§ 29. Mr. Eric Forth (Bromley and Chislehurst)If he will make a statement on the impact of the level of fuel duties on pollution. [58634]
§ The Minister of Transport (Dr. John Reid)It is estimated that, over the period 1996–2002, the road fuel duty escalator—if continued at its current level of an increase of 6 per cent. per annum in real terms—will save between 2 million and 5 million tonnes of carbon in 2010, compared with the carbon emissions that would occur in 2010 under the alternative of no real duty increases over the relevant period.
§ Mr. ForthI am grateful to the Minister for that reply. What estimate has he made of the impact that this enormous increase in duties will have on inflation, our business competitiveness and the automobile and related trades? Does he agree that, even if he achieves the figures that he has given, there is a distinct risk that the price in jobs, businesses and prosperity could be very high indeed?
§ Dr. ReidI remind the right hon. Gentleman that his Government introduced the policy of a real increase in fuel duty. As it happens, we agree with that policy, but he obviously does not, which is probably why he is no longer a Front-Bench spokesman. The Government have made their commitment clear. We are committed to environmental considerations to achieve an improvement in the environment, and to working with motor manufacturers to produce more fuel-efficient engines with fewer emissions, so that motorists can not only save money, but contribute to an improvement in air quality 742 and in the general environment. I am sure that that commitment is supported by motorists and non-motorists alike. It was advanced by the previous Government and has been continued by this Government. It seems that on this, as on many other questions, the right hon. Gentleman is isolated.
§ Mr. Barry Sheerman (Huddersfield)I welcome my right hon. Friend's comments, and the change in policy and momentum that the new Government have achieved. Will he examine more carefully the excellent example of the landfill tax? It is a hypothecated tax linked to landfill, and is doing much for the environment up and down the country. Could we have more hypothecated taxes that the public can see are linked to environmental improvement?
§ Dr. ReidYes, indeed. My hon. Friend will be well aware that, in a landmark decision, the Deputy Prime Minister, with the Chancellor's agreement, proposed that we should have hypothecated taxation or charging to enable local authorities to take action on congested roads. That is a major step forward for the environment and for the reduction of congestion. It allows greater transparency, and will enable people to see that the charges they pay are being put towards the real alternative of a reliable, safe and modern public transport system. Once again, the Government are contributing towards the improvement of the environment and the creation of choice for motorists and non-motorists alike.
§ Mr. Matthew Taylor (Truro and St. Austell)Given that the last Conservative Government imposed some £25 billion in extra fuel duties on motorists and that the new Government's policies would impose another £9 billion, is it not time—if we are to sell the principle of environmental taxation—to give something back to the taxpayer? That should be done not by making a small cut in vehicle excise duty, a proposal on which the Government are consulting, but by abolishing the duty—which is a tax on ownership rather than use of vehicles—for all but the most gas-guzzling cars.
§ Dr. ReidThe Government have given a great deal back to the taxpayer, in both environmental and transport terms. An example mentioned earlier is the £150 million for rural transport services, part of the £1.7 billion extra for transport. The hon. Gentleman may not know about the fuel duty rebates with which we are encouraging local authorities to make buses the centrepiece of local transport plans. We are taking a number of other measures. For instance, we are considering introducing a variable car tax. Under proposals announced by the Chancellor, there would be a lower car tax for smaller, more efficient vehicles.
I am grateful to the hon. Gentleman for giving me an opportunity to describe the numerous benefits that the Government are delivering to the taxpayer, in transport as in so many other areas.
§ Mrs. Gillian Shephard (South-West Norfolk)Is the Minister aware that the Government's announced intention to engage in yet more consultation—this time on variable rates of vehicle excise duty—has been memorably described by Friends of the Earth as "Carry on Consulting"? When will he and his right hon. Friend the Secretary of State stop walking and talking, as his 743 right hon. Friend keeps putting it, and start making some decisions—or are they waiting for the Treasury to tell them what to do again?
§ Dr. Reid"Carry on Consulting" is slightly preferable to "Carry on Matron", which is what we see every time the right hon. Lady comes to the Dispatch Box. I am surprised that she, as a leading member of what we are now told were a caring, sharing, sensitive, listening Government, should be so opposed in principle to consulting people. Perhaps, if that Government had consulted slightly more, she would not now be sitting on the Opposition Benches.
As for vehicle excise duty, I think that there will be wide and popular support for the idea that those who purchase and use smaller, more fuel-efficient and less polluting cars should pay less tax than those who use larger, less fuel-efficient and more polluting cars. The principle has already been agreed, we are consulting on the mechanisms, and I think that the proposal will be supported throughout the country.
§ Mr. Ken Purchase (Wolverhampton, North-East)It is absolutely true that those who pollute most should pay most. Does my right hon. Friend agree, however, that the longer-term prospects are for leaner-burn and more efficient, effective and economic combustion systems that will reduce all pollutants from engines, and will enable us over time to deal with the matter in a quite different way—not simply through price mechanisms?