Fuel Crisis

– in the Scottish Parliament at 10:26 am on 26th April 2001.

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Photo of George Reid George Reid Scottish National Party 10:26 am, 26th April 2001

The next item of business is an SNP debate on motion S1M-1866, in the name of Kenny MacAskill, on the fuel crisis. There is one amendment to the motion.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party 10:34 am, 26th April 2001

Fuel duty has been debated several times in the chamber. Only last autumn, we had two debates on the matter in a relatively short period. Considerable heat and discourse was generated during those debates. The Minister for Justice referred to mob rule when describing peaceful protests, a statement for which he has yet to apologise. That door is still open to him and I hope that he will take it, as those protests have continued—albeit at a lower tempo—and they have remained lawful and well-behaved.

Fuel was the issue of the autumn, as the price rocketed and the pain was felt by businesses and individuals alike. If the Government does not want fuel to become the issue of the summer, it must act, for the problems that were evident last autumn are back with us today.

The Chancellor of the Exchequer's amelioration of the issue in November has proved to be insufficient and short term. Although that amelioration was welcome, it was belated and inadequate and it has not prevented the problem from surfacing again. The price of petrol has again reached the levels that provoked the crisis last autumn. Moreover, there are parts of rural Scotland where the point at which a litre of petrol will cost £1 is not far in the distance, but around the corner. That is an unacceptable price to pay for an essential commodity.

Let us consider once again the reasons why we have the problem and the difficulties that it creates. Last year, I mentioned the significant problems suffered by the fishing, farming and road haulage industries. That was when foot-and-mouth disease was in the past, not the present. Farming and road haulage are now being crucified by the foot-and-mouth crisis. The farmers have secured a compensation package, but the haulage industry cannot and must not be overlooked. Only a foolish Government would forget an industry that was in the vanguard of previous protests and finds itself now in even more straitened circumstances. That industry, which carried out its protests with dignity and decorum, deserves not abuse from ministers, but assistance from the Scottish Executive. The situation is worse now than it was then. That assistance must relate not only to the foot-and- mouth crisis but, more importantly, to the underlying problem of high fuel costs.

The fishing industry was in difficulties last autumn as well, even before the tie-up crisis and its crucifixion, not by an epidemic, but by the inaction of the Executive. Notwithstanding rebated fuel, fuel costs are a factor for that industry in terms both of uncompetitiveness with foreign fleets and distribution costs on shore.

Tourism was mentioned in the previous debates. The high value of the pound and the high cost of fuel made Scotland a high-cost destination for a vacation. That also pre-dated the foot-and-mouth crisis and the scores of cancellations that have afflicted guest houses and hotels across the country. Some of Scotland is closed for business by necessary restrictions to combat foot-and-mouth disease, but much of the country is closed by lack of business.

The First Minister, the Minister for Enterprise and Lifelong Learning and their colleagues may have travelled to Washington to proclaim that Scotland is open for business, but the problem remains that it is open for business at a price. As I said, the cost of fuel in the rural parts of the country is heading towards £1 a litre. One can almost fly the Atlantic for less money than it costs to drive up and down the A9. What an absurd situation to find ourselves in at the start of the 21st century. Rural Scotland finds itself crushed by the hammer of foot-and-mouth disease upon the anvil of high fuel costs.

While we support the action that the Executive is taking to combat foot-and-mouth disease, action must also be taken on fuel costs. Why? Because before foot and mouth there was a crisis; during foot and mouth there is a crisis; and after foot and mouth there will still be a crisis. The foot-and-mouth disease crisis may have subsumed that of fuel for the moment, but, when it has passed, the fuel crisis will remain. It may now be obscured, but it has not gone away.

What has been done and what should be done? The London Government claimed that it was listening. Tony Blair said,

"Of course we will listen ... we will carry on listening, we meet regularly with representatives of hauliers and farmers and will continue to do so."

Not only had the Chancellor of the Exchequer listened, he said that he understood the genuine concerns that motorists and hauliers have and that he would do more to meet people's concerns. Given that we have a listening Prime Minister and an understanding Chancellor of the Exchequer, why are fuel costs once again rising to the crisis levels of last September? That is the situation that we are in. What goes around comes around.

Photo of Andy Kerr Andy Kerr Labour

Does Mr MacAskill agree with the Enterprise and Lifelong Learning Committee's report, which discusses the Chancellor of the Exchequer's recent budget and says that

"All of these developments have had a significant impact on the issue and indeed on the Committee's thinking"?

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

As I was about to say, those developments are de minimis. The listening Prime Minister and the understanding Chancellor of the Exchequer may have thought that their de minimis actions would suffice, but they have been shown to be only a short-term fix for a long-term problem.

The threat of a windfall tax to deliver the roll-out of ultra-low sulphur petrol and diesel might have put a different type of petrol in the tanks, but it has not put a different price on the pumps. The price at the pump is the problem, and is primarily driven by tax. Fuel prices are going up, and further rises are anticipated. Urgent action is therefore necessary. On 6 April, Richard Freeman of the Automobile Association stated:

"The petrol price is inexorably heading to the point where it will wipe out the benefits of the budget. ... We want the Government to introduce a de-escalator to get prices to come down to an acceptable level compared with the rest of Europe."

High costs are coming back, and with a vengeance. Action must be taken, or we fear that there will be a return to the demonstrations and the furore experienced but six months ago. Moreover, and more important, the economic and social effects will be catastrophic for Scotland. Why does the largest oil producer in the European Union have the highest fuel costs in the developed world? The reason is the level of taxation imposed by the present Government—and indeed by previous Governments of a different political complexion. It cannot and will not be forgotten that the Tories invented the fuel duty escalator. Fuel was an easy hit; the petrol pump a cash cow. People complained, but the money rolled in.

The Government tried to cover its stealth taxation in an environmental wrapping. However, as was made quite clear by the Government last year, the purpose of the high tax was not to meet Kyoto commitments, but to raise cash. According to the AA, about 79 per cent of the cost of a gallon of petrol is tax. No other essential commodity is hit by such punitive taxation.

And what of the Chancellor of the Exchequer's loudly hailed reduction in fuel duty? It is welcome, but it cannot be considered without bearing it in mind that the self-same chancellor, in four previous budgets, announced an increase. Tax on petrol is now 10p per litre higher than when he first took office. Even after last month's proudly trumpeted reduction, that is a tax increase of 27 per cent and a price increase of more than twice the rate of inflation.

That is a tax too far, and the tax must come down. That is why we are calling for an immediate cut of 10p per gallon. That cut has been costed, and we have outlined how it will be paid for. It appears to us better to apply the maxim:

"From each according to their abilities, to each according to their needs."

The motor car, for many, is not a luxury, but an essential. The cost of fuel is disproportionately high in rural Scotland, where there is no affordable or accessible public transport alternative.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

The Scottish National Party raised the topic on Tuesday of this week where it should have—in Westminster. Half the SNP MPs were not there, on the pretext that they should be here, to discuss the matter in this Parliament. I notice that there is only one SNP MP in the chamber at the moment—now two, as Mr Swinney has just come in. That is a third of the SNP's Westminster parliamentary party. Is that not rather hypocritical?

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

The proof of the pudding is in the eating. The proof in politics is how members vote. The SNP representatives at Westminster moved an amendment to reduce the cost of fuel and Mr Rumbles's people did not support it. That is what will come back to haunt the Liberal Democrats in future elections.

As I was about to say, is not it right that a small minority who can pay, should pay, so that the vast majority who can ill afford to pay can be afforded some relief?

Others in the SNP will doubtless speak further on the matter, but I will say that we in the SNP appreciate that, while the cost of fuel must come down, public services still require to be paid for. It is for that reason that we have specified how that cost reduction can be achieved. We realise that the cost of further cuts will also require to be met and paid for. That is why we are calling for a review on taxation. It cannot be right or sensible that almost £1 in £7 raised by the Government comes from the motorist. Our call for a review is not only because fuel is essential, but because it is finite.

At some stage, fuel cell vehicles or something similar will be mass-produced, first in the United States of America, and then elsewhere.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

Not at the moment. Fuel use by vehicles will decrease. What do we do then? Do we massively increase income tax or VAT? Do we cut services and public expenditure? If such a situation is to be avoided, steps must be taken now to review and reconsider how the tax burden is imposed and collected. This is not just a short-term fix, but a long-term change of direction.

Aside from the philosophy of it, what about the mechanism? The Parliament is currently prohibited from prescribing the remedy. However, we can recognise the gravity of the situation and address the chancellor with one voice.

The price of fuel affects our economic competitiveness. Given that we are a nation that is geographically distant from its markets and heavily reliant on its exports, distribution costs are a significant factor. Rising costs mean diminishing profits and uncompetitiveness, and, all too often, closure and redundancies. As a nation, we cannot price ourselves out of the market and the Government cannot price the nation out of economic existence by stealth taxation.

As has been said, particular industries are seriously affected by the high price of fuel. We have previously called for specific measures for fishing, farming and road haulage. We stand by those calls. The need is greater now than ever, and even before this crisis there was a cri de coeur from industries.

Tourism has been much in the news lately. The problems have meant not much good news for the Executive, and often not much good news for the industry. The number of visitors is down, and the foot-and-mouth disease epidemic has resulted in a situation in which, notwithstanding the belated advertising, what is open and what is shut remains a mystery. Even without the epidemic, Scottish tourism was facing yet another fallow year. There is a famine of visitors for all too many people working in the industry, but while foot and mouth could not have been foreseen, another bad year was clearly foreseeable.

