The Live Wire



Press Release

Small firms struggling to cope with the rising cost of fuel

12th September 2005

Small businesses in Northern Ireland are struggling to cope with rising fuel prices, which increased by 10 per cent in the year to July 2005 and resulted in an 8 per cent increase in transport costs.

Northern Ireland’s biggest business organisation warned today that many businesses now face a stark choice. Either they have to absorb the fuel cost increases themselves – in some cases endangering the future viability of their business, or they must pass them on to their customers - putting future contracts under threat.

Strong growth in global demand for fuel has driven the initial cost of crude oil from $35 a barrel in July 2004 to well over $60 a barrel today. 47.1p a litre tax is levied by the UK government in addition to VAT.

Wilfred Mitchell, FSB Policy Chairman said:

"We accept that with increasing global demand and unreliable supply, particularly following Hurricane Katrina, prices are bound to increase. But ministers must not lose sight of the fact that at cost price UK fuel is the cheapest in Europe. It is only after fuel duty and VAT are added that it becomes the second most expensive.

"For some small road haulage businesses, fuel costs have mushroomed from around a quarter of their total costs to more than half. This can cripple small businesses who cannot absorb these costs in the same way as larger firms.

"Rising fuel prices do not just affect the road haulage industry. Many businesses face increased distribution costs and manufacturers are forced to pass on the increased costs of raw materials to their customers.”

“In Northern Ireland the problem is reinforced as business owners also have the added problem of high insurance, electricity and banking charges. The Government have to address this issue before small businesses close and jobs are lost”



Press releases, papers and documents published on this page are the intellectual property of an organisation unrelated to Central Lobby. We promote their parliamentary and political campaigning activities as they are subscribers to the Central Lobby service.

As such, Central Lobby does not edit, endorse, or attempt to balance the opinions expressed on this page. The content of press releases and other such types of content are the responsibility of the originating organisation.

Federation of Small Businesses

Federation of Small Businesses

More from Dods

© Dods Parliamentary Communications Ltd