Bibby urges Brown to back British business as fuel prices bite

Bibby Financial Services is urging the Government to back British business now by making an immediate cut in fuel duty as petrol prices go through the roof in the wake of the devastation wreaked by Hurricane Katrina.

As protests against fuel prices escalate, Bibby Financial Services warns the disruption will have a devastating impact on the UKís small and medium-sized businesses.

David Robertson, chief executive of Bibby Financial Services, said: ìWith businesses and individuals paying over a 1 a litre for petrol in some areas, the repercussions for the small business sector are huge ñ government inertia will not only squeeze profitability and cost jobs, but will threaten the very survival of thousands of small firms.

ìThe fuel protests of five years ago cost British business around 1bn in lost output* and it is vital that this is not allowed to happen in 2005.

ìOur research shows that almost a quarter of small firms (22%) believe rising fuel costs is one of the biggest transport issues facing their business today, ahead of poor public transport infrastructure and the proposed extension of congestion charging. It is vital that the whole issue of rising fuel prices, which rears its ugly head time and time again, is resolved once and for all.î

Adding his weight to the argument, Federation of Small Businesses Transport Chairman, Steve Collie said: ìMinisters 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. 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.î

David Robertson concluded: ìWe strongly urge the Chancellor to listen to the pleas of the 3.7 million small businesses which make up the backbone of the UK economy by cutting fuel duty now and considering extending the current fuel duty freeze until the end of 2006.î