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Mr. Mans : I accept that. I do not think, however, that simply making unleaded petrol pumps compulsory in all garages will necessarily mean a large increase in take-up. There are many other factors, including the type of engine involved. As I have said, I think that the differential is about right ; the important thing is to achieve a complete programme to ensure that take-up increases progressively and reaches a much higher level. I am confident that within the year it will reach at least twice the present level of 14 per cent.
Mr. Matthew Taylor : I am pleased to be able to speak to the Social and Liberal Democrat amendments, which provide a stronger financial incentive than any of the others that have been tabled. The starting point- -on which everyone seems agreed tonight--is that, while much can be done to promote understanding of the need to turn to lead-free petrol, a financial incentive is needed for a rapid rather than gradual transfer as legislative requirements come to apply to motor manufacturers in any case.
I welcome the Government's recognition of that need through the provision to increase the rebate on excise duty on unleaded petrol, in tandem with changes in the duty levels on two-star and three-star petrol. That has resulted in a differential of perhaps as much as 10p a gallon, since it is not always passed on to the full extent. It has also resulted in considerable publicity, and there has clearly been an impact on the use of lead-free petrol.
The problem is that that is not enough ; we would not have put our name to the amendments if we felt otherwise. The full value of the Government rebate will not be passed on to the consumer. I believe that the larger rebate that we propose would guarantee a greater differential on the forecourts, and that scale of differential will be needed to
Column 938convince the many motorists who will have to convert their cars that such action is not only environmentally but financially advantageous.
Savings made through the use of lead-free petrol must provide immediate--or as near immediate as possible--compensation for the costs involved in the change. It must be made clear to motorists that they will stand to gain. I wish that we could persuade them without resorting to a financial incentive, but that is clearly not possible, as the Government have accepted by drawing up these measures. I think that they should go further.
Mr. Robert B. Jones : Can the hon. Gentleman explain why, when the Select Committee on the Environment was taking evidence on the matter only two years ago, neither he nor his party submitted any evidence to that effect?
Mr. Taylor : The hon. Gentleman has made a good party point, but it is not a very good point in practice. It is almost impossible from a practical point of view to make submissions on every subject ; what we are doing is tabling a constructive amendment tonight. The amendment would contribute towards a differential of about 15p at the pumps, which would mean a saving of about £45 a year for the average motorist. That is not much in itself, but should be sufficient to motivate many people to convert their cars. In my view, anything else would be inadequate. The Labour amendment adds nothing to what the Government are doing : it is not sufficient to make any real change.
There is no doubt that motorists understand in theory the need for change ; a recent survey suggested that four out of five drivers considered that air pollution from car exhausts represented a serious threat to the environment. Yet, although 10.5 million cars on our roads could run lead- free, in February 1989 only about 250,000 had been altered--although the figure will have increased since then. That is where the economic incentives come in.
There is also a need to convince independent retailers that it is in their interests financially--or even that the risk is worth bearing--to promote lead-free petrol in their outlets. Otherwise, we cannot really explain why Britain lags so far behind many of the leading countries ; we have heard many figures proving that that is the case.
It is an environmental issue that Governments can tackle effectively. Earlier in the debate, we discussed some of the evidence of the impact that changing to lead-free petrol can have in the health of adults and children. I referred to evidence from America which showed that, between 1976 and 1980, there was a 55 per cent. decrease in the amount of lead in petrol and a 37 per cent. reduction in the average level of lead in blood. That suggests a clear and immediate link between lead in petrol and people's health. The problem is that, given the current rate of conversion, I am not sure that there will be any reduction whatsoever in the amount of lead in people's blood or in the health hazards. Although cars are undergoing conversion, more cars are coming on to our roads and more mileage is being covered. I wonder how much impact the Government's present measures are having on the problem we are seeking to tackle.
