Autumn Statement

Robert Halfon Excerpts

Wednesday 5th December 2012 Commons Chamber

[Mr Osborne]

First, of course any young person who cannot get a job is a matter of regret, but youth unemployment has fallen this year. Our welfare to work schemes are helping to get people back to work, and our work experience scheme in particular is doing a great job of getting people into work, so I would ask those young people to go to their jobcentre and see the schemes that are available. As I have said, 1.2 million jobs have been created in the private sector over the past couple of years, in what are very difficult circumstances. I hope that, with the measures we announced today, business will be able to create some more jobs.

[Robert Halfon (Harlow) (Con)]

On behalf of my colleagues and FairFuelUK, I thank my right hon. Friend for putting fuel back into the fuel tanks of white-van Conservatives across the country. Can he confirm that the scrapping of the 3p petrol rise not only for three months, but permanently, as he has said today, will mean the average Harlow motorist will be better off by £80 to £100 next year?

[Mr Osborne]

As I said in my statement, I congratulate my hon. Friend on speaking for motorists and families across the country against Labour’s fuel tax rises. He speaks for Harlow man and woman, and I am glad that, as a result of his campaigning and the difficult decisions we have taken elsewhere to control public spending, we have been able to cancel altogether that fuel duty rise due for January.

Fuel Duty

Robert Halfon Excerpts

Monday 12th November 2012 Commons Chamber

[Cathy Jamieson]

No. I have given way already and I want to make some progress. It is important that people hear why we are proposing the motion tonight.

Almost 20% of FSB members identified fuel costs as a barrier to growth. Not only those organisations but—[Interruption.] Hon. Members on the Government Benches—those who tend to think they are the champions of industry—might want to listen to the voice of industry. The Petrol Retailers Association has reminded us of the impact of VAT and the impact on the price of fuel if the 3p per litre increase goes ahead in January.

Those are the voices of industry, but it is not just industry that will be affected:

“We must remember that motorists are not a lobby group. They are mums driving to school, children on buses and pensioners hit by inflation. When the cost of road haulage rises, the price of everything else rises too.”—[Official Report, 23 May 2012; Vol. 545, c. 140WH.]

Credit where it is due—those are not my words; they are the words of the hon. Member for Harlow (Robert Halfon) in a Westminster Hall debate in May 2012.

[Robert Halfon (Harlow) (Con)]

I am hugely grateful to the hon. Lady for giving way, but my constituents in Harlow will have much more trust in the Chancellor, who cut fuel duty last year, which the Opposition opposed, and provided two fuel duty freezes, than in the political opportunism that the hon. Lady is proposing today.

[Cathy Jamieson]

I am genuinely sorry that the hon. Gentleman adopts that tone because I know that he has worked determinedly to raise the issue. I am sure that his constituents will want to know exactly what the Chancellor is going to do. Our shadow Chancellor has said what he thinks, whereas the Chancellor seems to be debating by a nod and a wink, and nothing is determined.

--- 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.

[Dr Julian Lewis (New Forest East) (Con)]

Will my hon. Friend accept the assurance, as least from Government Members, that if the rise does not go ahead it will have far more to do with his campaign than anything the Opposition have done?

--- Later in debate ---

[Robert Halfon]

I am hugely grateful to my hon. Friend and, I have to say, to many colleagues in this House, some of whom are on the Opposition Benches. My hon. Friend the Member for Cleethorpes (Martin Vickers) has done a huge amount of work behind the scenes, as have many other colleagues. We will have to wait and see what the Government say in the autumn statement, but I am happy to support them because I believe that they are in serious listening mode.

I have three concerns about the Labour motion. First, it is a non-binding motion; it is just gesture politics. My constituents care about the price of petrol, not the politics. Secondly, the only way that we can stop the petrol tax is through the autumn statement on 5 December. That is how it has been done in the past few years. Yes, I am asking the Treasury for action on fuel, but what my constituents want is action on the policy—the substance. My constituents will not be looking at what happens today; they will be looking when the Chancellor makes his speech on 5 December. That is when we hope the Chancellor will listen to British motorists.

Thirdly, we need a long-term settlement for cheaper petrol. My right hon. Friend the Member for Wokingham is exactly right. The motion proposes a three-month oil rush, which would lead to motorists being hammered with a 7p tax rise in April 2013. The only way to get the long-term settlement is to work constructively with the Government and look at reform and how we can permanently lower fuel duty.

[David Simpson (Upper Bann) (DUP)]

Will the hon. Gentleman give way?

[Robert Halfon]

I may if I have time, but I will continue for the moment.

I believe that the Government are in strong listening mode, and I would not go into their Lobby tonight if I did not believe that to be the case. If we look at the Treasury amendment carefully, we see that it does not rule out stopping the planned rise in January. That is a significant move from a few months ago, when the Government said that the rise would go ahead. As I said, the Treasury team have done more to cut fuel prices than Labour did in a decade. We do not have to work at Bletchley Park to read the signals the Treasury is sending about helping with the cost of living—it is written in black and white.

I will continue to ask the Government to lower fuel duty, but I want to end where I started: this is a matter of social justice. I have stuck my head above the parapet and tabled several motions urging the Government to cut fuel duty. Inevitably, the focus in the media today has been on the economics, but this is about social justice. The average person in Harlow spends £1,700 a year filling up the family car—one tenth of their income. In essence, those families are facing fuel poverty. According to data published last year, three quarters of bankruptcies in the transport sector were the result of fuel costs. High fuel prices are adding to Britain’s dole queues. Furthermore, as the AA shows, families are choosing between buying food and filling up at the pumps.

I urge the Chancellor and the Treasury to listen to the thousands of Harlow residents who have written to me, and take action. Given everything the Treasury team have done in the past two years to cut fuel duty and given that the Chancellor’s amendment leaves the door open to cuts in fuel duty, we should at least wait for the autumn statement before casting judgment. That is why I will be proud to vote with the Government tonight, and I urge the House to vote for the amendment. I would not support the Government if I did not believe they had genuinely taken this on board. I hope they do not let us down.

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[Pamela Nash (Airdrie and Shotts) (Lab)]

I am disappointed that we have been forced to call this debate this evening. It shows just how out of touch with the public this Government are that they have yet to postpone January’s 3p increase in fuel tax. Dropping hints about the autumn statement is just not good enough at this stage.

