Last week the UK Government’s plan to restimulate the economy proposed tax cuts and increased borrowing against the advice of most economists, HM Treasury and the International Monetary Fund. This equates to the managing and finance directors of a company deliberately reducing prices and increasing costs without a clear plan to deal with the outcomes.
Over the last few months we have seen prices rise in road vehicle fuel (and then fall slightly as this column has explained); however further challenges are predicted for the transport sector and its users.
Five criteria determine transport costs – interest rates, leasing charges, currency exchange rate fluctuations, fuel prices and government expenditure cuts. And through the supply chain these will affect the prices we pay for our retail purchases.
