Fuel Prices

Debate between Angus Brendan MacNeil and Iain McKenzie

Wednesday 21st January 2015 Westminster Hall

[Mr Iain McKenzie (Inverclyde) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Roger. I am delighted to have secured this debate, although a longer debate would have given other Members an opportunity to contribute. My constituents are not the only ones to have had problems with fuel pricing, and other Members might have highlighted other areas of the country that are having the same problem.

I will highlight three matters that affect fuel pricing across the country to the detriment of motorists. The first is pricing at the pump and the lack of competition. The second is the supply chain and where profits and investments are being made in that supply chain. The last, but by no means least, as my speech will show, is taxation on fuel.

I acknowledge that, at last, we are seeing average petrol prices going back to the levels last seen in the autumn of 2010. However, we are being told and led to believe that that is due to an intense pump price battle between supermarkets and independent retailers. If that is true, my constituency of Inverclyde is certainly not witnessing it. Our prices remain higher than in areas outwith Inverclyde’s boundaries. My constituents would like to take issue with that, and it would seem that we are not alone. There remains significant variation in petrol prices across the country, even between neighbouring communities. Unbelievably, there can be substantial variation between the price of fuel at the pump over very small distances, and my constituents suffer from that. Fuel prices at the pump in Inverclyde can be 3p to 4p more than at forecourts just 15 miles away, and we are probably not the only area of the country that is witnessing such price differences within such a short distance.

Why are prices so variable from community to community? In the past decade, especially in my area, large supermarkets have moved in to dominate the forecourts, with many independent and even oil company-owned fuel retailers closing their roadside filling stations. The Petrol Retailers Association has told me that 900 independent retailers across the country have closed in the past five years. In Inverclyde, 14 independent filling stations have closed in recent years, leaving only two independently operated BP filling stations and, of course, two very large supermarkets. The supermarkets moved in, sold off fuel cheaper than the small independent fuel retailers and ended the competition from those small outlets.

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

The hon. Gentleman describes the experience of many people throughout Scotland, particularly rural and island Scotland. He probably agrees that the volumes of fuel going through service stations will affect the price that the stations have to charge, but does he further agree that there is a lack of transparency in the whole fuel chain from the refinery to the forecourt? It is opaque, so it is difficult to see what is happening and who is taking what fraction of the cost all the way through.

[Mr McKenzie]

The hon. Gentleman makes a good point, which I will emphasise later in my speech. We need to focus on that issue as much as on competition.

Not all the independent retailers that closed were small fuel outlets; in my area many were owned by well-known oil companies such as BP, Texaco and Esso, whose outlets are now scarce. In fact, some have vanished entirely from our roadsides, and it can be difficult to understand the pricing of those that remain. A classic example is the two BP filling stations in my constituency, which are within three miles of each other. Unbelievably, their prices vary by 3p. Work that one out. However, BP tells me that it franchises the filling stations and allows the franchisees to set their own pump price, and therefore there are differences, although the public will look at the name on the forecourt and assume that they are run by the same organisation. Remarkably, the prices at those two franchise filling stations are always higher than at the supermarkets. How much longer will they be trading?

[Mr McKenzie]

The hon. Gentleman makes a good point. We have seen that in the energy market, too. The blame is always placed on the wholesaler, but the problem is that we do not have evidence to substantiate whether that is where the blame should lie. I will go on to ask the Government to investigate the wholesale price of petrol.

The supermarkets have a much-voiced three-mile radius of competition—they tell us that they will match prices within three miles of each large supermarket. Of course, for my constituents that realistically means matching prices with themselves, because there is no one in that radius to challenge them on their pricing. Is that competitive? No, because competition was killed off many years ago.

In early November 2014, Asda, Tesco, Sainsbury’s and Morrisons all rushed out plans to cut prices at the pumps by 1p a litre. In stark contrast, the RAC called for a further 4p cut in unleaded and 2p cut in diesel, to be fair to motorists. The campaign group FairFuelUK has called for a Government inquiry to get to the bottom of the price fluctuations in fuel. Will the Minister consider adopting Labour’s calls for the Competition and Markets Authority to start the process of launching an inquiry into petrol pricing on the forecourts? She might want to support the Road Fuel Pricing (Equalisation) Bill, which the hon. Member for Wyre Forest (Mark Garnier) introduced yesterday using the ten-minute rule. At a time when we are asking the Government to look favourably on protecting dairy farmers from supermarkets, why not protect motorists, too?

