The association is writing to Business Secretary Lord Mandelson, pointing out the discrepancy between VOSA’s fee increase and his pledge to try and reduce the impact of regulation on business costs.

VOSA has ignored the unanimous and robust industry opposition to these proposals. This fee increase will earn it an extra £4.3 million this year, and the government agency has indicated that further above-inflation fee rises will be necessary to pay for its failure to cover its costs in past years.

“These increases will place a serious financial burden on an already ailing sector and will contribute to some operators going bust,” said BVRLA chief executive John Lewis.

“Remember that these businesses are vital customers for the UK automotive industry Lord Mandelson is so keen to preserve.”

VOSA also wants to raise an extra £5.3 million a year by merging the annual O licence vehicle fee with the annual test fee, bringing thousands more vehicles into scope.

This merged fee would put a completely unjustified burden on the rental and leasing industry and many other vehicle owners who would essentially be paying for enforcement costs despite not being subject to O licence requirements. This runs contrary to the “user pays” principle trumpeted by central government.

The merger of test fees will see the sector’s annual bill rise by £3.2 million in 2009 and £7 million in 2010.  

“VOSA expects our members to act as third-party tax collectors, and to recover these costs from their customers in the form of increased hire or lease charges. But this will be next to impossible in a fiercely competitive business environment,” said John Lewis.

‘Transformation’ in testing provision

According to reports, VOSA also plans to have 85% of all annual vehicle tests conducted at private sector sites (Authorised Testing Facilities or ATFs) by 2013. The BVRLA will be closely monitoring the scheme to ensure that it is delivered on time and with the desired cost benefits.

“VOSA claims the introduction of ATFs will produce a ‘transformation in testing provision’ that will reduce costs for operators,” said John Lewis.

“However, with its poor track-record for managing its infrastructure and reducing costs, we would suggest that its goals are more of an aspiration than a concrete target.”