I am sure that the high volume of correspondence I have received on fuel prices is replicated among Members across the Chamber, as fuel prices are now cutting into the quality of life of each of our constituents. In particular, I have been hearing from those who live in the rural and farming areas of my constituency. Rural sparsity, combined with the ongoing decline in rural bus services and a loss of local services, means that a car is a necessity in many rural areas, not a luxury. The Scottish Labour party has been calling for the re-regulation of bus services, as the Scottish Government’s policies have resulted in essential routes being unsubsidised and in many cases scrapped. Although voluntary projects such as the “Getting Better Together” project, in Shotts, and our regional transport partnership, Strathclyde Partnership for Transport, are working hard to fill the gaps, it will take direct action from the Government—to start with, by regulating our bus services—to fix this problem across the board.

The point is that the public transport infrastructure at this point is not at a level that could possibly allow the majority of people in rural communities to give up their cars without risking their quality of life and becoming increasingly isolated. The situation is becoming impossible for those who are having to decide to give up their cars, when there are little, if any, alternative forms of transport where they live. Every rise in fuel costs places a disproportionate burden on our rural communities, and now they feel that enough is enough.

It makes no sense to the Opposition that the Government, who postponed the fuel tax rise in August, seem to be ploughing ahead with this rise. Although we are cautiously coming out of a double-dip recession, most people have yet to feel this in their pockets. They are not yet seeing the difference in their bank statements at the end of the month. Incomes are still frozen, and the cost of essential bills continues to rocket. Those living in our towns are not escaping the assault on their standard of living, either. Increasingly, many have had to make difficult choices every day about using their car or paying other important bills.

Chapelhall, where I live, is home to many commuters. Commuters live where they can access more affordable housing, and homes are cheaper the further away they are from public transport links. Commuters also have to travel further to find jobs, as the employment market has yet to recover fully. This means that millions of commuters across the UK depend entirely on their cars to access work. Rocketing fuel costs are making work pay less.

I am particularly concerned about those of my constituents living with a disability that makes it difficult to travel. Labour introduced Motability way back in the 1970s to ensure that those living with a disability who require a car in order to travel can afford it. However, the costs are mounting for those running a car on Motability, and I have yet to hear the Government announce an increase in disability living allowance alongside the planned increase in fuel tax in order to plug the gaps caused by these additional costs. Some of the most vulnerable in our society will have to limit their car use, to the extent that it will jeopardise their chances of having a decent quality of life.

[Robert Halfon]

I am grateful to the hon. Lady for giving way, and for her speech. Given what she has just said, does she not recognise that the Government increased benefits by 5% and still froze fuel duty this year?

[Pamela Nash]

I thank the hon. Gentleman for his intervention, but the Government have taken other measures such as increasing VAT and cutting other benefits, which have had an adverse effect on the people I am speaking about. The fact that the Office of Fair Trading is conducting an inquiry into fuel prices reflects the public’s deep concern about the cost of fuel.

In press reports today, Government Back Benchers referred repeatedly to this debate as the cost of living debate; I have not heard it called the fuel duty debate at all. In his opening speech, the Minister seemed to talk about everything but fuel duty. It seems that Government Members want to talk about anything other than fuel tonight, because they know that the country is not on their side. I expected more Tory Back Benchers to be in the Chamber this evening trying to explain to their constituents why they are voting against our motion on fuel duty. I suspect that many of them are watching ITV to see their colleague in the “bug burial” in the jungle.

It is clear to Opposition Members, and to the thousands of constituents who have written to us about fuel duty in recent weeks and months, that the Government will be out of touch with the people of this country, who have been drastically affected by the increased cost of living, if they do not announce this evening the postponement of January’s fuel tax increase.

--- Later in debate ---

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

It is an honour to follow the hon. Member for Witham (Priti Patel) and her characteristically warm-hearted contribution to the debate.

This has been an important and much-needed debate. Members on both sides of the House have shown the strength of feeling that is out there on our roads against the extra burden that this fuel duty rise would place on families and businesses, at a time when prices are still rising faster than wages. Households that are already suffering from the Government’s failed economic policies cannot afford to be hit by an extra 3p per litre, especially with fuel duty already 15p more per litre than it was at the general election.

My hon. Friend the Member for Ynys Môn (Albert Owen) well summed up as hypothetical nonsense Conservative Members’ attempts to distract from their failure to support the motion by suggesting that were Labour in government the fuel duty might be 10p per litre more. Labour Members have been calling for a temporary VAT cut to take 3p per litre off the price of fuel immediately, but with the Government refusing to act, we are now calling on Members to support the motion to delay this extra tax that will hit families and businesses, slowing growth even further.

A clampdown on tax avoidance by employment agencies and umbrella companies would raise more than enough money to delay this rise until April. It would also bring an end to the exploitation of workers under those schemes, who are often left worse off as agencies pocket the extra profit from avoiding tax, leaving employees at risk of being pursued for that tax in later years.

There have been many excellent contributions to this debate, as well as some not so excellent. Many Members, especially those from rural communities, have raised concerns about the impact that the increase in fuel duty will have on them, and I mention in particular my hon. Friends the Members for Inverclyde (Mr McKenzie) and for Airdrie and Shotts (Pamela Nash). The hon. Member for Waveney (Peter Aldous) made a well-considered and reasonable contribution to the debate, but unfortunately failed to explain why he will not support the motion tonight. The hon. Member for Harlow (Robert Halfon) has long campaigned on this issue. He concluded his characteristically well-considered speech by saying that he is proud to support the Government tonight as the Chancellor is in “serious listening mode”, but that he hopes they will not let us down. Well, many of our constituents are sitting at home tonight, hoping that the Government will not let them down. Our economy has just emerged from a double-dip recession—a recession, I must add, that was made in Downing street. That emergence is welcome but there is no room for complacency. Our recovery is still fragile and people are feeling the struggle.

In government, Labour either cut, froze or delayed planned fuel duty rises 13 times because we thought it was appropriate, and did so twice following the financial crisis because we recognised that in a fragile economic environment, a postponement would provide practical help to ordinary people and businesses feeling the squeeze. The Government claim that they are in strong “listening mode”—Members on the Government Benches certainly seem to have been given that reassurance.

