Fuel Duty

Albert Owen Excerpts

Monday 12th November 2012 Commons Chamber

[Albert Owen (Ynys Môn) (Lab)]

I am disappointed by the Minister’s speech—I have heard it several times before. Whenever he addresses the House he uses the same argument: the previous Government got us into a mess. Today, my constituents are suffering from high petrol and diesel prices, which is why the motion, which I shall support, was tabled.

I have consistently supported the hon. Member for Harlow (Robert Halfon) over a period. Indeed, I opposed the Labour Government increasing fuel duties because I thought the timing was wrong.

[Henry Smith (Crawley) (Con)]

Will the hon. Gentleman give way?

[Albert Owen]

I will in a moment, but given the time limit I do want to make some progress.

I want to raise three issues, the first of which is the impact of fuel duty on businesses, especially those in peripheral areas of the United Kingdom. The Government also chose to impose a VAT increase, despite the Prime Minister having told the country before the election that they had no intention of doing so. Every time constituents throughout the country put petrol or diesel in their cars they pay an extra 3p per litre because of the tax introduced by this Chancellor of the Exchequer.

[Pete Wishart (Perth and North Perthshire) (SNP)]

I am genuinely confused. What is the difference between a Labour fuel tax hike and a Conservative one?

[Albert Owen]

Scottish National party Members always use that line on fuel duty, and I am not going to waste my time on it—[Interruption.] If the hon. Gentleman had checked the record, he would know that I have been consistent on fuel duty. I have followed SNP Members through the Lobby on that. Previous Labour Chancellors froze the duty following pressure from people. That is on the record. We can play games about previous Governments, but the serious issue is the cost—

[Henry Smith]

Will the hon. Gentleman give way?

[Albert Owen]

No. I want to make progress. The serious problem is that our constituents are paying 15p per litre more for petrol under this Government than they paid under the previous Government. Government Members can use nonsense hypotheticals, and say, “It would be 10p more expensive under a Labour Government,” but the fuel escalator was introduced by the Major Government. We could use the same argument, and say, “Had we stuck to that, fuel would by so many pence more expensive.” The reality is that it is 15% more expensive today.

[Jim Shannon (Strangford) (DUP)]

Will the hon. Gentleman give way?

[Albert Owen]

I will not give way—I want to make progress.

VAT is hurting families and businesses. Hauliers and small businesses in my constituency are paying extra fuel duty and VAT on their fuel. The impact is on goods—[Interruption.] The Lord Commissioner of Her Majesty's Treasury, the hon. Member for Scarborough and Whitby (Mr Goodwill), says from a sedentary position that they get the money back, but he should listen to businesses. They tell me that fuel duty and VAT impacts on their businesses. Are they wrong? He needs to listen to businesses rather than make silly party political points in the Chamber. That is the reality of the situation: they pay more for fuel.

There is a double whammy because, as the Minister said, businesses also pay more for raw materials. They are being badly hurt. The debate should concentrate on what our constituents are telling us.

[Jim Shannon]

rose—

[Albert Owen]

I will give way once more, and then I need to make progress.

[Jim Shannon]

In Northern Ireland, 25% of every worker’s wage is spent on fuel getting to and from work. Another 10% is spent on heating oil. Does the hon. Gentleman believe that the VAT increase should not go ahead for that reason, and that concessions should be made for people in Northern Ireland, where the price of fuel is higher than anywhere else in the UK?

[Albert Owen]

The motion calls for a freeze on duty, but Labour introduced a previous debate on temporarily cutting VAT to help hard-working businesses and people across the country. Businesses are being hurt.

We rightly say that road transport is hit hard, but ferry companies—this is a serious point that nobody raises—must, because of the high prices, put fares up and cut back on the time their service takes so they can cut fuel costs. The problems that British businesses face are real. In my part of the world, the extra fuel duties mean problems getting goods to market and getting people to the workplace. This is a real issue for real people. I hope hon. Members remember that tonight.

The hon. Member for Strangford (Jim Shannon) mentioned periphery areas. Northern Ireland has the highest fuel duty in the UK, but it is closely followed by periphery areas of Wales. The hon. Member for Aberconwy (Guto Bebb), who is not in his place, made a political point about council tax in Wales. The reality is that the Government cut revenue and capital spend in Wales, so those authorities have to make their decisions, but they are not responsible for fuel tax. Fuel tax lies at the door of the Government. Incumbents have the opportunity to increase fuel duty when they believe that is necessary and to reduce it when it hurts business and our constituents. Now is the time for this Government to think seriously about that.

