It is being widely reported—to zero surprise—that the U.K. Chancellor Jeremy Hunt will continue with the freeze on fuel duty in tomorrow’s budget. It will be the thirteenth consecutive annual handout to drivers of Britain’s internal combustion engine motor vehicles.
Owners of electric cars don’t benefit from the freeze—which has cost $101 billion since 2011, says the Office for Budget Responsibility’s (OBR), the U.K.’s official spending watchdog—and nor will local services, social care, or the NHS, all of which are, in effect, starved of funds to subsidize oil companies and mass motoring.
The total cost to the exchequer—and the U.K. population as a whole—will click past $127 billion in the next fiscal year, according to the OBR.
Last year, the U.K. government canceled a key part of the $57 billion High Speed 2 (HS2) rail line, a transport infrastructure project that, in part, removes cars from already congested roads. The U.K. could build two HS2s for what it has cost the country in lost taxes on petrol and diesel since 2010.
In January, Labour urged the government to stick with the fuel duty freeze. So, despite their supposed adherence to fiscal credibility, both Conservatives and Labour are, in effect, committed to keeping what was supposed to be a temporary freeze on fuel duty which, in 1999, generated more than 2% of GDP for the public purse.
Continued fuel duty freezes harm the U.K.’s net zero ambitions. According to Carbon Brief, the freeze in fuel duty since 2010 has increased the U.K.’s CO2 emissions by 5% thanks to increased road transport.
Transport analysts David Begg and Claire Haigh have calculated that between 2011 and 2018 the fuel duty freezes led to 60 million fewer rail journeys and 200 million fewer bus journeys, while traffic grew 4%. Buses suffer more from congestion than any other mode of transport. Congestion has been causing bus speeds to fall by on average of 10% every decade, causing bus patronage to fall by 10-14%.
Even without the duty freeze, Department for Transport research shows that motorists are already massively subsidized via what economists call negative externalities such as pollution, congestion, the health costs of crashes, sedentary lifestyles, noise, and harm to landscape and biodiversity.