[Robert Halfon]

I am grateful to the hon. Lady for her gracious remarks, but why did she and her colleagues vote against the Government when they cut fuel duty last year?

[Catherine McKinnell]

How will Government Members explain to their constituents why they have not voted for a freeze in fuel duty tonight, when the overwhelming consensus is that that is much needed by families and businesses up and down the country?

Let us hope the Chancellor is listening to the debate. The price of a litre of petrol is now £1.36, 5p more than when the Chancellor agreed to defer the duty increase in August and 15p more than at the general election. The tax on a tank of petrol in 2010 was £37.60, but it has now risen to £40.30. If we do not delay the 3p increase tonight—if hon. Members do not vote to freeze it—it will go up again in January to £42.20. A family could spend £200 a year more on fuel tax in 2013 than they spent in 2010. Families cannot afford that £200. The increase in VAT has cost a family with children £450 each year, pensioners are facing extra burdens after the granny tax, cuts in child tax credits will cost some families up to £545 a year, and cuts to working tax credits mean that those on low incomes will lose up to £3,870 a year if they cannot increase their hours at work. That is the impact of this Government’s polices on family budgets.

Small businesses, too, are struggling. The Government’s flagship project Merlin agreement with the banks has flopped and failed, and much-needed cash is simply not getting through to help businesses to expand and create jobs. Businesses need a break, and a freeze in fuel duty would provide it. That is why the Opposition have tabled the motion. We want to give the Government and Government Back Benchers the chance to join us and vote in favour of easing the burden for people up and down the country who will be hit by the fuel duty increase.

It is clear how the Opposition proposal could be paid for. The Government need to take urgent action to crack down on tax avoidance schemes by employment agencies and umbrella companies that classify part of their employees’ pay as a reimbursement for travel and subsistence expenses and claim back the tax relief. In most cases, employees do not see even a fraction of the extra profits that companies make as a result. In some cases, workers are not even aware that their pay is being manipulated in that way, but if they end up with too few national insurance contributions, they lose out. They could even be liable to repay the tax and national insurance and end up personally out of pocket if Her Majesty’s Revenue and Customs successfully challenges the scheme. HMRC’s figures forecast that the tax loss from such schemes in 2012-13 will be £650 million, but more recent estimates put the figure at more like £1 billion, as more companies jump on the bandwagon. Even a conservative estimate of what could be raised from clamping down on that one area of tax avoidance would more than cover the £350 million needed to pay for the fuel duty delay.

The Opposition understand that the rules exist, but enforcement has been lacking. The Government’s cuts to HMRC—an additional 10,000 jobs are set to be lost by 2015, and £2.1 billion has been taken out of its budget—have made the job even harder. It is essential that we take action. Companies that play fair and pay their tax properly and transparently are disadvantaged by those that cheat the system. The tax that should be paid and is avoided, or in some cases illegally evaded, is sorely needed to support our struggling economy.

The Government have lots of tough talk on tax avoidance but very little action. The Opposition motion calls on the Government to get a grip and clamp down on tax avoidance and to use the money where it is needed. Government Members know that that is what their constituents want and need. Nods and winks from the Chancellor will not fill their petrol tanks. Without a proper commitment from him, Members should support the motion tonight. If MPs unite today and vote for the motion, the Prime Minister and the Chancellor will have no choice but to see sense and give that reassurance to families, motorists and businesses that we are on their side.

Beer Duty Escalator

Robert Halfon Excerpts

Thursday 1st November 2012 Commons Chamber

[Andrew Griffiths]

I agree completely with my hon. Friend. The point about an escalator is that we stop when we get to the top. We have reached the top of the escalator and we are in danger of going off the edge of a cliff. That is why we must do something about the beer duty escalator.

[Robert Halfon (Harlow) (Con)]

I congratulate my hon. Friend on securing this debate on the cost of living. I recently attended the Campaign for Real Ale’s Harlow beer festival, which was supported by small independent breweries. Does he accept that the big breweries have a role to play, and that we need evidence to understand whether they are partly responsible for keeping beer prices high?

[Andrew Griffiths]

I commend my hon. Friend for supporting CAMRA, but I do not think there are such things as a bad brewer and a good brewer. We need large breweries just as we need micro-breweries, because we need a mixed economy. The problem is that all brewers are being hammered by the escalator.

The figures speak for themselves. In the last quarter alone, beer sales reduced by 5.6%, which is absolutely unsustainable. The Economic Secretary knows the figures better than I do, and he will know that the Treasury’s own projections for the next two years demonstrate clearly that the beer duty escalator will raise absolutely no money. Instead, it will hit the brewing industry and cost jobs and production.

Finance Bill

Robert Halfon Excerpts

Monday 2nd July 2012 Commons Chamber

[Miss Smith]

I share the concerns that many have raised about driving, the cost of living, and the challenges of running a business. Although the cost of fuelling a vehicle has recently eased as global oil prices have fallen, it is still a very important part of the overall cost of living. That is why the Government have announced that we will provide further support to motorists regarding the cost of fuel by deferring the 3p per litre duty increase that was planned for this August until January next year. That will mean that this Government will have kept fuel duty frozen for a total of 21 months since our decision in the Budget 2011 to cut fuel duty by 1p per litre.

[Robert Halfon (Harlow) (Con)]

I am grateful to the Government for moving on this issue, as will be many motorists across the country. Will my hon. Friend confirm that, because of what the Government have done, fuel duty will be 10p lower than it would have been if we had followed Labour’s plans?

[Miss Smith]

I shall certainly confirm that. It is testament to the repeated action that this Government have taken to support motorists that that is indeed the case.

--- Later in debate ---

[Miss Smith]

I shall say two things in response to that. First, as a result of all the actions that this Government have taken, including what we have had to do on VAT, the price of petrol and diesel at the pumps is still lower than it would have been under Labour—whose Members are, on the whole, absent today. Secondly, the decision that we are legislating for today combines our determination to help families with the necessity of keeping Britain safe in the global storm and with our credible plan to deal with the country’s debts.

[Robert Halfon]

Does my hon. Friend agree that the Opposition’s support for a cut in VAT is rather a misnomer, because not only would it cost £12 billion, but the vast majority of businesses who need to get their petrol prices down do not pay VAT?

