All set for debate over petrol prices

On Thursday I will be leading a debate in the House of Commons on petrol prices and the UK oil market.

Pressure is now growing on the Office of Fair Trading and the Financial Services Authority (FSA) to launch a full investigation.

During my fight with PetrolPromise.com for lower fuel taxes I have highlighted the situation regarding fuel prices in Harlow.

Petrol prices in Harlow are always 5p more expensive than in other nearby towns such as Stevenage, Chelmsford, and elsewhere and the Government should do a full investigation.

My Motion calling on the Office for Fair Trading and FSA to launch a full investigation into oil firms active in the UK, and calling on the Government to consider emergency steps being taken in other G20 countries to reduce fuel prices, has been signed by 70 MPs of all parties.

The main purpose of the debate is to urge the OFT, and the FSA, to launch a full enquiry as soon as possible - and then to take action to help keep petrol prices down.

Was the petrol price rigged too?

Many readers will have seen Monday's Telegraph, with an important scoop from @RowenaMason. As I told her for the article:

Allegations of oil fraud, and market manipulation, MUST be looked at urgently by the Bank of England and the Office of Fair Trading. This needs to happen as soon as possible.

The PetrolPromise.com campaign has repeatedly said it, but it is worth saying again: we need to know whether the oil price has been manipulated in a similar way to Libor. This could potentially impact on every single person in Harlow and the surrounding villages, as well as millions of people all round the country concerned about the price of petrol at the pumps.

by Robert Halfon MP - Working Hard for Harlow.

VIDEO: Labour Party praise my work for cheaper petrol

I'm not always known for having the support of the Labour Party (!) but their Shadow Minister was very kind to me recently about my petrolpromise.com campaign for cheaper fuel.

Cathy Jamieson MP said last week, in Parliament: I absolutely understand that the hon. Gentleman to who he is referring to, did a lot of work on the campaign. 

You can see a video above.

by Robert Halfon MP - Working Hard for Harlow.

VIDEO: Government Stops 3p rise in Fuel Duty

On Monday I took part in a debate about the Governments freeze in Fuel Duty for the rest of this year.

You can read my speech below, or watch it with the video above.

Robert Halfon (Harlow): 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 Stewart Hosie, who did so much work with FairFuelUK and attended the Westminster Hall debate to which 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 a 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.

Shadow Economic Secretary to the Treasury (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 (Harlow): 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.

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.

Economic Secretary to the Treasury (Chloe Smith): 

With just a few minutes remaining, I would like to respond to a few points—in some detail, if I may, in relation to the Government new clause.

I shall take up some of the themes raised by my hon. Friend Robert Halfon, who has indeed campaigned assiduously on this issue to the benefit of his constituents and others.

I recently wrote a blog post about my call for an investigation into Oil companies, which keep prices high at the pumps. You can read it here.

George Osborne freezes fuel duty, and praises campaign for cheaper petrol

Today in Parliament, the Government listened to thousands of hard-pressed Harlow motorists. They agreed to scrap the fuel tax bombshell for January 2012 - which would have seen fuel prices in Harlow rocket by upto 4 pence per litre.

This is fantastic news.

The Chancellor, George Osborne, praised the campaign for cheaper petrol and agreed to do more to look at reducing fuel prices in the longer term.

You can see a video of my question to him above. Our full exchange was:

Robert Halfon (Harlow): Can I thank the Chancellor for listening to millions of hard-pressed motorists, and the FairFuelUK campaign, by not raising fuel duty next year? Is he aware that this will save 37,000 Harlow motorists more than £1 million pounds next year? Could I ask him to listen to Essex Man once again, and set up a Commission to look at the longterm problems of petrol and diesel price rises and see if anything more can be done?

George Osborne (The Chancellor of the Exchequer): Well I should pay particular tribute to my Honourable Friend, the Member for Harlow. He has led a dogged campaign on behalf of the people of Harlow, and indeed the whole country, to try and get some relief from the increases in petrol taxes that were planned by the last Labour Government. I'm delighted that we've been able to help. And of course I always listen to Essex Man and its representative in the form of Robert Halfon.


by Robert Halfon - www.roberthalfon.blogspot.com

Setting a match to the debate on petrol inflation

INFLATION is now rising faster than wages, and Britain faces a cost-of-living crisis. Astronomical fuel prices are the number one issue in my constituency: they are creating a poverty trap, and are a major brake on economic growth.

In real terms, adjusted for inflation, motoring fuel has never been this expensive – except for just twice in history, during historic crises of supply, the Suez crisis and the Opec oil cartel’s blockade.

Ultimately, the problem is tax. Rip-off fuel taxes are crushing our economy, making our businesses uncompetitive, and hurting families and the unemployed as well. Right now, 66 per cent of the price at the petrol pump is taxation.

Even Greece and Spain, with all their debts, now have lower rates of fuel tax than Britain. How can this be right?

Inevitably, the recession hit sales of petrol and diesel in 2008. But even now that the British economy is growing – albeit slowly – sales continue to fall.

