Petrol and Diesel

Angus Brendan MacNeil Excerpts

Wednesday 23rd May 2012 Westminster Hall

[Robert Halfon (Harlow) (Con)]

It is a pleasure to serve under your chairmanship, Madam Chairman, and I appreciate what you have said. I have cut my speech down to allow for more interventions. The number of people here shows just how important the issue is, and I thank Members from both sides of the House for coming along.

I want to start by knocking something on the head. I welcome, as I am sure everyone here does, the fact that in the past few weeks petrol prices have come down a few pence, but families in my constituency still spend more on petrol than on food. The price of petrol is at an historic, all-time high. In Harlow, it costs more than 140p a litre, and that hits the poor twice as hard as the rich. People say that the price has come down, but it is a bit like a burglar taking £100 out of your pocket and giving you £5 back.

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

Does the hon. Gentleman agree that when a few pence comes off the price of a litre and the foot comes off the neck of the economy and of hard-working families, it is the wrong time for the Government to put that foot back again and squeeze the life blood out of the economy?

[Robert Halfon]

I am grateful to the hon. Gentleman. He supported me in the debate last year in which we managed to get the Government to postpone the January tax rise, and he will see from my remarks that I do not disagree with him.

Sir Terry Leahy of Tesco has said:

“Filling up the family car has gone up 70% in two years, causing what was a steady recovery to go sideways.”

I and most fair-minded people recognise that the Government have made significant progress, abolishing the previous Government’s fuel duty escalator, scrapping the planned hikes in 2011 plus a 1p cut in duty, with a partial fuel stabiliser and the freeze in fuel duty that I mentioned, in January this year. I firmly believe that the Chancellor shows an understanding of the matter, and that the Government must get credit where they deserve it, but we face considerable problems.

The first problem is the planned tax rise in August, which I ask the Government to reconsider. Secondly, we need a serious inquiry into the lack of competitiveness in the oil market, and possibly even a windfall tax on oil firms, to cut prices. Thirdly, there is the problem of the banks speculating on the price of oil.

--- Later in debate ---

[Miss Smith]

The hon. Gentleman will have heard me explain over the past few minutes that the Government have done something and that there are many other ways in which this Government need to consider what they do through the economy.

On the recent Royal Automobile Club report, which has also been raised today and in which my hon. Friend the Member for Harlow is interested, the Government announced in the Budget that they will consider whether vehicle excise duty should be reformed to support the sustainability of public finances and to reflect the improvements in vehicle fuel efficiency. The Government will, of course, seek the views of motoring groups before taking any decisions.

My hon. Friend also asked questions about the competitiveness of the oil market. As I think he knows, the Office of Fair Trading is undertaking research on pump prices on the Scottish islands, which are no doubt of interest to the hon. Member for Dundee East (Stewart Hosie). That work will help inform what further action, if any, may be appropriate elsewhere in the UK.

Several Members have asked whether other island and mainland areas could be included in the rural fuel rebate pilot scheme. It is a pilot scheme and nothing beyond its boundaries has been ruled in or out, but I have listened to what Members have had to say.

[Mr MacNeil]

I want to put it on the record that the pilot scheme seems to be working well. Indeed, I hope that it will be rolled out further and be made a permanent scheme in the future.