I do not wish to underestimate the crisis that has been caused by foot and mouth, but the outbreak should not be used as an excuse to ignore the underlying problems that are caused by the high value of the pound, and, in the north of Scotland, by high fuel costs. The British Government is pricing Scottish tourism out of existence. We live in an age when international transportation is easier than ever before. The opportunity to visit new and exotic destinations is not only available, but affordable. Scotland cannot wish that opportunity away and Scottish tourism has to compete in a global environment. However, if it is to compete, it must do so without the ball and chain of the world's highest fuel costs around its feet.

I welcome the steps that the Executive has taken to allay the fears of potential American visitors. Let us be clear, however: the principal market for Scotland is here and south of the border. If it is cheaper for somebody from the south of Scotland or from the metropolitan boroughs of England to holiday on the Algarve, no wonder hotels here are shutting, not just for the season, but forever.

Last week, the SNP called for a fuel duty rebate to be extended to coach tours. We understand that that is being considered. We hope that that will be dealt with as a matter of urgency. After all, according to a written answer, visitscotland estimates that 700,000 people took a coach holiday in 1999. The revenue generated by those individuals amounted to £170 million. However, the Confederation of Passenger Transport UK informs us that the number of people travelling is falling fast, and that cancellations are being made by the score. We must reduce the price of the product. As that applies to coach tours, it also applies to visitors, many of whom come to or tour Scotland by car.

The issue of fuel prices has not gone away. No master stroke was pulled off by the chancellor last year. That modest reduction did not mask the massive tax take. All the chancellor did was buy himself some time. As the world markets cause prices to rise—and it is accepted that market forces have an effect—the effect of last year's price cut is minimised, given that, after all, 79 per cent of the price of fuel goes in tax.

Abusing demonstrators and pillorying oil companies will not mask the root cause of the problem. We do not go cap in hand to London, pleading for handouts. We are no whingeing Jocks. We are the nation that discovered oil, but found itself getting poorer. We are the eighth largest oil producer in the world, yet we find ourselves with the most expensive fuel on the planet. That is economically crippling, and is manifestly wrong.

This should be a message from the Scottish Parliament, on behalf of the Scottish people, recognising the interests of all Scotland. Cut the cost of fuel. Take 10p off the price of a gallon as a prelude to getting towards European price levels. If that is not done, the message to the people of Scotland must be clear: what is the cost of new Labour? £4 a gallon. Who stands for a fair deal on fuel? Those who stand for Scotland.

I move,

That the Parliament notes the serious problem caused to industries and individuals in Scotland through high fuel costs; further notes the additional burden that the foot-and-mouth disease crisis has placed on industries and areas vulnerable to high fuel prices; recognises that notwithstanding the changes in the Budget announced by the Chancellor of the Exchequer, fuel costs in Scotland remain the highest in the developed world and are set to rise further towards £4.00 a gallon; therefore calls on the Chancellor of the Exchequer to reduce immediately fuel taxation by 10 pence per gallon and thereafter to move to a fairer system of taxation and ensure a harmonisation of fuel prices with our European competitors, and calls upon the Scottish Executive and Her Majesty's Government to take action to end the disparity of fuel prices in rural Scotland.

Photo of Annabel Goldie Annabel Goldie Conservative 10:50 am, 26th April 2001

Although I welcome the opportunity to contribute to the debate—to that extent I am grateful to the SNP for bringing the matter to the Parliament—the terms of the motion are such that I find myself in the surprising position of feeling more bountiful than Mr MacAskill. Mr MacAskill and the SNP are not usually trammelled by budgetary constraints, whereas members of the Conservative party are frequently challenged as being among the most niggardly politicians in the United Kingdom. If that means that we are prudent in looking at the economy, that we are pragmatic in our attempts to apply help where help is needed, and that we make reasonable and manageable savings to achieve that end, I am proud to stand up and advance that cause.

The facts, which may be unpalatable to the Labour party, make chilling reading. In May 1997, the average cost of petrol was 59p a litre, of which 45.7p was tax. Under Labour, that tax has climbed to 61p, which represents an increase of 34 per cent. By any standards, that is a cold and unwelcome message to the motorist. Indeed, Mr Brown must seem to the motorist like a wolf padding round looking for victims. His attitude to the motorist seems to say, "I'll huff and I'll puff and—eventually—I'll blow your house down." Perversely, if the motorists of Scotland turn for comfort from the threat and rapacious instincts of the wolf to the Scottish National Party, which masquerades as a good fairy, they will be somewhat surprised to find that, instead of Cinderella, they are presented with the two ugly sisters. The help that is offered in Mr MacAskill's motion is surprisingly limited—hence the Conservative amendment.

I will go back to the history of the price of petrol in Scotland over the past four years. There has been a deliberate and wilful attempt—

Photo of George Lyon George Lyon Liberal Democrat

Annabel Goldie talks about going back in history. Does she recognise that, when the Conservative Government came to power in 1979, the fuel duty and the VAT charged on that duty was 33p a litre, but that when the Conservatives left power in 1997, duty was 222p a gallon?

Photo of Annabel Goldie Annabel Goldie Conservative

The first thing to point out to Mr Lyon, for whom numeracy is not a strong suit, is that if one takes a time span of 18 years, one can expect to see a rise in tax. The depressing factor is that if we take a time span of four years under Labour, we see a dramatic increase in taxation over that short period which transcends anything that was done under the Conservatives—not that I expect Mr Lyon's numeracy to be improved by that elementary instruction.

I return to what the Labour party has done while it has been in power. In his first budget, Gordon Brown pledged not to increase taxes, but promptly increased the fuel duty escalator by 20 per cent. He held another budget in his first year, piling a double whammy of increased fuel taxes on to the motorist. Then, perhaps more devastatingly for those trying to make a living out of haulage, in his third budget, he increased tax on diesel by 12 per cent above inflation.

In manageable housekeeping terms, the average household finds that petrol has overtaken the mortgage and food as the single most expensive item of expenditure in the household budget. Currently, people pay £350 a year more for their petrol than they did in 1997. The difficulty is that either the chancellor is unable to understand what the rapacious effect of those tax increases has been on the motorists or, understanding that, is totally obdurate and reluctant to do anything about it.

Photo of Annabel Goldie Annabel Goldie Conservative

I am sorry; I do not have much time.

The cosmetic legerdemain that Mr Brown applied in the budget defied belief by promising a carrot until the election is over and then promptly withdrawing it. It is undoubtedly the case that in our remoter communities, particularly—as Mr MacAskill has said—those that have been affected by the ravages of foot-and-mouth disease, there is a crisis for the motorist and the haulage industry.

Photo of Annabel Goldie Annabel Goldie Conservative

I am sorry; I am pushed for time. Presiding Officer, I am not sure what my time allocation is.

Photo of Annabel Goldie Annabel Goldie Conservative

In that case, I will take Mr Rumbles's intervention.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

The amendment calls for a reduction of 3p a litre. During the 18 years of Conservative rule that the United Kingdom suffered, how many times was the fuel tax reduced?

Photo of Annabel Goldie Annabel Goldie Conservative

I think that Mr Rumbles will find that there was minimal reduction in fuel tax in that period. That is not unexpected, for the simple reason that fuel in Britain was then among the cheapest in Europe. Britain has now become the country with the second-highest fuel prices. Of course, Mr Rumbles conveniently overlooks the Kyoto agreement, for which all parties have pledged support. That commitment means that there was a need to apply some level of taxation to try to reduce consumption. The Conservatives always acknowledged that the fuel duty escalator would have a cut-off point and were prepared to apply that cut-off point. That is unlike Mr Brown, who, in lupine fashion, pursued his wolfish instincts and continued to ravage the motorist.

Photo of Annabel Goldie Annabel Goldie Conservative

I will make progress with the text of my speech.

Motorists find themselves in an impossible situation. In many places, particularly in remoter areas such as island communities, the car is not a luxury, but a necessity. Motorists find that they are penalised for relying on their motor cars for essential transport. That is unacceptable. Motorists in that beleaguered position must be offered some form of constructive help—certainly something more tangible than has been evident from any quarter of the Treasury.

The Scottish nationalists may masquerade to the people of Scotland as the good fairy, but if one analyses what they seek to do, one will find less comfort than they would like everybody to believe. Mr MacAskill has had to peg his purported help to the Scottish people at 10p per gallon. The motion offers to reduce fuel tax by 10p per gallon, but the motorist would like, and needs, much more than that. The Conservative party is committed to a cut of 3p per litre, which is 13.6p per gallon, because it acknowledges that there are pressing needs that must be addressed and it can see how costed help can be provided to a particularly desperate sector of an overtaxed community.

The reason why the SNP has to peg the help that it offers is the fundamental problem with its finances. The speeches of individual SNP members have been revealing to everyone who has witnessed them in the chamber during this Parliament. Almost without exception, those speeches have included uncosted spend commitments. A tally of everything that has been pledged by individual members of the SNP would reach a budgetary level that promises unacceptable expenditure cuts or impossible tax increases.

Photo of Margaret Ewing Margaret Ewing Scottish National Party

Will Annabel Goldie explain to the chamber—and to the Scottish public—the realities of the taxation policy of the Conservative party, which says that it will increase public expenditure at the same time as it cuts taxation?

Photo of Annabel Goldie Annabel Goldie Conservative

I thank Mrs Ewing for the opportunity to explain that aspect of our policy. The Conservative party has said that there clearly are areas in which public expenditure can be reduced without unacceptable consequences for public activity. It has also said that it is perfectly possible to reduce the level of taxation, which is now regarded by most economic commentators as being unacceptably high, and in so doing stimulate and nourish further growth and increase the revenue that is gathered by the exchequer.

