Regular readers will know that I have been banging on about petrol and diesel prices for some years now – and actually ConservativeHome was instrumental, in making the case through 2011 for lower fuel duty. The Government listened to us, and deserve credit for it. George Osborne has done more to cut fuel taxes in two years, than Labour did in a decade.
Today MPs will debate fuel prices again. Forget the recent price-drops – however good they may be – motorists are being ripped off for pounds, not pennies. A few pennies are welcome but they are not enough. Fuel duty is still too high, and even at this late stage I am urging the Government to think again on the 3p rise in August 2012.
But there is a bigger and more dangerous Leviathan, which is crushing our economic recovery. The oil market, along with bank speculation in oil, is keeping the international price of crude oil dangerously high – oil is now so ludicrously expensive in fact that even if the Chancellor DID cut fuel duty, families would barely feel it in their pockets.
Conservatives are not always on the front foot, when it comes to attacking the private sector, even when we are being ripped off. It is not our comfort zone. But I believe in Capitalism – not Corporatism. That’s why I will be urging the Government for a tough investigation into the following:
- The pump price seems to be quick to rise, and slow to fall. Why? Evidence from the AA and RMI Petrol shows that this was true for long periods of 2011.
- Allegations of price-fixing. As the www.PetrolPromise.com campaign has now repeatedly pointed out, Britain’s independent petrol forecourts have compiled a 60-page dossier, proving that UK motorists are being fleeced, and that oil companies active in the UK are now under formal investigation by the Federal Cartel Office in Germany, as a result of similar complaints. The OFT are dragging their heels. In fact, they have not investigated the UK oil market since 1998, despite the fact that British petrol and diesel prices are among the highest in Europe. This needs to be looked at seriously – and we cannot have excuses from the OFT. We need urgent action. I would encourage all ConHome readers to sign the petition at www.PetrolPromise.com and ask their MP to join the fight.
- The problem of local variation in petrol prices. This affects remote areas, but it also affects towns like Harlow, where fuel seems to be 4p or 5p more expensive than in nearby towns. I have complained to the OFT again on this issue – and their letter back to me was sympathetic, but it seemed to be very good at coming up with reasons why nothing could be done.
- The fourth issue is “fuel deserts”, as independent forecourts are squeezed by big oil traders. Research by Brian Madderson at RMI Petrol has shown that in 1990 there were 20,000 forecourts, but today there are just 8,500 – a drop of nearly 60% – leaving huge areas of the UK as “fuel deserts” where motorists have to drive miles to find a forecourt. The latest victims are the petrol station chain Calanike, with 19 outlets and 170 employees, who went into receivership in January. Without choice in the market, there cannot be competition – and that is bad for petrol and diesel prices.
This matters because of the human cost. The rich aren’t suffering particularly – as usual, the hardest hit are workers on low incomes, commuters, strivers, families with young children. Everyone seems to benefit from the current system, except for the people in my constituency who have no choice but to drive their car.
Fuel duty is a tax on everything, and we should be honest about who is paying it. When we talk about “motorists” – we should remember they are not a special interest or a lobby group. Motorists are everyone. Mums driving to school. Children on the bus. Pensioners being hit by inflation – because if the cost of road-haulage goes up, the price of everything goes up too. That is why this is an issue of social justice. The economy is important but it is only half the argument.
Petrol prices are crushing Britain, and they are creating a poverty trap. There is evidence that they are adding to Britain’s dole-queues. RAC figures show that an ordinary worker in Harlow is paying a TENTH of their income just filling up the family car – in essence that is petrol poverty.
Germany are cracking down on the oil cartels, America is taking action against rogue traders and banks – why can’t we do this here in Britain, too? The UK is a great car economy. I am urging the Government to think again on the August tax-rise, but also to launch a tough investigation into the oil market and bank speculation. If the big firms won’t cut their prices then we should consider everything – even a windfall tax – to get them to listen.