Road Haulage Industry

HC Deb 21 April 1999 vol 329 cc915-73

Madam Speaker

I have selected the amendment in the name of the Prime Minister.

3.51 pm

Mr. David Heathcoat-Amory (Wells)

I beg to move,

That this House condemns the Government's utter failure to acknowledge the crisis in the UK road haulage industry; notes that, despite promising not to raise taxes, Labour have done so in their first three Budgets, so that the Government is raising over £9 billion more from British road users than under the Conservative Government's plans and that the UK now has the highest fuel duties and vehicle excise duties in Europe, which now far exceed any environmental justification; further notes that they have created a crippling costs disadvantage for UK hauliers against their EU competitors, are forcing the closure or bankruptcy of many UK hauliers and inflating the costs of industries that are dependent upon road haulage; deplores the way in which the Government has sought to misuse figures produced by KPMG that are of no relevance to the situation that faces UK road hauliers and notes that independent analysis forecasts that 53,000 jobs will be lost from the UK road haulage industry over the next three years if government policies remain unchanged; commends the Conservatives' BRIT disc proposal as a first step towards reducing the competitive disadvantage faced by UK road hauliers; and urges the Government to end its complacency and refusal to listen to the road haulage industry and to acknowledge that fuel duties and vehicle excise duties are too high as a result of its policies.

One of the great deceits that a Government can play is to pretend that they are helping an industry when, in fact, they are helping to destroy it. One of the hallmarks of this Government is that they present a smiling face at the front, while at the back the dagger is at work. That is the relationship between the Government and the haulage industry. The haulage industry has been made uncompetitive, not because of a mistake, an oversight or an accident, but through a deliberate succession of tax measures in the past three Budgets.

The industry has made its case patiently and in detail in plenty of time before each Budget and has always been ignored. I have five substantial haulage companies in my constituency. Selecting one almost at random, I should like to say that Massey Wilcox wrote to me well before the Budget, saying: Britain's haulage community already pays way over the odds for a litre of diesel compared with other European countries … For many of us, any further increase will be the last nail in the coffin …I hope you will appreciate the gravity of the situation and lend your support to our cause. I have done that. I wrote to the Prime Minister and the Chancellor well before the Budget, but my arguments were ignored.

That may be slightly less surprising in view of another letter that was written to the Prime Minister by Reeve Transport Services, which is based in Sedgefield. Mr. G. Reeve, the proprietor, set out his concerns about the plight of the industry and asked that his Member of Parliament should at least understand the gravity of the situation. He then reported: I have just today received a post card from the Foreign Office Eastern Adriatic Department acknowledging my letter to you and to thank me for my interest about the situation in Kosovo! That graphically illustrates the interest that the Prime Minister has taken not just in his constituency, but in the haulage industry generally. Many other hon. Members will have received similar letters and will have been exasperated by the inaction of the Treasury and the Department of the Environment, Transport and the Regions.

The first thing that the Chief Secretary should do in the debate is acknowledge the scale of the problem and the gravity of the situation facing that important industry. The problem affects not just the haulage industry as narrowly defined; agriculture, forestry, quarrying, the coal industry and the retail industry are all affected, indirectly or directly, by the Government's economic policies.

Kali Mountford (Colne Valley)

The right hon. Gentleman began his speech by referring to the tax burden on industries, particularly the haulage industry. I note that he was a Treasury Minister when the fuel escalator was introduced. Will he explain to the House and perhaps to the people who wrote to him the thinking of the Government at the time and the purpose of that tax?

Mr. Heathcoat-Amory

Yes. I shall refer directly to the fuel escalator later in my speech.

Let me note now, however, that the Government are imposing an additional £25 billion tax burden on the industries about which the hon. Lady purports to be concerned. If she is worried about the burden on industry—that was the implication of her remarks—what is she doing to get the measures in the Budget reversed?

Several hon. Members

rose—

Mr. Heathcoat-Amory

I shall give way in due course, when I have made further progress with my speech and directly addressed the issue of the fuel escalator.

It is not just a matter of fuel; it is a double burden of high vehicle excise duty and high fuel duties, both of which are way above continental rates. In the Finance Bill that is now before the House, the Government are further increasing the vehicle excise duty on some heavy lorries to the staggering sum of £5,750 a year. That is several times the highest rate in any other European Union country.

The Government excuse their action by saying that they want to penalise lorries for using heavy axle weights and encourage hauliers to fit an extra sixth axle to their units. However, the provision will not have that effect. Had the Government listened to the industry or consulted before taking action, they would know that fitting an extra sixth axle is not just more expensive, but increases fuel consumption and the Government are increasing the cost of fuel. It is another example of a contradictory policy pulling in two directions at once. The Government are hitting the industry with higher road tax and higher fuel duties.

I now turn to the fuel escalator.

Jacqui Smith (Redditch)

Will the right hon. Gentleman give way?

Mr. Heathcoat-Amory

Perhaps the hon. Lady should first hear what I am about to say.

The Government inherited a fuel escalator of 5 per cent. a year as Labour Back Benchers are now aware. They have now increased the escalator to 6 per cent. It is not a trivial amount. By the end of this Parliament, that increase will raise an extra £1 billion a year from diesel duty alone, which represents only a minority of hydrocarbon revenue. However, the Government also introduced an extra Budget, with more taxation. Not content with the 6 per cent. real-terms increase, they have targeted diesel and singled out industry for extra increases. This year, the price of diesel will rise by a staggering 12 per cent. in addition to the increases in the last two Budgets.

We believe that the time has come to stop the escalator. Any justification for it has now been removed.

Jacqui Smith

May I perhaps have an answer today to the question that I asked the right hon. Gentleman yesterday? On the basis that he is reiterating the policy of withdrawing the fuel escalator, how would the Opposition fund the £1.6 billion black hole that they would open up in the public finances?

Mr. Heathcoat-Amory

I gave the hon. Lady an answer yesterday. I cannot give her the means to understand it, but I can repeat it. The Government's abject and continuing failure to reform the welfare state has created a gap between the plans that we left behind and the expenditure that they are now incurring. If the Government got back to our social security expenditure profile, an equivalent amount of revenue would be available.

Over this Parliament, the Government will be raising an extra £40 billion by way of taxation—and that is just from taxes announced in their first three Budgets. That is a colossal additional burden on British people and industry. We are proposing to give back one small part of that to the people who earned the money in the first place.

Mr. Tom King (Bridgwater)

Is my right hon. Friend sure that the British people will actually pay those increases and carry that tax burden? Will he comment on the stories that I have heard that overnight ferries to the continent carry a substantial number of lorries at cheap rates which fill up with fuel on the continent, saving £380, and then return to this country? Does he have any evidence of that?

Mr. Heathcoat-Amory

Yes, I do. My right hon. Friend will be familiar with the firm of Frampton's in Somerset. Mr. Frampton has written to the Prime Minister to point out that each of his lorries can save £592 every time it fills up in another continental country. That is the cost to the Exchequer; it also illustrates the colossal loss of competitiveness faced by British hauliers unless they can avail themselves of foreign filling stations. It was never intended that the fuel escalator should continue indefinitely. Alcohol taxation is an example that I have given the House previously. The previous Government had a similar increase, year-on-year, but, faced with similar problems of cross-border shopping and smuggling, we froze alcohol duties in our last two Budgets and cut duty on spirits, particularly in light of representations made by the Scotch whisky industry.

Ms Dari Taylor (Stockton, South)

How much does it cost a lorry to travel across the sea and back? How much does it cost ordinary people to do that? That answer should tell us that there are no savings whatever.

Mr. Heathcoat-Amory

I am afraid that the hon. Lady is entirely wrong. It costs a great deal less to send a tractor unit across to the continent on a ferry than the amount saved by filling up in a foreign port. If she believes that this is not a problem, why does she not support our demand for an independent and impartial study into the matter, to be published by the Government, to show all the comparative costs? That suggestion—as with all our suggestions and those from the haulage industry to try to get to the bottom of the matter—has been turned down by the Government. I can confirm that lorries and tractor units from my constituency are travelling to the continent to take advantage of the duty differential.

Mr. Tony Baldry (Banbury)

Is not the most disingenuous aspect of all this the Government's persistence in maintaining that a KPMG report somehow supports the notion that transport costs in this country are cheaper than elsewhere in Europe, when the report says no such thing? Is it not totally disingenuous of the Government to continue to rely on and abuse that report?

Mr. Heathcoat-Amory

My hon. Friend is entirely right. One of the most threadbare excuses used by the Government for continuing with their policy is the existence of this two-year-old report, which was commissioned by the Canadian Government and looked into general transport costs. It concluded that those costs were, to some extent, lower in this country simply because of what the report referred to as the "compact market area"—the fact that, in the UK, many factories are comparatively near their domestic customers. It passed no judgment on costs per tonne per mile, which is the subject at the bottom of this debate. If the Government cannot do better than to recycle an old study, that shows the weakness of their argument.

