The Budget and Fleet: Implications

George Osbourne : Hawk?

Four days after the Chancellor, George Osborne, announced his much-hyped ‘budget for growth’, the dust has settled on many of his announcements. The headline-grabbing ‘fair fuel stabiliser’ and immediate 1p pump price cut have been widely welcomed, but comes against the background of increasing prices across the board.

It remains to be seen how the oil companies will respond to this new levy, but with Mr Osborne insisting he will be watching producers ‘like a hawk’, it must be hoped that this measure will not provoke further rises will occur at the pump.

For business car drivers another interesting facet of the budget’s seemingly pro-motorist outcome was the £100million allocated to repairing Britain’s pothole-ridden roads. Many, including LeasePlan’s David Brennan were quick to point out that, while well intentioned, the amount allocated would be something of a ‘drop in the ocean’ in the ongoing battle to keep the UK’s roads up to standard.

The poor state of our roads remains something of a mystery - although a cold winter does damage to driving surfaces, the lack of quality repairs is inexcusable. While this example, highlighted by the Daily Mail, from quake-ravaged Japan does take it to an extreme, it is a demonstration of what is possible.

The Chancellor could never please everyone, though, and the increase in company car tax for higher emitting vehicles will present a headache for some fleet managers.

This change is, however, consistent with the Government’s commitment to greener fleets and should push business users towards more carbon efficient vehicles, as those that emit less than 95g of C02 per mile will be exempt from the new rises. In this case, fleet managers will have to assess all manufacturer options to ensure their drivers are getting the best value for money while also working to ensure compliant vehicles remain fit for purpose.

It would seem that one way or another, the days of the gas guzzling, prestige company car are long gone. Due to a combination of changes inside the UK, and outwith our borders, it would seem that environmental factors must become the key consideration when choosing a company car.