Thursday, March 10, 2011

50p to set us free

It wasn’t meant to be like this. Just a year ago Mervyn King was expecting inflation to drop back to its 2% target. Instead it’s well north of 5%. Petrol prices are up. The economy is stagnant. While the press and BBC have daily stories about “cuts”, no one talks about the fact that, even with these cuts, government debt continues to pile up and will do so throughout this Parliament.

It’s time to make the one cut needed to kick start the economy. This isn’t the cut of red tape, although that is desperately needed.

It’s time to take 50p off the price of fuel.

Doubtless civil servants at the Treasury will explain this is unaffordable. The opposite is true.

Lower fuel prices will help everyone: the worker paying a lower bus fare, the business on the edge of bankruptcy facing lower costs, the price of practically anything bought on the high street.

By helping the economy, it will lower government payments to the unemployed; it will increase profitability and tax revenues; it will create employment and consequently generate income tax and NI payments; it will help squeezed councils cover the costs of bin collections; it will help rural workers afford travel to their jobs.

It will drive down inflation so that those in poverty are less hard-pressed; those in the middle class will be able to spend more (or pay off debts faster); those looking for bank loans will be better able to justify them.

It will make the UK a better place to do business and make existing UK businesses more competitive overseas.

It’s win-win-win-win-win.

Can the Treasury see it? Write to your MP and tell him to pass on the message:

Take 50p off fuel and set our economy free


Slim said...

Nice idea, which I'd love to see happen. However, back in the real world the BBC and the politcal opposition would complain that it doesn't help the poorest. Also, how much would it actually cost? I suspect it is a little too much to swallow. It would also encourage more traffic to take to the roads and is thus not in tune with our CO2 emission reduction targets (and I'm not saying I agree with those either!).

Arash said...

I agree with you.

I don't know if the numbers add up, but, if they do, it's a great idea.

Sadly the Tree Party wouldn't even install a badly needed new runway at heathrow; so I can't see the govt going forward with anything that would actually make today any better!!

Uncle Bob said...

The Treasury should really be taking a dynamic view of this and other aspects of taxation. If the cost of this can be offset by a reduced welfare bill, cheaper travel, Long distance Lorry drivers filling up here insatead of on the continent so we actually get tax revenue from them, cheaper goods for consumers, it could pay for itself. It would also help to drastically reduce the personal indebtedness of all the country.

I don't know if 50p is ther right rate, but Osbourne should have his civil servants looking at everything and seeing ways to get our economy motoring.

One thing you could gaurantee with this though is that the Socks and Sandals brigades will have a meltdown...another good reason for the proposal!

Scary Mary said...

Why 50p and not 49 or 51?

Sean Haffey said...

I am concerned that the government (which I strongly support) is tinkering around the edges.

@ScaryMary - fair question. The point is we need a big cut fast. The temptation of civil servants is to do it in tiny steps, when the effect is lost. A big cut in fuel duty would be a substantial positive jolt to almost all sections of our economy. Unlike dozens of "targeted cuts" this would require no extra civil servants to manage. I am a "small state" conservative and want to see the economy flourish.

alan said...

A truly fantastic idea. Unfortunately it would make the CO2 mongerers flip. I will definitely be writing to my MP. Though Gerald Kaufman would sell his own daughter for 50p if it gave him any political advantage. Maybe the opposition need to believe it was their idea first.. "Stand by for mind control..."

njcar said...

Sean, surely the UK, and the world, is going to have to just get used to ever increasing fuel prices?

Sure, you might be able to get rid of a bit of tax here-and-there and make a small bit of difference in a very short term but the main story is that fuel prices will continue to rise as oil prices rise. No-one is thinking the oil price will be going down markedly any time soon right?

Sean Haffey said...

Hi Nick

In the UK, the overwhelming majority of the price is made up of government taxes rather than the oil price. I am a fervent believer in low taxes (and red tape for that matter). Petrol and diesel literally power the economy and we need a healthy economy to pay off the staggering debt accumulated by the previous government.

Angie Brooks said...

I just think Sean should be Prime Minister. Even for just a week - he'd get this mess sorted out good and proper! Think Happy. Vote Haffey.

Sean Haffey said...

Ah, Angela.

Will you be my campaign manager? ;-)