Climate levy price rise less than feared

23 May 2001
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24 May 2001

The controversial climate change levy has hit industrial prices for materials and fuel less severely than initially feared, according to preliminary estimates.

Information from the Department of Trade and Industry, based on figures from Customs and Excise, shows that the levy added 0.9 per cent to the monthly input prices index for materials and fuels purchased by the UK manufacturing industry.

However, National Statistics' (NS) producer prices for April exclude the levy, which was introduced at the beginning of April. The NS report noted the uncertainty surrounding the levy's statistical impact and stressed that energy providers are in a transitional phase.

Electricity buyers have voiced fears recently that the levy will increase annual gas and electricity costs by up to 20 per cent (see News, 12 April). Opposition to the levy was particularly strong in small and medium-sized firms.

The input price index for materials and fuels purchased by the manufacturing industry rose by 6.6 per cent in the year to April. The index rose by 0.4 per cent from March to April before the impact of the levy is taken into account.

SMmay2001

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