Farmers face red diesel clampdown
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by Charles Young • Hauliers who have lost work to farmers using agricultural tractors to haul goods have welcomed a ruling that many of those contractors are not entitled to use rebated red diesel.
Last year several hauliers contacted CM saying they had lost work after being undercut by agricultural contractors using red diesel.
But just before Christmas, Manchester Tribunal Centre dismissed an appeal against Customs and Excise by Sidney Tempest, trading as Cesspool Sid, for the sum of £15,929 in rebated fuel.
It found that the tractor Tempest used to transport slurry to farmers' fields and houses was not an off-road vehicle and his activities did not qualify as solely agricultural, so he was not entitled to use red diesel under the Hydrocarbon Oil Duties Act (1979).
Farmers pay around 15p/lit for diesel compared with hauliers who at best will buy their fuel for 51p/lit (ex-VAT). This allows agricultural contractors to undercut legitimate hauliers, who then lose business. Tony Haber of North Devon-based Tony Haber Haulage welcomes the ruling: "We can't compete with them using red diesel," he says. "Hopefully this will mean some of the work coming back our way."
Another source says South West Water, which is known to have employed such contractors, has tightened up its policy since the ruling. Last year SWW told CM it was seeking clarification over the question of red diesel from the Department of Transport. It also admitted the contractors had no 0-licences, but said this was a matter for the contractors themselves.
However, SWW denies it has tightened up its policy. "We are waiting for the Department of Transport's view of our position," says a spokesman. "We will take account of that in our future arrangements, which will be in accordance with what is right."
The issue of farmers and contractors working as hauliers came to light when CM exposed several Scottish farmers taking on haulage work without 0-licences (CM 8-14 Oct 1998).