Mr. Owen Paterson (North Shropshire)

I have a copy of the KPMG report in my hand. Yesterday, I rang up Mr. Glenn Mair, the project manager in Vancouver. The report is a comparison of business costs in the G7 countries and Austria, and it does not include the Dutch and Belgian figures, which the Deputy Prime Minister cited last week. It is a comparison of business costs and, as Mr. Mair said to me yesterday, the road freight component is very limited. Only six pages out of 156 refer to transportation: it is not a detailed analysis of the UK trucking industry. KPMG in Canada actually asked KPMG in London to talk to the Minister of Transport on the day of the truckers' rally to warn him not to misinterpret the report.

The Minister of Transport (Dr. John Reid)

rose—

Madam Speaker

Order. There must be a response from the right hon. Member who is at the Dispatch Box.

Mr. Heathcoat-Amory

My hon. Friend the Member for North Shropshire (Mr. Paterson) makes a very serious point. It now seems that the Government are misinterpreting the report, even though they were warned about doing so by its authors.

Dr. Reid

The right hon. Gentleman is misleading the House.

Mr. Heathcoat-Amory

I am not misleading the House in any way: I am responding to an intervention from my hon. Friend the Member for North Shropshire. If he is right, it appears that the Government are guilty of misleading the House.

Dr. Reid

Not only did the hon. Member for North Shropshire (Mr. Paterson) mislead the House—no doubt accidentally—but the right hon. Member for Wells (Mr. Heathcoat-Amory) perpetuated that misleading of the House.

Not only did I speak to KPMG before I made those comments, but its representatives were with me at the press briefing and answered questions. In front of the press, I asked them whether what I had said was an accurate reflection of their report, and they answered, "Yes." I hope that the hon. Gentleman will withdraw what he said and its implications. There was no misinterpretation. KPMG representatives were sitting within 5 yd of me when I briefed the press, and they were asked specifically if my version of the report was accurate. I hope that the hon. Member for North Shropshire will do the honourable thing and withdraw the insinuation that my briefing of the press was done without KPMG's knowledge, against its advice or contrary to its interpretation of the report.

Mr. Heathcoat-Amory

If what the right hon. Gentleman says is correct, why has KPMG not made a public statement on the matter?

Mr. Paterson

rose—

Mr. Heathcoat-Amory

I shall give way to my hon. Friend the Member for North Shropshire to get to the bottom of the matter, but nothing alters the fact that the Government have used the report in a way that was not intended by the original authors. That is my clear understanding and it has not been contradicted by KPMG.

Mr. Paterson

I simply reported a telephone conversation that I had yesterday with the project manager in charge of preparing the report, which is a comparison of all business costs in G7 countries and Austria. I can find no mention of Belgium or the Netherlands, although the Deputy Prime Minister cited figures for those countries in Prime Minister's Question Time last week. Mr. Mair told me that the Dutch and Belgian figures could not possibly be from the KPMG report. Even the Deputy Prime Minister can recognise flags, and neither the Dutch nor the Belgian flag is on the front cover.

Dr. Reid

On a point of order, Madam Speaker. As you know, I enjoy the robust exchanges of the House.

Mr. Tom King

That is not a point of order.

Dr. Reid

It is a point of order and honour, if the right hon. Gentleman will allow me to make it. The clear imputation of the hon. Member for North Shropshire was that I had misled the House and the country by my references to KPMG. I have assured the House not only that I did not do so, but that the KPMG personnel present at the press briefing that I gave, when asked specifically whether my representation of the report was accurate, said that it was. Through you, Madam Speaker, I once again ask the hon. Member for North Shropshire, if he is an honourable gentleman, to withdraw the imputation that he has made.

Madam Speaker

This is barely a point of order for me. It is a matter of very ferocious argument, but hon. Members are responsible for the statements that they make in the House and the debate will have to continue on that basis. The statement that has been made will be challenged on the Floor of the House in the debate, and no doubt for some days to come.

Mr. Heathcoat-Amory

I have no doubt that my hon. Friend the Member for North Shropshire accurately described a telephone conversation that he had, and he has relayed the substance of that conversation for the benefit of the House. I find nothing improper in that. It remains the case that, if the only study that the Government can produce is one drawn up for the Canadian Government using data that are two years old, that shows how threadbare is this Government's case. Nothing has altered that.

Mr. John Bercow (Buckingham)

Before my right hon. Friend leaves the subjects of disingenuousness and of taxation by stealth, will he recall, for the benefit of the House, the letter that appeared in The Times of 15 March from Mr. David Green, the director-general of the Freight Transport Association? It was signed by many other business leaders, who complained that the Chancellor of the Exchequer had signally failed in his Budget speech even to refer to the massive increase in diesel fuel duties. Is that not entirely emblematic of the Government's approach to these important matters?

Mr. Heathcoat-Amory

I agree: it is entirely in character for the Government and for the Chancellor to refuse to reveal, in a long Budget statement, many matters of substance, including these colossal tax-raising measures. They have rendered an entire British industry uncompetitive with Europe.

Ms Joan Walley (Stoke-on-Trent, North)

Does the right hon. Gentleman agree that we have to be honourable if we are to proceed with the debate? The right hon. Gentleman was Paymaster General in the previous Government when the vehicle fuel escalator duty was introduced. Is the House not entitled to know the reasons for that introduction, and the direct relationship with carbon dioxide emissions?

Mr. Heathcoat-Amory

The hon. Lady is going back a long way. I have dealt with the fuel escalator and given our reasons for ending it. The hon. Lady will have to accept that it is this Government who persist with an escalator that is long past its sell-by date. Indeed, they have increased it, despite representations from the haulage industry. The industry has a rock-solid case, but the Government have blocked their ears to it. That is a standing indictment of the Government's attitude to business. The hon. Lady's question would be better directed to Ministers.

Mr. Nick Hawkins (Surrey Heath)

Will my right hon. Friend give way?

Mr. Heathcoat-Amory

I hope that my hon. Friend will forgive me, but I want to make some progress before I give way again.

We are entitled to ask who the beneficiaries of the policy are. We have heard already that the French Treasury is benefiting from British firms taking lorries to the continent to fill up with diesel. However, I regret to say that the paramilitary organisations in Northern Ireland are the beneficiaries of the massive and continuing smuggling of duties from the Republic.

That problem was also pointed out to the Government in plenty of time for the Budget. The Petrol Retailers Association wrote to the Treasury last year, and stated: some 160,000 tonnes of fuel were being smuggled from south of the border with a loss to the Treasury in excess of £100 million. The price differential between Northern Ireland and the Republic has led to a huge trade in smuggling products. The effect on the retail petrol industry in the Province has been catastrophic. In a reply from an official, all that the Government did was to state that, although £100 million is a great deal of money, it is not necessarily very large compared to the total yield of £20 billion from hydrocarbon oils. That is utterly complacent and irresponsible. It is reported that that smuggling operation is not being conducted by legitimate traders—almost by definition such an operation is illegal—and that at least some of the profit is finding its way into the hands of the paramilitaries.

When in opposition, the Prime Minister was fond of saying that he wanted to be tough on crime and on the causes of crime. Here we have a cause of crime: a large and growing differential between the United Kingdom and the rest of the European Union. We should be concerned not only by the loss of revenue, but by the continuing erosion of British jobs in a British industry that is caused by that differential.

What is strange is that the Government are committed to tax harmonisation in the European Union. The Paymaster General chairs a committee in Brussels that deals with what is described as "unfair tax competition". That amounts to raising United Kingdom taxes to EU levels, when those taxes are alleged to be unfair. Why are the Government doing that, when, in this country, they are creating unfair tax competition between our haulage industry and that on the continent? Will the Chief Secretary refer the whole issue to that committee, chaired by another Treasury Minister, to find out what can be done about the unfair tax competition being suffered by British hauliers?

We have another suggestion—that we should tackle the question of the vignette, or road charge, that British hauliers pay when they travel on German roads, in the Benelux countries or in some other countries of the EU. We propose that a similar or equivalent charge, called a Brit disc, be levied on British hauliers and foreign lorries visiting the UK, the revenue from which could be used to reduce vehicle excise duty. That would not solve the whole problem, and it would certainly not solve it quickly. However, the idea has received the support of the trade associations and individual hauliers; I ask the Government to take it seriously.

Mr. Michael Fabricant (Lichfield)

My right hon. Friend clearly points out what happens in Europe. However, about an hour ago, during Prime Minister's questions, the Prime Minister said that European directives prevented us from adopting that system in this country. Why can other European countries get away with it, while, according to the Prime Minister, we cannot?

Mr. Heathcoat-Amory

I do not for one moment accept that it is impossible. There may be a limit on the amount of revenue that can be raised through a vignette system. However, that is a matter of detail; the fact remains that a substantial amount of revenue could be raised from hauliers visiting the UK—this year, about a million trucks will visit this country—who pay not a penny towards the maintenance or construction of British roads. The revenue from their visits could be recycled in order to reduce vehicle excise duty and erode the differential that disadvantages British hauliers.