Mr. Roger King : I have been listening to the hon. Gentleman and I think that he is painting an unduly pessimistic picture. He will recall that the European Commission decreed that the amount of lead in leaded fuel
Column 939should be reduced dramatically from 1982 onwards from something like 0.04 mg/ml down to 0.015. That is a dramatic reduction of about 70 per cent. in lead emissions into the atmosphere, without taking into account the impact of the general provision of lead- free petrol. So over a number of years, the Government, with the European Commission, have been playing an active part in addressing the issue, and lead levels have reduced dramatically. We are seeking to eliminate the final few per cent.
Mr. Taylor : I accept what the hon. Gentleman says, but I do not consider that we have gone far enough. I do not believe that the measures in the Bill will achieve what the Government consider necessary. I do not think that we should be debating whether there is a problem. Certainly Ministers believe that there is a problem. I am trying to encourage a Government who take a certain amount of pride in radical solutions to be a little more radical in addressing the problem. The Prime Minister could gain publicity points by saying that she is putting a tiger, or a tigress, into people's tanks--she would think that that would be an appropriate expression for her. I hope that the hon. Gentleman does not seek to use the debate to reopen the discussion on whether we need to do something about it. The public and the Government appear to acknowledge that. I turn from the financial incentives to the need to generate adequate information and publicity. There remains too much ignorance among motorists and others about the costs involved in making the necessary changes and the ease with which those changes can often be made. I do not believe that the problem is simply financial, although I have discussed that at some length. Despite the fact that, according to the survey to which I have referred, four out of five people acknowledge the problem, I suspect that there is insufficient recognition of how easy it is to tackle it, and the fact that, once converted, a car can still use four-star petrol and there are unlikely to be problems unless a car is fitted with a catalytic converter. All those subjects are insufficiently explained. Our debates tend to concentrate on four-wheeled vehicles, but in my constituency two-star petrol has virtually disappeared as petrol companies will not deliver it, so most garages provide four-star petrol or lead-free petrol and nothing else. Many people are getting in touch with me--and I have written to Ministers at the Department of Energy--about their motor cycles, their lawn mowers and garden implements that they have wheeled out in the recent sunshine ; they cannot get the fuel that they have been buying for years. There is virtually no information available to them. A local newspaper recently published an article asking the local motor cycle garage and lawn mower sales point for advice. Their advice was that they were considering the matter, that they were reasonably sure about modern machines being able to run on lead-free petrol, but, apart from that, they did not like to advise anyone and they said that people should refer to the manufacturer. Clearly, that is not a good position for those people.
The Government should adopt the recommendations of CLEAR and spend money on advertising to explain the benefits and the costs of conversion and put in the same efforts that they are making to explain the poll tax that we
Column 940debated earlier today. Hon. Members acknowledge the problem, but we must decide how to solve it as rapidly as possible. Amendments Nos. 11 and 12 show clearly that we can move forward by giving people a financial incentive within a time scale to which they are likely to respond.
Mr. Neil Hamilton (Tatton) : I am afraid that I shall have to disappoint the hon. Member for Truro (Mr. Taylor), because I believe that there is an issue that should divide us. I am against not only the proposed amendments but clause 1, for reasons that I have had the opportunity on previous occasions to dilate on in the House. I apologise to the hon. Member for Wrexham (Dr. Marek) for not being present at the beginning of his speech. I do not know whether he played a significant part in the Labour party's policy review, but as Socialism has been declared off the agenda it will no longer be appropriate to sing the "Red Flag" at the end of its annual conference. We can assume from his speech that it will be replaced by the green flag.
When Ministers and Opposition Front Bench spokesmen unite in favour of a proposal, hon. Members should regard it with the deepest suspicion. I never thought that my hon. Friend the Economic Secretary to the Treasury would be charged with the high crime and misdemeanour of seeking to be fashionable. I am afraid that that is the charge that I shall have to lay against him this evening. My hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen) made one of the most shameless speeches that I have heard in the six years that I have been an hon. Member. It was a truly disgusting performance, crawling on all fours before the editor of his local newspaper for some cheap mention on a matter that, in other circumstances, he would have disdained. Even he--in what for him was an idiosyncratic speech because it was not idiosyncratic--followed the fashionable nostrums of the time.
