Discount scheme stalls as Halkirk fuel outlet closes

A BID to make part of Caithness eligible for government-backed road fuel discounts has spluttered to a halt.

Politicians and business leaders had welcomed the inclusion of the Halkirk postcode area among seven additional areas in line to benefit from a 5p a litre cut in petrol and diesel.

But the reaction to the announcement at the end of last week has been tempered after it emerged the sole fuel outlet in the village wound up last month.

While the application is still on the list of 17 areas going forward for approval by the European Commission, it will be of no benefit to far north motorists so long as there is nowhere to fill up in the locale.

Since the discount scheme started in the Outer Hebrides, Orkney and Shetland in March 2012, there has been a clamour for it to be extended to parts of the Highlands, which face among the highest forecourt prices in the country.

Last year, 10 areas – none in Caithness – were earmarked to benefit from the 5p cut with the addition of seven to the list following a further bout of political lobbying.

Far north MP John Thurso was only made aware the Halkirk garage, J & G Sutherland, had stopped providing fuel at the weekend but said the application still stood and can be granted.

"My understanding is the application still stands and will be going to Europe, it’s not a matter for the UK government to chop and change," he said.

"If the application comes back successful, the firm would be entitled to offer discounted fuel should they decide to recommence."

But on Monday the owners said even if the business still offered fuel it would not have benefited much from the scheme.

Manager Karen Coghill took over the garage with her partner at the end of 2010 and started selling fuel in November 2012.

She said even if the application was successful, it would not have been financially viable to have continued running fuel services.

"We kept it going for as long as possible but there were a few reasons why we decided to stop," she said.

"We had ageing pumps which can’t be replaced and it costs a lot for somebody to come from Inverness to fix them.

"I also had supply issues – I was able to get diesel easily but obtaining petrol was an issue and had to get it transported from Inverness.

"There is no money to be made in fuel. Our idea was if the filling station was open it would have pulled people into the garage."

Halkirk was the only location in Caithness to be recommended in the fuel discount scheme. Thurso is the nearest location to Halkirk from which to obtain fuel but does not qualify for the scheme due to it being a large town.

Ms Coghill believed the scheme could benefit other areas but said small petrol stations in rural locations were becoming rare.

"Independent petrol stations are

becoming a thing of the past. It would be interesting to find out how much franchises are making on a litre because they must be getting supplied at a cheaper rate than we did to operate," she said.

"I think the scheme can work in isolated areas, if the only thing affecting them is the price of their fuel.

"We had regulars but we can’t compete with town rates and even the fuel rebate scheme wouldn’t have made that much difference as I would have had to pass on the discount to the customers so I would have remained in the same situation as before."

The process has been described by landward Caithness Highland councillor Willie Mackay as "a bit of a shambles".

Claiming the scheme has lacked promotion, he does not understand why all rural parts of Caithness are not given similar treatment.

Outside of Thurso and Wick, the only other existing petrol stations are located at Castletown, John O’Groats, Reay, Auckengill and Watten.

Mr Mackay said all five locations could have benefited from the fuel discount scheme and more effort should have been made to encourage these providers to apply.

"I am aware the retailer had to apply to be part of the fuel discount scheme but I think it was a bit of a shambles how other fuel stations in Caithness weren’t encouraged to apply," he said.

"All these four stations are rural and remote, which could describe the county in relation to the rest of Scotland.

"It is an embarrassing situation Halkirk’s application was accepted but there are no petrol pumps."

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