When our suggestion was put to the Deputy Prime Minister at Prime Minister's questions last week, he turned it down flat. My right hon. Friend the Member for Hitchin and Harpenden (Mr. Lilley) asked him: Will he introduce a Brit disc and a corresponding reduction in vehicle excise duty in the Finance Bill …? The right hon. Gentleman answered: No, we will not do that."—[Official Report, 14 April 1999; Vol. 329, c. 222.] It could well be that he thought that we were talking about the poll tax, but it hardly excuses his turning down, from the Dispatch Box, a constructive suggestion that has the support of the British haulage industry.

Mr. Hawkins

Does my right hon. Friend agree that one of the most peculiar aspects is that, although the Government claim to be concerned about jobs and small businesses, their rejection of the constructive proposals made by the Opposition and the haulage industry shows that, when it comes down to brass tacks, the Government do not care about either of those things? They are putting a vast number of small haulage businesses into bankruptcy, which will cost all the people who work for those businesses their job. Two companies in my own constituency have written to tell me that they are on the verge of bankruptcy as a direct result of the -Government's policy. As for the escalator, the Government do not understand that, when they get to the top of an escalator, they are supposed to get off.

Mr. Heathcoat-Amory

I agree with my hon. Friend.

What so annoys the haulage industry is that the entire issue is dressed up as an environmental issue—it is supposedly all about global warming. However, according to the Government's own booklet on climate change, if the escalator proceeds on its present course, the estimated annual carbon saving by 2010 will be between 2 million and 5 million tonnes. That same document enumerates far greater savings to be found in domestic fuel use, business fuel use and even Government fuel use for a fraction of the cost that the Government are loading on to the haulage industry. In other words, we have here a giant misallocation of resources: for colossal additional expenditure by the haulage industry, a small reduction in carbon emissions is gained; whereas, if a tiny part of that expenditure were applied to domestic heating and controls, the reduction in carbon emissions would be far greater.

Mr. Christopher Leslie (Shipley)

If the right hon. Gentleman is proposing to forgo the saving of 2 million to 5 million tonnes of carbon that might be gained through the fuel duty escalator, which he says should be scrapped, what policies does he suggest would enable us to achieve the same saving, or does he not care about meeting our Kyoto commitments?

Mr. Heathcoat-Amory

One of the inconsistencies in the Government's position, and a reason why they are not taken seriously in respect of environmental matters, is that they are pulling in two directions by blocking gas-fired electricity generation and encouraging coal use, which puts more carbon dioxide into the atmosphere. The coal industry digs up carbon that has been underground for millions of years and sends it into the atmosphere; so the Government's energy policies pull in the wrong direction in terms of global warming.

Yvette Cooper (Pontefract and Castleford)

Is the right hon. Gentleman saying that he would like to close coal-fired power stations, and so close down the coal industry?

Mr. Heathcoat-Amory

No, I am not saying that. I am saying that we should return to the policy of the previous Government, whereby the electricity generating industry made its own contribution to the reduction in carbon emissions. The current Government have blocked that policy, yet they pretend to have a coherent strategy to tackle global warming. Worse still, they are laying the entire burden of that global warming strategy on the British haulage industry, so crushing it. That is the cause of our complaint and that of haulage industry.

We want the Minister to tell us that the Government recognise the seriousness of the problems facing the industry. Will the Government confirm the damage that they are causing in terms of criminality through smuggling, loss of revenue, loss of competitiveness and loss of jobs? Will the Government commission and undertake to publish an independent report into the cost of haulage per mile for each tonne of freight for the various competing means of freight transport? Most important, will the Government at last drop their complacent and self-satisfied attitude and start to give us answers, instead of excuses?

4.25 pm

The Chief Secretary to the Treasury (Mr. Alan Milburn)

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof: believes that everyone, including hauliers, must play their part in reducing emissions of carbon dioxide from transport, and that the road fuel duty escalator first introduced by the last Government acts as an incentive to greater fuel efficiency; deplores the hypocrisy of the Conservative Party for doing one thing in Government and another in Opposition; calls on it to explain which areas of public spending it would cut in order to pay for the abandonment of the fuel escalator; welcomes this Government's commitment to promoting a more dynamic business sector, in particular the measures taken to help the road haulage industry, including cuts in the corporation tax rates, freezing the rates of vehicle excise duty for most lorries for two years running, doubling the maximum reduction in vehicle excise duty for cleaner lorries, and reducing duty rates on ultra-low sulphur diesel relative to ordinary diesel; notes that the UK haulage industry benefits from the total tax burden on business in the UK being lower than that of other major EU member states, and lower than the average for the EU and the OECD; believes that the environmental measures this Government has introduced will play an important part in encouraging use of more fuel-efficient vehicles, cleaner fuels and greener modes of transport; and welcomes the dialogue that is now taking place between the industry and the Government in the Road Haulage Forum.

This is an important debate about an important and extremely successful United Kingdom industry. Despite a problem of overcapacity, the United Kingdom haulage industry is extremely competitive by international standards and the best UK haulage fleets are better than any others in the world. However, there is enormous variation in performance. On the industry's own figures, the best UK haulage companies are almost twice as fuel efficient as the worst companies. No one disagrees with the fact that there is considerable scope for many British hauliers to reduce their fuel consumption.

The need to become more fuel efficient has been heightened by growing public concerns about the costs—especially the environmental costs—that hauliers impose through the use of their lorries. Inefficiency of the sort that I have described leads to unnecessary pollution and extra congestion. That is particularly true because of the environmental problems associated with diesel usage.

It is right and proper that everyone, including hauliers, should play a part in reducing such emissions. It is equally right that the costs that lorries impose in wear and tear on our roads should be reflected at least partly in the costs that their operators bear, particularly when the newest class of lorry does damage to the roads equivalent to that caused by at least 10,000 cars.

For those reasons, successive Governments have increased the duty on conventional diesel by more than the rate of inflation. The fuel duty escalator was formally introduced by the then Conservative Government in 1993 in an effort to meet the commitments they rightly made at the Rio Earth summit. This Government are continuing the escalator because it will help us to meet the commitments that we made at Kyoto.

Mr. Bernard Jenkin (North Essex)

I should like to explore the right hon. Gentleman's argument that diesel prices should be increased. It is within his power and that of his Government to stop the French Government continuing a diesel duty rebate, which makes diesel even cheaper for French trucks, by vetoing the regulation that is currently before the Council of Ministers. Will the Chief Secretary undertake to do that, or will he allow diesel to be sold even more cheaply to French drivers so that they can continue to come to this country and take British jobs?

Mr. Milburn

It is odd to hear the hon. Gentleman, of all people, advocating tax harmonisation policies in Europe: I thought he was on the Euro-sceptical wing of the Conservative party. What the French Government decide to do is a matter for them. As far as Kyoto is concerned, I remind the hon. Gentleman—[Interruption.]

He should calm down. There will be many opportunities to get excited in this debate, as I am sure he will demonstrate in his winding-up speech. I remind the hon. Gentleman that we are talking about legally binding international obligations that the previous Government entered into in all fairness, as have we. We must all play a part—hauliers included—in meeting those obligations.

I understand the concerns that the haulage industry has expressed about the implications of this approach. The Government openly acknowledge that a balance must be struck between environmental objectives and the needs of industry.

Kali Mountford

I thank my right hon. Friend for giving way and for providing the answer that I failed to secure from the Opposition spokesman, the right hon. Member for Wells (Mr. Heathcoat-Amory), about Rio. Could my right hon. Friend expand on the notion of polluter pays? Outmoded haulage vehicles have an effect not only on our roads but on the health of the population, and particularly children, who breathe in diesel fumes.

Mr. Milburn

My hon. Friend is correct. Until a month ago, polluter pays was a cross-party principle to which all parties subscribed. The then Conservative Government supported that principle when they announced their conclusions to the Rio summit, and we supported that policy in opposition. The Conservatives also supported the conclusions of the Kyoto summit that my right hon. Friend the Deputy Prime Minister managed to negotiate. The polluter pays principle is right and fair. It makes not only for environmental sense but for economic efficiency.

Mr. Tim Loughton (East Worthing and Shoreham)

Will the Chief Secretary explain the conundrum of how the polluter pays or the environment gains as a result of the Government's tax changes, which will have the effect of replacing British lorries belching British fumes on British roads with Belgian, French and German lorries belching their fumes on British roads? There will be no net gain whatsoever for the environment.

Mr. Milburn

I wish that the hon. Gentleman, who has expertise in this area, would consider the facts rather than relying on conjecture. [Interruption.] I say to hon. Members on the Opposition Front Bench that it is conjecture. The facts are straightforward. It is a fact that fewer than 1 per cent. of journeys by lorries on our roads are undertaken by foreign firms.

Mr. Loughton

rose—

Mr. Fabricant

rose—

Mr. Paterson

rose—

Mr. Milburn

I shall allow the hon. Member for North Shropshire (Mr. Paterson) to intervene. He probably wants to apologise.