--- Later in debate ---

[Cathy Jamieson]

I acknowledge that the hon. Member for Harlow (Robert Halfon), to whom the hon. Gentleman is referring, did a lot of work on the campaign. However, given the earlier suggestions that there was a lack of interest in this subject on the Opposition Benches because of the lack of numbers here tonight, I felt it important to lay out our case fully. I hear what the hon. Gentleman is saying, however, and I will bring my remarks to a conclusion.

I want to ask the Minister some specific questions. Now that the Treasury has had a week or so in which to do the number crunching—if it had not already done so—what areas of departmental underspend have now been identified to ensure that the decision to delay the August 2012 increase in fuel duty will be met in a fiscally neutral way? Will the Minister also tell us which Departments have, through budget exchange, already surrendered an underspend in advance of the end of this financial year, and which Departments are expected to have greater than originally forecast savings in departmental spending in 2012-13?

I do not have time to comment on the points that have been raised about biofuels. Perhaps I shall be able to do so in another debate. In conclusion, however, I should like to refer Members to new clause 9. We shall not be pressing it to a vote this evening, but it calls for a review of the relationship between fuel duty, other taxes charged on road fuels, and the cost of road fuel. It was made clear in the recent Westminster Hall debate that such a review might reflect the views not only of the Opposition but of many Government Members —I see some of them nodding—and I hope that the Government will be good enough to listen to that proposal, and to come forward with a plan to establish such a review.

[Robert Halfon]

I am grateful to have the opportunity to speak, and I support the Government’s new clause. I hugely welcome the support of my colleagues, particularly that of the hon. Member for Dundee East (Stewart Hosie), who did so much work with FairFuelUK and attended the Westminster Hall debate to which the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) referred.

The case for cheaper petrol is economic, social and moral. It is economic because the AA says that keeping 3p off fuel prices will pump £1.8 million into our economy every single day. That supports high street demand at a time when it is collapsing in Europe. It is social, because fuel duty is a tax on everything, and we should be honest about who is paying it. We talk about “motorists”, but they are not a special interest lobby group. As FairFuelUK and many hon. Members have shown, motorists are everyone: mums driving to school, children on the bus, pensioners hit by inflation. That is why this is an issue of social justice. The economy is important, but it is only half the argument.

The case is moral, too, because as I have set out in other debates, fuel duty is regressive. The Office for National Statistics said last year that it hits the poorest twice as hard as the richest. Fuel prices are now, in essence, a poverty trap, adding to our dole queues. The average motorist in my Harlow constituency pays £1,700 a year to fill up the family car—that is a huge amount and clearly unsustainable.

Opposition Members have spoken of a U-turn, but I would say that it is an L-turn, showing that the Government have listened, and I believe that the Government deserve huge credit for doing so. When I spoke to my constituents at the weekend, no one said that this was a U-turn or wondered when it was first mentioned or by what Minister when and why. Rather, they said thank you to the Government for listening to motorists.

The Chancellor, the Economic Secretary and her predecessor, who is now the Transport Secretary, have done more to cut fuel taxes in two years than the Opposition did in a decade. The 2011 Budget saw Labour’s rise cancelled and fuel duty cut by 1p, while in last year’s autumn statement Labour’s January rise was scrapped after the campaign by FairFuelUK and MPs. Then, last week, the Government delayed Labour’s August rise. This is a radical tax-cutting agenda, targeted in a way that helps the poor. It shows that the Government are on the side of the little guy, supporting aspiration and hard work.

I listened to the “Today” programme interview with the shadow Chancellor, and I say to the hon. Member for Kilmarnock and Loudoun that this is not a decision made in a day. I and many others have been to see Treasury Ministers over many weeks and have led delegations to see relevant Ministers. I knew that the Government were considering this issue for a long time.

[Cathy Jamieson]

I thank the hon. Gentleman for making those points. If those discussions were going on for that length of time, would he not have expected the Government to say how it was going to be paid for?

[Robert Halfon]

In the Westminster Hall debate, which the hon. Lady mentioned, the Economic Secretary did not give a view either way on the issue and said that the Government were looking at it. Ministers then came to the House for Treasury questions. What better way of informing us that they were going to stop the August rise?

Returning to the “Today” interview with the shadow Chancellor, he said that Labour had “acted” on petrol prices, but a House of Commons Library note says:

“From 2000 the Labour Government increased road fuel duties...In its 2009 Budget the Labour Government announced that in future years fuel duties should rise by 1p a litre above inflation.”

In the next Budget, they

“proposed that the escalator should apply at least until 2014/15”,

and that

“the increase set for 2010/11 would be phased in over the coming tax year in 3 stages...fuel prices continued to rise strongly, driven by this increase in duty rates”.

That is the record we inherited, and which we are now having to unwind.

[Sarah Newton]

Will my hon. Friend give way?

[Robert Halfon]

I apologise, but I cannot, as I have to allow time for the Minister to respond.

There are still problems: fuel is still at around £1.30 a litre, which is unsustainable. As the RAC has said, duty revenues are shrinking every year, as people are driven off the roads. We must stop seeing cars as a cash cow.

I accept that the Government can only do so much. We are always held hostage by the international oil price. As has been noted, however, pump prices are quick to rise, but it feels as though we need a court order to get them down. Evidence shows that from May to August last year, oil prices fell by 5.5%, but petrol and diesel stayed high, falling by just 1.5%.

The Office of Fair Trading has said it will not investigate the UK oil market. I am petitioning the Backbench Business Committee to table a motion so that Parliament can urge the OFT to investigate that market, which clearly looks uncompetitive and unfair to many people.

Finally, there is the problem of local variation in petrol prices, especially in rural areas, but also in towns like Harlow. Harlow residents often write to me, saying that fuel is 5p cheaper only a couple of miles down the road, and there is no explanation for it, other than a lack of competitiveness. Germany, Austria and America have initiated fuel price regulation to limit price rises. We should be doing the same thing.

In conclusion, the Chancellor and the Economic Secretary have given Harlow families and many millions of motorists across the country at least six months’ breathing room, and I welcome that. I urge the Government to look seriously at the long-term cost of fuel and petrol, and see what else they can do. I also urge them to put pressure on the OFT to do a market study. I will vote wholeheartedly for the Government’s new clause, and I urge the House to join me.