The SNP does not address this fundamental shortfall: on the basis of recent figures, all the income that Scotland generates is £28.2 billion, but we currently expend £33.1 billion. The Scottish nationalists do not explain anywhere from where they will produce the missing £4.9 billion.

That is the hole in the side of the ship that sinks it. It is perfectly clear that, while the Scottish National Party purports to offer help to the motorist—to whom its motion seeks to give some form of tangible support—the underlying frailty of its economic arguments and calculations defeats that party's aspiration to offer more extensive help. That is why I lodged my amendment.

My amendment seeks to give tangible help to the Scottish motorist, not just by offering a cut in fuel tax, but by making some constructive suggestions as to how real help might be given in the more remote and island communities to motorists who desperately need it.

I move amendment S1M-1866.1, to leave out from "calls on" to end and insert:

"calls upon the Scottish Executive to make representations to the Chancellor of the Exchequer to reduce fuel tax by at least three pence per litre (13.6 pence per gallon) and to investigate a derogation of Vehicle Excise Duty for island registered private cars and the extension of such a derogation to designated remote communities in Scotland, identified on a postcode basis."

Photo of Sarah Boyack Sarah Boyack Labour 11:01 am, 26th April 2001

Today, we have two opportunities to debate the transport issues that affect rural Scotland: this afternoon, the Executive will set out the positive steps we are taking across rural Scotland to address the transport needs of rural communities.

Our agenda is positive. It is the result of hard and persistent effort and we have worked closely with rural communities, making a difference to real people in their daily lives. By contrast, this morning's debate has nothing to do with making a difference to rural Scotland and everything to do with electoral opportunism and political hypocrisy.

SNP members think that if they shout loud enough, no one will notice the hollowness of their position. Rural Scotland will not be deceived: rural Scotland wants real progress on the ground, not empty gestures.

We recognise the real concerns of many rural communities about high fuel prices and poor public transport services and that Scottish rural motorists travel longer distances, spend a higher share of their income on motoring and have fewer alternative forms of transport. There is also a substantial differential between prices in Scotland's remoter rural areas and elsewhere. Prices in Sutherland, the northern isles and the Western Isles are on average about 7p to 9p a litre higher than prices in the central belt. As MSPs from the Highlands and Islands know too well, the differentials are even higher in many instances.

Those serious issues need to be addressed in a serious manner, not with nationalist scaremongering. The nationalists' antics do a disservice to those they purport to help. That is particularly the case when rural Scotland is suffering from the effects of foot-and-mouth disease.

Photo of Sarah Boyack Sarah Boyack Labour

No thank you; I have just started.

After so much struggle and effort by so many, the situation in Scotland appears to be improving, despite the disappointment of the confirmed cases further east, near Duns in the Borders. Ross Finnie is coming to the chamber to make a statement on that situation shortly.

Against that backdrop, the SNP has lodged a motion that raises the spectre of further large-scale price rises and that casually promises reductions in fuel duty.

What are the facts? Diesel prices have stayed constant, so Scotland's hauliers are paying no more this week than they were last month. We accept that Scotland's haulage industry has a major agenda that needs to be addressed, which is why we are working to implement proposals to improve the situation. As for the cost of petrol, pump prices have risen about 1.5p a litre over the past few weeks.

What are the facts about fuel duty? Our debate should be honest. Fuel duty is a sizeable source of revenue, raising about £23 billion in the past year, which is more than 6 per cent of the total UK tax take. That revenue has not been disappearing into a black hole; it is funding schools, hospitals, local government, environmental protection and transport.

Photo of Annabel Goldie Annabel Goldie Conservative

I thank the minister for giving way and I appreciate the candour and clarity of her enthusiasm for the importance of petrol revenue taxes to the exchequer. If that money is so essential to the exchequer, will the minister concede that it would be more honest to increase income tax than to punish and pulverise a section of the community?

Photo of Sarah Boyack Sarah Boyack Labour

Annabel Goldie is referring to the SNP's policy and the point that she makes is at the heart of this issue. I will speak about what Gordon Brown has done later in my speech.

Ten pence a gallon off fuel duty makes a great slogan and harmonisation of fuel taxes across Europe is a great piece of rhetoric, but what of the reality? It is interesting that Mr MacAskill did not mention the nationalists' plan to increase by 5p the top rate of income tax on taxable earnings over £100,000—the wealthiest Scots would pay that.

The motion tells us that the SNP's real agenda is tax harmonisation across Europe. What are the nationalists' plans for income tax for the future? We have a right to know that. They are adding new spending commitments as they go. A reduction of 10p a gallon would cost our budget some £65 million a year—that is quite a lot of schools, hospitals and roads—and harmonising tax levels could lose us about £450 million a year.

Photo of Sarah Boyack Sarah Boyack Labour

No, thank you.

That is an awful lot of schools, hospitals and roads.

Photo of Sarah Boyack Sarah Boyack Labour

No, thank you. I am just about to come on to the nationalists' policies.

This time last year, Kenny MacAskill told us that he was still looking for the best solution to the problem of exorbitant fuel prices in rural areas. He went on to say that European Union rules meant that national taxation had to be applied at a standard rate and that the only apparent scope for alteration was to surcharge motorists in urban areas. There was not much about that in his speech today. This year, he calls for a review, so the nationalists still do not have the answers.

So how are the nationalists going to pay for all this?

Photo of Andrew Wilson Andrew Wilson Scottish National Party

I am grateful to the minister for giving way. Will she let the chamber know whether she thinks it is fairer to raise that money through income tax, which takes account of people's ability to pay, or from fuel tax, which does not? What is the fairest way of taxing people?

Photo of Sarah Boyack Sarah Boyack Labour

We have examined the nationalists' uncosted wish list. Mr Wilson should add up that list to see what the impact would be on income tax. The SNP's motion talks about a marginal reduction in fuel duty and how it would be paid for, but the SNP is talking about a wider review and a total harmonisation of taxes in Europe, which has much bigger implications.

While the nationalists are at it, perhaps they might explain in their summing-up speeches how they will pay for the cost of renationalising the rail network, which would cost around £7 billion at the UK level, taking account of share buybacks and assumed liabilities. Last week's commitments on the A9 and the A96 by an SNP candidate add another £1 billion. Nationalist candidates from around the country constantly add to the wish list. It is all hot air with an eye on the election.

Photo of Sarah Boyack Sarah Boyack Labour

No, thank you.

By contrast, the Executive is serious about representing in London the interests of Scotland's rural communities. We have an easier time of it with a UK Labour Government that is committed to investing in Scottish services, rather than a Tory Government that would be committed to cutting £16 billion from public services, which are still recovering from the Tories' last time in office.

By working patiently and constructively with the UK Government, we will ensure that a balance is struck between the interests of Scotland's fragile rural communities, the environment and our wider spending policies.

Gordon Brown has listened. There has been a cash freeze for all road fuel duties, an extension from 1,200cc to 1,500cc of the lowest rate of vehicle exercise duty for cars, a cut of 2p in ultra-low sulphur petrol backed up by a temporary 2p cut in standard unleaded petrol until June—

Photo of Sarah Boyack Sarah Boyack Labour

No, thank you. I am in the middle of a list.

There has been a 3p cut in ultra-low sulphur diesel, abolition of VED for agricultural vehicles and a major reform of lorry VED which will save the UK's hauliers more than £300 million a year.

Photo of Murray Tosh Murray Tosh Conservative

Since we are hearing about all the great things that Gordon Brown, having listened, has taken action on, can the minister tell us what action he is taking on the point that she raised earlier—the serious issue of the rural fuel price differential? We would be delighted to learn what he—and, indeed, the Executive—is doing to tackle that issue.

Photo of Sarah Boyack Sarah Boyack Labour

Mr Tosh will know that, last year, the Office of Fair Trading produced a report on that issue. He will also know about the current EU rules on derogation in rural areas. In our discussions with the UK Government, we are carefully examining what can be done within those constraints.

The Executive is working hard to address rural transport problems and to make a difference. By our own hand, the rural transport fund has provided new investment of more than £14 million in rural public transport, creating more than 380 new rural services, supporting 100 new rural community transport projects and assisting 23 rural petrol stations. As a result of the spending review 2000, we will increase our spending to £18 million over the next three years, which is an increase of 33 per cent. Support for lifeline air and sea services is at record levels, with new investment in airport terminals and new ferries.

Work is also under way on key trunk road schemes: the £10 million A830 Arisaig to Kinsadel widening and the £12 million A96 Fochabers to Mosstodloch bypass scheme. Over the next three years, a total of £92 million will be spent on rural trunk roads.

There has also been help from the public transport fund, which has provided support for rural public transport projects in Shetland, Orkney, the Western Isles, Highland, Argyll and Bute, Aberdeenshire, Dumfries and Galloway and the Borders. That is not empty rhetoric, but action.

Photo of Sarah Boyack Sarah Boyack Labour

No, thank you.

The SNP's motion is disappointing, particularly when it is contrasted with the Enterprise and Lifelong Learning Committee's recent "Report on the Inquiry into Fuel Prices in Remoter Rural Areas". Committee members from all parties have worked together to produce a considered and constructive piece of work, as have members of the Rural Development Committee in that committee's "Report on the Impact of Changing Employment Patterns in Rural Scotland".

Unlike the SNP motion, the Enterprise and Lifelong Learning Committee's report acknowledges the complexity of the issues, the constraints imposed by European Union policy and the practical measures that the Executive has taken. The Executive will give serious consideration to the committee's recommendations on vehicle excise duty, support for liquefied petroleum gas and the future of the petrol station network in remoter rural areas. We will respond formally in due course.

