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Finance Bill

The arguments that I want to present have been reprised over many years. Indeed, I have the Hansards of all the debates going back to 2005 and will refer to some of them. On a number of occasions when I have tried to introduce a similar measure, there have been rather different circumstances, with modest, and sometimes significant, price spiking, the consequence of which we have seen. In 2005, when I first attempted to introduce a similar measure, I pointed out that the price of a litre of unleaded petrol had risen by 6p over six months, to 86p a litre. By the time that we debated the issue in 2008, the price of fuel had gone up to between £1.10 and £1.30 a litre, and on some of the islands, as well as in the more remote rural areas, it was significantly more. Today the price is relatively stable at about 95p a litre and $50 a barrel. Just for hon. Members' information, in 2008 the price crashed through the $140 a barrel level. However, there is no certainty that prices will remain relatively low or relatively stable. Indeed, as the world comes out of recession, they might well rise. If India and China regain some of their impetus, there will be increased demand and inflationary pressures. If there is a cold European or north American winter, there will be demand on hydrocarbons and inflationary pressures. There might be supply-side shocks if there is war or terrorism in an oil-producing region, thereby causing the barrel price to rise. If we have natural disasters that take out refining capacity, which has happened before, there might be a significant price rise. Even without any of those eventualities, which are risks that we can identify, some future prices—for next year's delivery, for instance—are already 40 per cent. higher than those today. Indeed, I have seen delivery costs for 2015 that are more than 40 per cent. higher than those today. My judgment, which reflects comments made in previous debates, is that it is better to try to introduce a mechanism to smooth out price increases when prices are relatively low and we have relative stability than to wait until prices shoot up again. We must take cognisance of the eventualities that we can predict—we know what has happened in the past three or four years—and take action to mitigate identifiable risks, not least because we know the impact of a prices spike on families and businesses, including the haulage sector and other communities. In our 2005 debate on this subject, when there was a modest increase, the AA was quoted as saying that, because of the 6p increase over the previous six months,""individual motorists have seen the monthly cost of petrol for a typical privately owned car rise from £87.43 in January to £94.02 in May. In households with two cars this represents a £13.18 hit on family expenditure each month"." That was a modest rise, but it was none the less significant over the piece. In that debate, we also learned that bankruptcies among hauliers were running at twice the average for other industries at that time. We must avoid that in future. Hauliers' average running costs then were 52p a mile and, as was pointed out:""Competition from hauliers in Europe, driven by lower fuel prices elsewhere, have led to a massive reduction in the percentage share of cross-channel freight delivered and carried by UK hauliers. The industry and, indeed, domestic car users pay some of the highest fuel prices in Europe, driven by some of the highest taxes on fuel in Europe of 69 to 74 per cent."—[Official Report, 6 July 2005; Vol. 436, c. 361-62.]" We can therefore see the impact that even modest rises have, in terms of additional bankruptcies in the haulage sector.