Oral Answers to Questions

Robert Halfon Excerpts

Tuesday 26th June 2012 Commons Chamber

[Danny Alexander]

By May 2010, the hon. Gentleman’s Labour Government had put in place plans to increase fuel duty by above the rate of inflation each and every year of this Parliament. He should be welcoming the fact that we are taking steps to support hard-pressed families and hard-pressed consumers across the country in the very difficult economic circumstances that we face.

[Robert Halfon (Harlow) (Con)]

Does my right hon. Friend agree that motorists across the country will welcome the cut in fuel tax announced for August and that it will greatly improve the performance of the economy? Does this not show that the Government are on the side of hard-pressed working people?

[Danny Alexander]

I agree entirely with my hon. Friend. I met representatives of the FairFuelUK campaign yesterday. We have a great deal of sympathy with its arguments, as well as with those made by families across this country, including in remote and rural areas. It is worth saying that thanks to the decisions this coalition Government have made not only is fuel tax 10p a litre lower than under Labour’s plans, but council tax is lower and income tax is lower. In the Budget in March we also saw the largest ever increase in the income tax personal allowance, all of which puts money back into the pockets of hard-pressed families.

Petrol and Diesel

Robert Halfon Excerpts

Wednesday 23rd May 2012 Westminster Hall

[Nadine Dorries (in the Chair)]

It is unusual to have this many Members present for a 30-minute debate. If everyone wants to make an intervention, Mr Halfon will not be able to speak. The Economic Secretary will have 10 minutes to wind up, and I ask Members to keep interventions to a minimum because Mr Halfon probably has a 20-minute speech.

[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.

[Several hon. Members]

rose—

[Robert Halfon]

I give way to my hon. Friend the Member for Newton Abbot (Anne Marie Morris).

[Anne Marie Morris (Newton Abbot) (Con)]

May I propose that my hon. Friend add a fourth suggestion to the list—that we consider a proper price stabilisation mechanism, rather than a fuel duty one? At the moment, the tax can go up, but it never comes down.

[Robert Halfon]

As so often, my hon. Friend has hit the nail on the head. We need a fair fuel stabiliser that looks at prices at the pump, so that when the international oil price goes up tax at the pump goes down. That really would be a fair fuel stabiliser.

[Guy Opperman (Hexham) (Con)]

I support my hon. Friend’s campaign. I represent the least densely populated constituency in England. In Northumberland, fuel is a key issue, as I am sure it is everywhere else. I suggest that there should be an Office of Fair Trading examination, much like those we have carried out so successfully in remote communities into other forms of heating and other oil.

[Robert Halfon]

I thank my hon. Friend for his remarks. That matter is an important part of my argument.

On the August rise, the Automobile Association says that a 3p rise in petrol prices will switch £1.8 million a day out of the economy and into petrol costs, draining money away from high streets. At the same time, a report by the respected Centre for Economics and Business Research shows that cutting duty by 2.5p would create 175,000 new jobs. The RAC Foundation and the Institute for Fiscal Studies—both very respected—show that revenues from motoring taxes are set to collapse by between £10 billion and £13 billion a year over the next decade, as people are driven off the roads by economising on fuel. That is why I urge the Government to think again.

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Gentleman on the very good campaign that he has carried out on this issue. We all appreciate it. With our fuel costs rising and it costing more to fill a car or heat a home than to buy groceries, does the hon. Gentleman feel that now is the time for a windfall tax on the oil companies that are making exorbitant profits?

[Robert Halfon]

Yes, and I thank the hon. Gentleman for his incredible support all through this argument. I recognise that there is no magic money tree, so to cut prices at the pump the Government need seriously to consider another windfall tax on the oil companies, not necessarily on North sea production but on the companies as a whole.

Not enough emphasis is put on my second point which, as my hon. Friend the Member for Hexham (Guy Opperman) says, is that we need competitiveness in the oil market. Not only the Government but businesses and the oil companies have a responsibility. There are four complaints. The first is that pump prices are always quick to rise, but that it feels as though a court order is needed to get them down. Evidence shows that from May to August 2011, oil prices fell by about 5.5%, adjusting for exchange rates, but petrol and diesel prices stayed high, falling by only 1.5%.

The second complaint—the debate comes in the wake of this—is about the OFT’s interim decision not to investigate the UK oil market, despite a dossier of evidence from Brian Madderson, who represents the UK’s independent forecourts, which shows that British motorists are being fleeced and that oil firms active in the UK are under formal investigation by the Federal Cartel Office in Germany as a result of similar complaints.

[Several hon. Members]

rose—

[Robert Halfon]

I shall give way to my hon. Friend the Member for Totnes (Dr Wollaston) and then to my hon. Friend the Member for Great Yarmouth (Brandon Lewis).

[Dr Sarah Wollaston (Totnes) (Con)]

I congratulate my hon. Friend on an excellent campaign. Does he agree that my constituents who live in the most rural areas face an additional penalty in that they pay much higher prices, and that prices can be many pence higher in garages only a few miles apart?

[Robert Halfon]

My hon. Friend is exactly right, and I am grateful for her support. People in rural areas face fuel deserts, in essence, because of the uncompetitive nature of the oil industry. People have to travel further, particularly in rural areas, to deal with the cost of fuel.

[Several hon. Members]

rose—

[Robert Halfon]

I promised my hon. Friend the Member for Great Yarmouth that I would allow him to intervene.

[Brandon Lewis (Great Yarmouth) (Con)]

I thank my hon. Friend for giving way so generously, in an excellent debate. Rural areas such as Norfolk are affected, but does he agree that it is not just about rural areas? Places that focus heavily on the tourism industry, such as Great Yarmouth and other coastal towns, are adversely affected if fewer people are able to afford to travel there, which has a knock-on effect on our economy.

[Robert Halfon]

My hon. Friend is exactly right, and that is why I am proposing some of these things today.

[Several hon. Members]

rose—

[Robert Halfon]

I will give way to my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) and then I will carry on a bit more.

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

Does my hon. Friend agree that a hidden consequence of all this is to be found in the voluntary sector? People who do things such as meals on wheels and those who are voluntary carers—the pillars of our society—are beginning to wonder whether it is all worth while.

