Select Committee on Northern Ireland Affairs Appendices to the Minutes of Evidence


Memorandum submitted by Councillor Joe Byrne, a Member of the New Northern Ireland Assembly

  As a member of the new Northern Ireland Assembly for the constituency of West Tyrone I have been approached by several owners of petrol filling stations in the North West area who are extremely concerned about the Chancellor of the Exchequer's increases in fuel excise duties announced in his recent Budget. As you are well aware, these increases are having a severely damaging effect upon the livelihoods of many filling station owners across the entire border region as the gross disparity in fuel prices between Northern Ireland and the Irish Republic is causing many people to travel across the border to purchase petrol and diesel.

  Although I am very conscious of the fact that the Chancellor has to take into consideration environmental concerns because of the commitments given by the then British Government at the Kyoto Summit back in 1990, and I am generally supportive of policies designed to protect the environment, I nevertheless do believe the policy of increasing fuel duties by 6 per cent annually, as outlined in the Chancellor's budget, will have an extremely detrimental effect upon our local economy. For example in my own constituency of West Tyrone six filling stations, two in Omagh, two in Sion Mills and two in Strabane, have already closed down in the previous 18 months and the recent budgetary increases in excise duties have left many more on the verge of closure.

  These increases have also exacerbated the problem of the illegal importation of fuel from the Irish Republic into Northern Ireland and I believe you have already heard submissions from the Road Haulage Association and the Petrol Retailers Association and are due to present a report in the near future on this issue. The combined effect of cross-border smuggling and legitimate cross-border purchases could result in an estimated net annual loss to the Exchequer of £200 million.

  Under the ad hoc title of the North West Petrol Retailers Forum, filling station owners from the North West have to date held two public meetings chaired by myself in Strabane, which were attended by senior representatives of the Petrol Retailers Association and the Valuation and Land Agency to discuss possible ways of dealing with these serious issues. During these meeting we debated ways of co-ordinating a lobby strategy and floated various proposals designed to soften the effect of the Chancellor's proposals. As an initial measure we are seeking a rates re-assessment for filling stations with the Valuation and Lands Agency as their throughput gallonage has declined sharply since their previous valuations. Indeed, since the recent Budget some filling stations in the North West have experienced a drop in throughput gallonage of between 50 and 80 per cent.

  As Northern Ireland is in the unique position as being the only region in these islands which has a land border with another EU Member State, we also discussed the possibility of the introduction of some form of price harmonisation between fuel prices in the North and the Irish Republic. I believe there is a European precedent for such a proposal as a form of price harmonisation has been successfully introduced along the Dutch-German border and a similar measure could be introduced in Northern Ireland.

  In my opinion, Northern Ireland should be treated as a special case because of its particular geographic and economic circumstances and I hope you will give the above points I have outlined serious consideration and recommend some effective remedial measures when drafting your report on the illegal smuggling of fuel.

23 April 1999

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