HC Deb 29 June 1943 vol 390 cc1529-34

(1) As from the first day of January, nineteen hundred and forty-four, the rates of Excise Licence Duty chargeable under the Second Schedule to the Finance Act, 1920, as amended by Section twenty-five and the Seventh Schedule to the Finance Act, 1933, in respect of the classes of mechanically-propelled vehicles described in the provisions hereinafter mentioned of the said Schedule, shall be reduced in the case of gas-propelled vehicles to one half of the duty which would but for the passing of this Act have been chargeable in respect of such vehicles.

(2) The provisions hereinbefore referred to are paragraph 3, sub-paragraph (d) of paragraph 4, and sub-paragraphs (a), (b) and (c) (iii) and (iv) of paragraph 5.

(3) For the purposes of this Section the expression "gas-propelled vehicle" means a vehicle propelled by any fuel which is wholly gaseous at a temperature of sixty degrees Fahrenheit under a pressure of thirty inches of mercury, such fuel being produced in an apparatus carried on the vehicle or on a trailer drawn by the vehicle.—[Mr. Isaacs.]

Brought up, and read the First time.

Mr. Isaacs (Southwark, North)

I beg to move, "That the Clause be read a Second time."

I do so without very great hopes, in view of what has transpired. The object of this Clause is to secure some abatement of the tax on commercial vehicles using producer gas. In October, 1942, the Government ordered goods vehicle operators with more than 10 vehicles to convert at least 10 per cent. of those vehicles to producer gas. That conversion involved capital expenditure, but they were not permitted to put in that capital expenditure as current expenses, although it brought upon them a fairly heavy charge. The use of producer gas vehicles means an increase in operating costs. The equipment requires constant attention. At this stage, at any rate, the vehicles are not highly efficient; probably when there is an opportunity of making use of the skill and experience which have been obtained they will be far more efficient. The use of producer gas means a decrease in the revenue-earning capacity of the vehicles. When the producer plant forms part of the vehicle itself, it reduces the space available for goods, and there is, in addition, less efficiency in running and a lower mileage for the vehicle. If, on the contrary, a producer gas equipment is fitted as a trailer, it adds to the load in another direction, and requires additional tyres, and therefore the use of more rubber; so the tendency is to use this equipment on the vehicle.

It has been estimated that there are commercial vehicles to the number of 11,615 running to-day on alternative fuels of various kinds. Of these, 6,412 are running on electricity, and therefore are not really converted vehicles. They are mainly suitable only for short journeys. Of those which have been converted, 1,200 are.running on coal gas, and 1,400 on creosote. None of these requires anything like the capital expenditure for converting the existing vehicles as do those which run on producer gas. There are 1,504, according to the latest figures, running on producer gas. These are taxed at anything from 1504, according to the last figures, running on producer gas. These are taxed at anything from £25 to £90 a year. The proposal is that the tax should be reduced by half. Assuming that they are all taxed at £90, this reduction would cost the Exchequer £67,680. That seems a large figure, but, taking into account the whole Revenue of the country, it is not large. The concession would afford some compensation to the users for the cost incurred in conversion, in running, and in the loss of user, and would encourage the conversion of more vehicles. "Hope springs eternal in the human breast," and my breast is human, even if I do not look it. I hope the Chancellor will find it possible to accept this Clause.

Mr. Ivor Thomas

I beg to second the Motion.

I do so on the highest ground of public policy. Although this may not seem to be the time for encouraging the use of fuel derived from coal any more than the use of imported oil—because there is a shortage of coal no less than of oil—we must look ahead. I do not want to appear alarmist, but it is said on the highest authority that the world may see a shortage of oil supplies within 20 years. It may be very difficult for our modern civilisation to adjust itself to such a contingency. Even the United States, producing about 70 per cent, of the world's output of oil, has felt it necessary to embark on schemes for the hydrogenation of coal and the production of other fuels in the immediate future. That is a pointer to the direction in which we are moving. It is a fact that the average of all the most reliable estimates shows that the present supplies of crude oil will begin to run short within a period of 20 years. It may be that new factors, not known at present, will upset that estimate, but the State should do all it can to prepare for such a contingency. To that argument we can add the general arguments for using fuel derived from native coal rather than imported fuels. On this ground of the utilisation of coal generally, I would like to support the new Clause. I only regret that my hon. Friend has not made it wider. I wish it had included coal gas. The State has already done something on the lines sought. I believe it is a fact that, whereas the weight of the producer used to be taken into account for the purpose of taxation, that is no longer the case. The adoption of this Clause would give a definite stimulus to the production of fuels derived from our native coal and would give great help to our own coal industry.