The Executive will continue to talk to the UK Government about motoring taxation. We have already done much to support LPG, in spending around £1 million a year on converting up to 1,000 cars a year and in providing grants to convert rural petrol stations to supply LPG.

Photo of Sarah Boyack Sarah Boyack Labour

No, thank you.

We will meet the Petrol Retailers Association and the Scottish Motor Trade Association to discuss the difficulties that confront their members in rural areas.

A lot has been done but there is a lot still to do. Once again, the SNP has chosen to debate a reserved issue. That issue is important for Scotland. That is why the UK Parliament is important, why we have to work with it to promote Scotland's interests and why its debate on the Finance Bill on Tuesday was so important.

We do not want hot air and soundbites—that is all the SNP seems to offer Scotland's rural communities. The Executive is in the business of delivering and making a difference. I urge members to reject the motion.

Photo of George Lyon George Lyon Liberal Democrat 11:11 am, 26th April 2001

I will start with the rather headmistress-like lecture on my numeracy skills that I received from Annabel Goldie. Her and her party's weakness lies in history lessons, especially the period from 1979 to 1997. I respectfully suggest that she spend some time refreshing her memory. The people of Scotland have certainly not forgotten that period.

I want to outline the Scottish Liberal Democrat policy on fuel. The Liberal Democrats at Westminster have voted against every rise in the fuel escalator that has been proposed by Tory and Labour Governments for the simple reason that neither Government has offered compensation measures for Scotland's remote island and rural communities, which are hit disproportionately by the policy. I welcome the Tories' late conversion in their amendment. They recognise that measures have to be taken to try to alleviate the huge differential between central belt prices and Highland prices. We support that position and my colleague, Mike Rumbles, will deal with that in more detail in his speech.

The Scottish Liberal Democrat position on fuel is clear and consistent. We believe that there has to be a cap on fuel tax for the next five years and that excise duty should be abolished for the most fuel-efficient cars to encourage the take-up and use of such cars. There should be specific help for the additional cost of fuel for Scotland's remote rural and island communities.

Photo of Andrew Wilson Andrew Wilson Scottish National Party

Mr Lyon is clear on Liberal policy for the future, but do the Liberal Democrats believe that fuel tax is currently too high, too low or about right?

Photo of George Lyon George Lyon Liberal Democrat

I will come to that.

In stark contrast to the SNP, the Scottish Liberal Democrats have been consistent and clear in stating our position on fuel tax. The SNP has had four different policies over the past year. The latest is the flagship general election policy of a 2p per litre reduction in fuel costs. The SNP also proposes to increase taxes on Scotland's highest earners from 40p to 45p. That is very similar to another party's policy that is not very dear to my heart.

What does the SNP propose to do with that money? Does it propose to give it to our hard-pressed schools or to our hospitals, which the SNP tells us week after week are in desperate straits? Does it propose to give it to pensioners, who week after week the SNP says are insulted by the increases that have been given so far? No. The money is to be given to the oil companies in the vain hope that they might pass it on to consumers instead of pocketing it as profit. How on earth will the SNP guarantee that that money will be passed on to consumers?

We now know the SNP's priorities for the general election: oil company profits first; schools, hospitals and pensioners last.

Photo of George Lyon George Lyon Liberal Democrat

Mr MacAskill is not noted for taking interventions on his speeches, but I will let him in once.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

I actually took two interventions. If George Lyon had been listening and watching he would know that.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

How are the oil companies going to benefit? Is George Lyon suggesting that the Executive is bringing in some form of windfall tax? If the tax cut is on the Government's income, how does that affect the oil companies unless the Government is imposing taxation on them?

Photo of George Lyon George Lyon Liberal Democrat

How will the SNP guarantee that the oil companies do not pocket the reduction in tax but pass it on to the consumer instead? What cast-iron guarantee will the SNP extract from the oil companies to make sure that the reduction is passed on to consumers?

The SNP has learned the lesson of the last debate in the Parliament on fuel tax, which is a reserved matter: this time, they raised it in Westminster—unlike the last time. Such was the importance that they attached to standing up for Scotland at Westminster that three of their six MPs did not even bother to turn up. That included their leader and their deputy leader. So much for the SNP standing up for Scotland at Westminster. That instance reinforces the argument that a vote for the SNP at Westminster is a wasted vote.

Photo of George Lyon George Lyon Liberal Democrat

Certainly. I believe that Mrs Ewing was actually there.

Photo of Margaret Ewing Margaret Ewing Scottish National Party

I certainly was there and I will always be at Westminster when matters concerning Scotland are being debated. Where were the Liberal Democrats in the division lobbies? They say one thing in their constituencies and do nothing when it comes to the vote at Westminster.

Photo of George Lyon George Lyon Liberal Democrat

It really is a bit rich that when half of the SNP's MPs will not even turn up to support their party's policy, they expect the Liberal Democrats to do it. Come on; that is ridiculous. The Liberal Democrats chose to abstain because the vote was nothing more than a general election ploy, as we all know.

The SNP has also, under its new policy, called for the harmonisation of fuel taxes with the rest of Europe. What does that mean? It means that the SNP is demanding the abolition of tax-free red diesel for our farmers, fishermen and forestry industry. The SNP policy would mean a rise in diesel prices in Scotland from 22p per litre today to the European average of 55p per litre for our farmers, our fishermen and our forestry industry. In Europe, the majority of countries do not have a red diesel policy. The increase in diesel would be nearly threefold.

Photo of George Lyon George Lyon Liberal Democrat

I am sorry, I have to continue.

The increase would mean economic ruin for rural Scotland. I suggest that Mr MacAskill's suggestion that the SNP is standing up for the rural primary industries was nothing more than crocodile tears and hype. The SNP seems willing to put the final nail in the coffin of our hard-pressed rural industries. Its policy is ill thought out and ill judged. It could inflict ruin on rural Scotland and the rural economy.

I ask members to reject the motion.

Photo of Duncan Hamilton Duncan Hamilton Scottish National Party 11:18 am, 26th April 2001

More than any other member, I have had the opportunity to follow George Lyon's speeches in his constituency and in the Parliament. The speech that he has just given was the most bizarre I have yet heard. It culminated in the wonderful thought that the SNP's proposal to cut 10p off a gallon of fuel is somehow a hit on rural communities. We have to wonder which world the man inhabits.

Photo of Duncan Hamilton Duncan Hamilton Scottish National Party

I think I know which world George Lyon inhabits. I will let him in later.

The lack of honesty in the debate is quite remarkable. I will come on to that in just a minute, but first I will make a quick point about the Government's handling of fuel. Last autumn, as everyone knows, it was the No 1 issue. It drove the whole political debate. Now, there is a degree of success, we are told, because the issue is off the agenda; it has been lanced.

I suggest that if it takes a crisis in fishing, a crisis in farming and a tourism industry on its knees to get the Government off the hook, that is no way to proceed. The way out of a crisis is not to invent a worse crisis; the way out of a crisis is to face up to responsibilities and do something.

The minister and her Labour colleagues have been utterly disingenuous. We are told—as we have been for months—that it is the fault of the oil companies. Today, we can still say that 79p in the pound goes to the Government in the tax take. That suggests that this is a Government problem. It has been a Government problem and it is still a Government problem. The minister has come to the chamber today to tell us, in breathless tones, that this is an important issue for Scotland—so important, in fact, that it should be passed to the UK Parliament. What is this Parliament for if not to express an opinion and to argue the case for Scotland? What precisely is the minister's job if not to make the case on behalf of the rural communities that she says she listens to and understands? That is why this Parliament exists. I suggest that there has been a blatant abdication of responsibility.

Photo of Sarah Boyack Sarah Boyack Labour

If Duncan Hamilton had listened to the whole of my speech, he would have heard that that is precisely what we are doing, day in, day out, with the UK Government. We are promoting Scotland's interests at the UK level and we are working in Scotland to deliver what is within our powers.

Photo of Duncan Hamilton Duncan Hamilton Scottish National Party

That brings us seamlessly to the next point. If the minister is indeed making those representations, she is not making them very well. When the same party is in power in Scotland as is in power in the UK, what kind of Executive is it that, even then, can argue for Scotland but cannot deliver for Scotland? If that is meant to be an effective Executive, frankly, all is lost.

The minister made points about nationalist candidates running round the country making pledges they could not keep. That brings me on to a perfect example of Labour dishonesty. It comes from Dave Stewart, the MP for Inverness East, Nairn and Lochaber. It is impossible to disagree with anything in the first page of Mr Stewart's maiden speech made back in May 1997. In the first paragraph of the second page he said:

"Tourism is very important. It is responsible for 20 per cent. of the highlands' gross domestic product and it supports more than 20,000 jobs throughout the highlands. That is why transport is so important in my constituency and why I shall campaign for a reduction in the price of petrol and diesel, which is extortionate in the highlands and islands."—[Official Report, House of Commons, 21 May 1997; Vol 294, c 772.]

Let us contrast that statement with Dave Stewart's voting record. He voted for an increase in tax in 1997; against a cut in tax in 1998; for an increase in 1999; against a cut later in 1999; for an increase in 2000; and, only yesterday, against the Scottish National Party amendment to cut the price of fuel. If we are going to talk about dishonesty, let us start at home with the Labour candidates who were elected on a basis on which they have not delivered.

