News

The toll operator running the Severn Bridge has agreed to reduce the price hike for trucks crossing the bridge following the Transport Secretary's intervention in the VAT row. However, Severn River Crossing (SRC) has not ruled out further increases during 2009 if the government raises VAT back to 17.5%.

Last month, Commercial Motor spoke to hauliers who were  angry that the new toll rate being introduced on 1 January did not take into account the recent reduction in VAT to 15% and would force them to cough up an extra 70p each time they crossed the bridge ('Toll Operators Failing to Pass on VAT Reductions', CM 18 December 2008.)

But just before Christmas, the Department for Transport and SRC caved in to the pressure and agreed to a new rate of £16.30 for HGVs, an increase of just 40p, which also takes into account the retail price index (RPI).

SRC general manager Jim Clune says it had already announced the original rate rise when the government decided to reduce VAT, and claims it had to wait for Ministerial approval before it could reach agreement on the U-turn: "The Secretary of State [for Transport] issues a statement every year to fix the price for the following year. If it's less than RPI, he must get  agreement and we did agree to it."

However, Clune warns that economic uncertainty could force a review of the charges before the year is out: "Who can say if the Government will make another decision regarding VAT some time during 2009? Anything is possible."

The Road Haulage Association says it is "absolutely chuffed" at the decision. Regional director Mike Farmer adds: "I spoke to SRC immediately after the reduction in VAT and asked if it was going to alter rates for 2009. The answer was no. At the end of the day it's a good result."