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Mr. Christopher Leslie (Shipley): I want to ask the right hon. Gentleman a simple question and I hope that I can get a simple, straight answer. Is his commitment to oppose any increase in the road fuel duty not just for this financial year but, say, for the next four?
Mr. Maude: One expects a simple question from the hon. Gentleman. My commitment is exactly as I have stated it; we oppose the increase this year and we believe that the road fuel escalator should be abandoned. I do not know whether the hon. Gentleman is trying to say that he thinks that the same rate should continue in future. Does he believe that?
I have stated our position clearly; it has at heart the interests of competitiveness and enterprise in this country.
Mr. McNulty:
At the risk of receiving the same unnecessary abuse, may I ask an equally simple question? Last Wednesday--not that long ago--the right hon. Gentleman supported a lengthy Opposition motion on the taxation of the road haulage industry, which made no mention of getting rid of the escalator; why not?
Mr. Maude:
I know that the hon. Gentleman is new to the House of Commons, but he should understand that we are discussing the Finance Bill. We are talking about a Government commitment that is imposing grave damage--
Mr. McNulty:
Where is the right hon. Gentleman's amendment?
Mr. Maude:
On the same day, we announced our plans to move off the road fuel escalator. My right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) said that clearly during his speech in last week's debate.
Mr. McNulty:
Will the right hon. Gentleman give way?
Mr. Maude:
I shall not give way again. I have made the point quite clear. We made it as clearly as we could in the debate. If the hon. Gentleman was not paying attention at that time, that is his problem; he can check Hansard if he wants to do so.
The Government should accept that their policies are causing hardship now; it is not enough merely to utter warm and reassuring words about the possibility of doing something next year. The problem exists now. The Government have made a mistake now and they should scrap the escalator now.
Mr. Swinney:
The right hon. Gentleman might have heard the comments made earlier in relation to The Daily Telegraph article to which he referred. Based on the Chief Secretary's remarks, would it be fair to assume that the comments in the Red Book stand and that, over the weekend, the Government have been involved in some meddling to try to take the heat out of this debate, when, in fact, their intention is to maintain the fuel duty escalator for the remainder of this Parliament?
Mr. Maude:
The hon. Gentleman might be making a mistake by placing any reliance on what is contained in the Red Book, which is now a means to obfuscate the truth, not to illuminate it in the way that it has done in the past.
Duty on petrol rose by 4p a litre in the Budget, following increases of 4p and 4.5p in the Labour Government's first two Budgets. Overall, the average motorist is now paying more than £150 a year extra in petrol tax as a result of the fuel duty increases in those Budgets. The latest Budget alone cost drivers £50 a year--a stealth tax of £1 a week. Under Labour, petrol prices are now the highest in the European Union, and the proportion of the price of a gallon taken in tax by the Chancellor is now as much as £8.50 in every £10. Excise duty--
Mr. Derek Twigg (Halton):
Will the right hon. Gentleman give way?
Mr. Maude:
I have given way a great deal and I want to make some progress. If the hon. Gentleman persists, I shall give way in a little while.
Rural motorists and the least well-off are especially hard hit by these vindictive tax increases. We know that, when he can remember which day of the week it is, the Deputy Prime Minister thinks that owning a motor car is a luxury--for everyone except him, of course; for him, owning two gas-guzzlers is an absolute necessity. However, a car is an absolute necessity for people who live in rural areas; it is not a luxury. I point out to the Chief Secretary that those people are deeply insulted by Government rhetoric that depicts them as selfish and irresponsible when, in reality, most people in the countryside cannot get by without a car.
Let there be no mistake that these massive tax hikes hit the poorest people hardest. Many of those people mistakenly believed that the Labour party was on their side at the last election, but they now find that they are taxed ever more heavily. We understand why they feel
betrayed by a Government whose members promised, before the election, that they had no plans to increase taxes, but who have been piling taxes on motorists ever since. That is why we shall vote against petrol tax rises.
Mr. Twigg:
The right hon. Gentleman has complained about stealth taxes and has referred to the situation now. Will he take this opportunity to make a clear promise and rule out the idea that his party will ever introduce a road fuel escalator at the next general election or at any other time in the future?
Mr. Maude:
I have stated our position clearly. People will be pretty insulted to find that the hon. Gentleman is trying to make cheap debating points about a time after the next general election, while businesses and motorists face extinction today. If he can only make cheap points while people are losing their jobs and livelihoods, it will confirm people's opinion that his party does not care about business or about the livelihoods of hard-working people.
Mr. Milburn:
Does the right hon. Gentleman agree with the green manifesto that his party published at the last general election?
Mr. Maude:
I fought the election on that manifesto. The fact is that an escalator was introduced when our petrol and fuel prices were among the lowest in Europe. We always said that there was a place for an escalator, until we reached the point at which it inflicted grave and excessive damage--then we needed to get off it. The point at which the escalator is doing disproportionate harm has now been reached, and exceeded--[Interruption.]--The Chief Secretary fails to take account of the fact that his Government activated the escalator three times during their first two years in office, and at a rate considerably in excess of that committed to under the Conservative Government. That is why the top of the escalator has now been reached and the escalator should be abandoned.
Mr. Twigg:
Will the right hon. Gentleman give way?
Mr. Maude:
No, I shall not give way any more. I want to make some progress.
Diesel duty in Britain is now the highest in the EU--by a considerable amount.
Mrs. Teresa Gorman (Billericay):
Will my right hon. Friend give way?
Mr. Maude:
If my hon. Friend will forgive me, I shall carry on.
It is no wonder that scores of companies have complained that they face a huge competitive disadvantage compared to their continental counterparts. [Interruption.] Discount is scoffed at and sneered at by the Chief Secretary because he does not care about that. Companies are being forced to flag out their operations.
The industry has warned that thousands of jobs will be lost unless something is done to reduce the ever-rising taxes on hauliers. Those who suggest that there are still environmental justifications for continuing those increases should consider some recent research by the Centre for Economics and Business Research Ltd. The calculations in that research show that
What is the Government's response to the legitimate, serious and heartfelt concerns expressed by so many people? It makes matters worse that Ministers seem utterly ignorant of the problem. The Financial Secretary claimed that lorries do about 40 miles to the gallon--the actual figure is less than 10 miles. Last week, the Chief Secretary said:
Mr. Milburn:
I presume that the right hon. Gentleman was listening to what I said. I reiterated the figures that I gave last week. When he says that the price of diesel has increased by 14p, that is simply wrong. He should look at the statistics produced by the Digest of United Kingdom Energy Statistics--the official bible in relation to these issues. He will find that the allegation that he has just made is misplaced--as is the allegation made to me in writing by his right hon. Friend the Member for Wells (Mr. Heathcoat-Amory).
"road usage will be reduced by 0.51%"
following the increase, but that the impact on the economy will be a loss of nearly 12,000 jobs. The environmental justification for the escalator has now completely disappeared.
"The truth is that the price of a litre of diesel has risen by 7p since the general election."--[Official Report, 21 April 1999; Vol. 329, c. 929.]
He has said that again today, but it is simply not true. The price of a litre of diesel has actually risen by about 14p since the election, and the proportion of the price of diesel taken in tax has risen from 76 to 86 per cent. since May 1997. The Chief Secretary's approach is symptomatic of the Government's arrogant attitude to the problems caused by their policies.
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