THERE was some welcome respite for drivers enduring high petrol prices in yesterday’s Autumn Statement but hopes of a tax break for air passengers went unanswered.
Chancellor George Osborne announced that the 3p fuel duty increase planned for January 2012 would be cancelled, while the 5p hike due in August 2012 would be only 3p higher than prices now.
Mr Osborne said millions used cars to go to work and to pick up children from school and for most people their vehicle was not a luxury but a necessity. Having cut fuel duty by 1p in this year’s Budget, Mr Osborne said that families would be saving £144 on filling up the average family car by the end of next year.
AA president Edmund King, a visiting professor at Newcastle University, said: “The Chancellor has seen sense on this vital issue. Cash-strapped drivers will heave a heavy duty sigh of relief as current pump prices are close to the record high.
“This measure will not only be a relief to drivers but also to the high street as drivers have less to spend if more money is pumped into their tanks. It is still tough on the streets for many drivers but at least the Chancellor hasn’t added to their pain. ”
Green organisations attacked Mr Osborne’s failure to mention low-carbon growth and jobs, which they say can drive a real economic recovery.
Friends of the Earth executive director Andy Atkins said: “Throwing billions of pounds at roads and dirty energy will increase our dependency on gas, coal and oil and lock cash-strapped homes and businesses into spiralling fuel bills.
“Just a fraction of the money earmarked for new roads would throw a crucial lifeline to the solar industry – and the 30,000 jobs currently under threat from Government cuts,” he said.
Hopes of airlines and passengers that the chancellor would defer a planned rise in the Air Passenger Duty (APD) airport departure tax were dashed however.
Instead it was announced that the increase, calculated by airlines to be more than 10%, will go ahead in April 2012, following big rises in 2007 and 2010.
In a joint statement, the bosses of four airlines – Virgin Atlantic, easyJet, Ryanair and British Airways’ parent company IAG – said: “In the cause of UK economic recovery, APD is an own goal – and the Chancellor has just scored another one.”
They went on: “By increasing this tax by double the rate of inflation, he is further deterring inbound tourism and foreign investment, and choking off yet more job opportunities for young people.”
The Airport Operators Association said the APD decision was “bad for jobs, bad for growth and bad for passengers“.
Graeme Mason, planning and corporate affairs directors at Newcastle International, said: “We are very disappointed with the news regarding Air Passenger Duty in today’s Autumn Statement.
“The double inflation rise in 2012 and the planned extension to business jets in 2013 will both further damage the North East economy. We await the further announcements on APD which are to be made on December 6 before making more detailed comments.”
As expected, the Chancellor took a little sting out of the planned New Year train fare rise by reducing the increase by 2%.
Regulated fares, which include season tickets, had been due to rise 3% above the RPI inflation figure.
But Mr Osborne said the rise was “too much” and that the increase would be limited to RPI plus 1%.
This will mean that the average rise in January will be 6% and that will also be the figure for the Tube and for London buses.
:: Click here to read the full Autumn Statement
