Mike Waters' Blog: 20 June 2008
23 June 2008
Mike Waters is head of market analysis at Arval
We are all feeling the pinch from rising fuel prices, but there is no doubt that some people are in a worse position than others...
The rising cost of work
We are all feeling the pinch from rising fuel prices, but there is no doubt that some people are in a worse position than others.
When the Government announced AMAPs, or approved mileage allowance payments, were not to increase it must have been a bitter pill to swallow for drivers who use their own car on business. Especially given the recent rise in advisory fuel rates for company car drivers.
The upshot is that drivers using their own car for business mileage receive the same level of reimbursement they have for the past six years. As well as the obvious duty of care issues this raises the problem that some people may be in a position where they are effectively subsidising their employer through work travel, hitting them in the wallet and leaving them with a sense of injustice.
It goes without saying that certain jobs are impacted more than others, and while it is always advisable for organisations to reduce unnecessary mileage wherever possible we must acknowledge that some people have no option but to drive a certain mileage for work. One such example is the community nurse. If the nurses don't drive, their patients don't get seen, which would be an unacceptable situation.
They are so concerned the Royal College of Nursing recently contacted the Chancellor to warn him the UK's 60,000 community nurses are struggling with the increased cost of running a car.
There is no doubt they would benefit from being on a fuel management scheme. This would not only provide an accurate map of their mileage which supports better journey planning but also means their employer is paying the actual price of fuel and the employees are receiving what they are owed, no more, no less.
Unfortunately, this type of policy decision is generally something the driver has no control over. As we know, there are steps in the interim that drivers can take to reduce their fuel usage through the way that they drive, but this won't make the system fairer.
The danger is that certain occupations may become unattractive because of fuel costs leading to resource shortages in the future. As a result, employers should be reviewing their fuel policy now in order to manage any issues that could come back to bite them further down the line.