Sir Hal Miller : Is not my hon. Friend being a little ungenerous to my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen), who made his maiden constituency speech and should not therefore attract unduly robust criticism?
Mr. Hamilton : I always regarded the constituency of my hon. Friend the Member for Wolverhampton, South-West as being principally himself. One should not confuse his electorate with his constituents. That is something to be avoided, and I understand that my hon. Friend avoids it as often as possible.
There is no case for a differential in the tax rate between leaded or unleaded petrol.
There is no case for discriminating between leaded and unleaded petrol because there is no evidence that lead in petrol poses any health risk. An article appeared in a journal which I am sure lies on the bedside of all hon. Members--the British Journal of Developmental Psychology --about relationships between blood lead, behaviour, psychometric and neuropsychological test performance in young children. A sample of 201 inner-city-dwelling children aged five and a half was taken by the university of Birmingham's environment, research
Column 941and behaviour research group. I commend it to my hon. Friend the Member for Wolverhampton, South-West. It says :
"Results show that the initial correlations between blood lead and the outcome measures were generally few and low. No significant relationship was found between overall IQ and blood lead and the one marginally significant association found when the sample was split by father's occupation proved non-significant on multivariate analysis."
This latest study merely backs up the numerous studies published over the years to which I referred in a previous speech in this House, made to a somewhat smaller audience at 1.14 am on 4 December 1984. I gave a number of examples of scientific studies which conclusively proved nothing in relation to this matter.
I will remind the Committee briefly of some of those examples. The Medical Research Council, to which the Government listen carefully, reviewed the subject between 1979 and 1983. It said that the published evidence showed that there was no statistically significant association between body lead burdens and IQs after allowance had been made for the confounding factors. In 1983, the "Digest of Environmental Protection and Water Statistics" reviewed 35 surveys carried out in the European Community. Of those, in only three instances was the reference level set by the EC for the lead content of the blood breached. It was shown that in each of the studies, the reason for the breaches had nothing to do with lead emissions into the atmosphere.
Mr. Budgen : Surely all that my hon. Friend is saying is that there may be some doubt about the technical and scientific evidence used to support the incentives that the Government have put into the fiscal system. He is doing a perfectly good service in drawing attention to the uncertainty of the scientific evidence, but as long as the Government give an incentive merely by way of fiscal encouragement and not by the use of the criminal law, there is nothing to complain about. My hon. Friend may, of course, wish to draw this matter to the attention of the wider public, so that they can take his views into account when deciding whether they wish to avail themselves of the fiscal incentive or to buy what they may regard as more effective petrol.
Mr. Hamilton : That is true, but this tax change costs the Treasury £170 million in a full year. I contend that we could have had other tax reductions in its place, such as exempting all Members of Parliament from income tax, which would have had far more demonstrable benefits to society in general by encouraging men of high ability, but of otherwise of no earning power, to come into the House.
There is no evidence for justifying a tax differential of this kind. It is wrong for the burden of proof to be placed on those who say that there is no evidence. The Government are saying that we should try to prove a negative, which we cannot. This is one more unfortunate instance, which we have seen too often in recent years with Governments of all parties, in which the taxation system is being used to dictate the preferences of the consumer.
Column 942perhaps not a large mistake--and I am sorry that on this occasion we have decided to be slaves to fashion and have moved in an unfortunate direction.
Mr. Pike : The hon. Member for Tatton (Mr. Hamilton) often expresses minority views in an extreme way. I will say only that to be speaking in opposition to his convinces me that we must be moving in the right direction.
I do not intend to refer to the problem of other vehicle emissions, although lead is only one of the many problems, because the other emissions are not relevant to the debate. The hon. Member for Wyre (Mr. Mans) and other hon. Members referred to the obstacles that prevent people from converting to lead-free petrol and that is valid. But in view of the time, I will not pursue those matters, nor the fact that there are causes of lead poisoning other than vehicle emissions.