[Robert Halfon]

I am a passionate believer in the big society because it is about people power, social capital and helping social entrepreneurs, and the price of petrol and diesel stops people in their charitable work and harms communities. My hon. Friend makes a powerful point.

This month, Germany decided to initiate fuel price regulation and to limit price rises. Austria implemented similar measures last year, and the AA has noted their impact in keeping prices down.

[Neil Parish (Tiverton and Honiton) (Con)]

Will my hon. Friend give way?

[Robert Halfon]

I will in a minute. Because of where they are sitting, I am concerned that two of my colleagues, including my hon. Friend the Member for Tiverton and Honiton (Neil Parish), have joined the other side—I hope not. The Office of Fair Trading has not investigated the UK oil market since 1998, despite the fact that British petrol and diesel prices are among the highest in Europe, so we need a proper investigation.

[Neil Parish]

My hon. Friend makes a great case for a reduction in petrol and diesel prices. Oil companies, I believe, take far too much. When crude oil prices go up, they immediately put up their prices, but when the crude prices come down they take for ever to bring their own down. We need a thorough investigation into the oil companies.

[Robert Halfon]

My hon. Friend is exactly right, which is why I am arguing that the Government should force the Office of Fair Trading to launch an investigation into the uncompetitive nature of oil companies.

The third issue is the problem of local variation in petrol prices, especially in rural areas and towns such as mine. In Harlow, fuel is always 4p to 5p more expensive than it is a couple of miles down the road. I have complained to the OFT. Its letter was a classic Sir Humphrey reply, giving a lot of sympathy and a whole load of reasons why nothing could be done.

[Mr Marcus Jones (Nuneaton) (Con)]

I thank my hon. Friend for giving way, and I pay tribute to his work on this campaign. On local areas and price differences, does he not agree that any OFT investigation should consider the lack of filling stations? Owing to the huge reduction in their numbers over the past 15 or 20 years, there is a distinct lack of price competition in local areas.

[Robert Halfon]

My hon. Friend has read my mind; I was about to come to fuel deserts. Britain has gone from 20,000 forecourts in 1990 to 8,500 today, a drop of nearly 60%, turning huge areas of the UK into fuel deserts where motorists must drive to fill up. There are examples in Cornwall, where a hypermarket sold fuel at below cost price until all the other petrol stations went bust, after which its prices rose considerably.

[Mr Andrew Smith (Oxford East) (Lab)]

From the Labour Benches, I, too, offer support to the hon. Gentleman’s campaign. Earlier, I went to a petrol price comparison site. Would it surprise the hon. Gentleman to know that although the situation is bad in Harlow, it is even worse in Oxford? He will enjoy the support of my constituents in winning his campaign.

[Robert Halfon]

I thank the right hon. Gentleman. The next time I get my many e-mails from Harlow residents, I will pass them on to him so he can help me to respond. I am grateful for his support. It shows the Minister that this is an all-party campaign, because the issue affects everybody.

[Martin Vickers (Cleethorpes) (Con)]

As always, my hon. Friend makes a powerful case. The point about the price differential from area to area is particularly important in my constituency, where Immingham is a major centre for the haulage industry. Increased haulage prices trickle down into the economy generally. Does he agree that it is particularly important that any investigation take note of the impact on haulage businesses?

[Robert Halfon]

My hon. Friend is completely right. Before I answer that, I should say that although I have received a lot of credit for working on the fuel campaign in Parliament, he is deputy chair of FairFuelUK and has done an enormous amount of work to help me behind the scenes. I must give credit where it is due. Haulage firms all over the country are closing down. Transport firms are closing.

[Caroline Nokes (Romsey and Southampton North) (Con)]

Southampton is in close proximity to Portsmouth ferry port. One big challenge faced by hauliers in the south-east is easy access to the continent and European lorry drivers coming over with much cheaper tanks of fuel.

[Robert Halfon]

Again, we need to consider that, as well as considering the charging of foreign lorries that come here. I recognise that the Government have made some progress, but those lorries must be charged a lot more. The playing field is not level. Why should our people suffer because foreign lorries have an unfair competitive advantage?

[Andrew Bingham]

I thank my hon. Friend for giving way so generously every three or four words. We are all taking over his speech. I have two points. Does he agree that not only is fuel dear in rural areas, but rurality makes it far more necessary to have a car, so the impact of fuel prices is far greater there? Also, in High Peak we produce the finest limestone in the world, which is more often than not transported by road, meaning more costs.

[Robert Halfon]

My hon. Friend is completely right. My argument has always been that it is not whether people can afford to have a car—we have a great car economy—but whether they can afford not to.

[Mr Andrew Turner (Isle of Wight) (Con)]

I am grateful to my hon. Friend for securing this debate. We worry about the cost of petrol and diesel, particularly on the island, where prices are higher than everywhere but the most extreme places such as the Isles of Scilly, the Hebrides and the northern islands. Does my hon. Friend acknowledge the additional cost of transporting fuel to such places?

[Robert Halfon]

The Minister will have heard what my hon. Friend says. I am sure that the fact that so many people are here today making similar points will not be lost on the ears of a Minister who we know listens.

[Stewart Hosie (Dundee East) (SNP)]

Before the hon. Gentleman moves off rurality, can I make the issue real? A 10p difference per litre is nearly 50p a gallon or £5 a tank. For someone commuting and filling their tank twice a week, that is hundreds of pounds a year. I hope that he will take the opportunity to reinforce to the Minister that for ordinary working families who are struggling in this austerity period, that extra few hundred pounds makes a huge difference.

[Robert Halfon]

I thank the hon. Gentleman for his remarks. As I will say in my conclusion, statistics show that motorists in my constituency on average earnings pay one tenth of their income just filling up the family car. The Government say that people face fuel poverty if they spend one tenth of their income on fuel. People are forced to use their cars, and in my constituency—and, I am sure, elsewhere—they are paying one tenth of their income to fill up the family car.

I will make a brief point about the banks; I am nearly done. Last year, western Governments tried to release oil to cut pump prices, but banks bought up at least £1.6 billion of it. There is evidence that a lot of it was stored in silos at sea rather than entering the market, keeping prices high. America is introducing tough new penalties for market manipulation. I urge the Government to do the same in Britain. If Governments around the world do the right thing and release oil stocks, we cannot allow banks to buy it up, keep it at sea and hurt the struggling motorist.