Since 1970, Britain’s consumption of petrol and diesel has risen to approximately 35m litres a year. But 2008 was the high-water mark. Since then, our consumption has fallen year-on-year, and the Department of Energy and Climate Change forecasts that it will continue to plummet next year.

Petrol is now so astronomically expensive that it is driving people off the road, and costing the exchequer money.

The government’s own figures show that between January and June this year, 1.7bn fewer litres of petrol and diesel were sold (compared to the first half of 2008). The AA believes that this equates to £1bn pounds in lost revenue for the Treasury.

This is disastrous: the government’s plan to balance the books depends on raising an extra £5bn from fuel duty revenues a year by the end of this parliament.

With fuel sales down last year; down this year; and estimated to be down next year, where will that extra £5bn in revenues come from?

The only way of squaring this circle is to scrap the planned increases in fuel duty for 2012, and to keep taxes as low as possible, to boost demand.

As the chancellor said earlier this year, we must “put fuel into the tank of the British economy”: we must flatten anything that gets in the way of growth.

To his credit, George Osborne did cut fuel duty by 1p at the budget this year, and delayed the inflationary tax rises. But we have to go further, for the sake of the ordinary businesses and citizens it affects.

That is why today I will move a formal motion in Parliament, triggering a debate on cheaper petrol. So far, 107 MPs from across the House of Commons have signed my motion, and over 110,000 members of the public have signed an e-petition supporting the FairFuelUK campaign. It is vital that the government treats this as a priority, and acts now to keep petrol prices low.

by Robert Halfon - www.roberthalfon.blogspot.com

"Axe Petrol Tax" says The Sun

As I wrote in The Sun today, petrol prices are crucifying families, businesses and pensioners, who depend on buses to travel.

This is the biggest brake on economic growth and is creating a poverty trap, as people can't afford to drive to work.

Our taxi firms and lorry drivers are also being taxed out of existence, adding to Britain's dole queue and causing misery for millions.

We need a CUT in fuel duty for millions of hard-working motorists and families.

Most people have no choice but to fill up their car or van with fuel. That is why I am fighting for cheaper petrol.

Over 100 MPs have now signed my motion for cheaper petrol, which will be debated in Parliament next week (Tuesday 15 November).

Government after Government on this issue has had the "engine of a lawnmower, but the brakes of a Rolls Royce". I am glad that the Chancellor cut fuel duty by 1p a litre this April, but we need to go further to get cheaper petrol, as soon as possible.


by Robert Halfon - www.roberthalfon.blogspot.com

Party Conference: My Campaign for Cheaper Petrol

Today, Conservative Home is giving out 5,000 copies of a free newspaper, at Conservative Party Conference. The newspaper includes an article about our FairFuelUK campaign and our fight for cheaper petrol prices.

You can see the article above, or in the full newspaper HERE.

by Robert Halfon - www.roberthalfon.blogspot.com

Petrol Prices and unemployment : The Sun backs the Halfon/FairFuel UK E-petition for Cheaper Petrol

This week we found some information from the London School of Economics, showing the link between high petrol costs and unemployment.  I will post the details of the study later.  Meanwhile:

From today's edition of The Sun:

The Sun is backing my e-petition for Cheaper Petrol and Diesel, which I have set up with the FairFuelUK campaign.

So far, it has clocked up 55,000 signatures in two weeks. If we can get 100,000, we are very likely to secure an MP's debate in Parliament. This wil keep the issue of rip-off fuel taxes - and the need for cheaper petrol - high up on the Government's agenda.

Working together with FairFuelUK, I have been campaigning on this issue for many months now, including debates in Parliament, delivering a petition to Number 10 Downing Street, and even pushing a car up Whitehall.

Recently, I also asked the Prime Minister David Cameron about this at PMQs, and he gave a very supportive reply.

High petrol prices are the number one issue facing Harlow residents, and thousands of families and businesses are struggling with the cost.

Please sign our e-petition today - it only takes 30 seconds. Please also share this with your friends on Facebook and Twitter, and urge the Government to cut fuel duty NOW.


by Robert Halfon - www.roberthalfon.blogspot.com

Raising the Laffer Curve and petrol taxes in the Commons

Today in the Commons, I called for a debate on the Laffer Curve and Petrol Taxes (see my previous blog). You can read my question here:

Robert Halfon (Harlow) (Con): May we have a debate on the Laffer curve and petrol taxes, because figures from the AA show that the Treasury received £637 million less in revenue from petrol taxes than in the equivalent period three years ago? Will my right hon. Friend make representations to the Treasury to ensure that we do not raise petrol taxes next January?

Sir George Young: As someone with an economics degree, I am always happy to debate the Laffer curve. The fair fuel stabilizer means that fuel duty will rise by inflation only when oil prices are high. As he knows, the measures we have already taken mean that pump prices are about 6p a litre lower than they would have been had we simply carried forward the previous Government’s plans. We are also encouraging retailers wherever possible to pass on savings to consumers as quickly as possible.