The government may rethink plans to lumber hard pressed small rural petrol station with red tape over a proposed fuel discount scheme in the Hebrides and Northern isles.
Retailers say it will stretch their cash flow resources if forced to administrate a 5p a litre cut in fuel duty. The pilot initiative has been delayed pending EU approval.
But petrol stations have received letters from local councils, on behalf on the Treasury, indicating they would have to fork out the full wholesale price yet will be forced to discount their pump prices by 23p a gallon.
It would force many struggling businesses to subsidise the scheme, on a rolling basis, until the Treasury repays them their cash which, say some, could take two months.
Western Isles MP Angus B MacNeil slammed treasury minister Danny Alexander for putting the onus on struggling petrol stations.
He said: “Mr Alexander should ensure that small retailers are not bearing the brunt of the costs of implementing the scheme.
Mr Macneil highlighted: “That will create cash flow problems for small businesses and no government should want to endanger the existence of rural filling stations.”
He criticised the delay in taking in the scheme stressing: “The whole process is taking far too long. Meanwhile, families and businesses continue to struggle with fuel costs.”
Danny Alexander told Hebrides News: “We are currently in the process of trying to secure European agreement. We are pushing that as hard as we can but there are processes to go through.”
He highlighted no firm decision on “delivering that discount” to motorists on the forecourt has been taken.
He explained: “We are talking to retailers at the moment to try and find a simple and effective way to administer the scheme.”
On behalf of the Treasury, island councils are consulting with fuel outlets until
mid-
Industry sources urged the Treasury to look at the easier system of applying the duty cut when the ship is loaded at the refinery.
The coastal oil tanker only carries fuel for the Hebrides, Shetland and Orkney which will all be covered by the scheme. Thus, the duty cut could be applied to the entire oil cargo in one sweep with minimum administration.
Government may rethink threat over fuel cut red tape 25/7/11