What is to be done? I am a realist. I do not believe in “Charge of the Light Brigade” politics; I much prefer the battle of Agincourt. I accept that we do not have a magic money tree, but the big oil companies are not struggling. In the first quarter of this year, Shell had profits of $7.6 billion, BP $5.9 billion and Exxon Mobil $9.4 billion. It is a similar story at Chevron and ConocoPhillips. At the end of 2011, those firms had $58 billion in cash reserves. In order to find the money to stop price rises and help hard-pressed motorists, the Government could consider a windfall tax to fund cheaper petrol at the pumps. A windfall tax was imposed before, but on North sea oil in particular. I am asking the Government to consider a windfall tax on oil companies in general.

We must remember that motorists are not a lobby group. They are mums driving to school, children on buses and pensioners hit by inflation. When the cost of road haulage rises, the price of everything else rises too.

[Andrew Bridgen (North West Leicestershire) (Con)]

Will my hon. Friend give way?

[Robert Halfon]

Very quickly, but this is the last intervention.

[Andrew Bridgen]

I thank my hon. Friend for giving me this opportunity. To declare an interest, I should say that I am a qualified transport manager and have run a considerable haulage fleet. One major anomaly in the haulage industry is that we compete against foreign competition, but diesel is priced considerably higher than petrol in the UK, whereas on the continent it is considerably cheaper. Perhaps we could explain that anomaly. It is extremely important in my constituency, because more than one third of private sector jobs there are in distribution or are distribution-related. As we have no railway stations in my constituency, a vehicle is not a luxury; it is essential.

--- Later in debate ---

[Robert Halfon]

I agree entirely. We must look at the price of diesel too, because it has risen hugely. Prices are much higher. People often quote unleaded petrol prices but forget to quote those for diesel.

As we have agreed, petrol prices are crushing businesses and families and creating a poverty trap, and evidence from the London School of Economics and elsewhere shows that they are adding to Britain’s dole queues. As I have said, I believe that the issue is not whether people can afford a car, but whether they can afford not to. I urge the Minister to reconsider the August tax rise, launch a tough investigation into the oil market through the OFT and elsewhere and consider a windfall tax to cut prices at the pumps.

Before I end, I should say that we are here today not just because of MPs representing their constituencies but because of the work of FairFuelUK, which has done much to bring the issue to the public’s attention, especially through The Sun newspaper’s “Keep It Down” campaign, which has done an enormous amount to highlight it. Both The Sun and FairFuelUK have campaigned tirelessly.

We face a petrol crisis in our tax system, our oil companies and our banks. Everyone seems to benefit except hard-pressed motorists in Harlow and the millions of hard-working people throughout our country who have no choice but to drive their cars.

IMF

Robert Halfon Excerpts

Monday 23rd April 2012 Commons Chamber

[Mr Osborne]

I do not think that any Chancellor since the creation of the IMF would have taken a different decision. In the end, all parties—at least, until today—have recognised that the IMF is an incredibly important institution for the stability of the global economy. If was created under a Labour Government, and it would be pretty remarkable if a Labour Chancellor were to try to pull the plug on Britain’s participation in it.

[Robert Halfon (Harlow) (Con)]

Will my right hon. Friend assure my constituents that there will be no impact on the increased spending on our schools and hospitals that the coalition Government are providing, and no impact on cutting taxes for more than 40,000 Harlow residents through raising the income tax threshold?

[Mr Osborne]

I can absolutely assure the people of Harlow that we will deliver a big increase in their personal tax-free allowance, continue with real increases in the health service, support their schools and, above all, get their economy moving after the disastrous mess that the previous Labour Government put us in.

Amendment of the Law

Robert Halfon Excerpts

Wednesday 21st March 2012 Commons Chamber

[Ann McKechin]

My hon. Friend has cleverly noted that hidden message, to which, I am sure, the Chancellor was keen to avoid drawing attention. However, pensioners are not as daft as he thinks, and I think that they will soon reckon that they are paying for the millionaires’ tax bonus announced today.

There has also been complete radio silence on other matters: women, for example, or children. By any rational definition, the Budget has not only ducked the hard issues, but entrenched the division in our society.

[Robert Halfon (Harlow) (Con)]

For 13 years of the Labour Government, the millionaires’ tax rate that the hon. Lady mentioned was at 40%. That was changed only in the last stage, and it is now 45%. Why was it 40% for so long while she was in office?

[Ann McKechin]

As even the Chancellor would admit, the economy was very different. [Interruption.] We had job growth and we were taking people out of poverty—that was the difference, which the hon. Gentleman seems to have completely failed to realise.

The Chancellor must by now be all too aware of the criticism levelled at his efforts in the past two years. Women were left paying more than 72% of the net cost of the changes in taxes, benefits and tax credits in his June 2010 Budget, and the subsequent comprehensive spending review ushered in yet more of a burden on women and families. Of the £18.3 billion raised through net direct tax, pay and pension changes up to now, £13.2 billion is coming from women. For children, the position is even worse. If we are to reach the target set in the Child Poverty Act 2010, the Government need to reduce the number of children in poverty by 120,000 per annum.

Prevention of Nuclear Proliferation

Robert Halfon Excerpts

Tuesday 13th December 2011 Commons Chamber

[Robert Halfon (Harlow) (Con)]

I welcome this debate because, contrary to what has just been said, I believe that Iran is in essence the new Soviet Union of the middle east. It supports terrorism. We know well its strong backing of Hezbollah in Lebanon. It supplies Hezbollah with the missiles and the finance that it needs to destabilise the region and to fire attack missiles on Israel. Iran also supports Hamas, and we know what Hamas has done in Gaza, overthrowing the more moderate Palestinian Authority, running a totalitarian mini-state known as Hamastan in Gaza, stopping moves towards peace and regularly firing missiles on Israel.

Iran has also undermined democratic states. Not long ago it fired missiles on to the Kurdish regional Government. It is supporting the Syrian Government of President Assad and his crackdown on the recent anti-Government protests. It has provided the Syrian authorities with equipment, advice and technical know-how to help curtail and monitor internal communications. It has provided material assistance in the form of riot and crowd dispersal material, as well as military training for Syrian troops. Hamas, Hezbollah and Syria are in essence proxies for Iran. We well know that Iran has sent suicide bombers into Iraq and attacked our troops.