The Liberal party masquerades as a party of rural Scotland. I suggest that its abstention at Westminster yesterday will be remembered. That was a chance to make a substantial difference for the people of Scotland by cutting fuel duty. The Liberal party decided to abstain. In this debate, the Scottish National Party has made a constructive proposal. We have said that we will cut fuel duty immediately by 10p. According to the minister, that is scaremongering. It is not: it is about the long-term aspiration for the sustainability of rural Scotland. That is something around which this Parliament should unite. There should be no division and no dissension. The fact that there is says a great deal about this Executive.

Photo of Kenneth Macintosh Kenneth Macintosh Labour 11:23 am, 26th April 2001

Before I talk about rural fuel prices, I will say that I am aware that members know me as a townie—an urban, if not quite urbane, representative of that most suburban of constituencies, Eastwood. It may interest members to know that I was introduced at a public meeting recently as the MSP, Ken Macintosh, who was born in Inverness and who takes an active parliamentary interest in crofting and Gaelic.

I am not sure that I recognise myself in that description and I think that the meeting was disappointed that I was not wearing one of John Farquhar Munro's colourful tweed jackets instead of my usual suit. Despite my impeccable Highland credentials, I want to speak as a member of the Enterprise and Lifelong Learning Committee—not on behalf of that committee, but as a Labour member of that committee—on our "Report on the Inquiry into Fuel Prices in Remoter Rural Areas". Several points are worth bringing to the chamber's attention.

Before I do that, however, I have to say that I am dismayed by what I have heard from the Opposition on rural fuel prices and on other, more general, rural issues. The Opposition constantly tries to play on the rural-town divide. That is an artificial divide and I do not accept it. There are differences, but the problems of people who live in the country are the same as the problems of people who live in the cities—tackling child poverty, tackling pensioner poverty, creating social justice and equality of opportunity and building schools and hospitals. Those are the things that really matter to people, whether they live in small villages or town estates. Those are the priorities on which the Executive is delivering.

I recognise, however, that there are differences. Fuel prices are a particular problem. Fighting my way through the foot-and-mouth disinfectant roadblocks on my way to see my relatives in Skye over the Easter weekend, I was struck yet again by the dependency of people in smaller communities in rural areas on cars, lorries and buses. Public transport is not good in those areas. Not only are people very dependent—overly dependent—on cars, they have to use them to travel much longer distances.

Photo of Jamie McGrigor Jamie McGrigor Conservative

As a member with an interest in crofting, what would Mr Macintosh say to the crofters on the island of Harris who are paying 90p a litre for diesel and 87p a litre for unleaded petrol?

Photo of Kenneth Macintosh Kenneth Macintosh Labour

I am about to talk about the measures that we are proposing. Both at Westminster and in the Scottish Executive, those problems are being tackled—especially with the action that we have taken to reduce rates for rural petrol stations, to give grants for tank replacements and to encourage alternative, cheaper fuels.

The Enterprise and Lifelong Learning Committee has made a number of observations. The problem of noticeably higher petrol prices is not uniform across rural areas. There may be a difference of 1p or 2p per litre in some areas, but it is in the islands and in the remotest areas where the difference can be big. The most crucial factor affecting prices in those areas is not transportation costs or exploitation by retailers or oil companies; it is low turnover and the low volume of sales at those petrol stations. The committee also noted that the Office of Fair Trading is to continue its investigation into the Western Isles because the market there is not fair.

Having made those observations, the committee went on to consider some other options. We agreed to rule out reductions in VAT or fuel duty, but we thought that there was room for action in a number of areas, including the introduction of a lower rate of vehicle excise duty. That already exists on some islands for lorries and it could be extended. The committee recognised the role of the Scottish Executive and the work that it is doing. I would like to draw the Executive's attention to the potential for co-operative schemes for the bulk buying of fuel. Highland Council's experience of operating a scheme for fishing boats in Skye was especially encouraging and could be extended. I believe that the Rural Development Committee has also made that point.

Yet again, one of the committees of this Parliament has shown that it can make a constructive contribution to the debate. Far from being divisive, the committee's report builds on the work that is being done at UK and Scottish Executive levels. I noted the minister's comments and I recommend the Enterprise and Lifelong Learning Committee's report to the Executive as providing a helpful way forward.

Photo of David Davidson David Davidson Conservative 11:28 am, 26th April 2001

It would be helpful if there were some honesty in this chamber and if we started off with the basic truth that the biggest factor in fuel price at the pumps is taxation—it makes up almost 80 per cent of the price. The biggest factor, and therefore the biggest opportunity for change to help people who are struggling—and the minister has already accepted that people, especially in rural Scotland, have no option but to use their road vehicles—is to consider ways of dealing with taxation. We set out our stall on this issue last year. Gordon Brown has made a temporary reduction to cover the period of an election campaign.

I am puzzled as to why the nationalists still work with gallons. I thought that they had reached the new age of the litre. However, perhaps they do not want to go beyond the 10p, because they do not know how they are going to afford that in their spending plans. Will Mr MacAskill confirm that the 10p per gallon is for the UK motorist, or is this just a Scottish device? He did not make that clear.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

This matter is reserved, so it will be dealt with at Westminster until such time as it is returned here.

Photo of David Davidson David Davidson Conservative

Thank you. So we are talking about something that would never be delivered as long as we have the union—thank God.

Photo of David Davidson David Davidson Conservative

By that, I mean the SNP pledges, policies and wish list—the cost goes on and on. Money does not grow on trees.

We have dealt with the pledges and how things might be paid for, but we have not yet had an explanation of the taxation policies. Perhaps Andrew Wilson will deal with this—I presume that he is going to wind up the debate. Mr MacAskill talked about the competitiveness of Scottish business, yet most Scottish businesses are not incorporated. Those people pay income tax.

Photo of David Davidson David Davidson Conservative

In a minute. Perhaps the member can deal with my point when he winds up the debate. Can the SNP tell us whether the extra penny for Scotland is a dead policy or another taxation policy on top of the 3p?

Photo of David Davidson David Davidson Conservative


Is the SNP going to use the power to vary income tax by 3p? Those are things that we need to know. We need to know where the basket of taxation is coming from. I am not convinced by some of the measures that the SNP has told us about today. We have heard nothing about other means of support for rural petrol stations. The SNP has told us nothing about how it would support petrol stations in conversion to meet the new vapour recovery requirement. The Executive is not paying out enough money for that—everyone says that. The conversion to allow vapour recovery is a huge drain on the individual suppliers.

Turning briefly to the Liberals—they are only worth a brief comment—George Lyon managed to go through the whole of his speech without telling us what his policy was.

Photo of David Davidson David Davidson Conservative

In other words, the Liberal policy is very simple. The Liberals want to freeze prices—although they have not said whether that is in real terms or will be inflated—for five years, but the truth is that they do not want to say anything that might upset their Labour colleagues.

Photo of David Davidson David Davidson Conservative

Sit down, Mr Lyon.

Let us consider one or two things that the minister said. They were quite revealing. She has displayed some honesty this morning and I thank her for that. However, I do not know from what figment of her imagination she has produced the figure of £16 billion in cuts. Even No 10, in its wildest estimates, cannot get the total past £11 billion, and even that figure is fictitious. We need to move on.

The minister also talked about LPG.

Photo of David Davidson David Davidson Conservative

No. It is almost impossible to access LPG in the north-east of Scotland. There is a filling station in Laurencekirk, but the next one is above Dyce. The cost of conversion is quite prohibitive. If we want short-term help, particularly for those areas affected by foot-and-mouth disease, the pump prices must be adjusted as quickly as possible. The businesses affected by foot-and-mouth are suffering now—they need immediate help. The Executive cannot postpone action on this much longer.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat 11:33 am, 26th April 2001

As all members know, fuel tax is a matter reserved to Westminster. My colleague George Lyon has dealt very effectively with the SNP motion. The point that he made about the SNP abandoning Westminster—I mentioned the same thing in my intervention—was very good. Only three out of six SNP MPs turned up for their own debate. Why were they missing? Because they said it was far more important to be here in the Scottish Parliament.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

I see that Margaret Ewing is here, but where are the others? It is hypocrisy of the highest degree.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

In a moment.

The most important point that George Lyon emphasised—and which the SNP cannot answer because it has got it completely wrong—is the SNP attack on the farming community at this particular time. It is probably unintentional, but it is stupid. The SNP motion talks about ensuring

"harmonisation of fuel prices with our European competitors".

What does that mean to the farming community? Does that mean that red diesel at 22p per litre would go up to 79p a litre? It is completely ill thought out.

Photo of Andrew Wilson Andrew Wilson Scottish National Party

None of those things will change. It is the overall price of fuel at the pump that we are dealing with. Perhaps Mr Rumbles will answer the question that George Lyon was unable to answer, which is that if the Liberal Democrat policy—

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

No. Sit down. The SNP is completely wrong. The members do not understand the terms and implications of their own motion. It would be devastating for farmers in rural Scotland and the fishermen whom they purport to support. It is ridiculous.

I have one more point about the SNP, a point that David Davidson touched on earlier. Is it not interesting that the SNP motion calls for a reduction of "10 pence per gallon"? When did they last pass a service station that prices petrol in gallons? Why use gallons? Because 10p per gallon sounds a lot. It is done for the benefit of the press gallery. In effect, that is a reduction of 2p per litre. It is typical of the SNP: hot air and soundbites.

Talking of hypocrisy, let us turn to the Tory amendment. David Davidson had the nerve to talk about honesty. The Tory amendment calls for

"a derogation of Vehicle Excise Duty for island registered private cars and the extension of such a derogation to designated remote communities in Scotland, identified on a postcode basis."