Mr. Paterson

No, I should like to try to educate Ministers about the environment. The Government's Kyoto target is to reduce carbon emissions by 12.5 per cent, using the 1990 rate as a base. According to the House of Commons Library, in 1990 this country produced about 159 million tonnes of carbon: power stations produced 54 million tonnes; other sources produced 76 million, and road transport produced 30 million. The Library estimates that 16 per cent. of road transport emissions were from freight traffic, so 5 million tonnes of carbon are emitted by the road haulage industry.

How on earth will the Government halve the emissions by the road haulage industry when if loads are not carried by British trucks, they will be carried by foreign trucks, and when Library figures show that road traffic is increasing year on year?

Mr. Deputy Speaker (Mr. Michael J. Martin)

Order. The hon. Gentleman's intervention was far too long.

Mr. Milburn

The simple answer to the hon. Gentleman's lengthy question is that we shall achieve our aim through improved fuel efficiency. My right hon. Friend the Minister of Transport and the haulage industry are working closely in partnership to tackle those issues. There are extremely simple measures that the industry wants to take, and can take, to improve its fuel efficiency, such as improved driver training, less empty running and better logistics management. Those are all straightforward options which my right hon. Friend is now exploring with the industry.

I say to the hon. Member for North Shropshire and the right hon. Member for Wells (Mr. Heathcoat-Amory) that we have established the road haulage forum to allow us to listen to the industry's concerns and, where possible, to meet its representatives. The first meeting of the forum took place earlier this month. It was constructive and the forum agreed to examine as quickly as possible the industry's competitive position, with a view to considering solutions.

Far from the Government ignoring hauliers' views, as the Opposition motion alleges, we are working closely with the industry and the trade unions that represent its workers. That is a sensible approach. Dialogue is certainly preferable to the disruption that a minority of militant hauliers have been visiting on the streets of our major cities in recent weeks. I hope that hon. Members of all parties will condemn such disruption as irresponsible and ultimately self-defeating.

Mr. Fabricant

Is not the Minister aware that while he continues to talk about this issue, businesses are going bankrupt? He says that the question of taking vehicles abroad is conjecture, but is he aware that Fareham council now plans to get all its heavy vehicles licensed in France?

Mr. Milburn

I shall turn in a moment to the allegations about flagging out made by the hon. Gentleman and by his party in the Opposition motion.

Mr. Andrew Welsh (Angus)

Will the Minister give way?

Mr. Milburn

In a moment. I shall make a little progress first.

I know that industry representatives have rightly been cautious about appearing to sanction any disruption by a minority of militant hauliers. They should be equally cautious about relying for political support for their cause on the Opposition, whose motion I shall now deal with in detail.

The Conservatives have adopted the worst possible combination of hypocrisy and exaggeration in making their case. First, it is a bit much to hear the right hon. Member for Wells accuse the Government of damaging the haulage industry, because when he was a Treasury Minister, his Government's policy of boom and bust drove 5,000 road haulage companies out of business. I can tell the right hon. Gentleman that what industry dreads most is a return to the days of the late 1980s and early 1990s when interest rates and inflation were in double figures, thanks to his Government's policies.

In any case, the figure that the right hon. Gentleman quoted in respect of job losses, and which the Opposition motion repeats, is pure make-believe. Before the Budget, the Opposition were citing job losses of 26,000; now, that figure is 53,000. In all candour, I have to tell Opposition Members that thinking of a figure and then doubling it overnight is hardly the most credible way to win a political argument. [Interruption.] If the hon. Member for New Forest, West (Mr. Swayne) wants to win a political argument, I am happy to give way to him.

Mr. Desmond Swayne (New Forest, West)

Does the right hon. Gentleman agree that there is a clear difference between unemployment arising out of the accidental and unforeseen consequences of an interest rate policy that was backed by the then Opposition, and his own quite deliberate policy, given that he began by saying that there was overcapacity in the industry and went on to say that it was his intention to drive fuel-inefficient companies out of business?

Mr. Milburn

I am not sure whether that was an apology for the damage that the previous Government wreaked on the haulage industry, but it certainly should have been. In those days, the Government set interest rate policy directly, and they set interest rates in double figures. I remind the hon. Gentleman that interest rates were in double figures not for one but for four years.

What is ever more striking about the Opposition's position is their pure opportunism. This is from the party which, while in government, introduced the fuel escalator, extolled its virtues and defended its impact. We have of course become used to new U-turns and new posturing by the Opposition almost daily, but today the Opposition have displayed a degree of opportunism that frankly is enough even to make the Liberal party blush.

It is simply astonishing to hear the right hon. Member for Wells now oppose the fuel duty escalator as he was a Treasury Minister in the previous Government who introduced it in the first place. Not only that, but he was one of its foremost exponents. He told the House on 23 January 1995 during the passage of the Finance Bill: These increases"— the 5 per cent. real increases— are also an important part of our strategy to reduce carbon dioxide emissions. The fuel duties policy should reduce carbon dioxide emissions by around 2.5 million tonnes of carbon by 2000. This, together with other measures already announced, should enable us to meet our targets of reductions arising from the Rio agreement. On the same day, he went on to justify the escalator further. I do not know whether he can remember this speech, but he said: The fact is that 20 per cent. of carbon emissions in the United Kingdom come from road transport, and a large increase in emissions is forecast by the end of the century; so transport must contribute to any strategy to reduce carbon dioxide emissions."— [Official Report, 23 January 1995; Vol. 253, c. 98-103.] Nothing could be clearer.

I know that the Conservative party is desperately trying to reinvent itself, but I had not realised that that applied to individual members of the party as well as the organisation itself. What on earth are we going to see next? Heaven knows, we might even see the deputy leader of the Conservative party and the Front-Bench spokesperson on health agreeing their policies on privatisation, for example.

It is not as if the Conservatives stopped supporting the idea of environmental taxes the moment they left office. Quite the reverse is true. When this Government took office and announced that we were continuing the escalator policy introduced by the Tories, and, indeed, were raising it from 5 to 6 per cent. in our first Budget, the Leader of the Opposition told the House on 2 July 1997: We also welcome the Chancellor's continued use of tax for environmental purposes".—[Official Report, 2 July 1997; Vol. 297, c. 323.] So what has changed?

Mr. Loughton

One thing that has certainly changed since 1993 is the abolition of cabotage rules in the European Union last year. That means that any continental vehicles can come to this country, belching out their fumes and taking UK loads. That certainly was not the case in 1993. I repeat the question that I asked earlier: how is that an environmental gain? It is simply substituting one country's pollution for that of another on our roads. The Minister must admit that.

Mr. Milburn

I cannot admit that, and there is no evidence for it. I shall deal with those matters in a moment.

Mr. Welsh

Although the Minister is right to attack the Conservatives, how can the Government justify the fact that Scotland, which is Europe's largest oil producer, has the highest fuel taxes and the highest fuel costs in Europe? Does the Minister realise that by raising fuel costs, he automatically lowers the living standard of every Scottish family and attacks the competitiveness of every Scottish business?

Mr. Milburn

I thought that the hon. Gentleman was a member of the party that wanted to increase taxes for the people of Scotland.

Mr. Welsh

How can the Minister justify the fact that Scotland is Europe's major oil producer, yet it now has the highest fuel taxes and costs in Europe? That should not be the case. The Scottish National party wants to make our industry more competitive. The Government's policy is attacking the competitiveness of our industry and the living standards of the Scottish people.

Mr. Milburn

That sounds to me like a further increase in income tax if, heaven help us, the Scottish people were landed with an SNP Government in their Parliament.

Mr. Bill Rammell (Harlow)

I return to the disingenuousness of the Conservative party. Does my right hon. Friend recall, when that debate was going on, the former Chancellor of the Exchequer, the right hon. and learned Member for Rushcliffe (Mr. Clarke), saying that signing up to the aims of the Rio summit and then denying the means to achieve them through the fuel escalator comes dangerously close to hypocrisy? Does that not belie the hot air coming from the Conservative party today?

Mr. Milburn

My hon. Friend is right. The right hon. and learned Member for Rushcliffe (Mr. Clarke) posed a real dilemma to the Conservative party and the House. This is not straightforward. There are dilemmas and difficult issues to balance and get right, but it is important that hon. Members on both sides of the House veer away from a hypocritical position. I fear that some hon. Members are in danger of not doing that.

The Conservatives claim that the entire problem is down to the extra 1 per cent. that the Government—

Mr. Deputy Speaker

Order. I hope that the right hon. Gentleman is not suggesting that any hon. Member would be hypocritical in his or her behaviour.

Mr. Milburn

Of course not, Mr. Deputy Speaker. I was merely repeating the words of the then Chancellor the Exchequer, who warned about the dangers of sailing close to hypocrisy on some of these matters.

Mr. Deputy Speaker

Perhaps the right hon. Gentleman may accuse a political party of being hypocritical, but certainly no hon. Member.

