HC Deb 30 April 1986 vol 96 cc925-7
9. Mr. Eadie

asked the Secretary of State for Scotland what reply he has sent to the correspondence he has received recently from the Scottish Motor Trade Association Ltd. on matters of consumer interest.

Mr. Allan Stewart

My right hon. and learned Friend the Secretary of State will be replying shortly.

Mr. Eadie

The Minister must be aware that recent figures show that it is 18p more expensive to buy petrol in Scotland than it is to buy it in some parts of England. Did he see the recent STV programme which showed that there was a gross difference of between 40p and 50p per gallon between the price of petrol in parts of Scotland and England? As the Scottish Motor Association has written to me saying that it does not accept the Government's policy that market forces will resolve the problem of the consumer being exploited, what does the Minister intend to do so that the consumer can be protected from the exploitation of oil companies?

Mr. Stewart

I read the recent article in the Petroleum Times. As the hon. Gentleman may know, that journal regularly publishes a report on local prices. The article showed that the average price for four star petrol was 177.7p in Edinburgh and 177.3p in London. I understand that the edition coming out later this week will show further reductions. The areas of greatest demand inevitably experience the greatest competition, and that is reflected in a relatively speedy reduction in prices. It is clear that that process invariably takes longer in less populated areas, where competition is not at the same level. The figures do not substantiate the hon. Gentleman's generalisation.

Sir Hector Monro

Has my hon. Friend had a discussion with my right hon. Friend the Secretary of State for Transport about the changed date for the vehicle registration letter next year? Is he aware that almost every motoring association in Scotland and motor dealer has written to say that the change to October is wrong and will have a serious and detrimental effect, not only on the sale of motor cars, but on the secondhand value that the public would expect? Will my hon. Friend hold discussions on this matter, because at present everything is being done purely for the benefit of the DVLC in Swansea?

Mr. Stewart

My right hon. Friend the Secretary of State for Transport gave a written answer on 28 April which stated that on 24 April he told the Motor Agents Association that he would be prepared to consider an alternative if the weight of opinion in the motor industry as a whole changed, and provided it was acceptable to the police. If that is not the case, the change will go ahead as planned in October 1987.

Mr. Wilson

Is the hon. Gentleman aware of the anger in Scotland about high petrol prices? Is he aware also that the Director General of Fair Trading has stated that one problem may be that too few petrol forecourts are owned by independents and too many are owned by big combines? In those circumstances, will the hon. Gentleman ask the Secretary of State for Trade and Industry to instruct the Monopolies and Mergers Commission to conduct an inquiry into the matter?

Mr. Stewart

The hon. Gentleman will be aware that the MMC prepared a report on the industry in 1979. The OFT conducts an annual review of the petrol retail industry. I have no doubt that, in the course of that review, it will pay special attention to the degree of competition.

Mr. Ewing

I urge the hon. Gentleman not to be complacent about this matter, because there is serious disquiet not only in Scotland but in other parts of Great Britain. Evidence is emerging that the oil companies, the suppliers, are selecting certain areas in Great Britain to subsidise at a much higher level than other areas, especially in Scotland. There is clear evidence that there is a difference of about 50p a gallon in the price of petrol in one area compared with another. That evidence has been put forward by the Scottish Motor Trade Association. Based on the hon. Gentleman's figures, I can produce evidence showing that there is an 18p a gallon difference between the price in Edinburgh and the price in parts of my constituency.

Mr. Stewart

Prices vary considerably. I can tell the hon. Gentleman exactly where the biggest price differential occurs, according to the figures that are available. The price is as low as 154.7p in south Wales and as high as 205p in London. That does not suggest any bias against Scotland.

Mr. Kennedy

Will the hon. Gentleman accept that in the Highlands and Islands there have been persisent problems of differential regarding petrol pices? Car and haulage travel there is not a luxury but an absolute necessity to the whole of the economy because of the way of life. The Highlands and Islands are suffering badly, as I know the hon. Gentleman appreciates, through falling oil prices following the contraction of the North sea exploration market. Will we see some advantage from falling oil prices, such as cheaper costs of derv, haulage costs and prices at the petrol pumps? At the moment we are seeing nothing. We are getting the worst of both worlds.

Mr. Stewart

I assure the hon. Gentleman that the Government are very conscious of the price variations. We have vigorously reminded the oil companies of the need to ensure that rural areas, such as the Highlands, derive adequate benefit from lower oil prices.