Talks offer to avert London lorry protest London

THE GOVERNMENT yesterday offered to set up a high-level forum with lorry drivers in a last-minute bid to head off a demonstration that threatens to bring chaos to London today.

Hundreds of lorry drivers say they will bring traffic in the capital to a halt by driving slowly through the streets in protest at Budget increases in diesel duty and road tax.

John Reid, the Transport minister, said he would set up a special forum of Transport and Treasury ministers and hauliers' leaders. He meets the heads of the Freight Transport Association (FTA) and the Road Haulage Association (RHA) tomorrow.

Hauliers say the Budget will add millions of pounds to their running costs and force them to cut jobs. At least three firms representing 2 per cent of the industry are planning to register their fleets abroad unless the Government backs down.

But Mr Reid, speaking on GMTV's Sunday programme dismissed any possibility of "rewriting" or "unpicking" the Budget, adding: "We want to build a bridge to the future so that we can see that the haulage industry continues to thrive."

He warned hauliers not to take part in the demonstration. "If they chose to reject the industry forum and chose instead to disrupt the lives of millions of ordinary people who are paying their taxes, then I don't think they will get a resonance out there with the public."

The FTA attacked the offer of a forum, accusing ministers of trying to placate hauliers rather than dealing with their concerns. "The problems that the transport industry is facing are here and now. While a forum may help us in the future we need short-term help because the fact is that jobs and companies are at risk," said spokesman Geoff Dossetter.

He warned the Government that the prospect of companies leaving this country to take advantage of lower diesel and road tax rates in Europe was "real fact, not just hype". Two of Britain's largest road haulage groups are seriously considering registering all or part of their fleets abroad to escape the swingeing hikes in duties. Wincanton Logistics and Tibbett & Britten have about 4,000 lorries and said the move - known as flagging out - could save pounds 2m a year in Vehicle Excise Duty (VED) or road tax alone.

Eddie Stobart, the UK's most famous lorry firm, has said it will register up to half its 800-strong fleet abroad. VED for 40-tonne lorries is just pounds 338 in Luxembourg compared with the new British rate of pounds 5,750 - up from pounds 3,210. On top of that, Wincanton said the Chancellor's decision to add 6p a litre on diesel duty would add pounds 5m to its annual fuel costs.

Mr Dossetter said: "There cannot be a transport manager in the country worth his pay who is not investigating whether he should flag out."

But environmental groups said the duty increases would help cut pollution levels and encourage hauliers to use rail freight. Roger Higman, of Friends of the Earth, said: "Lorry traffic is a major cause of pollution. The Government must be firm - the policy is working."