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Haulage Industry

Dáil Éireann Debate, Thursday - 4 November 2021

Thursday, 4 November 2021

Questions (86)

Michael Fitzmaurice


86. Deputy Michael Fitzmaurice asked the Minister for Transport if he will take steps to ease the pressure on struggling haulage companies, hauliers and motorists in view of the increasing costs of diesel and petrol; and if he will make a statement on the matter. [53953/21]

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Oral answers (6 contributions) (Question to Transport)

Will the Minister of State take measures with regard to the struggling haulage companies and examine what reliefs can be given? I ask this in the context of the Government taking €1 of every €1.70 per litre of diesel. Compared with 16 or 17 months ago, what the Government takes now on every litre of diesel is 40 cent higher. There is room, therefore, for the Government to make an allowance. This fuel is used to haul food, whether it is exported or goes to cities or rural Ireland.

I appreciate this issue is of great concern, which is why it has been raised in the House. I am very aware of increased prices at petrol and diesel pumps over recent weeks. This is an international trend. Wholesale energy prices have increased significantly following rises in international oil and gas prices and a post-lockdown surge in energy demand. While the trajectory of the global energy market is not within our control, indications are this current spike will abate over the coming months.

My colleague the Minister for Finance sets policy in respect of tax and excise duties on fuel. The only increase in this year’s budget in this regard related to the already planned increase in carbon tax. At a time when the eyes of the world are on what governments in developed economies such as ours can do to address climate change, our carbon tax represents an important contribution to that effort.

The diesel rebate scheme partially insulates the licensed haulage and bus sector from such fuel price increases. Under the scheme, qualifying road transport operators can apply for a repayment of part of the mineral oil tax paid on auto diesel purchased in the State. While this current spike in fuel prices is likely to be short lived, it is important to take this opportunity to take stock of our dependence on imported fossil fuels in the transport sector. The new climate action plan, which will be published today, will reduce our reliance on these fuels and allow us to transit to greener renewable energy sources for transport.

Electrification of road transport is key. A comprehensive suite of measures is available to electric vehicle, EV, drivers, including purchase grants for private car owners and taxi drivers, vehicle registration tax, VRT, relief, reduced tolls, home charger grants, and favourable motor and benefit-in-kind, BIK, tax rates. While I appreciate this does not relate to HGV drivers, the plan commits also to increasing biofuel blend rates. These are transitionary fuels that provide time for sectors such as haulage to invest in new, greener technology. As I mentioned, a grant scheme was launched in March to assist the purchase of alternatively fuelled heavy duty vehicles. The take-up of this scheme has been excellent and demonstrates the level of interest in this sector to make the transition.

With due respect to the Minister of State, whatever civil servant wrote her contribution does not know much about the transport industry. There are no articulated lorries in Ireland or Europe at the moment that run on electricity. Whoever wrote the contribution needs to go back and read up on the matter.

As Deputy O'Rourke pointed out, gas is now more expensive than diesel. It costs €18,000 to convert a lorry from diesel to gas. As Deputy O'Donoghue pointed out, the new Euro 6 engine has drastically reduced emissions and we should examine using it to help the haulage industry. The Minister of State is correct in stating international prices of fuel have increased, but every time they do so, the Government gets 65% of the price. It is like a hen clucking. The more the price increases, the more the Government will get. It receives 40 cent more on every litre of the same product in a year because the price has changed, so there is room. I do not say this for the hauliers; I say it for the ordinary people because the food of Ireland is transported throughout this country on lorries.

I take the point the HGV sector is reliant on fossil fuels and I am acutely aware of that. As part of this transition, we are trying to ensure we put in place supports such as the diesel rebate scheme. I mentioned the alternatively fuelled heavy duty vehicle grant, which had a significant uptake from the sector, showing the interest. We are also co-funding three research projects with Trinity College Dublin and University College Cork, focusing on decarbonising the freight sector. This will not be easy and it will not happen next week. I am very aware of that. Nevertheless, we are working across government to ensure we reduce our emissions and protect the sector. Part of that relates to the ten-year haulage strategy, the first of its kind in Ireland. Now is the time for people to feed in positively and constructively to the sector, as they are doing, relaying their needs and what they need to do to help support their sector into the future.

I welcome what the Minister of State said about research being carried out and I understand all that, but the crisis is now. I will be the first to admit there is a grant to help people move from diesel to gas, but the cost of doing so is probably €17,000 or €18,000. They will pay more than if they had kept diesel. That is a fact.

I reiterate there is a difference of 40 cent between the revenue on diesel the Government was taking in last year and the revenue this year. In light of the crisis with regard to the haulage sector shifting goods throughout the country, there is room for manoeuvre. If the price of diesel had not increased internationally, the Government would not have the additional 40 cent. What it never had, it never wanted.

I accept the Minister of State said much of this cannot be done in the short term and I understand that fully. Even so, for the time being, until we get these electric vehicles that will transport food throughout the country, wherever they are on the horizon, or until gas returns to a normal price, will the Government make a decision on the additional 40 cent to help the ordinary public? They are the ones who will ultimately have to pay.

I will continue to engage, as I have done since I came into this role, with the sector to ensure we protect it. I will also work with my Government colleagues, given this is not just a transport issue. For example, the Minister for Finance sets policy in respect of tax and excise duties on fuel and the only increase this year was the planned carbon tax increase. I will engage with them in respect of that ten-year haulage strategy, which is the vision. We need to set out that long-term plan as well as working on what I outlined earlier as the immediate concerns for the sector, namely, ensuring there is a robust supply chain and that we have the skillset, working with our educational centres, whether through skills for HGV drivers or research in the area of reducing emissions, and ensuring we have vehicles and the technology available.

Some of the strategies are more for the long term. We are working on short, medium and long-term approaches. I share the Deputy's frustration and understand people's questions about the ambition to tackle these issues. This is a global challenge and we must rise to that challenge and work with sectors to ensure our approach is fair and achievable.