Fuel Prices

George Freeman Excerpts

Thursday 13th September 2012 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

I shall follow your strictures, Madam Deputy Speaker, by keeping my foot to the pedal and not taking interventions.

I congratulate my hon. Friend the Member for Harlow (Robert Halfon) on his dogged, determined and diligent campaigning on social justice issues. Harlow is lucky to have him, and so are we in this House. This is a key issue because it goes to the heart of the cost of living, it undermines growth and economic recovery, and it raises important issues to do with market failure and regulation. I welcome the news that the review will look into the lack of competition at the pumps and strongly support my hon. Friend’s call for an investigation into the oil market.

I want to focus my comments on the pressures facing my constituents and the rural economy generally. Some garages in Mid Norfolk are currently charging £1.40 for fuel, and in the past that has risen to £1.45. The cheapest fuel in Britain today is £1.32 and the average is £1.38. Rural communities are paying more for their fuel. As others have said more eloquently, rural communities are dependent on cars for travel; there is little or no alternative. A car is not a luxury. Many of my constituents, whose average income is £18,000, have to run two cars to maintain a family. This affects the whole community—not only families and commuters but pensioners, those who depend on public transport and have to recoup the cost, and the public sector. As my hon. Friend said, this goes to the heart of social justice in serving the most vulnerable in rural and marginal areas.

Inflation is another factor. The market is not working, and that is deeply inflationary. The rural economy, particularly food and farming—our biggest manufacturing sector—is being damaged, and that is hugely significant in terms of our economic recovery. I draw Members’ attention to the Norfolk food and farming festival that is taking place here today. For anyone who has not had a chance to pop over and celebrate our produce, I ask them please to do so.

Recent data show that when the last fuel rise took place, traffic levels generally fell by 1% while in rural areas they fell by 5%. That highlights the degree to which rural areas are particularly sensitive to, and dependent on, fuel prices. There is nothing progressive socially about condemning poor families to live in isolated rural communities unable to play their part in society, and nothing progressive economically about penalising the car usage of those in rural and marginal areas. The rural economy, particularly in East Anglia, has the opportunity to drive and lead a more sustainable model of economic growth, with small businesses back in the countryside and less commuting, but that will not happen unless we support the oil of the economy, which is fuel.

I welcome the many measures that the Government have taken. They have frozen fuel duty, invested more than £4.5 billion in relief and petrol is now 10p cheaper, saving families more than £159 on average every year. I also welcome the fair fuel stabiliser. There are no simple answers. The truth is that the previous Government bequeathed us a horrible legacy of debt and a dependency on the fuel levy, and pennies at the pump in relief cost the Treasury billions, which undermines our effort on the deficit and puts at risk our low interest rates.

I hope that the Minister will acknowledge the real impact of this pernicious tax on the most vulnerable, particularly in rural and isolated areas; explore all and any options for targeting relief at those who need it most; take this opportunity to confirm the excellent initiative on the fair fuel stabiliser; and put the Government’s and his formidable political weight behind this call for an inquiry into the serious allegations of market rigging that have been highlighted, commendably, by my hon. Friend.