This simple amendment deals with a principle that is accepted by both the Government and the Opposition--that to encourage the use of lead-free petrol, an incentive should be provided in the price. We are debating a question of degree. The Labour party's amendment would increase the size of that incentive slightly, while the SLD amendment would make an even greater concession.
Given that there is such a degree of agreement, I suggest that the best course for the Government to take would be to accept amendment No. 1, which embodies the middle-of-the-road approach. They could thus avoid dividing the Committee. It would be sensible not to argue on this occasion about which party is the greener and about whether the SLD is greener than the Greens. We are talking about very small sums. I hope that, in view of the Government's Budget surplus, they will see the wisdom of conceding that the Labour party is right and accepting the amendment.
On 21 February the hon. Member for Hornsey and Wood Green (Sir H. Rossi), the Chairman of the Select Committee on the Environment, sent the Chancellor a letter which was issued as a press release. The Select Committee was not politically divided ; the Chairman's letter received the support of both sides of the Committee. The Chairman of the Select Committee told the Chancellor that he supported the action previously taken by the Government but that he was concerned that there had not been a sufficient increase in the take-up of lead-free petrol. The letter said :
"The purpose of this letter, which has the support of my Committee, is to urge you to make a substantial increase in the duty differential, namely, to at least 12p per gallon, which the oil companies should be required to pass on to the motorist in full." The amendment would bring us nearer to that figure of at least 12p. The Government should acknowledge the unanimity of the Select Committee on the Environment. They should accept our amendment and thus avoid the need for a Division.
Mr. Michael Brown : Unfortunately, my views and those of my hon. Friend the Member for Tatton (Mr. Hamilton) are not the same on this occasion. Perhaps I can explain why. In December 1984, my hon. Friend presented a petition from the residents of Tatton and Eddisbury for redundancy payments for Associated Octel workers who had been made redundant due to the Government's policies on lead in petrol. My hon. Friend was representing
Column 943his constituency interests. I, on the other hand, represent a constituency that contains the Conoco and Lindsey oil refineries. Hon. Members have spoken about the need to move more quickly. I have to point out to the hon. Member for Truro (Mr. Taylor) that we could not move more quickly in my constituency until we had built that catalytic cracker at Immingham in my constituency at a cost of £80 million. We had to do that so that we could make unleaded petrol for use in the tanks of garages all round the country. It takes two years to build a catalytic cracker for oil refineries such as Conoco, so the Government must be acquitted of the charge of not moving quickly enough.
The amendments should be rejected. The Government have been shown the way to encourage people, but we should be careful about going too far too fast.
The hon. Member for Barnsley, Central (Mr. Illsley) talked about the cheapness of conversion. I will willingly take my 20-year old Land-Rover and my eight-year old Jaguar to his constituency if they can be converted to use unleaded petrol for £4.95 each.
It has been a good debate. The Government have struck just the right balance, and we should congratulate my right hon. Friend the Chancellor of the Exchequer on what he is doing.
Mr. Lilley : The amendments call for us to do more of what my right hon. Friend the Chancellor has done in the past three Budgets. Most amendments are critical. However, Miss Boothroyd, like your colleague Mr. McWilliam, you are a noted music lover. You will know that the calls of "encore" at the end of a concert are primarily expressions of praise rather than demands for an action replay of Mahler's Fifth. I take the spirit behind the amendments primarily as praise for what my right hon. Friend the Chancellor has done in increasing the differential to about 14p, not the lower figures that were given by the hon. Members for Burnley (Mr. Pike) and for Truro (Mr. Taylor). The reason the pump price differential tends to be only about 10p is, as my hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown) said, that there are considerable costs in producing lead-free petrol as against leaded petrol.
