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Mr. Redwood: Is the hon. Gentleman aware--as my hon. Friend the Member for Tunbridge Wells (Mr. Norman) pointed out--that the Conservative party voted against the Government's previous four big increases in petrol tax? By opposing rip-off Britain at the pumps, we are being entirely consistent. Will he take back his remarks about bandwagons? We made the bandwagon; it is an extremely democratic one and it is going to win.
Mr. Foster: I do not want to trade voting records with the right hon. Gentleman. However, if he examines them, he will find that the Liberal Democrats voted in the same way as him, but we at least had the honesty to say that the reason we did so was that we believed that any money raised from the proposed increases should be ring-fenced and used to improve support for the travelling public--not least through improved public transport.
The Conservative party policy is not even a popular policy. An opinion poll, carried out by NOP and quoted in the press on 6 October, found that 68 per cent. of those questioned would prefer to stick with the current fuel tax if it guaranteed less pollution and better road and rail links. That survey found that a similar proportion of people would prefer to have the 3p from fuel tax spent on green schemes for the environment than on a Tory plan to cut the price of petrol by 3p a litre. The Conservatives have come up with a simplistic solution, which does not address all aspects of the issue. Let me briefly discuss those aspects and the way forward.
The road haulage industry undoubtedly faces problems. Some of those problems come from unfair competition. The industry also has problems relating to overcapacity; it has not been said before, but it is true.
Mr. Bennett: Does the hon. Gentleman accept that when the road hauliers came to the House, lobbying very hard to have the axle limits increased from 38 to 44 tonnes, part of their argument was that that would improve productivity? As one cannot go on driving lorries indefinitely, in effect they have 10 per cent. oversupply of both vehicles and drivers.
Mr. Foster: I understand the hon. Gentleman's argument. Although I understand the pressures from the European Parliament on this, I was very disappointed that we went down the 44-tonne lorry route, not least because of the impact that I and many other commentators believe it will have on our ability to move more freight on to our rail system. However, the haulage industry does have a problem of unfair competition with continental operators. That problem may have been somewhat exaggerated, and many in the industry now accept that, because when one considers the totality of costs, taking into account labour costs, road tolls and other forms of taxation, it can be demonstrated that the unfairness is not quite as it was initially presented. Nevertheless, I believe that there is still a further case to be made--
The way that I believe we should be moving--the Minister has at least given a hint that the Government might be supporting this, and it now appears to have all-party support--is to make progress on the European vignette scheme and reduce vehicle excise duty further. VED has been reduced for lorries, but it should be reduced further. At the same time, we should introduce through the vignette scheme a means whereby foreign lorries using our roads have to contribute.
Mr. Paterson: I am most grateful. Perhaps it may enlighten the hon. Gentleman if I tell him that the haulier who was trumpeted by the Government two years ago in the infamous KPMG report told me today that he moved his entire operation to Luxembourg--an operation which, thanks to the Government, is reduced from 100 trucks to 70. That haulier would be £1.5 million better off, which is the advantage in fuel duty and VED over the social costs and corporation tax in the United Kingdom.
Mr. Foster: The hon. Gentleman should have a look at some of the latest documents put out by the bodies that represent the industry--the Freight Transport Association and the Road Haulage Association. They themselves now acknowledge that the competition argument was
What is the way forward? Many things need to be done. There needs to be a massive increase in investment in public transport. It is a great shame that, during the first three years of a Labour Government, they actually spent less on public transport than their Conservative predecessors. We need increased investment in alternative fuels. Although I welcome the Prime Minister's announcement yesterday of additional funding, I must point out that, over the past three years, research into alternative forms of energy under this Government has been dramatically cut.
On the point raised by the hon. Member for Denton and Reddish, the time has come to deal with the two key environmental issues that matter--namely, pollution and congestion. The time has come to make a clear commitment to cap the level of fuel duties and, for environmental reasons, to deal with the problem of congestion by supporting those local authorities that want to introduce congestion charging, provided that there has already been a significant improvement in the availability of public transport.
We also need to deal with the problem of pollution. We need to go further than the Government have done so far, although we welcome the start that they have made by linking more carefully VED with the level of pollution that is caused by a vehicle to the point at which the most fuel-efficient and pollution-reducing vehicles pay no VED at all.
Mr. Jon Owen Jones: I agree with several of the ideas and policies that the hon. Gentleman has introduced, including those involving congestion charges, but is it not the Liberal Democrats' policy to introduce a carbon tax? Will he explain how a carbon tax can be introduced with a five-year cap on fuel increases? Would not that introduce enormous distortions into the process? How could the system possibly work?
Mr. Foster: Given that many other hon. Members want to speak, the House would not want me to give a detailed discourse on that matter, although I am more than happy to talk to the hon. Gentleman later about it. The crucial issue involves CO 2 emissions and the other pollutants that come from vehicles. That is why we believe that the link that the Government established between VED and emissions is crucial. We should like to take the process further.
We also believe that stronger measures are required to support those in rural areas. For example, a strong case can be made for introducing rate relief for rural filling stations. There should be a specifically targeted mechanism that will help those who live in rural areas to, for example, convert to liquid petroleum gas. There should also be specific support in rural areas for alternative forms of public transport, including dial-a-ride and taxi buses. Those schemes must be eligible for the fuel duty rebate, and I look forward to the Government's
Sir Robert Smith (West Aberdeenshire and Kincardine): I notice that the Financial Secretary to the Treasury is now present. Does he recognise that by Monday he can allow the Ministry of Agriculture, Fisheries and Food to help one sector of the rural economy that is greatly affected by fuel prices? It could be helped by allowing the release of agrimonetary compensation that is available, although the deadline is next week.
I hope that I have made it clear that this is not a simple issue and that there are no simple solutions. We need solutions that deal with the environment and the economy and that promote social justice. The knee-jerk reactions of the Conservative party--it might think that its reaction was populist--are not fully thought through, and they will not solve the real problems that concerned protesters in September.
We need a package of measures, and that is what the Liberal Democrats have offered. I am delighted that our proposals are recognised as realistic. I note, for example, that in The Independent on Sunday, the journalist Jo Dillon wrote: