Fuel Prices

Alan Reid Excerpts

Thursday 13th September 2012 Commons Chamber

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

We are facing higher fuel prices in real terms, as the hon. Member for Harro—sorry, the hon. Member for Harlow (Robert Halfon) said; I have as much difficulty in pronouncing the name of his constituency as he does in pronouncing the name of mine.

I draw the Chamber’s attention to a debate here on 7 February 2011, when I said that prices in my constituency were a shocking £1.45 a litre. Now they are between £1.52 and £1.59 for diesel, with petrol typically about 4p a litre less. Those prices take into account the 5p rural fuel derogation. I make this plea to the Government: in the modern day, a 5p derogation is not enough. We might have to go to Europe and ask for a larger one.

I point out to the hon. Member for East Lothian (Fiona O'Donnell), who was particularly partisan, that when I asked for a larger derogation in the last Parliament, I was told by the Labour Government that the introduction of such a derogation would mean that people travelled to the islands to buy fuel that would still have been more expensive. I did not follow the logic then and I do not now.

[Mr Alan Reid (Argyll and Bute) (LD)]

The hon. Gentleman is right. We raised the rural fuel issue with the last Government, but nothing was done. This Government have introduced the rural fuel derogation. Like the hon. Gentleman, I would like it to increase. Will he support a campaign to see the derogation extended to remote parts of the mainland, such as the Kintyre peninsula?

[Mr MacNeil]

The hon. Gentleman makes a great point, and a serious one, about rural places in mainland Scotland. Places such as Argyll, Caithness, Sutherland and Lochaber, which I must not forget as I worked there, would benefit from the extension and increase of the derogation.

It is interesting that, as the motion states, other countries, from the United States of America to Austria and Germany, are regulating. Ultimately, we will have to do the same in the United Kingdom before the economy is totally strangled. Whether it is the fault of the companies, the distributors, the speculators or the retailers, we need to get the issue sorted for the good of the economy. Indeed, retailers would be quite pleased to have greater regulation or transparency, especially as they are sometimes tied to long-term contracts with distributors, which makes it difficult for them to shop around and means that the price of fuel cannot be brought down in marginal areas.

Transparency might be the answer, but we must bear it in mind that in some areas and markets prices can go up if the seller is reluctant to give discounts to certain buyers. For that reason, regulation must be taken seriously before the economy is strangled. We cannot leave the foot pressing harder and harder on the jugular in the neck of the economy.