What a good idea. That is an issue that the Liberal Democrats will be campaigning on at the forthcoming general election. Is it not a pity that when the Tory chancellor, Kenneth Clarke, had ample opportunity to implement such a provision, he refused to do so? That is rank hypocrisy of the highest order. That attitude fits well into the long tradition of Tory hypocrisy, particularly in relation to the fuel price escalator, which the Tories now tell us they want to get off.

Photo of Murray Tosh Murray Tosh Conservative

As we are talking about honesty and transparency, perhaps Mr Rumbles could explain to the Parliament and to the Scottish electorate why the Liberal Democrats have voted all along against increases in fuel prices and have called instead for a carbon tax.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

Yes, I will address that now. We must remember that another Tory chancellor, Norman Lamont, introduced the fuel price escalator. The Scottish Liberal Democrats consistently refused to back those Tory fuel increases without the derogation for hard-pressed areas of rural Scotland—that is what we are standing up for in particular today.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

What a cheek to hear the Tories pretending to champion the cause of remote and rural Scotland. I have nothing but contempt for that approach in politics. No wonder people are turned off when they listen to the Tories.

The real issue is the continuously increasing taxation of fuel. The Liberal Democrats are the only main party at Westminster that has a realistic and sensible policy to help rural motorists. We demand a real-terms cap on fuel taxation for the next five years—I hope that David Davidson is listening to that point—and that any extra VAT revenues that the Government receives be redirected to help public transport and reduce taxes for road hauliers. We also want a derogation of vehicle excise duty for all remote areas of rural Scotland.

Photo of Patricia Ferguson Patricia Ferguson Labour

Please come to a close, Mr Rumbles.

Photo of Mike Rumbles Mike Rumbles Liberal Democrat

Our policy is absolutely straightforward and clear. We do not support the tabloidism and incompetence of the SNP motion nor the hypocrisy of the Tory amendment.

Photo of Sandra White Sandra White Scottish National Party 11:38 am, 26th April 2001

I heard the word "clear" mentioned. I do not know whether it is as clear as muck, but the Liberal policies and speeches sounded like that to me. I am very pleased that I am a member of the Scottish National Party. It is clear from the speeches given by members of the other political parties that we are the only party that stands up for Scotland.

David Davidson mentioned that the minister was being honest. Mr Davidson was certainly very honest—he said thank goodness for the union—whereas the Labour and Liberal members kid on that they do not really believe in the union until it comes up to a general election. I thank Mr Davidson for being honest. We know where all the other parties come from—Great Britain and that is it. They are not interested in Scotland or how the price of petrol affects the people here.

The minister said that we should be honest. Well, let us be honest. Is the cost of fuel too high? Yes. Is that caused by the tax? Yes. Who is responsible for that? New Labour. I will give an example, which I will quote in litres rather than gallons. In April 2001, diesel costs 77.9p per litre, 77.1 per cent of which is tax. How is that fair?

The minister said that we should consider local issues and the details that affect people's daily lives. Unfortunately, she forgot to mention urban areas, as did many members. I hear a lot about rural areas and rightly so, because they are being crucified by the costs of fuel, but so are the urban areas.

Photo of Helen Eadie Helen Eadie Labour

Is it SNP policy that we should apply the cost of transport and fuel to every aspect of taxation policy? If we consider the European situation, we have the lowest business and income taxes. We need to look at taxation policy in the round. Is Sandra White saying that the £1 billion—

Photo of Sandra White Sandra White Scottish National Party

Thank you. I let Helen Eadie in for a question, not a speech.

The best taxation is fair taxation. Fuel tax is not a fair tax; it is a punitive tax, which affects everybody. The minister mentioned people's daily lives. I will provide a couple of examples. In urban areas, the minister may not realise—although perhaps she does, as she is the Minister for Transport and Planning—that people travel to work, and they use cars and transport—

Photo of Sandra White Sandra White Scottish National Party

Yes, they use buses as well. Thank goodness somebody is listening.

They take the money for travel out of their wages. Fuel tax is a punitive tax. People who are on low wages have to pay it. The tax does not discriminate, which is unfair. Take the example of a family on a low income with a small car—

Photo of Sandra White Sandra White Scottish National Party

Sorry, but no.

That family may have a small car and a couple of children. They may want to go out for the day, for example, to take their kids swimming. They have to pay high fuel prices, and they are on a small wage.

In housing schemes there are few local shops. Perhaps all there is is a mobile van. Food in those areas is expensive. People who live there have to pay the high cost of food—not just young people, but pensioners—yet the minister tells me that this is fair taxation. I asked for honesty in this debate, and the minister said that she would be honest, but she has not been. Fuel tax affects poorer people, not the folk with lots of money, and the minister does not realise that. The tax takes no account of income, which is why the SNP's motion is fair.

The minister mentioned rural Scotland a lot. Yes, tourism is one of the main employers in rural Scotland. People are not coming to Scotland as a result of high fuel prices. When will the minister realise that and go to Westminster—I see that the minister is shrugging her shoulders, but that will do her no good. People out there are listening and waiting for something to be done. High fuel prices are a disgrace, and they must come down.

Photo of Andy Kerr Andy Kerr Labour 11:42 am, 26th April 2001

Here we are again, sadly. I thought that when Kenny MacAskill left the position of Opposition spokesperson on transport we would see an end to these puerile, meaningless debates, but we are back with them. He is the IM Jolly of the Scottish Parliament, and the king of crisis. He used the word "crisis" around 12 times in his speech. It was pathetic. The vision of Annabel Goldie and Kenny MacAskill limbo dancing under the petrol pump to get the price lower than anybody else was pretty uninspiring.

Nobody has mentioned the oil companies in this debate, least of all Kenny MacAskill, the friend of the oil companies. The leading four oil companies doubled their profits to £35 billion as a result of the oil crisis, and senior executives of those companies benefited by as much as £10 million in share options. The SNP talks about taking 2p off a litre. What about the price elasticity in the marketplace? We could take that money off, but the oil companies would put the price back up, because they know that the consumer will pay. If we do that, £1 billion will be lost to the Exchequer. That is £1 billion that we want to spend on the real issues identified in the spending review—

Photo of Andy Kerr Andy Kerr Labour

In a minute.

It is not just about what the Scottish Parliament does through the spending review to deliver for rural communities, with measures such as the transport fund and the support that we give to petrol stations in rural areas, but about all the other factors that the SNP bleats about every day.

Sandra White represents a community in which 60 per cent of members do not own a car, yet she wants to levy a tax against them, through general income tax, to the disbenefit of the majority of her community.

Photo of Sandra White Sandra White Scottish National Party

Andy Kerr says that 60 per cent of residents in the area that I represent do not own a car. His facts and figures are wrong. He should go back and check them. I do not think that people in Kelvin or other areas are particularly interested—

Photo of Andy Kerr Andy Kerr Labour

I thank Sandra White for that speech. Does she argue with the figure that 52 per cent of the urban population do not own a car? That figure was supplied by the Office for National Statistics. So 52 per cent of the population in urban areas will pay for the SNP's petrol price cut. It is a pathetic and silly policy.

Photo of Andy Kerr Andy Kerr Labour

No, we had a fairly pathetic contribution earlier.

Let us not forget that this is about the environment. It was about trying to encourage a mixed economy in the delivery of transport services. We cannot ignore our commitment under Kyoto. The Tories introduced the fuel duty escalator, and Labour removed it. We are reducing carbon emissions dramatically. However, let us relate this issue to America, where petrol is 35 cents per litre and consumption is 1,600 litres per person. In the European Union, the price ranges from 60 cents to 90 cents per litre, and consumption is 500 litres per person, so tax makes a difference. We know that, and that is part of the strategy that we have adopted. It is gas-guzzlers versus fuel efficiency.

The Enterprise and Lifelong Learning Committee's report on fuel prices praised measures that were introduced by the Chancellor of the Exchequer: for example, the across-the-board freeze of fuel duty excise, the 2p per litre cut in excise duty on ultra-low sulphur petrol and the 3p per litre cut on ultra-low sulphur diesel, and the change in the small car engine capacity threshold to 1549cc to give an estimated 5 million car owners access to the £55 discount on vehicle excise duty. That will make a difference, not just to the environment but to the Scottish economy, which we dearly look after.

Kenny MacAskill goes on about the comparison with Europe. We do not have road tolls to the extent that they do in Europe. It does not cost us £36 in road tolls to travel to London, as it would if we compared with Europe. The Institute for European Environmental Policy's study on transport costs in the UK shows that the costs overall are similar to those in the rest of Europe. We should consider the effect on air quality and the environment. For example, 24,000 premature deaths and 24,000 hospitalisations in the UK can be directly related to vehicle emissions.

I tell Kenny MacAskill that it is easy to argue for a shallow policy for political purposes, but he should live in the real world. Where will the £1 billion come from? Where is the fairness to those in the community who do not own cars in the SNP's policies, which seek to reduce what people pay for their cars, yet levy the cost against those who do not own cars? Why should my mum, who does not own a car, have to pay for the SNP's policies on car ownership? It is unfair and ill thought through. Colleagues, the SNP is not standing up for Scotland; it is misleading and bankrupting Scotland.

Photo of George Lyon George Lyon Liberal Democrat 11:47 am, 26th April 2001

As has been shown in this debate, the SNP's policy, as outlined in the motion, is flawed. The SNP has failed to stand up for Scotland when it really counts at Westminster on this important issue. We find it humorous and ironic that the SNP is demanding to know why the Liberal Democrats did not support the SNP amendment at Westminster, when 50 per cent of the SNP's MPs could not be bothered to make the journey to support that policy. It takes a bit of believing when Margaret Ewing points the finger at us.