Praise from any quarter is welcome, particularly when it comes from the Opposition. It is most unexpected when it comes from my hon. Friend the Member for Wolverhampton, South-West (Mr. Budgen). I am grateful to him for it. I suspect that his praise is in the same spirit as that of the great Bacon, from my constituency, who talked of "laudande praecipere"--to praise in order to teach. I agree that we should not use the criminal law to encourage the use of lead-free petrol and are right to proceed by the means we have adopted. We have got it right and been successful. Since the Budget, the response to the announced changes has been more dramatic than we dared hope. The market share of lead-free petrol has more than doubled-- from 6.4 per cent. immediately before the Budget to 14.4 per cent. a month later. The number of filling stations selling lead-free petrol increased dramatically from 30 per cent. before the Budget to about 50 per cent. after the Budget. I assure the hon. Member for Wrexham (Dr. Marek) that it is continuing to increase at the rate of about 250 a week. The hon. Gentleman will be able to work out that that is about 1,000
Column 944a month. Given about 20,000 filling stations, that is an extra 5 per cent. a month. The hon. Gentleman's target of 60 per cent. by next year seems to be easily attainable.
The major reason for the rapid increase in the number of petrol stations stocking lead-free petrol is the measure that the Financial Times described as a masterstroke, whereby the price of two-star petrol has increased to that of four-star petrol. As a result, the share taken by two-star, which was already falling and had fallen to 6 per cent. before the Budget, has fallen to about 0.6 per cent. and it has effectively disappeared from most forecourts in the country. Customs and Excise has had to introduce special concessions to petrol companies that have had to return unsaleable two-star and three-star petrol and sought duty remission on it.
Mr. Lilley : It is almost unprecedented for any hon. Member to ask a question for that reason. Most motor cycle and similar engines can take two -star petrol. If they cannot, they can take four-star leaded petrol, but it is appropriate to ask a dealer or garage if one has a particularly rarefied form of engine.
Mr. Matthew Taylor : The Minister will recall that I referred to that matter. The picture is not quite as straightforward as he paints it. Many people who use four-star petrol will see a considerable reduction in the life expectancy of their machines. Simply to refer people to manufacturers is somewhat inadequate. Much effort has been made for motor vehicles. Will the Minister see whether some effort can be made to help those who are concerned about motor cycles and garden machinery?
Mr. Lilley : Perhaps the hon. Member for Truro will welcome the fact that we have not accepted the advice of the hon. Member for Wrexham to ban the sale of two-star petrol. It will remain on sale, so there is the possibility that it will continue to exist. Another important measure of the changes since the Budget is that Halfords earlier this year was adjusting to lead-free petrol some 200 cars a week. Since the Budget, as a result of its excellent campaign with the Today newspaper, it is adjusting some 6,000 a week at a cost of less than £10 each.
As a result of those changes, I can inform the House that we have increased our estimate of the likely share taken by lead-free petrol by the end of this year, which we had expected to rise to about 15 per cent. It has already reached 14.4 per cent., so we expect that by the end of the year it will have risen to 20 to 25 per cent. I see no reason why by this time next year it should not have reached the target of 30 per cent. that was suggested by the hon. Member for Wrexham.
We are already the fourth highest country in the list of users of lead-free petrol and we are rising rapidly up that list. I hope that that will be welcomed by hon. Members. It is still, nevertheless, necessary for us to dispel the myths about the use of lead-free petrol, and thereby increase the uptake of the fuel. Two thirds of all vehicles on the road
Column 945at present can make use of lead-free petrol either already or as a result of a cheap adjustment, which is sometimes available free, but rarely costs more than £20. Those who switch to lead-free petrol can mix with it or change back to leaded petrol if they wish or if lead-free petrol is not available. Most tests have shown no discernible loss of performance in vehicles using lead-free petrol. The Government since the Budget have given a boost to lead-free petrol with a £1 million publicity campaign. I believe that the Opposition will welcome that use of Government money to get the facts over.
The differential in price at the pumps should in due course widen. At present, about 10p of the 14p cost advantage is generally passed on to the customer. As the uptake of lead-free petrol increases and the overheads of the original cost of producing it are more widely spread, it should be possible for the petrol companies to pass on an increased proportion of that 14p differential.
We believe that the United Kingdom has now reached a position where the rate of improvement in the take-up of lead-free petrol has reached a process of self-sustaining growth and that the present level of benefit for lead-free petrol is at about the desirable level. It is the highest in Europe, apart from Denmark, and therefore quite satisfactory.