Mr. Milburn

That is absolutely right, Mr. Deputy Speaker.

The Conservatives claim that the entire problem is down to the extra 1 per cent. that the Government have added to the escalator. Talk about torturing the statistics until they confess. The truth is that the price of a litre of diesel has risen by 7p since the general election. Under the previous Government, it rose by 26p.

I remind the right hon. Member for Wells that three duty rises under the Conservatives added 10 per cent., 10 per cent. and 13 per cent. to the price of diesel. The party that introduced the escalator and is responsible for its having the greatest impact on fuel prices now opposes it. There is only one way of describing that: it is naked opportunism.

However, that is not all. The Tory party wants to have its cake and eat it. It professes to support a cleaner environment. As I understand it, the environment is one of the issues that today's Conservative party is most keen to discuss around its kitchen table. Indeed, to be fair to the Opposition, they supported the Government when we made our legally binding commitments at Kyoto, and I am grateful to them for that. Now their abandonment of the escalator leaves them professing support for our environmental objectives, but opposing the policies necessary to bring them about. Presumably, they believe that improvements in the environment will simply look after themselves.

I remind Conservative Members of what the previous Conservative Chancellor said to the House about the dilemma: Any critic of the Government's tax plans who claims also to support the international agreement to curb carbon dioxide emissions will be sailing dangerously near to hypocrisy."—[Official Report, 30 November 1993; Vol. 233, c. 939.] This Government believe that the right hon. and learned Gentleman was right—just as his party used to believe that it was right—to use the taxation system to achieve our environmental objectives. All that has changed is the Conservative party's attitude and its opportunism in latching on to an issue that it believes will bring it some desperately needed popularity.

Mrs. Eleanor Laing (Epping Forest)

Will the right hon. Gentleman give way?

Mr. Milburn

Yes, but this will be the last time.

Mrs. Laing

Does the right hon. Gentleman realise that he has entirely missed the point of what Conservative Members are saying? He is right, of course, in the statistics that he has just given on the rise in the price of fuel as a result of the escalator, but the point is that the escalator has reached a threshold at which it is no longer working. Since it is no longer working and of benefit to the environment, as it was when first introduced by my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), it should now be stopped.

Mr. Milburn

No, that is not the position. I shall come to the figures in a just moment or two.

The Conservative party's credibility will be damaged still further by the admission of the hon. Lady and, indeed, of the right hon. Member for Wells that its policy is now to abandon the escalator. If that is so, the right hon. Gentleman had better start explaining to the British people how the Tories will plug the £1.5 billion annual black hole that that will leave in their annual spending. Which taxes will have to rise to compensate for that loss of revenue? Which services will be cut?

Just last night, we heard the deputy leader of the Conservative party claim that it was the party that now supported public services and wanted to invest in them. Less than 24 hours later, his position has been totally undermined by his Treasury Front-Bench team, which would deny schools and hospitals the investment that they need.

Mr. Jenkin

rose—

Mr. Milburn

I will not give way to the hon. Gentleman; I have already done so. He is to make a speech, heaven help us, before too long, and will have plenty of opportunities to make his points then.

The Opposition's credibility is not enhanced either by the ludicrous claim that the hon. Member for North Essex (Mr. Jenkin) and the right hon. Member for Wells are making about the impact of the fuel duty escalator on flagging out. I said that I would come to this point, and I now do so. The right hon. Gentleman makes much of the cost of diesel in the UK compared with the price in Europe. There is no denying that it is higher, although it is interesting—some would say strange—to hear the Conservative party acting as an apparent advocate for tax harmonisation in Europe.

Mr. Paterson

We advocate lower taxation.

Mr. Milburn

That is not the position, as I understand it.

More importantly, the right hon. Member for Wells failed to mention the other costs that haulage companies face as part and parcel of doing business. The cost of fuel is of course important, but so are labour costs, other social costs and the taxes that companies face wherever they operate. Once all those factors are taken into account, it is clear that moving out of the UK would be an expensive business for haulage firms. That is so because the total tax burden on businesses in the UK is lower than that in other major European countries and, indeed, lower than the average in both the Organisation for Economic Co-operation and Development and the European Union.

For example, a typical firm with a fleet of 50 articulated lorries would face higher business costs of nearly £400,000 a year if it relocated from the UK to France, £600,000 if it relocated to Holland, and more than £800,000 if it relocated to Belgium.

Mr. Loughton

Will the right hon. Gentleman give way?

Mr. Milburn

I have given way twice to the hon. Gentleman; he should not be greedy.

There are good reasons why Britain is the best and most cost-effective place for haulage companies to locate. With a handful of exceptions, there are no road tolls in the UK. In France, an operator can expect to pay road tolls of about £7,800 for every vehicle every year. On top of that, corporation tax is 50 per cent. higher in France, and labour taxes 100 per cent. higher.

Some overseas companies—

Mr. Loughton

Will the right hon. Gentleman give way?

Mr. Milburn

I will not give way to the hon. Gentleman any more.

Some overseas companies have already recognised those facts and have moved into the United Kingdom. Despite the irresponsible claims made by Conservative Members, Britain is the best place for hauliers, but the idea that Britain's roads are about to be overrun by what the hon. Member for North Shropshire last week called dirty foreign trucks would be laughable if it were not so serious: fewer than 1 per cent. of lorry journeys are undertaken by foreign-based companies.

Despite that, the Opposition advocate what they call a Brit disc—which, more properly, the industry calls a Euro vignette—as a means of taxing foreign lorries for operating on British roads and passing the benefits on to domestic hauliers either through reduced fuel prices or reduced vehicle excise duty. That, as I understand it, is the hon. Gentleman's policy.

However, even the initiator of that proposal—the Road Haulage Association—estimates that it could not raise much more than £10 million a year, which would achieve a maximum reduction in fuel prices of only 0.01 of a penny off a litre of diesel. In reality, the reduction would be much less than that because of the European directive, to which the Conservative party signed up when it was in government, that limits the scope of the Euro vignette.

The vignette would need to apply to United Kingdom and foreign hauliers alike, and administering and enforcing it could cost nearly as much as it would raise in revenue, so it is far from being a panacea. None the less, because the industry has made the proposal, my right hon. Friend the Minister of Transport has agreed that we will examine its feasibility. That is precisely what we are doing.

Mr. Jenkin

Hear, hear.

Mr. Milburn

That is not a surprise, although it may be to the hon. Gentleman. We made that announcement on 8 April.

The best prospects for the industry lie in the measures that my right hon. Friend the Chancellor introduced in his recent Budget. The most fuel-efficient, road-friendly vehicles, and the companies that operate them, stand to gain from the package that he announced, which is designed to encourage the use of cleaner fuels and vehicles and to discourage unnecessary journeys.

We cut the duty on cleaner, ultra-low sulphur diesel relative to ordinary diesel. We made similar cuts in previous Budgets, and they have been extremely successful. By the end of the year, nearly all diesel sold is expected to be the cleaner type. The success of the policy will cost the Exchequer £400 million, which gives the lie to claims that our approach on fuel duties is driven by financial rather than environmental considerations.

We also cut road fuel gases by a quarter, further increasing the duty differential with conventional fuels. We froze vehicle excise duty for—

Mr. Loughton

Will the right hon. Gentleman give way on that point?

Mr. Milburn

I am not giving way any more.

We froze vehicle excise duty for 98 per cent. of lorries. We doubled the reduction in VED for lorries meeting low-emission standards. We cut the red tape surrounding switching lorry weights to qualify for lower VED, which is exactly what the industry had been calling for throughout two decades.

Mr. Jenkin

Not enough.

Mr. Milburn

If that is not enough, we cut corporation tax as well. The new rates of 30p, 20p and lop are the lowest in the history of United Kingdom company taxes. They are the lowest of any major country and, indeed, the lowest of any major industrialised nation in the world. Haulage companies will be among the 270,000 firms in particular that will be benefit from the new lop starting rate of corporation tax, which has been so warmly welcomed by the business community.

The Government fully recognise the contribution of the road haulage industry to the economy. The best way to help the industry is to ensure stable economic growth and long-term investment in business; the worst is to adopt the position of Her Majesty's Opposition. The Government will not be unpicking either the Budget or the Finance Bill. The policy of the Opposition is unprincipled, hypocritical and irresponsible. It speaks volumes about today's Conservative party and deserves to be rejected by the House. I urge my hon. Friends to do just that.

4.55 pm

Mr. Tony Baldry (Banbury)

The Chief Secretary's special adviser has clearly drafted him a robust speech for this Opposition day debate, which he delivered with characteristic panache. It may well cheer Labour Back Benchers, but the House should consider what is happening in the real world out there. No one supports the disruption of our highways by road hauliers, but Ministers on the Treasury Bench and Government supporters should consider why hauliers are giving up a day's pay and a day's work to demonstrate. They are not doing so because of some fictional grievance.