The Minister is listening—he says the Government always listen and that they are in listening mode—but he needs to take action, and to tell businesses tonight whether or not he intends do so. It is no use the Chancellor and Government Back Benchers getting together, cloak and dagger, to say that the motion is opportunism. The reality is that many of those same Back Benchers have introduced the same motion and supported it in a Back-Bench debate. We need consistency from Government Members, because they know their constituents are feeling the pinch.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

The hon. Gentleman makes a strong speech. He has shown personal consistency, but it is reasonable for Government Members to say that many of his colleagues show anything but. If he wants this duty freeze, what does he want to do to raise the money? Can tax loopholes instantly provide the money, does he want a cut in Government spending, or is he, like most of his colleagues, in favour of ever more borrowing?

[Albert Owen]

FairFuelUK’s argument is that money is lost to the Exchequer because of the serious impact of fuel duty on businesses. If we had growth in our economy, which all hon. Members want, the Exchequer would get more money, and businesses would be able to reinvest. That is one way. I would like the 4G windfall money to be used to help to alleviate small businesses—[Interruption.] The hon. Member for Scarborough and Whitby says the Opposition have spent the money, but that is not true—we are not sure how much it will be or how it will be spent. I should also point out to him that the Opposition do not spend the money; the Treasury makes those decisions. It is about time the Government took responsibility for their actions rather than making knockabout comments.

My final remark is about the ordinary family. In my part of the UK and many periphery areas, motorists do not go on luxury outings. Motorists are families taking their children to school and students getting to college and university. People in remote areas need their cars for the weekly shop because public transport is not available. It is great when people can take alternative transport, such as in central London and large cities, but that is not a choice in periphery and remote areas.

There is a choice tonight: hon. Members can vote for the motion or the amendment. They should vote for what their constituents want, and do what Members on both sides of the House have been asked to do. They should put loud and clear pressure on the Chancellor. If he is in listening mode, he will listen to the will of the House and suspend the 3p tax increase that he proposes to introduce in January, so that families can have a bit of a break and go into Christmas and the new year in the knowledge that they will have more money to spend, and so that businesses have more money to reinvest.

--- Later in debate ---

[Robert Halfon (Harlow) (Con)]

I believe that, as has been said, fuel duty has become a toxic tax, and that the public have just had enough. I also believe that the Government are listening, and that that is shown by their amendment, as highlighted by my right hon. Friend the Member for Wokingham (Mr Redwood). I am disappointed with Labour’s smokescreen. This debate is really about hiding the record of the shadow Chancellor and many years of putting up fuel duty. I have to say to the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) that when I was campaigning hard last year, organising and working hard with FairFuelUK to get the Government to cut fuel duty, the Government cut fuel duty in the 2011 Budget but the hon. Lady, the shadow Chancellor and their party voted to keep fuel duty up, so let us have no discussion about who is being opportunistic. I am disappointed that the Labour party has chosen to conduct the debate in this way.

The heart of the debate should be the figures published by the Office for National Statistics almost a year ago. Its data proved that fuel duty is regressive and hits poorest Brits the hardest. It is with that fact in mind that we should consider the recent history, or at least the past five years, of the debate in the House on petrol taxes. In 2007, the shadow Chancellor said:

“In this Budget, we have set out further actions to advance the environment agenda, including…a fuel duty increase of more than inflation”,

and that that

“demonstrates the Government’s commitment to tackling climate change”.—[Official Report, 26 March 2007; Vol. 458, c. 1265.]

I think that that sums up the shadow Chancellor’s principles on the issue. I have to say that he makes the Vicar of Bray look like Gandhi. In reality, the shadow Chancellor’s petrol tax had very little to do with climate change, because families could not change their behaviour to respond to it. Like scrapping the 10p rate, it was a tax on the poor.

That is why I am sceptical when the Opposition motion makes much of the small delays that Labour has sometimes applied to its increases in fuel duty. If one looks at the substance of the Budgets of 2009 and 2010, one sees that it programmed in massive fuel hikes for 2010, 2011, 2012 and 2013. That is what we are dealing with today, and why I have campaigned, with many of my colleagues, to cut the cost of fuel duty. The argument is therefore not about whether we believe that the fuel duty rise should not go ahead—I passionately believe that—but about tactics. It is sensible and right to wait for the autumn statement. Given the Government’s record—they cut fuel duty last year and have stopped two planned fuel duty rises—I believe it is right to wait for the autumn statement.

[Albert Owen]

The hon. Gentleman has been consistent on this issue. He has also been campaigning hard for transparency on fuel duty matters. On that theme, will he tell the House what discussions he has had with the Chancellor? Which report in the newspapers is right: that the 3p rise will not go ahead and there will be a cut, or that there will be a 2p increase in the autumn statement?

[Robert Halfon]

Unfortunately, I am just a brand-new MP and I do not have the luxury of having discussions with the Chancellor. I have no idea what is in his lunchbox, but I do know that the Government have a record of cutting fuel duty. That is something that I am proud of and to which I can give strong support.