There is an inherent flaw in the SNP's proposal to reduce fuel tax. The SNP cannot say whether the proposed tax cut will reach the motorist or whether it will wind up in the pockets of the multimillion-dollar oil companies. Kenny MacAskill, the friend of the oil companies, is an ironic title.

Photo of Robin Harper Robin Harper Green

Does George Lyon agree that the Liberal Democrat policy of a freeze on fuel taxation for five years will give the wrong message to those third-world countries that we want to get onside with the Kyoto protocol?

Photo of George Lyon George Lyon Liberal Democrat

If our policy is sending out the wrong message on Kyoto, what does that say about the SNP policy?

The greatest flaw in the SNP motion is the announcement that it will abolish red diesel. That would destroy the farming industry, the fishing industry and the forestry industry. Let us be under no illusions—

Photo of George Lyon George Lyon Liberal Democrat

Calm down, Kenny, and sit down.

Photo of Patricia Ferguson Patricia Ferguson Labour

Mr MacAskill, the member is not taking an intervention.

Photo of George Lyon George Lyon Liberal Democrat

Kenny MacAskill should understand his own policy before putting it on paper.

Let us be under no illusions: fuel is the single biggest cost for the fishing industry. SNP members portray themselves as the champions of the fishing industry. I wonder what the fishing industry will say when it realises that its biggest cost will triple under the SNP's policy. The SNP has made a grave mistake in failing to think through the harmonisation of fuel taxes or motoring costs throughout Europe. As the Minister for Transport and Planning rightly said, harmonising motoring costs throughout Europe would mean a substantial rise in motoring costs in Scotland.

I will quickly move on to the Tories—and it will be quick.

Photo of Margaret Ewing Margaret Ewing Scottish National Party

Is that an alteration in the Liberal Democrats' attitude to Europe? Do they no longer believe in cohesion?

Photo of George Lyon George Lyon Liberal Democrat

If Margaret Ewing thinks that the Liberal Democrats will follow the SNP on abolishing red diesel for the farming, fishing and forestry industries, she has another think coming.

I welcome the Tories' belated recognition of the need for special measures for rural parts of Scotland. It is a pity that they did not recognise that in 1993, when they introduced the fuel tax escalator. Why did not Norman Lamont or Ken Clarke stand up for rural Scotland and implement some compensatory measures for our rural industries and motorists? That shows hypocrisy.

Photo of Murray Tosh Murray Tosh Conservative

Will Mr Lyon take an intervention on the carbon tax?

Photo of George Lyon George Lyon Liberal Democrat

Mr Tosh is far too late.

David Davidson needs help not only with his hearing, but with his knowledge of history. As his colleague Annabel Goldie had, he seems to have forgotten the time from 1979 to 1997.

Duncan Hamilton—that Edinburgh-based MSP for the Highlands and Islands—said that he had spent his life following me. Long may that continue.

Photo of Murray Tosh Murray Tosh Conservative 11:52 am, 26th April 2001

We have had some interesting insights this morning, not least the love-fest between the Liberals and the SNP about who voted where, why and for whom. My first amusing thought this morning occurred when Kenny MacAskill informed us that he would not be a whingeing Jock, then proceeded to be a whingeing Kenny for 15 minutes. His second entertaining comment was his revelation of the carefully guarded state secret that the purpose of petrol taxation is to raise taxation. That had obviously come as a blinding revelation to him. He felt that that purpose was inappropriate. That is a bit unfair, because in the Parliament's two years, no other member has shown greater dedication to spending the proceeds of taxation. It seems reasonable to consider now and again where some of the money comes from.

Kenny MacAskill said that the SNP's policy is not a short-term fix but a long-term remedy. Mr MacAskill fools nobody about that—probably not even himself. He is fixed only on the short term and the election. He promises cuts that he knows cannot be delivered, because unlike the Conservatives, the Scottish National Party cannot win the general election and cannot deliver on its pledges. [Interruption.] That is not to say that Mr MacAskill did not have some pertinent points. In the past three or four years, it has been clear that fuel prices have been high.

Photo of Murray Tosh Murray Tosh Conservative

Absolutely. When we win the Westminster election, we will deliver a reduction in fuel duty. We will deliver it in litres, and it will be a greater reduction than that which the SNP proposes.

We accept that the level of fuel prices has distorted trade. I will not sign up to the motion that is in Mr MacAskill's name, but I support the idea that, in selected areas, we should be careful to ensure that our fuel prices are not dangerously out of line with those of our competitors. We have debated road haulage costs and that is a fair point.

It is also fair to say that the Executive has responsibility for rural fuel prices. The minister referred to that. When she had finished enumerating her list of the acts of the listening chancellor, she conceded that the Scottish Executive and the Chancellor of the Exchequer were discussing rural fuel prices. I appreciate that the Enterprise and Lifelong Learning Committee's report was published only relatively recently. It is responsible for the Executive to take some time to respond to that.

However, it is important that we say to the Executive that the whole Parliament expects it to speak for Scotland on rural fuel price differentials. That issue has emerged in the Parliament. It is responsible and appropriate to say that we should look for Scottish solutions to Scottish problems. I am grateful that Mr Lyon acknowledged our support for that emerging debate in committees and the Parliament. He was rather more generous than Mr Rumbles—that is another blinding revelation that will astonish nobody.

As we were all re-examining the past and being open and transparent, I asked Mr Rumbles whether he would kindly explain to voters the difference between the petrol tax that Labour and Conservative ministers have imposed and the carbon tax that Liberal ministers would theoretically impose. He said that he would deal with that later, but he did not. Mr Lyon was too late into his speech to deal with the issue, and I am too late into mine. Perhaps the member will have his opportunity on another day.

Photo of Patricia Ferguson Patricia Ferguson Labour

You are in your last minute.

Photo of Murray Tosh Murray Tosh Conservative

Mr Rumbles was not in his last minute when he took my intervention. He promised me an answer, then blatantly ignored the point. I asked a question and was promised an answer but was not given one. That answer has repeatedly not been given. None of us should take the moral high ground. Let us agree that if there is one thing that has emerged from the debate about fuel, it is the injustice done to our rural areas.

Photo of Murray Tosh Murray Tosh Conservative

We all have a stake in the remoter rural areas and all represent electors in those areas. There is a wider feeling in Scotland that an injustice is being done and should be remedied. I applaud the Enterprise and Lifelong Learning Committee's work. I agree with much of what Ken Macintosh said in his excellent speech. [Interruption.] I am astonished that, in debate after debate, Mr Rumbles is allowed to shout at members of the SNP and the Conservatives. He never shows some restraint. He does not shout at Labour members, although they like him less than we do. [Laughter.]

Justice must be done and be seen to be done on rural fuel. The Enterprise and Lifelong Learning Committee has given ministers a dignified and appropriate way of raising and redressing the issue. I hope that that proposal will be the outcome of two years of debates in the Parliament. I support the amendment that is in Miss Goldie's name.

Photo of Patricia Ferguson Patricia Ferguson Labour

Before I call Mr Macdonald, I ask all members to listen to other members' speeches. The level of noise in the chamber is becoming excessive.

Photo of Lewis Macdonald Lewis Macdonald Labour 11:58 am, 26th April 2001

The debate has been rather predictable, but it has been good to have the occasional moment of entertainment. Sadly, the Opposition parties have mainly made the usual array of uncosted promises, as if we could have swingeing tax cuts today and no loss of public services tomorrow. That relates to elections to another place. Many members have listened to the Opposition parties simply to find out who can make the rashest promises. Opposition members are no doubt secure in the confidence that they will never have to deliver on them.

The opportunity to invent a crisis was not going to be passed by. Only last week, Simon Hinde warned in the Scottish Daily Express that according to the gloomiest forecasts, the price of petrol could rise to more than £3.60 a gallon. He reckoned without the gloominess of Kenny MacAskill. If there is a chance that the cost might rise to £4 a gallon, Kenny will want to be the first to say so.

The Labour party recognises the seriousness and significance of the matter, so we are introducing constructive measures to tackle the issues that face us. Those measures add up to a strategy for tackling disadvantage in areas that suffer from a low throughput of petrol at the pump or as a result of rural disadvantage. We also want to protect the wider public spending needs of the country as a whole.

Kenny MacAskill told us that his pledges were fully costed. He also said that he recognised that tax cuts might threaten public spending, yet he did not offer a single figure to substantiate his costings. The SNP is an Opposition that promises to do everything and promises that doing everything will cost nothing. To help the SNP out, Sarah Boyack brought forward an estimate of the cost of the SNP's proposals. If 10p off a gallon means roughly 2.5p per litre in the language of 2001, we estimate that that could cost Scottish public services in the region of £65 million. It would be interesting to know where that money would come from.

Photo of Richard Lochhead Richard Lochhead Scottish National Party

The minister represents the Aberdeen Central constituency. Will he tell the chamber why motorists living in Aberdeen, which is the heart of Europe's oil and gas industry, have to pay the highest price for fuel in Europe?

Photo of Lewis Macdonald Lewis Macdonald Labour

Motorists in Stornoway would take exception to Richard Lochhead's statement. The Office of Fair Trading continues to investigate the price of oil and petrol in Stornoway.

However, that said, I will respond to Richard Lochhead's intervention. In his motion, Kenny MacAskill proposes

"a harmonisation of fuel prices with our European competitors".

Does Kenny MacAskill mean harmonisation with Norway? That country produces more oil than we do, yet it pays more for petrol than we do.