The Government seem to think that this is a great fantasy, but out there in the real world, the road haulage industry is expressing its concerns and complaining. I cannot believe that representatives of the road haulage industry in their hundreds have been writing only to Conservative Members of Parliament to express their concerns about the predicament in which they find themselves. Perhaps they are writing to us because we are the only Members of Parliament prepared to listen to them.

The Minister of Transport tells the House that he has set up a road haulage forum, but his colleague the Chief Secretary to the Treasury has just told us that nothing in the Budget will be reconsidered—I think he used the word "unpicked". What on earth is the point of consultation with the road haulage forum if the Government are not prepared to change one iota of their policies? It is little wonder that road hauliers are not prepared to write or talk to Labour Members of Parliament, because they know that they will get no mileage out of them.

Ms Rosie Winterton (Doncaster, Central)

Will the hon. Gentleman clarify whether he is in favour of the action that road hauliers are taking to disrupt ordinary people's lives, or whether he is in favour of the Government's way of proceeding, which is to sit down with the industry and talk about a way forward to resolve this problem?

Mr. Baldry

I thought that I had made it clear to the House—if I did not, it was my fault—that I do not think anyone would support the disruption of highways and commerce by road hauliers blocking the streets. Hansard will show that I made that point clear.

Road hauliers would not give up a day's pay and take such action unless they felt that they had a real grievance. The hon. Member for Doncaster, Central (Ms Winterton) and her colleagues should consider why they are demonstrating and behaving in that way. They are doing so because they consider that they are being driven out of business by the Government's policies. They are also concerned that the Government are unwilling to listen to them. The Government say that they have set up a road haulage forum, and that is fine. However, Ministers have said today that they will hold the forum, but that they are not going to change their policies. What on earth is the point of the road haulage industry talking to the Government if they are not prepared to change their policies?

Mr. Paterson

On the Government's willingness to listen to the industry, I had an Adjournment debate on this subject on 11 November 1998, and I asked the Economic Secretary whether she would allow me to take a delegation from the industry to meet her. The answer was no, although she graciously allowed me to go along for a half an hour on my own, and at a later date I was allowed to take one representative of the industry to meet some civil servants. It is only very recently, following the major demonstrations and the rally at the House of Commons, that the Government have listened and have set up the forum. They will still not allow into the forum delegates from trucking companies who want to attend.

Mr. Baldry

I do not know what the practice is at the moment, but when I was a Minister, there was an implied constitutional convention that Ministers would always see parliamentary colleagues, irrespective of party, if they wanted to take a delegation to meet them. In fairness, I must add that when the Chief Secretary was at the Department of Health, he always saw delegations. Nevertheless, until very recently, Ministers at the Department of the Environment, Transport and the Regions seemed to be unwilling to listen to what the industry was saying. That must be why representatives of the industry apparently write only to Conservative Members of Parliament. If they were also writing to Labour MPs, no doubt some of those MPs would recognise that a problem exists.

Dr. Reid

As the hon. Gentleman has recently discovered the real world, let me share another bit of it with him.

Since becoming a Minister, I—in common with my officials—have been talking to both the Road Haulage Association and the Freight Transport Association. Only two months ago, we issued a major document on sustainable distribution. Both associations were present at the press conference and the issuing of the press release, and we were associated with their network. The road haulage forum includes the two associations, and I am in the process of writing to them to invite not only their full-time officials, but their elected presidents to attend. What we cannot do is promise to invite everyone who says that if we do not invite them they will blockade the streets of Britain. We are acting in a sensible, reasonable fashion: I am sure that the hon. Gentleman will be reassured by that.

Mr. Baldry

The right hon. Gentleman says that he is talking to road hauliers. What he is not doing is listening. Ministers are clearly spending all their time talking at the industry, rather than listening to its concerns.

Last Tuesday, during transport questions, the Minister seemed to find it amazing that anyone should suggest that road haulage industry representatives should want to flag out from the United Kingdom to other countries. Only this month, the Road Haulage Association reportedly said: Hauliers are voting with their feet against the Government's swingeing increases in fuel and vehicle excise duty. A staggering 2,000 firms—20 per cent. of the Association's membership—have asked for information packs on the 'registration plates of convenience' scheme under which they can register trucks abroad. This is clear evidence, if it was needed, that the industry isn't just prepared to protest. It will hit the Government where it hurts most … in its pocket".

Ms Claire Ward (Watford)

Will the hon. Gentleman give way?

Mr. Baldry

Not now. I want to finish what I am saying.

It would be helpful if the Minister would do me the courtesy of listening, as I want to refer to an answer that he gave me at Question Time. When I suggested that, if everything was as hunky-dory as the Government were suggesting, it was extraordinary that so many firms should contemplate moving elsewhere in Europe, the Minister said that I had got it completely wrong, and that if I looked at the KPMG report, I would see that there was no problem. He said: The fact is that all the independent assessments, including the most recent one by KPMG, show that, next to Austria's, our road haulage industry is the most competitive in Europe."—[Official Report, 13 April 1999; Vol. 329, c. 9.] The House could reasonably have inferred from that answer that the Government had commissioned independent research providing a comparison between road haulage costs in the United Kingdom and road haulage costs elsewhere in Europe, but, as we have now discovered, that is not the case.

Ms Ward

Will the hon. Gentleman give way?

Mr. Baldry

When I have finished making this point, I will gladly give way.

When we look at the KPMG report, we discover that nothing of the kind happened. The report concerns a number of different sectors, and a comparatively small part is devoted to road haulage. It states that the only reason for low freight costs in the United Kingdom is "compact market areas", meaning shorter distances. It is nothing to do with the cost per mile of running a UK-registered truck on UK fuel in competition with other European Union hauliers on the same roads. Therefore—whatever the exchange, and whoever from KPMG appeared at the Minister's press conference—to rely on such a report to suggest that there is no problem is, at best, disingenuous.

Ms Ward

The hon. Gentleman said that some hauliers are requesting information on how to register their trucks abroad. However, he did not say that, when they receive that information, they realise that, when all the costs are taken into account, the United Kingdom is comparatively much more competitive than other European countries. Hauliers may be requesting that information, but, once they receive it, they realise how well they are doing.

Mr. Baldry

The hon. Lady and some of her colleagues have a hard learning curve to surmount—we have all been there. It is fine coming into the Chamber, picking up a Whips' brief from the Government Whips Office and reading it out, but, when road hauliers visit the hon. Lady's surgery and confront her with real facts, it will be very difficult to justify the pretence that there is no real problem and that it is all a figment of the hauliers' imagination.

Several hon .

Members rose—

Mr. Gerry Sutcliffe (Bradford, South)

The hon. Gentleman mentions road hauliers coming to our surgeries. However, if they do, they will be talking not only about what the current Government have done, but about what happened to them in the 18 years of the previous Government. When they do speak to us, they will take into account all that has happened. If the hon. Gentleman genuinely means what he is saying, surely he will take some responsibility for what the previous Government did in 18 years to the industry.

Mr. Baldry

In the 18 years of the previous, Conservative Government, I cannot recall any occasion on which the road haulage industry felt it necessary to take to the streets, to demonstrate, to blockade and to voice its concerns. I think that the industry always felt that, in the Conservative Government, it had a Government who listened and had its interests at heart.

I represent the heart of England—

Mr. Loughton

Metaphorically and physically.

Mr. Baldry

Yes, both.

Dun and Bradstreet's most recent profitability survey shows that Banbury has the highest proportion of profit-making businesses in Britain. I am glad to say that I represent one of the most successful areas of the United Kingdom. Why did Dun and Bradstreet reach that conclusion? It states: The M40 has helped to make north Oxfordshire one of the fastest growing economic areas in the South East", and that Banbury has taken on a new lease of life since the arrival of the M40". It continues: Banbury is strategically situated about one mile off the motorway almost half-way between London and Birmingham.

Hundreds and thousands of new jobs have come to north Oxfordshire because of motorway links. The goods and services manufactured and provided in north Oxfordshire are taken away and delivered mostly by road haulage. Therefore, Opposition Members' concerns about the road haulage industry's complaints are not simply about the road haulage industry, but about the overall competitiveness of United Kingdom industry. If the road haulage industry is facing substantially increased costs, it will pass those costs on to United Kingdom industry generally, and primarily to United Kingdom manufacturing industry—an economic sector about which I should have thought that the Government should be concerned.

Mr. Jenkin

My hon. Friend is making an extremely important point—that the debate goes much wider than only the road haulage sector. It is important to understand that only a certain part of the industry—businesses that already operate internationally—may flag out, and that much of the industry cannot do so. That part of the industry will have either to pass on its costs to its customers or to go out of business. Therefore, directly as a result of the Budget, the transport costs of businesses such as Cortaulds have risen by 11 per cent.—and the Government have the nerve to lecture us on competitiveness.

Mr. Baldry

I agree with my hon. Friend. There is no need to argue about the facts. Following last month's Budget, a litre of diesel costs 71.2p, compared with an average of 42p in the rest of Europe. In Germany, it costs just under 40p. More than 85 per cent. of the UK retail price is taken as tax. Under Labour, British lorries are subject to the highest vehicle excise duty in Europe. The Budget increased vehicle excise duty on 38-tonne trucks to £5,750 a year. The average in the rest of the European Union is £928, while in France, it is just £486.

