Fuel Prices and the Cost of Living

Aidan Burley Excerpts

Wednesday 16th March 2011 Commons Chamber

[Justine Greening]

I do not think the right hon. Gentleman even believes that himself. The bottom line is that he wants—[Interruption.] The shadow Chief Secretary says that we need to take action now, but he wants us to embark on a process that took six to seven years the last time it happened. How is that taking action now?

Let me tell the House on which items the rate was changed. Here are a few of the products and services to which a reduced VAT rate is now applied in other countries:

“minor repairing of bicycles, shoes and leather goods, clothing and household linen”.

Window cleaning was also one, and hairdressing was another. The Government at that time—a Government of whom the right hon. Member for Morley and Outwood (Ed Balls) was part—did not seek to add road fuel to that list. He says that that was because the previous Government never raised VAT on fuel. That is not strictly true, of course: they reduced it, but then put it back up again, as we have heard. The other reason was that, year on year—and, in the final stages, month on month—they were consistently raising fuel duty, so they had no need to use VAT as a tool. They were getting plenty of additional tax from the motorist.

[Mr Aidan Burley (Cannock Chase) (Con)]

The last Government might not have increased VAT, but they certainly increased fuel duty. When Labour came to power in ’97, duty on unleaded petrol was 36p a litre; when the last Government left office in 2010, it had risen to 57.9p a litre. Does my hon. Friend think that Labour Members should take some responsibility for increasing fuel duty by more than 20%?

[Justine Greening]

Of course they should, but as so often they never do, unfortunately.