Diesel is set to cost UK van operators about £2.5bn more this year, Moneysupermarket estimates

The £2.5bn ^[3] is a modelled figure built on typical mileage and fuel consumption ^[4], and in our view its direction is firmer than its size. Moneysupermarket puts this year's total at almost £8.5bn against £5.95bn last year ^[1][2], a rise of roughly 43% ^[19]. The per-van bill climbs faster, by £671 or 52% ^[14][15]. Divide each total by its per-van figure and this year implies roughly 4.3m vans while last year implies roughly 4.6m ^[21]. The Guardian says the number of vans on British roads has grown significantly in recent years ^[20]. One explanation is that the total covers vans and pickups ^[1] while the per-van figure describes the average van ^[4].

Margins decide who absorbs a rise of that size. Richard Smith, the Road Haulage Association's managing director, said: "Many of our members run on margins of around 2%." ^[8] That is his description of RHA members, not a measured figure for van operators in general. Even so, a fuel bill that rises by about half in a year ^[15] is a large item for any business with margins that thin.

Set against the increase already in the pump price, the planned duty rise is small. It adds 5p a litre in two steps ^[6][16], about 9% of the 57p by which diesel remains above its level before the Iran conflict ^[10][18]. Smith's objection is to the stacking. He said that adding fuel duty rises on top of today's fuel prices would hit both the many firms that move goods and the households that buy them, and that a rise in fuel duty amounts to a rise in food prices ^[9].

The relief on offer would reach different buyers depending on the instrument. The RHA wants a 15p a litre rebate for van, coach and haulage operators, three times the planned 5p rise ^[12][17], and says Spain, France and Italy have already offered similar help to commercial vehicle businesses ^[12]. The RAC's head of policy, Simon Williams, pointed to a wider route. He said: "The government has the power to take some of the sting out of higher fuel costs, either by extending and increasing the fuel duty cut or reducing VAT as they've done with domestic electricity." ^[11] The trade-off is reach against revenue forgone: a rebate confined to commercial operators reaches fewer buyers than a VAT cut or a deeper duty cut. We do not know yet whether the chancellor will favour any of them, and the Guardian's report does not include a government response.