All this would be bad enough were it not for Iran’s nuclear programme. As has been said, the development of the nuclear bomb in Iran is incredibly concerning. The IAEA report has been highlighted and clearly shows that Iran has been covertly developing the technology needed to weaponise nuclear material. If we think the current Iranian regime is extreme, its so-called more moderate predecessor said that it would be okay to use a nuclear bomb in the middle east against Israel, because if a few million are killed in the process, it does not matter for the wider good.

[Jeremy Corbyn]

The hon. Gentleman mentioned nuclear weapons. Does he not have concerns that Israel has 200 nuclear warheads and is not a signatory to the nuclear non-proliferation treaty? Does he not think a nuclear weapons convention including Israel would be a helpful step forward in the region?

[Robert Halfon]

I am happy for any nuclear convention to reduce nuclear weapons in the middle east, but the crucial point that the hon. Gentleman misses is that Israel is a democracy and Iran is a dictatorship.

[Mike Freer (Finchley and Golders Green) (Con)]

I agree with my hon. Friend. May I point out that it is not Israel that has threatened to wipe its neighbour off the face of the earth? Is that not the key point?

[Robert Halfon]

My hon. Friend, who is a strong supporter of Israel, is exactly right.

The one difference between Iran and the Soviet Union is that, when the Soviet Union and the west had nuclear weapons, we lived under the doctrine known as MAD, mutually assured destruction, and for MAD to work one had to be sane, but the sad fact is that Iran does not have that level of sanity, given that, as my hon. Friend says, the President often says that he wants to wipe Israel off the map. We know how the regime behaves from its recent treatment and trashing of the UK embassy, from its taking of American hostages and from its many other human rights abuses.

The hon. Member for Islington North (Jeremy Corbyn) mentioned the abuse of trade unionists and the imprisonment of women, an issue that The Times has highlighted so well, so I strongly welcome the fact that the Government have brought in the tough measures before us. This is the first time the UK has used such powers to cut off an entire country’s banking sector from our financial sector, and that is hugely important not just because of the hoped-for effect of stopping the Iranian nuclear regime, but because of the message that it sends to other tyrannical regimes throughout the world—that Britain will not be weak, but be strong and do everything it can to stop the actions of such dictators.

Although I strongly welcome these tough sanctions and praise the Treasury for having the courage to introduce them, I note that we may be too late. Iran is not far off acquiring a nuclear bomb, and we—perhaps not this country itself, but NATO—may need to take further military action to rid the world of that bomb, to put pressure on the country’s evil regime and to bring about a true democracy, with the rule of law, freedom and everything that the Iranian people deserve.

--- Later in debate ---

[Mr John Baron (Basildon and Billericay) (Con)]

I rise to suggest to the Minister not only that it is questionable whether sanctions are working but that they may be counter-productive. I also suggest that the west underestimates its ability to influence Iran. It is a complex society with multiple centres of authority and constant power struggles. I hope that our Government will recognise that better in our diplomatic efforts.

Iran is a very wealthy country when it comes to minerals; other major powers are queuing up to gain access to its oil. That lessens the impact of sanctions from the west. Anyway, if Iran has set herself on nuclear weapons, she will not be scared away; if she has not, sanctions will, in my view, serve only to encourage her to get them.

In our discussions on Iran, we tend to forget too easily that it is a complex society justifiably proud of its history. As we have heard, the Parliament has protected rights for minorities; Iran’s 25,000 Jews are represented by a Jewish MP. We forget that there is no desecration of synagogues, which is more of a problem in Europe. We also forget that there is a well developed middle class in Iran that often disagrees with Ahmadinejad, as recent protests have illustrated.

My concern is that sanctions are counter-productive. Support for the current hardliners in Iran probably increases as a result of sanctions—Iranians responded to Bush’s talk of an axis of evil in 2002 by removing the reformist President Khatami. I suggest that the only sensible course of action is calm yet vigorous diplomacy.

[Robert Halfon]

I am incredibly grateful for my hon. Friend’s thoughtful remarks, although I come from a completely different perspective. He said that sanctions have made the regime more extreme, but some years ago there were no sanctions yet the regime became more and more extreme. Can he explain that?

[Mr Baron]

I am afraid that my hon. Friend was not listening. I did not say that sanctions made the regime more extreme, but that they reinforced the position of the hardliners within Iran, itself being a complex society. There is a difference. The only sensible option is calm yet vigorous diplomacy. We need to offer implicit recognition of Iran’s status as a major power in the region—a status that we created ourselves by castrating Iraq. There is a precedent for recognising a new status. In the 1960s, when the US presence in Asia was waning and China was beginning to flex her muscles, Nixon did not respond by denying the reality of Chinese power.

As I said, the west underestimates the opportunity to influence Iran. She is a state in transition with multiple centres of authority and constant power struggles. The challenge for the west is to influence those struggles. Crude sanctions or appeals for regime change undermine local proponents of reform by making them look like imperialist lackeys. Offering Iran a new relationship with the west could strengthen the pragmatists at the expense of the hard-liners. We can, and should, go the extra mile for peace. Much greater emphasis needs to be placed on quiet diplomacy between Iran and the west.

Autumn Statement

Robert Halfon Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Speaker]

Order. I may or may not be economically illiterate, but I gently, tentatively and courteously point out to the Chancellor that I do not have a five-point plan.

[Robert Halfon (Harlow) (Con)]

I thank the Chancellor for listening to millions of hard-pressed motorists and the Fair Fuel UK campaign and for not raising fuel duty next year. Is he aware that that will save 37,000 Harlow motorists more than £1 million next year? Will he listen to Essex man once again and set up a commission to look at the long-term problems of petrol and diesel price rises and see whether anything more can be done?

[Mr Osborne]

I should pay particular tribute to my hon. Friend, who has led a dogged campaign on behalf of the people of Harlow and of the whole country to get some relief from the increases in petrol taxes that were planned by the last Labour Government. I am delighted that we have been able to help. I always listen to Essex man, who is represented in the form of my hon. Friend.