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March 9, 2020

CPA urges red diesel rethink

Filed under: Latest News — EHN Team @ 11:43 am

Following media reports suggesting that Chancellor Rishi Sunak is set to announce the abolition of the subsidy on red diesel will be abolished, the Construction Plant-hire Association (CPA) has written to him directly asking him to reconsider.

It is believed that the suggestion forms part of a bid to encourage a switch to greener alternative fuel usage.

The CPA states that scrapping the rebate would have significant financial implications for the construction sector, as users of diesel powered plant would pay an extra 47p on every litre of diesel used.

In his letter, CPA Chief Executive Kevin Minton (pictured) said, “As a key sector within the wider construction industry, we are concerned about reported proposals in the forthcoming budget, to place restrictions on the use of red diesel in construction machines.

“The CPA set out our concerns in the government’s call for evidence on the use of red diesel back in 2018. It is disappointing to see such measures being discussed again.

“Restrictions on the use of red diesel in the construction sector would, unfortunately, have a profound impact for our members and the wider construction industry by raising costs and squeezing already tight profit margins. This in turn will limit scope for investment in new skills and new cleaner, greener technology – something the government is encouraging our members to do.”

He continued, “We urge you to delay any consideration of this issue until a proper consultation can be carried out, and suitable amelioration measures identified.”

Red diesel currently accounts for approximately 15% of total diesel sales in the UK and costs the Treasury about £2.4bn a year in revenue.

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