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Red derogation goes

Pridding: 'Sensible transition period'
Pridding: 'Sensible transition period'

Early last month the treasury minister, John Healey, confirmed the European Commission had rejected the government’s application to renew the UK’s derogation on red diesel for private recreational boaters.

‘Boaters could face a substantial increase in the price of marine diesel,’ warned Howard Pridding BMF executive director, ‘which will have a huge adverse impact on the UK marine industry. It’s profoundly disappointing that the EU has not listened to the UK government.’

The derogation goes on January 1, 2007, but the effects will not be felt for some time yet as implementation has to be announced through a Finance Bill. ‘They couldn’t physically do that before July of next year,’ said Pridding.

But what are the ramifications of the loss of derogation? ‘We don’t want to start saying this is going to be devastating,’ said Pridding, ‘but we do know the cost of fuel will go up, which could have an impact on boat usage.’

That will have an economic impact, not just on the industry, but also on boating tourism, said Pridding, where people spend money in the local economy.

Marinas and yards will have to decide which market they will serve – leisure or commercial. Changing to white diesel obviously has a cost impact.

‘Our objective is to make sure we get a sensible transition period,’ said Pridding. ‘The hire boat companies, for example, have already published their brochure for next season, so we’ve got to get Customs to realise they can’t possibly implement the changes until the year after.’

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