The next area that I would like to explore is the supply chain from extraction, refining and transport to the pump. Just where are profits and investments being made? Can we identify where the price is being hiked? As we have seen in the past couple of months, the oil price per barrel has dropped significantly. My rough analysis of the supply chain suggests that exploration costs make up about 5%, capital costs—leasing buildings and rigs, and so on—make up 20%, and paying staff and transport costs and so on makes up 10%. Then there is tax of some 40%, and oil company profits make up the final 25%.

[Mr MacNeil]

The hon. Gentleman is being kind and generous with his time. He has mentioned tax. As the price goes down, tax becomes a larger share, and the Government have a role to play in that. Is it not iniquitous that, in small places with lower volumes of sales and where higher margins are required on each litre of fuel, VAT is also charged? Small rural places are paying more tax per litre—the islands certainly are—than the big cities that have the advantages of large volumes of sales and tough competition between supermarkets.

[Mr McKenzie]

I thank the hon. Gentleman, who mentions the VAT hike that the Government placed on fuel when they came to power in 2010. He also mentions the islands. I was contacted by an islander the other day who said that fuel was being transported to the island to supplement the price.

In the past couple of months, the oil price per barrel has dropped significantly. However, as we have already discussed, the wholesale price—the cost of production and refining—is calculated at 22p per litre on fuel that costs 109p. We need to investigate the supply chain to see whether that is the case.

What of the failure to reduce costs as quickly as they are increased? I have highlighted the problem in the domestic energy sector—we had a debate on that the other week—whereby companies pass on wholesale price increases quickly, but not wholesale price drops. Energy companies always announce their price hikes by blaming the wholesale prices, but when wholesale prices fall, they never seem to pass the savings on to customers quickly. We seem to have the same problem with fuel—reduced costs are apparently not being passed on promptly to the consumer on the forecourt.

Oil prices, as I have said, have fallen by about a third since the summer of 2014. Campaigners say that prices are quick to increase when wholesale costs increase, but when wholesale costs go down, prices decrease slowly. We need to investigate that to see whether evidence shows that that is indeed the case, and whether wholesalers are to blame. The AA has called for transparency in the supply chain and for the Government to make petrol wholesalers reveal their prices. It says:

“Consumers can see the price of oil and they know how much they pay for petrol but they do not know the cost of wholesale, which means that petrol retailers cannot defend themselves when they are accused of not passing on price cuts.”

There was an investigation into petrol prices by the Office of Fair Trading, and in 2013 it published its study, which stated that the fuel market was working fine. However, that was not a formal inquiry, and many motoring organisations were dissatisfied with its conclusions. The Petrol Retailers Association considered the report substantially flawed owing to the fact that it did not investigate anti-competitive pricing by oil companies, or by supermarkets that subsidise fuel with margins from groceries to eliminate competition and enjoy a monopoly in the fuel market.

It is also worth noting that, in August 2013, the European Commission started a high-profile investigation into alleged oil price fixing by certain oil companies and traders. That involved dawn raids on oil companies in places as far afield as Norway, Holland and London. We have heard very little from the Commission on the findings of its investigation and, given the inadequacy of the OFT report, we need to have an open and transparent look at where profits and investments are being made. It looks as if we need to apply something similar to Labour’s proposals for the energy regulator to enforce an immediate, fair and proportionate price reduction.

Finally, I will look at Government taxes levied on fuel. The largest portion of a fuel bill goes to the Government: with petrol priced at 109p a litre, fuel duty is 58p and VAT is 18.2p of that. Fuel duty has been frozen since March 2011 and it looks like it will remain so—hopefully—until at least May 2015, but it still makes up a hefty chunk of the cost. More than 60% of what motorists pay goes to the Exchequer in fuel duty and VAT. According to FairFuelUK:

“The Treasury hides the staggering fact that the UK still has the highest level of percentage taxation on road users in the EU for diesel and the second highest for Petrol. The Chancellor currently takes considerably more at the pumps for diesel in tax than any other EU Finance Minister.”

The Petrol Retailers Association believes:

“The main reason pump prices have not fallen in line with crude oil is due to the high proportion of Government tax levied on fuel.”

