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[Un-allotted Half Day] — Fuel Costs

Part of Opposition Day – in the House of Commons at 6:07 pm on 7th February 2011.

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Photo of Alan Reid Alan Reid Liberal Democrat, Argyll and Bute 6:07 pm, 7th February 2011

Yes, I agree with the hon. Lady. I hope that a stabiliser formula for the whole country can be found and made to work, but I remain sceptical. It is important that the Government consider that idea, but it is also important that no idea is put into practice without careful consideration of all possible negative effects. Any rigid formula could have such unforeseen effects, such as the 4.5p increase that would have resulted in 2009. I am convinced that a rural fuel derogation could be made to work in a specific area. I have no argument whatever against a stabiliser pilot scheme, but I remain sceptical. It would be great if a stabiliser could be made to work-the Government ought to consider it-but we must be very careful. The way forward is definitely a rural fuel discount.

The Budget is only a few weeks away. It is important that the Chancellor exercises restraint and that he does not increase fuel duty in the Budget, when the fuel price is already so high. However, rather than having a rigid stabiliser formula, which could have unforeseen side effects, it is important that he acts sensibly.

Under the previous Labour Government's policy in their last Budget-the fuel escalator-the tax on fuel would increase by more than 4p a litre in April. I hope that the Government do not follow Labour's policy. That would be grim news for a rural economy that is already struggling under the burden of a high fuel price. I urge the Chancellor to heed the warnings he has received on the impact that another 4p per litre increase would have, and I plead with him to cancel the proposed fuel duty increase in the Budget.