David Cameron has given false hope to millions of motorists by resurrecting the idea of a fuel stabiliser - despite the OBR rubbishing the idea in September.
David Cameron has given false hope to millions of motorists in today’s Daily Mail by resurrecting the idea of a fuel stabiliser to cut fuel tax when oil prices soar, despite the Office for Budget Responsibility effectively rubbishing the idea back in September.
Their report found that a £10 a barrel higher oil price would boost UK oil and gas revenues by £2.4 billion, but once effects are offset elsewhere on the public finances, it would reduce the benefit to almost zero for a temporary rise in oil prices.
The OBR agreed with the Campaign for Better Transport that a fuel stabiliser doesn’t work; higher prices don’t really mean higher revenue for government so they’d have to find the money from elsewhere, which seems unlikely in the current financial climate.
Whilst no one wants to pay more for something they rely on, fuel prices need to be put into perspective. Since 1997 the overall cost of motoring has fallen 14 per cent below inflation whilst rail fares have risen 13 per cent. So it’s not surprising that many assume the government’s decision to drive rail fares even higher this week – increases of up to 12.8 per cent for some season tickets – is a deliberate effort to price people off the trains and onto the roads.
That isn’t good for motorists, who’ll have more traffic jams to deal with, and it’s certainly not good for rail passengers.
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