What of Labour’s record in office on fuel duty? According to the House of Commons Library, under the previous Labour Government the percentage of the cost of a litre of fuel paid in tax fell from 75% in 1997 to 65% in 2010. In contrast, between 1990 and 1997, under the Conservatives, it rose from 59% to 75%. In government, Labour announced the postponement of fuel duty increases on several occasions—in total we postponed increases or froze fuel duty in real terms 13 times. The coalition is in government now, so I ask the Minister to discuss with her Treasury colleagues at the very least to drop the extra tax from their VAT hike on fuel.

[Mr MacNeil]

I am hearing the hon. Gentleman waxing lyrical about the former Labour Government. I was trying to bite my tongue, but I have to remind him of the fuel duty escalator that they were quite happy to use. Is it now a source of shame to him that his Government did not introduce a rural fuel derogation that would have helped island and remote areas, despite being asked for that for four or five years? They could and should have done that, but they refused. Under pressure, this Government have now done that, but that was an opportunity lost by that Labour Government.

[Mr McKenzie]

As the hon. Gentleman will be well aware, the fuel duty escalator introduced by Labour was a green tax to put funds into green energy. Unfortunately, that idea has never been taken up. We heard from this Government that they were to be the greenest that we had ever seen, but they are not by some margin.

Let me now focus on why we need to reduce fuel costs. Apart from the obvious—reduction in transport costs for goods, and increasing employment—large numbers of workers rely on a car to get to their place of work. They have no choice in that, especially with the price of rail travel as it is today. Petrol and diesel are simply unavoidable, essential costs for millions of motorists and businesses—90% of people in employment say that they have no choice but to use their car to get to work, and 44% also use their vehicle when at work.

In a recent survey of small and medium-sized enterprises, one in 10 said that they were making staff redundant owing to high fuel prices, and two in 10 said that they had stopped recruitment. Car-owning households are estimated to spend a high percentage of their disposable income on running a vehicle. Again, car ownership is not a luxury but an essential part of modern life. Let us not forget that public transport in the form of bus and rail travel must also reduce in price if oil prices are falling.

In conclusion, I ask the following of the Minister. We need an open and transparent inquiry into fuel pricing. We need more parity on fuel prices at the pump and an end to the ridiculously small radius for competition and price comparison. Fuel wholesalers must be made to reveal their prices, because that will allow retailers to defend themselves when they are accused of not passing on cuts.

At the very least, we need a further freeze in fuel duty. In view of the continuing cost of living crisis and the low rate of inflation, there can be no justification for an increase—if anything, there should be a reduction. Finally, the Government should return the rate of VAT on fuel from 20% to the level it was before they came to power in 2010. I am in danger of showing my age here, but if the British motorist was to sit down and work out how much they paid for a gallon of petrol, they would be appalled.

Scotland and North-east England Post-2014

Debate between Angus Brendan MacNeil and Iain McKenzie

Tuesday 4th March 2014 Westminster Hall

[Mr Iain McKenzie (Inverclyde) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Weir. I congratulate my hon. Friend the Member for Sedgefield (Phil Wilson) on securing this important debate.

As a Scot, I believe that separation from the rest of the UK would present business on both sides of the border with an unnecessary barrier. In Scotland, there would be a barrier to trading with our biggest market—the UK—and to our long-established trading with the north-east of England, and that makes no sense at all. No one wants a barrier to our trade and connections with north- east England, except those who promote independence for Scotland.

[Mr MacNeil]

Will the hon. Gentleman give way?

[Mr McKenzie]

I will not give way at the moment.

We are all aware that the open border between Scotland and the north-east brings significant economic, trade and employment opportunities. We are also aware that, should Scotland vote yes in September, the border will be closed, with the new Scottish state being outside EU membership. Scotland’s languishing in a long line for EU membership would mean its being outside the EU and having a closed border—absolutely guaranteed—bringing about significant trade difficulties. We would lose our shared opportunities, despite the fact that we all agree that we need as many opportunities as we can get these days.

Cross-border private and public sector trading can do without this obstacle being put in the way of ease of doing business. Clearly, Scotland has an important economic relationship with north-east England and the UK as a whole. The facts speak for themselves: Scottish business buys and sells more products and services from the UK than any other country in the world. This enables the Scottish people to be part of a larger and more successful economy, and to trade and share easily with our neighbours in north-east England. Some 70% of Scotland’s exported goods went to other parts of the UK, and 70% of imports came from the UK, clearly demonstrating that Scotland’s economic performance is stronger because it is part of a larger integrated UK economy. Exit the UK and our border becomes a barrier that will impede and restrict ease of trade.

