§ Lord Clinton-Davisasked Her Majesty's Government:
What is the estimated effect of increases in fuel duty in terms of influencing the usage of private motor cars and lorries.
§ The Parliamentary Under-Secretary of State, Ministry of Defence (Lord Henley)The Budget and the Financial Statement together produced an average increase in road fuel duties of 10.9 per cent. and an average price increase of 7.0 per cent. Economic analysis, using price elasticities calculated by the Institute for Fiscal Studies, suggests that as a result demand for road fuel will fall by around 1.9 per cent. This reflects a number of factors, including the incentives towards reduced use of vehicles, more careful driving and substitution into more fuel efficient vehicles.