Mr. Evelyn Walkden (Doncaster)

Although I am of the opinion that the Chancellor is going to provide the same answer—or at least that he has the same other Clauses which have been moved, I am inclined to submit a further plea on behalf of this Clause. It is in connection with methane gas, which is gas obtained from sludge digestion plants. It is solely derived from such plants. When we hear pleas for the elimination of waste, it should be known that hundreds of thousands of cubic feet of gas were being wasted week by week before the war at one large sludge digestion plant. Many other areas have now introduced sludge digestion plants, and the scientific research experts have devised equipment to make use of this gas to run vehicles similar to those which we are now discussing. I believe that the City of Birmingham is running buses on the same sort of gas, and one or two other corporations are running buses or collecting-vehicles on that kind of gas. Every day, at the plant to which I refer, there used to be a huge flame burning, a 15 inch jet going up into the heavens, causing waste all the time. Now the scientists and the need for economy have come to our aid. Useful work has been done. But my right hon. Friend charges the same amount of tax for a plant which is actually eliminating waste, in a manner that we ought to encourage and admire. I believe that just before the outbreak of war about 60,000 cubic feet of gas were wasted every day in the borough where I live. Certain arrangements have been made to ensure that that gas is not wasted, but certain local authorities up and down the country, whether it be Sutton and Cheam at one end of the scale or Birmingham at the other, are being penalised because we do not recognise the work they are doing in order to stop waste. I ask the right hon. Gentleman, therefore, to be not only generous but genuinely considerate towards these developments. There is a great future for methane gas. It is produced practically from waste, and we are losing a very valuable product because we do not encourage people to convert their vehicles and use this gas in the most economical manner.

Mr. Loftus (Lowestoft)

Six or seven years ago I was urging the same point of view as that which has been put forward so convincingly by hon. Members speaking on this Muse. Probably my right hon. Friend the Chancellor will not give the full concession which is asked for, but I hope that he will hold out some answer prepared—as he has given on encouragement for the future, and will realise that there is a strong feeling in the country that we should do everything possible to prevent our people being so very dependent on imported fuels when we have in our own country a fuel which we could utilise.

Sir K. Wood

We have had three or four very interesting speeches on this matter. In general, if I were occupying my present position in normal times I would desire to give what encouragement I could. I commend in particular the speech of the hon. Member for North Southwark (Mr. Isaacs), because he clearly appreciated the financial issues. He told the House what the cost of the proposal would be, and, without entering into the controversy, or fight, between my right hon. Friend the Home Secretary and my right hon. Friend the Member for Wakefield (Mr. Greenwood) upon "meaningless symbols," I would say that it is a useful thing for the House to know what in fact is involved when an Amendment is proposed; I wish that my hon. Friend's procedure were always followed.

There is this to be said on the other side—and I say this from the point of view of the arguments that have been adduced—that the disadvantages which my hon. Friend mentioned are to some extent offset by the fact that the vehicles using this method of propulsion operate on tax-free fuel. I am informed that a ton of producer-gas fuel, which would cost about £6, plus about £2 10s. for petrol for starting purposes, would take the vehicle an average of about 1,400 miles, for which the corresponding figure running on petrol alone, at present retail prices, would be about £15. Apart from the financial considerations and my inability to make these alterations at this time, I am afraid that the exact suggestion that has been made is not particularly practicable and my hon. Friends may have this in mind when they bring these matters forward perhaps in some other form on some other occasion.

It is very difficult to see how it would be practicable to make the adjustments which would be necessitated if this particular method were accepted. Apart from the fact that liquid fuel has to be used for starting, and also in the case of any failure of apparatus, there is a type of conversion apparatus which enables an engine to be run partly on heavy oil and partly on gas. It is also to be remembered that producer-gas apparatus cannot be used for certain types of work. Therefore it would be very difficult indeed to devise appropriate categories according to the proportionate use made of producer-gas and liquid fuel and it would be almost impossible to enforce their observance. 1 give that information to my hon. Friends because no doubt they will desire to pursue this matter, and I would not desire to discourage them from doing so when we are better able to deal with modifications of present taxation, but I regret that in present circumstances, as hon. Members will appreciate, I am unable to accept their proposal.

Question, "That the Clause be read a Second time," put, and negatived.