Even where free trade agreements exist alongside controlled borders, neighbouring countries with similar economies are affected by the presence of that border. As we have heard, we know this to be true. Hon. Members need only look at the US and Canada: their trade is thought to be some 44% lower than it could be—a result of that controlled border between them.

[Mr MacNeil]

I am listening to the hon. Gentleman carefully and wonder whether his argument is that Canada would be better giving up its independence and becoming part of the United States of America. That seems his logical position.

[Mr McKenzie]

The comparison I am making is between a closed border and an open border. As the hon. Gentleman is aware, it is not only business that will be disadvantaged. Labour migration between Scotland and the rest of the UK is estimated to be as much as 75% higher within an integrated UK. More than ever, we need to share skills and knowledge, so that both sides of the border can prosper. Without doubt, Scotland’s leaving the UK would create an unnecessary barrier to trade with our close neighbours in north-east England. More unites us than divides us. Common goals and common bonds have been built over generations, which is why I believe in a vision of working across an open border and a continuation of the ease in our trading relationship that we have come to expect and enjoy.

We remember and value our close association with those with whom we share a border, but it is a border in name only. The border is not a symbol of division, but a link spanned by friendship and a common understanding of the challenges that we face together. Scotland’s relationship with north-east England should be a constructive collaboration, not a destructive competition, as would undoubtedly transpire after Scotland’s separation from the UK. The SNP is always arguing both ways, telling its supporters that everything will change while telling people on both sides of the border that nothing will change.

If all that independence is about is getting away from a Government for whom Scotland did not vote, I would ask Members to join me in seeking independence for Inverclyde. We have never voted for an SNP Government. We have a Labour MP, a Labour MSP and a Labour-controlled council, yet twice we have had to suffer under an SNP Government. The difference is that we understand and accept democracy. I have visited north-east England many times, and I have always believed that the future of Scotland and of north-east England lie together in one country—the UK.

Fairness and Inequality

Debate between Angus Brendan MacNeil and Iain McKenzie

Tuesday 11th February 2014 Commons Chamber

[Mr MacNeil]

I thank the hon. Gentleman for that interesting intervention. As an MP for a left-of-centre party—sadly, the hon. Member for North East Somerset is no longer in his place to hear this—I am asking how it is possible that our society and, indeed, many other societies, particularly in the English-speaking world, can tolerate inequality, which has now grown to levels beyond those of the 1920s. Has something primitive been transmitted to our minds through the media? The belief that the poor are poor because they are undeserving and have not worked hard enough is a primitive thought. People have to be helped, because we are complex creatures living together in society. People have deep psychological needs and some can suffer from the paralysis of feeling swamped or depressed when they feel stuck or trapped.

Yesterday’s report by the Living Wage Commission, “Working for Poverty”, looked into the scale and problem of low pay and working poverty in the UK. The first shocking statistic I stumbled on came from the work of the Resolution Foundation, which had tracked low-paid workers for a decade between 2002 and 2012. Despite working for a decade, only 18% of those people had managed to escape low pay in that 10-year stretch. In other words, people in low pay had a four in five chance of remaining there.

The report further notes:

“1.3 million employees remained stuck in low pay for the subsequent decade, and a further 2.2 million workers held higher paid jobs but returned to low paid jobs by the end of the decade.”

That is and should be depressing. Imagine the feelings of the people we eyeball who have been living with that reality on a daily basis for a decade.

There is good news and bad news. Over the past decades, the wealth of this and other countries in the west has grown as productivity has increased. The bad news is that the fruits of that productivity have been disproportionately distributed. According to the BBC’s wealth gap analysis, as the wealth pie grew and there was more to slice up, many people got roughly the same slice of the pie while others took a share that would embarrass a lion.

Between 1997 and 2007, the income of the top 0.1% grew by 82% to an average of £1.179 million annually; the top 0.5% saw an increase of 66.5% to an average of £452,000 annually; and the top 1%, which, of course, includes the previous two groups, saw their income rise by 60%, but their rise was only about a quarter of that of the 0.1%.

Meanwhile, between 1997 and 2007—the happy decade, as some in financial circles call it, before the crash of six years ago—the bottom 90%, which includes most of society, saw their wages rise by only 17%, a disproportionate slice of the economic pie. Another way of looking at it is that the fraction of pay the bottom 90% were getting in comparison with the top 1% had fallen by a fifth over that decade. As Professor Stiglitz says:

“A corporate CEO will not exert less effort to make the company work well simply because his take-home pay is $10 million a year rather than $12 million.”

