: "This is democracy at its very best where a government and a chancellor can review decisions, and act with fairness and common sense. Businesses and hard-working families across this country will breathe a grateful sigh of relief, at least for the rest of this year."

Last week Prime Minister David Cameron said the planned duty rise would be "looked at", but held out little hope for a delay, saying: "I think people sitting at home know that the government doesn't have a bottomless pit of money."

The cancellation of the duty rise comes after Bank of England governor Sir Mervyn King said he was "pessimistic" about the short-term prospects for the global economy.

He told the Commons Treasury Committee there was "enormous uncertainty" and that he had "no idea" what the outcome of the eurozone crisis was going to be.

Official data shows the government borrowed £17.9bn in May, more than most experts had predicted.

Sourced: http://www.bbc.co.uk/news/uk-politics-18588855

Speeding fines to go up by 50 per cent

Similar increases will also be imposed for other driving offences such as using a hand-held mobile phone and not fastening a seat belt.

On taking office, the Coalition promised to end what it called Labour’s “war on the motorist” with the previous Government having been accused of using drivers as a cash cow.

Yet based on the latest available Government figures, the latest changes would net the Treasury an additional £33.5 million a year in motoring fines.

Other changes, outlined in a Department for Transport consultation document, will see drivers who tailgate and cut up other road users being hit with an automatic three points on their licence and an on the spot £90 fine.

Assuming that the level of motoring offences remains at around the same level as in 2010, the higher fines would see drivers contributing £100 million a year to the Treasury.

The move to increase motoring fines comes a month after The Daily Telegraph disclosed that the Government faces a £300 million black hole in its finances because of a drop in fuel duty revenue as drivers turn to more efficient cars with less thirsty engines.

It has left drivers facing the prospect of a rise of up to £20 in the cost of their tax disc to plug the gap identified by the Office of Budget Responsibility, with the Budget small print saying the the Government would consider reform to “ensure that all motorists continue to make a fair contribution to the sustainability of the public finances”.

However, in one small piece of good news for the motorist, the Government has resisted pleas from local authorities for parking fines to be raised as well.

For many offences the increase will be the first since 2000 and, according to the Department for Transport, are now artificially low when compared to fines elsewhere.

The amount of money raised in speeding fines in particular has fallen sharply over the last five years as a result of a dramatic drop in the number of drivers being caught by camera.

In 2005, when local safety partnerships were allowed to keep all the fine income to reinvest in more cameras, 1.9 million drivers were fined for speeding and received three points on their licence.

This figure began to fall when Labour decreed that all fines should go to the Treasury and then be distributed by Whitehall for a wider array of road safety schemes, rather than just being recycled into buying yet more cameras.

On taking office the Coalition tightened the rules on the installation of speed cameras and many were taken out of commission as a result of spending cuts.

The introduction of on the spot fines for careless driving was first proposed in the Government’s road safety strategy in May last year.

It was designed to tackle anti-social and inconsiderate driving, which currently required a police officer to take the motorist to court.

"Careless driving is a major public concern and a cause of deaths and injuries on our roads,” said Mike Penning, the road safety minister.

"We also need to make sure that the penalties for a wide range of fixed penalty motoring offences are set at reasonable levels, consistent with the potentially severe consequences of some infringements."

The changes were given a guarded response by motoring groups.

“On the one hand, there is a need to do something about careless driving behaviour that not only poses a danger but winds up some drivers and intimidates others,’’ said Luke Bosdet of the AA.

“However, unlike speeding enforcement where there is a reasonably clear measure of lawbreaking, careless driving enforcement is more subjective. That increases the chance of ‘incidents’ at the scene.

“Catching careless drivers that haven’t been involved in an accident would depend on the number of traffic cops enforcing it.

“If it’s perceived that the chance of being caught is slim, careless drivers are far less likely to be deterred.”

Professor Stephen Glaister, director of the RAC Foundation added: “People are as annoyed with anti-social behaviour on the roads as in any other walk of life.

"Most people would want to see extra officers on the road to deal with it, yet the current financial crisis means the numbers are likely to decrease rather than rise.

“This plan offers the chance to reverse that trend with police out catching offenders rather than in the office doing piles of paperwork.

"We understand there are good reasons for increasing the level of fines, but why has there not been any inflation-linked rises for the past 12 years?

"A sudden hike of 50% will only encourage sceptics to see a link between a cash-strapped government and a move which could bring in significantly more money."

Claire Armstrong of the campaign group, Safespeed, condemned the rises: "It appears to show nothing more than milking the motorist and linig the pockets of the ever growing pockets of the speed camera industry .

"In no way will this improve road safety."

Robert Gifford executive director of the Parliamentary Advisory Council for Transport Safety was also sceptical

“In 2011, just over 26,000 drivers were prosecuted for careless or inconsiderate driving according to Ministry of Justice figures.

"The question will be whether there is an increase in enforcement as a result of this proposal.

"To enforce a FPN properly, there will need to be a greater police presence. At a time of cuts in police budgets and reductions in dedicated roads policing, increases in visible enforcement seem a little unlikely.

“Deterrence works through a combination of certainty, severity and speed. The most important of these is certainty. If there is a small likelihood of being caught, drivers will continue to behave illegally."

The rise in fines was also condemnded by Luke Bosdet of the AA

"The leap from £60 to £90 should be done in two phases, perhaps up to £75 initially. The deterrence impact can be analysed and the £90 limit considered.

"That would make the increase look more like an attempt to get drivers to behave themselves rather than a cash-cow."

Sourced:
http://www.telegraph.co.uk/motoring/news/9331510/Speeding-fines-to-go-up-by-50-per-cent.html