Rail Investment

Debate between Justine Greening and Brian H. Donohoe

Monday 16th July 2012 Commons Chamber

[Justine Greening]

My hon. Friend is right to raise the issue of capacity in London, particularly on his line, which I know local MPs have had real concerns about. We are looking to work closely with operators such as Transport for London to see what we can do together to improve those services over time. As I said earlier, 120,000 more people are catered for in these plans, which we have worked up very carefully. I think that it is very good news for commuters in London.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

I welcome the statement, if it is not in fact one about jam tomorrow. In those circumstances, can the Secretary of State give some indication of what additional resources will be put into the railway system this side of the general election and, in particular, how much extra will be paid to the Scottish Parliament?

Oral Answers to Questions

Debate between Justine Greening and Brian H. Donohoe

Thursday 19th April 2012 Commons Chamber

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

7. What recent discussions she has had with the Chancellor of the Exchequer on the cost of fuel.

[The Secretary of State for Transport (Justine Greening)]

I have regular meetings with ministerial colleagues on a range of economic issues. The Government are very aware of the impact that high fuel prices have on people who rely on their cars. In the Budget last year, the Chancellor cut fuel duty by 1p per litre and it is now 10p per litre lower than it would have been under the previous Government’s plans. Between 2011 and 2013, as a result of that change, the Government will put £4.5 billion back into the pockets of motorists.

[Mr Donohoe]

I should say that I thank the Secretary of State for that answer, but the problem is that the tax on fuel is not just the excise. There is also a thing called VAT which has not been taken into account in the equation. In her regular meetings with the Chancellor, will the Secretary of State suggest to him that they change the formula for the price of fuel, given that VAT plays a fairly significant part in that and the problem is now at a critical stage in my constituency? People are writing to me to say that they can no longer travel to work and that they are considering giving up their employment.

[Justine Greening]

We want motoring to remain affordable and, in fact, this Government are working very hard to ensure that that remains the case. We must also ensure that we take the decisions that can get our public finances back into order. We must do that if we are to continue to be able to invest in infrastructure such as transport. One needs only to come to Transport questions to see how important the issue is to many constituencies and communities, so I can assure the hon. Gentleman that we are trying to strike the right balance. We have taken action as a Government and will continue to review the situation.

High-speed Rail

Debate between Justine Greening and Brian H. Donohoe

Tuesday 10th January 2012 Commons Chamber

[Justine Greening]

No, I do not. The fact the people rightly complain when they get delayed on a train and stuck in traffic shows intuitively that people place a huge value on their time, and rightly so. We use robust methods to value time in the business case, and they are absolutely correct.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

Timetables are important to railways. When does the Secretary of State expect to see the first high-speed train into Glasgow Central station running on high-speed rails?

[Justine Greening]

In theory it should be in 2026, when the high-speed line from London to Birmingham is complete and trains will continue up the west coast main line, and no doubt arrive in Glasgow. I know that the hon. Gentleman’s underlying question was when the high-speed network will make it up to Scotland, and as I said on a number of occasions during the statement, I am very happy, indeed keen, to talk to the Scottish Government about their proposals for that in the future. In the meantime, the good news today is that we are getting on with phases 1 and 2. That has to happen in order for his desire to be fulfilled as well.

Road Fuel Duties

Debate between Justine Greening and Brian H. Donohoe

Tuesday 13th September 2011 Westminster Hall

[The Economic Secretary to the Treasury (Justine Greening)]

It is a pleasure to see you in the Chair, Mr Dobbin, into which you seamlessly moved during the course of the debate. First, let me congratulate the hon. Member for Central Ayrshire (Mr Donohoe) on securing the debate. As the shadow Minister, the hon. Member for Bristol East (Kerry McCarthy) said, the House has had a number of opportunities to debate the pressures that the high cost of petrol puts on individuals, families and businesses. The Government continue to view the issue as incredibly important, and the hon. Member for Central Ayrshire was right to raise it. In the time that remains, I will do my best to respond to the points that he raised, and those raised by my hon. Friends. I also hope to provide an update on some of the questions raised about the rural fuel duty discount.

Even though average pump prices fell slightly over the summer, there is little doubt that the cost of fuel remains a difficult issue and concerns many families and businesses across the country. The Government have recognised that for some time, and as hon. Members will know, in the Budget we announced a second rise in the personal tax allowance that aimed to take more people out of income tax altogether. In total, that benefited about 23 million or 24 million people who pay the lower rate of tax on their household income. The Government have worked hard to recognise and tackle the cost of living.

