|
|
What Welsh motorists can expect after Budget outline
publication date: Jun 23, 2010
|
author/source: Robin Roberts
| Car makers and car sellers have clashed over the
implications of yesterday’s Budget announcements and the Welsh Assembly
Government cabinet will meet today to consider its response although the
final settlement will not be known for some weeks. | | SMMT has welcomed the Budget for the long-term
clarity and stability it gives to UK manufacturing through clear
measures to re-balance the economy and place greater importance on the
private sector and industries, like automotive, to drive growth,
investment and exports. | However, industry recognises that these will
continue to be challenging times for the economy and our members’
businesses as we emerge cautiously from recession.
“Today’s
emergency Budget sets out painful measures for individuals and
businesses. Industry hopes the certainty they provide will create
financial stability, confidence and growth,” said Paul Everitt, SMMT
chief executive minutes after the announcements.
“Although there are concerns about the rise in VAT, its
delayed introduction will give industry an opportunity to prepare and
may boost demand in the short-term. The determination to increase bank
lending and investment in new low carbon technologies is welcome, but
effective measures are urgently required to help sustain a still fragile
recovery.”
The increased rate of VAT
will add around £300 to the price of an average car, potentially
impacting on private buyers’ confidence and demand, but industry
welcomes the delayed timeframe, allowing time for businesses and
consumers to plan and prepare.
We remain concerned
over lower capital allowances, these may impact on business investment
and demand for vehicles. Government action
to ease access to affordable finance can only help support private
sector investment in skills, innovation and technologies at a crucial
period of recovery.
| | A statement from the Welsh Assembly Government said that
the Budget will hit hardest the poorest and most vulnerable in
society and take big risks with the economic recovery in Wales.
"The
proposed tax break for businesses to assist in creating jobs outside
London and the South East is welcome, as is the decision to make no
further cuts in capital budgets beyond the previous Government’s already
tough plans. Continuing capital investment is key to supporting the
recovery and to transforming public services.
"Detailed UK spending
plans for the period after 2010-11 are not included in the Budget. So
it is still not yet possible to say exactly what our future settlement
will be. But this Budget – with an unprecedented combination of tax
increases, cuts in benefits and public spending– is grim news for most
people across the UK and particularly bad for people in Wales.
"Our
view – shared by many economists and business leaders – is that cutting
spending by too much, too soon could damage the economy as well as
public services. The deficit needs to be reduced and Wales will play
its part in this. In fact, the Assembly Government has led the way in
the UK and started planning for these challenging times over a year ago.
But the deficit should be reduced at a pace which does not threaten
the economic recovery and without incurring massive damage to public
services.
"The cuts set out today by the UK Government take big
risks with the fragile recovery that we have been seeing. | Support for manufacturing, the digital upgrade, no
further changes to fuel duty or VED rates and the confirmation of plans
to establish a Green Investment Bank are also welcome measures that will
support our businesses commitments to the UK.
The
UK automotive industry looks to continue its collaborative work with
government. Through the Automotive Council, industry will strive to keep
the UK at the centre of the global low carbon agenda and a prime base
for investment in a country that the chancellor described as “open for
business”.
The Freight Transport Association has welcomed the
Budget
statement from the Chancellor today and his pledge to ‘support the
transport links we need to trade our goods.’
However, FTA still
wants further action to support the sector that is the lifeblood of the
whole economy. | | Edmund King, AA President, said, “Desperate
times may need desperate measures but the AA does not want drivers to be
left in dire straits – paying more but getting ‘money for nothing’ in
terms of congested roads and more potholes.
“This budget brings
short-term relief at the pumps but extra duty and VAT will hit motorists
in the future. Motorists will be relieved that there is no immediate
increase in duty at the petrol pumps but will have to prime themselves
for a 1p increase in Oct and another 0.76p plus extra VAT in January.
These increases will add an extra 4.6p to petrol prices already at
record levels.
“We agree that as the cost
of fuel continues to rise that the Government should look again at their
promise for a fair fuel price stabiliser. Already our AA Populus
survey shows that 67% of drivers are cutting back on journeys, cutting
back on other expenditure or both due to the high cost of fuel. With
the proposed freeze in public sector pay, and many private sector firms,
a freeze in fuel duty would have helped millions to remain mobile and
in work.”
”Increases in Insurance Premium
Tax are worrying as they could lead to more uninsured drivers and growth
in the motoring underclass.”
| | | | | Brian Madderson, Chairman of RMI Petrol, said,
“Although the Chancellor announced no increase in fuel Duty today, the
Government remains committed to the increases announced in the March
2010 Budget which sees a rise of 1.00ppl from 1 October this year and a
further 0.76ppl from 1 January 2011.
“However, the Chancellor did
announce that he is to suck an extra £1.2 billion out of the consumer
by raising VAT on road fuels to 20% from 4 January 2011 (based on a UK
average road fuel consumption of 45 billion litres/year).
“With tax bludgeon rather than rapier, the low paid,
retirees on fixed incomes, single parent families and rural motorists
with limited public transport alternatives are amongst those who will
all feel the financial pinch on their fast shrinking disposable incomes.
“The announcement of this tax hike could not be
worse as it coincides with a new rally in global oil prices - up from
US$68 to nearly $80/barrel in just the last four weeks.
| | | | |
Download the Wheels Within Wales toolbar for your quickest way to keep in touch with everything that's happening on Welsh roads and in showrooms or use our RSS feed for the headlines you will not want to miss
|
|
|
.gif){kind=small}