A threat by members of the Irish Road Haulage Association (IRHA) to cause disruption on the roads - and perhaps much worse - unless the Government immediately reduces the cost of diesel fuel is akin to political blackmail. As such, it is totally unacceptable. Street action is a blunt weapon; it damages everything it touches. It elevates the concept of might over right. Effectively, it rejects the notion of social partnership on which our current prosperity is largely based. For all of these reasons, the president of the IRHA, Mr Gerry McMahon, and members of his executive would be well advised to adopt a moderate, thoughtful course of action.
The frustration and anger of IRHA members, whose profitability has been seriously eroded by rapidly rising fuel prices, are easy to understand. Some private hauliers are in danger of being forced out of business if fuel prices continue to rise. But massive disruption of the economy caused by road blockades is not the answer. As an open economy, Ireland has a far higher dependence on exports and imports than other EU states and an estimated 92 per cent of freight is now moved by road. Much of our modern freight business was created in recent years when the economy prospered and fuel prices were low. The militancy of French truckers, taxi drivers and fishermen has spread across the EU and is now threatening Ireland. But circumstances here are quite different, in terms of prices and dangers. Far greater damage could be done to our economy in the short term than to these large European states. And the prospects for recovery would be less.
Oil prices are never static. The cost of crude oil has risen from $11 to almost $30 a barrel during the last 20 months, leading to the present unrest. But a year earlier, the price per barrel was in excess of $20. Recent production commitments by members of OPEC are expected to bring about a gradual reduction in price levels to a range of $22 to $26 per barrel. So, while there has been great volatility in the oil market, Government policies have not added to the cost of the fuel, as has been the case in a number of EU states.
In advance of his meeting with members of the IRHA last evening, the Taoiseach, Mr Ahern, appealed to them to engage directly in negotiations with the Government to try and find a solution to the difficulties being experienced. A commitment to address the inflationary and fuel price issues, along with other related matters, was made to the social partners last July, he said, in the context of a review of the Programme for Prosperity and Fairness. Those concerns would be dealt with in the December Budget. The Budget is now only 10 weeks away and Mr Ahern has appealed to hauliers to display the same discipline and understanding as farmers, industrialists, trade unionists and the other social partners.
Earlier this week, members of the IRHA demanded a 20 per cent cut in excise duty on diesel and threatened to seriously disrupt traffic if its ultimatum was not met. This claim was hiked up to 33 per cent on the back of yesterday's price rise at the pumps. No government - and no business - can operate effectively in such a climate. It's not just hauliers who are affected by the rise in fuel prices. It contributes significantly to the growth of inflation, which affects everybody. The Government has given a commitment to negotiate on all these matters with the social partners over the next six weeks. That is where a rational, sustainable solution will be found. The other road leads to anarchy and perhaps even to recession.