There were extensive debates in the House and the Finance Bill Committee about the cost of fuel and the Government’s plans to support motorists. I welcome the opportunity to revisit those issues, but before I address some of the points raised today I want to explain why the Government acted as they did in the Budget, and set out why the approach proposed by the Labour party is not only illegal but unworkable. Perhaps if I explain to the Chamber why I believe that to be the case, we can put the issue and the alternative proposals to bed once and for all, and perhaps I can save Labour Members from continuing with the hole they are digging in pressing for them, although that is obviously up to them.

The coalition Government recognise that motoring is an essential part of everyday life for many households and businesses. The cost of fuel affects us all and the Government recognise that the rising price of petrol has become an increasingly significant part of day-to-day spending. We know that high oil prices are causing real difficulties in trying to ensure that motoring remains affordable, and it is important that when shocks such as the steep rise in the price of oil occur, a responsible Government are able to listen, consider and respond.

The hon. Member for Bristol East mentioned the fuel duty escalator. That was introduced in the 2009 Budget by the previous Government and involved seven increases in fuel duty. The previous Government had planned for an above-inflation increase at the start of April—that was the position we inherited, and we had to make a decision about whether to go ahead with the pre-planned rises left by the previous Government. Had we gone ahead with those rises, pump prices would, on average, have been 6p per litre higher than they are currently. I take on board many of the points raised by the hon. Member for Central Ayrshire about the impact of high petrol prices, but he must recognise that had we done nothing, that extra 6p would only have created more pain for motorists and businesses. On top of that—let us be clear—the plans that we inherited would have introduced further above-inflation increases in duty in 2012, 2013 and 2014. On taking office, we had to come up with a plan to support motorists, because the previous Government did not have one—it was the exact opposite.

From the start, the coalition Government have been actively looking at how we can ease the burden on motorists, although that is incredibly challenging given the constrained and difficult fiscal situation that we inherited. One of the first things we did, as the hon. Member for Coventry South (Mr Cunningham) mentioned, was ask the Office for Budget Responsibility to look at how high oil prices flow through to impact on the economy and try to understand that. As the hon. Gentleman pointed out, we were concerned to understand the impact on businesses and jobs. That was part of our work in looking at how we could construct a fair fuel stabiliser, which I will come to in a moment.

As part of the Budget, we finally announced our plan to ease the burden on motorists with a £1.9 billion package. The Government listened to hard-pressed motorists and businesses and acted. What did we do? We acted by cutting fuel duty. The hon. Member for Central Ayrshire clearly wants us to go further in cutting fuel duty, but he should at least be able to welcome the fact that we have already cut fuel duty by 1p a litre from 6 pm on Budget day. We acted by cancelling the previous Government’s plan for a fuel duty escalator for the rest of the Parliament. We acted by introducing a fair fuel stabiliser that will better share the burden of high oil prices between motorists and oil companies, so fuel duty will increase by inflation only when oil prices are high.

[Mr Donohoe]

Does the Minister accept that there is a correlation between the duty and the increase in VAT? Indeed, the cost of the VAT increase to the motorist was 2.8p a litre. If the Government are to do anything to redress the imbalance, it is that amount, not the 1p that she talks of, that should be taken from the price, because the consequence of increasing VAT to 20% has been an increase in the price to the motorist of 2.8p.

[Justine Greening]

I take the hon. Gentleman’s point. The issue was raised of VAT being applied to the total price of fuel, including fuel duty. For clarification, that is in line with EU rules. That is the reason why that approach is taken. However, I will say two things to the hon. Gentleman. First, we have introduced a £1.9 billion package to support motorists. Secondly, I have heard a number of Opposition Members bemoan the increase in VAT, but they have had several chances in the Division Lobby to vote against that VAT rise and they have not taken them. I would be happy for any hon. Member who voted against the VAT rise to intervene on me now, but having checked Hansard—[Interruption.] Let me be clear that I am not referring to the Scottish National party contribution to this debate, because of course it called the vote. I think that both I and the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), who represents the SNP, would recognise that the Labour party abstained in that vote and did nothing, despite its words. It never followed them up with action. Those Members owe it to their communities to be a little more frank about the fact that they waved through the VAT increase themselves.