The “Working for Poverty” report contains a series of nuggets and goes fearlessly into some thought-provoking factors.

[Mr McKenzie]

The hon. Gentleman has mentioned poverty and how to tackle it, which is welcome, but can he explain why the SNP Government in Edinburgh have taken £1.2 billion out of anti-poverty programmes since 2008?

[Mr MacNeil]

The hon. Gentleman will find that the efforts of the SNP have been very laudable in Scotland, with unemployment and youth unemployment lower than in the rest of the UK. The SNP Government have done all they can. He should realise that the Government in Edinburgh are in a financial straitjacket set by the philosophies of the Chancellor of the Exchequer and the Secretary of State for Work and Pensions in London. If the hon. Gentleman really wanted to tackle such issues, he would free himself from that straitjacket, and the SNP or whichever party was in government in Edinburgh would be fully accountable, rather than held within the straitjacket of another Government’s philosophy with which we disagree. Does he want to intervene again?

[Mr McKenzie]

indicated dissent.

[Mr MacNeil]

No, the hon. Gentleman is very happy.

Housing Benefit (Under-occupancy Penalty)

Debate between Angus Brendan MacNeil and Iain McKenzie

Wednesday 27th February 2013 Commons Chamber

[Mr Iain McKenzie (Inverclyde) (Lab)]

I welcome this debate. Unjust, unfair and unnecessary are the words to describe this tax. Households in my constituency will suffer dramatically as a direct result of the introduction of this tax. Indeed, families throughout Scotland and the United Kingdom will suffer the consequences of this tax. In Scotland, we are told that a total of 94,000 tenants living in the social rented sector are considered to be under-occupying their homes. We are told that a total of 75,000-plus tenants are under-occupying by only one bedroom.

With still unacceptable levels of unemployment and soaring energy and fuel prices, this measure brings nothing but further bad news for the struggling households across Scotland and the UK. Specialist bodies, including Citizens Advice and Shelter, have already warned that 40,000 households in Scotland alone are likely to run up arrears, with research suggesting that up to 10,000 households could face homelessness. That is on top of tackling the homeless problem we already have in Scotland. The prospect of homelessness is a reflection of the direction in which the Government are taking the country.

The bedroom tax is neither a cost-cutting exercise by the Government nor about introducing fair reform to the welfare state; it is nothing more than a tax on the poor and the most vulnerable in communities across the country. Of the 94,000-plus Scots who will be affected by the tax, it is estimated that about 23,000 have a disabled household member, with up to 16,000 households already having some form of aid or necessary adaption in place.

Constituents have approached me as they have become aware of how this unfair tax will affect their quality of life. I will give one example, although I could give many others. One lady came to me who previously had shared a home with her daughter. Her daughter has moved on, however, having found employment in another part of the country. The lady has a two-bedroom apartment, but now has one spare room. She has lived in the apartment for more than 20 years. She feels safe there and has good neighbours, but is now scared she will have to move and feels unsettled and frightened at the prospect of being moved across the constituency.

My constituent asked me, “Where can I go?” Down-sizing is not an option for her, because in my constituency there is not much one-bedroom accommodation. It is so limited, in fact, that she would be in her 80s before she would be offered one-bedroom accommodation, if she was lucky. Indeed, there is a lack of family accommodation in my constituency, too, so we really need to address the lack of housing and the building of new housing in and around Inverclyde. She wonders, if she were to move to the private sector, whether she would end up in a house of multiple occupancy, where we see that the private sector’s reference to efficiency involves merely pushing people into rooms with shared facilities.

By introducing this tax, the Government will do nothing more than cement their unfair and unjust attack on those who need our help the most. I support today’s motion, which calls on them to abandon this unfair, unjust and unnecessary tax, and I add my voice to the list of many here and beyond this place calling on the Government urgently to change course before these reforms hit our constituents hard. I also call on the Scottish Government to act to alleviate the burden of the tax on the people of Scotland. Across Scotland, local authorities already suffering as a direct result of severe cuts to their budgets will find it impossible to minimise the impact of the bedroom tax on many of our constituents and communities.