Photo of Margaret Ewing Margaret Ewing Scottish National Party

Norway is not even in the European Union.

Photo of Lewis Macdonald Lewis Macdonald Labour

Norway is one of our European competitors, even if Margaret Ewing chooses not to accept that. The SNP often models its policy prescriptions on Norway. Does Scotland want harmonisation with Norway where, although more oil is produced, petrol costs more and the gross domestic product is higher? Or does it want harmonisation with Greece, where petrol is cheap but people are poor?

Kenny MacAskill may want to answer that.

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

Has the minister seen the Automobile Association's fuel price report, which details that the price of diesel in Norway is equivalent to 55.76p, as opposed to 78.4p in the United Kingdom—

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

And in Norway, unleaded petrol is 66.48p per litre, as opposed to 84.7p in Scotland's remote areas—

Photo of Kenny MacAskill Kenny MacAskill Scottish National Party

Could he indeed tell us why he does not want us to harmonise at least towards those levels?

Photo of Patricia Ferguson Patricia Ferguson Labour

Order. Mr Macdonald, I have to stop you for a second. Please wait until the member has finished his intervention before you continue—I presume that Mr MacAskill has now finished.

Photo of Lewis Macdonald Lewis Macdonald Labour

I will certainly take your guidance on that, Presiding Officer. No doubt I will have another opportunity to allow Kenny MacAskill to propose his petrol prices.

The fundamental paradox that lies at the heart of SNP policy in this area is that everything about Scotland's economy will be all right in the end because of the infinite value of North Sea oil. SNP members appear not to understand that the main driver for the ups and downs of petrol prices is not the level of taxation but the price of crude oil in global markets. That is what drives the price of petrol at the pump. Today, the price of a barrel of Brent crude is $26.50; six months ago, it was $35. Perhaps Mr MacAskill noticed how much higher our petrol prices were then. Two years ago, the price was barely $10—so low, incidentally, that it put thousands of Scottish jobs at risk.

If setting the level of fuel duty on the assumption that prices will be stable or rising would be a mistake, setting the whole of Scotland's revenue and spending plans on the same assumption would be folly. That is the kind of folly which Mr MacAskill's party would have us accept.

Photo of Lewis Macdonald Lewis Macdonald Labour

I will refer to the Tories. As has been pointed out, they introduced the fuel duty escalator. On the one hand, they wish to compete with the SNP in promising tax cuts that they will never have to make. However, to their credit, their amendment mentions one of the reasonable proposals that the Enterprise and Lifelong Learning Committee report asked the Executive to consider. Sarah Boyack has made it clear that ministers will address those proposals when they respond to the committee's report.

Vehicle excise duty is a reserved matter. It is for the Executive to raise such matters with colleagues in the UK Parliament. We will continue to do so and to take up the matters on which we believe that a real impact can be achieved.

The same is true of extending the availability of liquefied petroleum gas, which is already receiving significant funding support. Stations are opening all over Scotland. For those who are concerned about the tourism industry in the Highlands and Islands, it is worth noting how widely spread LPG is in many of the countries that send tourists to the Highlands and Islands. In fact, one of the reasons why LPG is such a success in Highland Scotland is that it is cheap and available to tourists from Italy, the Netherlands and elsewhere.

The Executive will operate in the real world and will consider the real choices that face it. We will not pretend that we can have lower tax and better services. Instead, we will invest the money that we have in improved infrastructure and transport throughout Scotland, investing record sums in our lifeline services to remote island and mainland communities and making the case for Scotland's transport needs in our dealings with the UK Government. The Executive is determined to use the Parliament's powers to improve the lot of our people, whether they live in rural communities or in urban Scotland.

Photo of Fergus Ewing Fergus Ewing Scottish National Party 12:06 pm, 26th April 2001

I have not one shred of doubt that the majority of people in Scotland, and especially in the Highlands and Islands and rural Scotland, agree completely with the proposition that the cost of fuel in Scotland is far too high. I say that in all seriousness because I have been disappointed by aspects of the debate, one of which was mentioned by Mr Tosh. The seriousness of the topic was driven home by Sandra White, who pointed out in a straightforward, down-to-earth manner the impact that fuel prices have on those on low incomes.

That point was first forcefully underlined to me after I was elected, when I met two people in my constituency who live in a part of Scotland called the Cabrach, which is about as rural as one can get. It is miles from the nearest stick. The married couple both had to work on very low wages.

Photo of Fergus Ewing Fergus Ewing Scottish National Party

Mr Kerr should sit down, as he had his shot earlier.

The amount of money that those people have to pay for fuel from their weekly earnings is totally unjustifiable. In its impact on those on low incomes, the fuel tax is far more punitive than the poll tax ever was. I am disappointed that not one back-bench Labour MSP in the Parliament has had the guts to speak out on the issue, although I am not surprised, because—

Photo of Fergus Ewing Fergus Ewing Scottish National Party

If Mr Kerr is saying that he will speak out, I will read his press release after the debate. I am having my turn now, so he can sit down on his bahookie.

Labour MSPs—all 56 of them—have copied that example from their models down in Westminster, not one of whom, over four years, has rebelled against Tony Blair. I issue to Labour MSPs a challenge, from which Mr Kerr is excluded. Can they find a random sample of 56 people in Scotland in which a single person does not think that fuel tax is too high? Despite their opinion surveys, focus groups, consultants' reports and the millions of quid of taxpayers' money that they say they are so concerned about but which they blow away on advertising, not one member of a random sample of 56 people would agree with them.

Photo of Fergus Ewing Fergus Ewing Scottish National Party

That is because we have a serious problem to address.

I want to discuss how that problem should be dealt with and to tell the Conservatives, who have tried to propose a serious argument, why I believe they are wrong. First, fuel tax is too high. Secondly, as Murray Tosh recognised, we must be able to compete with our European competitors. How on earth can our businesses compete with those in countries such as Greece, where the cost per litre is cheaper by nearly half, at 43.69p as opposed to 78.5p? How can we compete with countries such as Ireland, a close competitor in many fields of business, where the cost is 48p? How can we compete even with Italy, where the cost is slightly higher than that, at 55.87p?

Photo of Fergus Ewing Fergus Ewing Scottish National Party

I do not know whether there is a problem in Tuscany. I do not know whether there are higher prices in Tuscany, as there are in the Highlands and Islands, although I should be very happy to hear an intervention from Mr Alasdair Morrison who, I believe, could probably tell us what the price of fuel in Tuscany is.

Photo of Fergus Ewing Fergus Ewing Scottish National Party

How can we compete with our competitors if we are saddled with that unfair burden?

Photo of Lord David Steel Lord David Steel Presiding Officer, Scottish Parliament

Order. I get the impression that Fergus Ewing does not want to give way, so other members must resume their seats.

Photo of Fergus Ewing Fergus Ewing Scottish National Party

I fear that I shall just have to speak up, Presiding Officer.

The other problem, of course, is that the Conservatives' measure of a one-off cut will not do, because it will not begin to tackle that competitive disadvantage. We must have a level playing field in that regard. One of the very real disadvantages is that 40-tonne trucks coming into the UK can carry 14,080 litres of fuel and can drive for 2,500 miles. The amount of smuggling that goes on costs hundreds of millions of pounds a year, according to the Road Haulage Association, and it is not a problem that affects only businesses.

Photo of Fergus Ewing Fergus Ewing Scottish National Party

Mr Kerr should sit down and learn something.

I have been advised that, in Northern Ireland, it is estimated that as much as half the fuel bought by domestic purchasers may be brought over the border. People whom I have met recently tell me that, at one specific petrol station, they saw one person buying 140 gallons of fuel in a car and in various jerricans. Quite apart from the fact that that must be a huge danger, it is economic madness. The Labour party has made no attempt in the debate to say what the hidden cost of smuggling is, nor has it made any attempt to address the problem of the cost to business.

When I was elected, I made a pledge that I would raise the topic of fuel from time to time, and I hope that I have done so—perhaps not as often as I should have, but I shall try to put that right. I was told by a haulage contractor that he could not continue profitably in an otherwise very successful business unless action was taken to tackle the disgracefully high level of fuel tax.

The most intractable problem is how to deal with the differential that we have suffered in the Highlands and Islands for several decades. Indeed, when I was a member of the Enterprise and Lifelong Learning Committee, I quoted a 1976 editorial from The Press and Journal about that. Of course, we welcome any measures that will tackle that problem, but we are far from convinced that there is any real will on the part of the Government to do so.

Photo of Fergus Ewing Fergus Ewing Scottish National Party


Sarah Boyack's saying that she recognises concerns about high fuel prices should be seen in the context of the fact that the Labour Government has had four years to address the problem. I am afraid that LPG, as has been pointed out by many members, is frankly not the answer. Sarah Boyack could not tell me how many cars in the Highlands take LPG, but all I can say is that I have not seen any and I think that I have seen only one garage in my constituency where LPG can be purchased. [Interruption.] I did not go to Tuscany over Easter.

At Westminster, the SNP has consistently voted on every single occasion for the policy that we support today for a reduction in fuel tax. Our policy has been utterly consistent. It is one of the policies with which I am most familiar, because I wrote it, and it was passed unanimously at conference, irrespective of my persuasive skills, I am sure.

The level of fuel tax hits every business in Scotland and every family in Scotland. I believe that in a few weeks' time, when people have the chance to say who they believe on the issue, they will send the clear message that the SNP stands up for Scotland, while the Labour party has betrayed the interests of Scotland for the past four years and will continue to do so for time immemorial.