The Government may be unwilling to listen to the truckers and the road haulage industry, but I hope that they will be prepared to listen to established organisations such as the Confederation of British Industry, the Federation of Small Businesses and the Association of British Chambers of Commerce, which collectively have advised the Government that 53,000 British jobs are at risk because of the high taxes facing the haulage industry. In my experience in government, organisations such as the CBI and the Association of British Chambers of Commerce did not give us fantasy figures or figures that they had not researched. When such organisations express real concerns, it is sensible for the Government to listen to them. British truckers face the highest road tax and the highest diesel prices in Europe. British truckers trying to compete abroad are hit by foreign road taxes, while continental truckers with lower rates of tax can drive free of charge on British roads, using cheap foreign fuel.

Ms Margaret Moran (Luton, South)

Does the hon. Gentleman accept that when road haulage companies assess the competitive advantages of locating in this country or elsewhere, they will take into account the total comparative tax burden, which includes the lowest rates of corporation tax that this country has ever had and lower labour taxes? In comparison with the Netherlands, there is a £800,000 tax advantage to locating in this country. Will they not also take into account the costs of pollution, of which they create their share? Those costs are estimated at about £18 million a year. Will not the average haulage operator in this country take all those considerations into account—and to our benefit?

Mr. Baldry

If all those facts were correct, one would expect European truck companies to be flagging in to the United Kingdom and moving here. I suggest that the hon. Lady gets in touch with her local chamber of commerce to ask why the Association of British Chambers of Commerce is telling the Government that 53,000 jobs are at risk. The hon. Lady smiles, but I would not smile at the suggestion of 53,000 jobs being at risk. The figure has come not from some off-the-wall academic think tank or an industry pressure group, but from the CBI, the Association of British Chambers of Commerce and others, who have expressed their deep concerns to the Government.

Mr. Loughton

Does my hon. Friend agree that it is pretty rich for the Government, who have finally woken up to the additional costs of integration with Europe, to use that as their argument here? They have done a great deal to give up our opt-outs from the extra social chapter charges that the previous Government were able to avoid. They are seeking to bring those extra costs to this country.

Mr. Baldry

Since coming to office, the Government have taken many decisions that have made the position of UK industry far less competitive.

The UK road haulage industry is expressing real concerns about the position that it is being put in. They are not imaginary concerns. The Government have made it clear this afternoon that they are not prepared to take any action to help the British road haulage industry. The simple test of that is whether, in a month or two, the Chief Secretary or the Minister of Transport report to the House what positive actions they have taken or are taking as a consequence of their discussions with the road haulage forum. I am prepared to bet good money with anyone who, wants to take a bet this afternoon that nothing will emerge from those discussions, because the Government are committed to the strategy that they have adopted in this year's Budget.

Mr. Milburn

Repeating allegations does not make them any more correct. This is the third or fourth time that the hon. Gentleman has repeated his allegation that we are not listening to the road hauliers. My right hon. Friend the Minister of Transport and my hon. Friend the Economic Secretary have had their first meeting with the road hauliers. I repeat the undertaking that my right hon. Friend the Deputy Prime Minister has already given to examine the industry's proposals for a Euro vignette. We go into that with our eyes open. It is not the panacea that Conservative Front-Bench Members think.

Mr. Baldry

When the Chief Secretary looks at Hansard, as I am sure that he will do shortly, he will see that in almost the last sentence of his speech, he said that the Government were not prepared to unpick the Budget or the Finance Bill. If he has not yet realised that the road haulage industry is complaining about the provisions in this year's Budget, he has clearly not been listening to the industry.

Ms Moran

rose—

Mrs. Diana Organ (Forest of Dean)

rose—

Mr. Baldry

I shall not give way, because there are others who want to speak.

We are not putting forward the Brit disc as a panacea. As I am sure that my hon. Friends on the Front Bench will explain in greater detail, the proposal is a first step to try to redress the situation. If the Government do not start listening to the UK road haulage industry—

Mrs. Organ

Will the hon. Gentleman give way?

Mr. Baldry

No. I have made it clear that I shall not give way. I am sure that the hon. Lady is one of those who would like to have a chance to speak.

If the Government do not start listening to the UK road haulage industry, not only the road haulage industry, but the whole of UK industry will suffer. That will be highly detrimental to the competitiveness of the UK economy. I hope that the Government will start to listen, sooner rather than later, to what UK industry and business is telling them. Repeating the Treasury mantra will not make Government policies any more palatable or correct.

5.18 pm

Mr. Christopher Leslie (Shipley)

I have listened with interest to the debate. My right hon. Friend the Chief Secretary to the Treasury has adequately rebuffed all the Opposition arguments, so I hope that I do not need to repeat many of the points. The Opposition seem to be having a problem taking in some of the realities of the outside world. It is interesting that there are not many Conservative Members in the Chamber this afternoon. I know that Lady Thatcher gave an important speech yesterday evening and it was a late night for many of them, but perhaps they should have the courtesy to come into the Chamber on an Opposition day.

Looking at the subject objectively, the Government have listened to the road haulage industry. Like most hon. Members, I have haulage companies in my constituency. It is important to take into account their costs and the opportunities that they have to trade across the country and across Europe. I am pleased to see the constructive way in which the Government have addressed the problem. Rather than hyping up the militancy and the protests that have disrupted the country—as the Conservatives have done—my right hon. Friend the Minister of Transport has set up an industry forum to listen and consult with employees, union representatives and business leaders in the road haulage industry. The Government are trying to listen and to take on board some of their comments.

Mr. Swayne

I have been listening to the concerns of the road haulage industry. I also listened to the Chief Secretary. Will the hon. Gentleman comment on the opening five minutes of the Chief Secretary's speech, when he told us, first, that there was overcapacity in the industry and, secondly, that it was fuel inefficient? The conclusion that we draw from that is that Government policy is designed to cause bankruptcy and fallout within the industry. One might even call it a price worth paying.

Mr. Leslie

It is funny that the hon. Gentleman should quote that. I recall that it was said by Lord Lamont, a former Conservative Chancellor, about unemployment. It is a shame that the Opposition stick by that comment.

In my view, my right hon. Friend the Chief Secretary got it absolutely right. Although the road haulage industry faces various difficulties, we have to consider the wider world and the environmental issues that we must address. The Opposition seem to ignore the fact that we face a worldwide environmental catastrophe, with global warming threatening the livelihoods of millions of people. We have only to see the appalling pictures from Bangladesh and elsewhere in the world, where weather conditions have worsened significantly—probably due in part to carbon dioxide and other emissions since the industrial revolution. It is incumbent on us, as the responsible party of government, to consider the issues and introduce policies that will go some way to honouring our share of the commitment to rectifying the environmental problems that we face.

It is important to point out that the fuel duty escalator, which was introduced by the Conservative Government, was designed in part to discourage the consumption of hydrocarbon oil fuels that produce carbon dioxide and other emissions.

The shadow Chief Secretary said that it did not matter that a saving of 2 million to 5 million tonnes of carbon would be lost as a result of his proposed policy of scrapping the fuel duty escalator. He described that significant reduction as irrelevant. We need to recognise the importance of meeting our commitments at Rio and Kyoto.

Mr. Loughton

Has the hon. Gentleman seen the report by the Automobile Association that calculates that the entire extra cost on the motorist imposed by the Budget was designed to reduce carbon dioxide emissions by no more than 1 per cent., and that exactly the same reduction could be achieved at much less expense by issuing every person in the country two energy-efficient light bulbs?

Mr. Leslie

I have not seen that report so I will not comment on it. However, I read another report that said that continuing with the fuel duty escalator could produce a reduction in carbon dioxide emissions from transport of between 5 and 12 per cent. by 2010. That is a significant figure, so it is worth keeping our eye on the ball.

When the Opposition were asked how they would substitute for the saving of 2 million to 5 million tonnes of carbon gained through the fuel duty escalator, they revealed their true colours. They wanted to cut back on the coal industry and reduce carbon dioxide emissions by returning to the policies that they pursued in government.

Millions of people were sickened by the previous Government's disregard for coal miners. My hon. Friend the Member for Pontefract and Castleford (Yvette Cooper), who intervened earlier, will have many constituents who are worried by the threat that a Conservative Government will be re-elected and shift the burden from the road haulage industry back to the coal industry. That would certainly not be a solution.

Mr. Sutcliffe

Does my hon. Friend agree that there must be a dialogue on climate change so that the Government and industry work together to help improve the environment? That is why the forum is important; it provides the ability to set environmental targets and discuss their effect on industry. Is that not the proper way forward, instead of the militant action that the Opposition have supported?

Mr. Leslie

As usual, my hon. Friend has hit the nail on the head. I hope that the industry forum will provide a way forward through partnership instead of the combative approach of the Opposition.