[Mr MacNeil]

Is not one of the most important things that local councils could do perhaps to reclassify bedrooms that could be used for other purposes and are no longer bedrooms?

[Mr McKenzie]

That is an option, but as I have said, the difficulty in my constituency is that we have limited accommodation, and the reclassification of bedrooms is not an option there.

I have been working with many agencies in my constituency that have been offering advice to those who think they will be affected by the tax. We have been holding events and information evenings, and people are frightened that they will fall foul of this tax and lose their homes. The Scottish Government could provide more guidance and help to local authorities about how to cope with the impact we know is coming. The bedroom tax is not a Westminster attack on Scotland alone. As we have heard, it is an attack on many constituencies across the UK, and I join others in calling on the Government to abandon this unjust, unfair and very unnecessary tax.

Welfare Benefits Up-rating Bill

Debate between Angus Brendan MacNeil and Iain McKenzie

Tuesday 8th January 2013 Commons Chamber

[Mr Iain McKenzie (Inverclyde) (Lab)]

The Chancellor intends to take a further £6.7 billion from benefits and tax credits over the next four years by capping the increase in them at 1%. That is a real-terms cut and an additional squeeze on families, because of the Chancellor’s failure to create growth in our economy, and the delivery instead of a double-dip recession. The Government told us that they would bring down borrowing, but they are now borrowing an £212 billion more than planned. The Chancellor claims that he is cracking down on a benefits culture, but hard-working lower and middle-income working families are those hit hardest by the Bill. Many working families need tax credits and benefits to top up their incomes, as without them work really would not pay. Just 23% of the savings come from jobseeker’s allowance, employment and support allowance, and income support—the principal out-of-work benefits. The rest comes from tax credits such as maternity pay, sick pay and housing benefit, all of which are claimed by working people.

Some 60% of people affected by the changes to tax credits and benefits are in work, and one-earner working families could lose as much as £534 per year at a time when more than 6 million people in working households are already in poverty. Levels of long-term unemployment are worryingly high, because the Government have failed to kick-start the economy and their Work programme has failed. Even excluding the 60% of working people affected by the changes, this is hardly the time to start picking on the unemployed. The Government are always prepared to talk about skivers when unemployment is high and they are worried about costs, but never want to do so when job vacancies are relatively numerous and unemployment is low. Surely, if the Government wanted to inconvenience so-called skivers, this is not the time to target them, when large numbers of people are without work and reliant on benefits.

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

Does the hon. Gentleman agree that the reform will make it more difficult to kick-start the economy? It will remove millions if not billions of pounds from communities up and down the UK, making it harder for people to spend and therefore kick-start the economy.

[Mr McKenzie]

I could not agree more with the hon. Gentleman. The Bill will take many millions out of local economies and have a double kick on the downturn.

Incredibly, the Government take from struggling households and give to millionaires. As I have said, at the same time as the Government are giving tax cuts to millionaires—as we have heard, some cuts are in the region of more than £2,000 per week—the Bill effectively means a permanent reduction in benefits, which could have a devastating effect when a proper safety net is desperately needed by millions of the most vulnerable people in Britain.

It is highly likely that this regressive change will lead to an increase in poverty, especially for those who are already facing a perfect storm of cuts to public services and rising prices. Clearly, the Bill is an attack on hard-working families, who are paying the price for the Government’s economic failure. It is without doubt an attack on striving families. In my Inverclyde constituency, 6,300 families receive working tax credit. They are being asked to pay the price for the Government’s failure, while millionaires—believe it or not—get a tax cut.

In Inverclyde, the number of unemployment claimants means that 15 people chase every vacancy. The Government would suggest they use the Work programme. Where can I start with that? My constituents never hear from the Government where they can start work. The Work programme has delivered less than 1% in my area, which is a disgraceful and pitiful success rate.

The best way to reduce the cost of welfare is to get people back into work. The truth is that the Government’s failure on the economy is pushing the dole bill through the roof. That is why Labour propose real jobs for those who have been out of work for two years or more. Scotland stands to gain most from the introduction of the compulsory jobs guarantee. Long-term unemployment has been rising faster in Scotland than in any other part of the UK.

I shall conclude, because other hon. Members wish to speak in the debate. The welfare bill is going up under this Government—it is a staggering £13.6 billion higher than forecast—because they are failing to get Britain back to work. The Government need to practise fairness, but the Bill fails on fairness and on the economic tests, which is why I will support the amendment.