Dr. Marek : I have already said what the Labour party policy is, but I must say at this stage that I am not completely against what the Economic Secretary has said. In his statement there has been the expectation that the Government will reach the targets that I set them for the sale and the availability of unleaded petrol. I welcome that statement and I look forward to those targets being achieved. The Chairman of the Select Committee on the Environment asked the Government to ensure that there would be a 12p differential between leaded and unleaded petrol and to require the oil companies to pass that on to the motorists. In that respect, we do not believe the Government have gone far enough.
Two Aunt Sallies have been raised. First, the hon. Member for Wolverhampton, South-West (Mr. Budgen) said that I had talked about further measures and then implied that we would set the police on the motorists to check whether they had unleaded petrol in their tanks. Nothing could be further from the truth. There are far better ways of ensuring that motorists use unleaded petrol. Secondly, the hon. Member for Tatton (Mr. Hamilton) declared his interest, or had it declared for him by his hon. Friend the Member for Brigg and Cleethorpes (Mr. Brown). He said that he had employees involved in making the lead for leaded petrol. Perhaps he should have tried to redeploy those employees instead of allowing them to be made redundant.
We do not think that the Government have gone far enough. That is why we shall seek to press our amendment.
Question put, That the amendment be made :--
The Committee divided : Ayes 149, Noes 215.
Column 946Division No. 194] [10 pm
Abbott, Ms Diane
Adams, Allen (Paisley N)
Archer, Rt Hon Peter
Ashdown, Rt Hon Paddy
Banks, Tony (Newham NW)
Barnes, Harry (Derbyshire NE)
Barnes, Mrs Rosie (Greenwich)
Beith, A. J.
Brown, Gordon (D'mline E)
Brown, Nicholas (Newcastle E)
Buckley, George J.
Campbell, Menzies (Fife NE)
Campbell, Ron (Blyth Valley)
Carlile, Alex (Mont'g)
Clark, Dr David (S Shields)
Clarke, Tom (Monklands W)
Cook, Frank (Stockton N)
Cook, Robin (Livingston)
Davies, Rt Hon Denzil (Llanelli)
Davis, Terry (B'ham Hodge H'l)
Duffy, A. E. P.
Ewing, Mrs Margaret (Moray)
Field, Frank (Birkenhead)
Godman, Dr Norman A.
Golding, Mrs Llin
Grant, Bernie (Tottenham)
Griffiths, Win (Bridgend)
Home Robertson, John
Howarth, George (Knowsley N)
Hughes, John (Coventry NE)
Hughes, Robert (Aberdeen N)
Hughes, Roy (Newport E)
Hughes, Sean (Knowsley S)
Jones, Barry (Alyn & Deeside)
Jones, Ieuan (Ynys Mo n)
Jones, Martyn (Clwyd S W)
Kaufman, Rt Hon Gerald
Kinnock, Rt Hon Neil
McKay, Allen (Barnsley West)
Mahon, Mrs Alice
Marek, Dr John
Marshall, Jim (Leicester S)
Martin, Michael J. (Springburn)
Michie, Bill (Sheffield Heeley)
Michie, Mrs Ray (Arg'l & Bute)
Mitchell, Austin (G't Grimsby)
Moonie, Dr Lewis
Morris, Rt Hon J. (Aberavon)
Orme, Rt Hon Stanley
Pike, Peter L.
Powell, Ray (Ogmore)
Quin, Ms Joyce
Reid, Dr John
Ross, Ernie (Dundee W)
Shore, Rt Hon Peter
Smith, Andrew (Oxford E)
Smith, C. (Isl'ton & F'bury)
Smith, John P.
Taylor, Matthew (Truro)
Wardell, Gareth (Gower)
Welsh, Andrew (Angus E)
Welsh, Michael (Doncaster N)
Williams, Rt Hon Alan
Tellers for the Ayes :
Mr. Robert N. Wareing and
Mr. Ken Eastham.