Mr. Bercow

I am grateful to the hon. Gentleman for giving way. He spoke about the interests and views of constituents. Perhaps he can tell the House where in his election address he informed the good people of Shipley that he would be voting to increase taxes and regulation on Britain's road hauliers at a time when cabotage in the European Union means that low-tax, high-polluting foreign lorries can travel scot free on Britain's roads?

Mr. Leslie

I am not sure that it is scot free. As I understand it, the changes in the cabotage rules will account for only 0.04 per cent.—

Mr. Jenkin

That was in 1995.

Mr. Leslie

I am not sure whether it is any more significant in recent years. In any case, in my election manifesto I placed great emphasis on the environmental benefits that we wanted to achieve in office and the importance of being responsible in government and not simply making a promise one year and changing it the next, as the Conservatives did when they introduced the fuel escalator and then washed their hands of it. One can imagine what the country must think of the desperate state of the Conservative party today, scratching around for issues and spending two days of vital parliamentary time discussing this one. By and large, people understand and accept the need for the measures.

Ms Moran

Does my hon. Friend agree that the Opposition's view that we should return to their former policies is not only environmentally unsound, but is economic insanity as under the previous Government the country faced some £30 million net per annum in pollution and congestion costs?

Mr. Leslie

My hon. Friend is correct. It is clear that the Conservatives never really intended to solve the problem of congestion or comprehensively deal with the transport crisis that was precipitated by their policies.

As I have mentioned road haulage firms in my constituency, perhaps I should say at this point that I have received more positive comments from road hauliers about the Bingley relief road which is going ahead thanks to my right hon. Friend the Minister. That policy will produce great benefit to industry in the Aire valley area. I may return to that point later. It is also worth mentioning that the Government are taking measures to encourage fuel-efficient and environmentally friendly trucks and lorries. For example, the vehicle excise duty concession has now doubled to £1,000. I hope that that measure, coupled with the increasing differential between the price of ordinary diesel and ultra-low-sulphur diesel, will help to clean up the environment and reduce carbon dioxide emissions, nitrogen dioxide emissions and particulates, which are seriously damaging the atmosphere and the health of all our constituents.

On competitiveness, I find it amazing that Conservative Members can single out one issue without looking at the context of the costs to the industry. We have heard about labour taxes in the rest of the EU, and that we have a relatively competitive position in this country. It is also worth emphasising the corporation tax reductions made by the Government, which will bring great benefit to road hauliers and many other businesses across the country. The hon. Member for Banbury (Mr. Baldry) said that his constituency had the largest number of profitable firms in the country, and I imagine that they will be benefiting from the Government's corporation tax reductions.

It is worth repeating the point that road hauliers must pay tolls on the continent. There are few tolls in this country; the Isle of Skye and the Humber are two examples. In France, the owner of a typical truck will have to pay £7,800 in an average year. Those costs must be taken into account and, in my judgment, there is still a great deal of competitiveness for the road haulage industry in this country.

The Opposition have made great play of the fuel duty escalator, and, no doubt, they will want to come back to that matter during discussions on the Finance Bill. However, I cannot see the logic of their position. The fuel duty escalator has significant principles behind it that need reiterating. It not only has environmental benefits, but spells out clearly to the country the Government's plans over the longer period; rather than doing what the Conservatives would do, which would be to chop and change their tax plans in response to the political expedient of the day. At least this Government have continued what the previous Conservative Government were going to do, and have said that the escalator will continue.

Several references have been made during the debate to remarks by previous Chancellors. One that has not been mentioned so far is a comment by the right hon. and learned Member for Rushcliffe (Mr. Clarke) who, when he increased the rate of the escalator to 5 per cent., said in his Budget statement: It is not good policy in these environmentally conscious days to keep road fuel costs so much cheaper than they used to be."— [Official Report, 30 November 1993; Vol. 233, c. 938.] At the time, at least, he recognised the environmental benefits of tackling some of these serious issues.

Mr. Bercow

Does the hon. Gentleman not understand that my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) made the decision to impose at 5 per cent. but opposes the increase to 6 per cent., and that there is no inconsistency? How does the hon. Gentleman explain the fact that the current Paymaster General, the hon. Member for Bristol, South (Dawn Primarolo), at that time opposed the introduction of the levy at 5 per cent., but vigorously supports the imposition of the levy at 6 per cent?

Mr. Leslie

If the hon. Gentleman cannot see an inconsistency between someone supporting the escalator at 5 per cent. but finding it appalling at 6 per cent., I am worried about his health.

Opposition Members must address some of the consequences of their actions. Although raising money is not an overriding objective, the fuel duty escalator brings significant resources into the Exchequer; resources that can be used for vital public services such as health, education and transport.

These are not small amounts of money: according to the Red Book, there will be £1.5 billion of revenue in 1999–2000; £2.9 billion in 2000–01; and £4.2 billion by 2001–02. The right hon. Member for Wells (Mr. Heathcoat-Amory) was asked how he would plug that gap, which taxes he would raise and which services he would cut—or whether he would add the amount to the national debt. He failed to answer the question.

Mr. Loughton

Does the hon. Gentleman accept that it has been estimated that, already, £400 million has been lost in excise duties that are now going to the continent as a result of lorry drivers filling up their tanks there? That amount will increase enormously, and the money will be lost anyway.

Mr. Leslie

I do not know where the hon. Gentleman gets his figures from.

Mr. Loughton

From the lorry drivers.

Mr. Leslie

I do not know whether the hon. Gentleman got that information while driving around in the cab of a lorry, but when he presents me with some objective analysis, I might take it seriously.

Perhaps I was misrepresenting the views of the right hon. Member for Wells when I said that he gave no suggestion of where the money would come from. I recall his saying during the debate that he wanted to cut welfare spending to achieve those amounts of money; that is, up to £4.2 billion in 2001-02. Cutting welfare is now the policy of the Conservative party. Pensions, child benefit and disability benefits are all to be slashed by the Conservatives because they want to reduce the fuel duty escalator.

I wonder whether the constituents of Conservative Members—especially their poorest constituents—are fully aware of the risk that would be posed to their financial well-being should the Conservatives ever be re-elected. What an unfortunate day that would be.

The hypocrisy of the Conservative party has been evident throughout the debate, and a strong whiff of feigned outrage and false indignation is emanating from the Opposition Benches. Opposition Members must reconsider their desperately opportunistic stance on so many of these issues, especially when they introduced the road fuel duty escalator in the first place.

As bedtime reading recently, I looked through some of the amendments tabled to the 1997 and 1998 Finance Bills by the Conservative party—as one does. It was rather soporific. In debates on the 1997 Finance Bill—after the general election—the Conservatives proposed a 7.2 per cent. increase in the duties on diesel and all hydrocarbon oil fuels. In 1998, they proposed a 6.4 per cent increase in those duties. That is interesting, given that the expressed policy of the Conservative party is to get rid of the road fuel duty escalator.

I should like to know—the House deserves an answer—whether the Conservative party will stick with the commitments it made during the last few Finance Bills. Will the Conservatives go back to the 5 per cent. escalator? Will they propose a 5 per cent. change, a 1 per cent. change, or do they propose to cut the duty?

Mr. Jenkin

We want to stop the escalator.

Mr. Leslie

I recognise that, but will the Conservatives commit themselves to freezing the duty on hydrocarbon oils, or do they propose to cut those duties? That is what we need to know. I look forward with relish to the amendments that the Conservatives table next week to the Finance Bill. They will be well worth waiting for.

It has been a pleasure to speak in this debate, although—as I said—I feel that there was little to add to the speech made by my right hon. Friend the Chief Secretary to the Treasury, who showed up the hogwash and humbug uttered by Conservative Members.

5.39 pm

Mr. Norman Baker (Lewes)

I welcome the opportunity to speak in this important debate, and I am grateful that the Conservatives have chosen this subject.

There are genuine concerns in the road haulage industry about the present situation, which the Government have acknowledged this afternoon that they recognise. Hon. Members may disagree about the action that has been taken, but it does not help to name-call or to suggest that people are not interested in the industry when, clearly, they are.

The Conservatives have found an issue at last, after months of searching—taxation of the road haulage industry. However, they have not helped their case or the road hauliers by over-egging the pudding. The motion refers to the Government's utter failure to acknowledge the crisis in the UK road haulage industry. It talks about 53,000 jobs being lost and says that the Government should end its complacency and refusal to listen to the road haulage industry". Conservative and Liberal Democrat Members may feel that the Government should do more, but it does not help to exaggerate beyond belief the Government's response to the issue. Whether they are taking the right decisions is another matter, but they are listening to the road haulage industry. A forum has been established and, this afternoon, the Government have acknowledged some problems. I hope that we will now see some positive action from the Government. Let us have a sensible debate instead of the point scoring that we have heard so far.

Mr. John Hayes (South Holland and The Deepings)

Typically, the hon. Gentleman is being generous to the Government, but would it not have been more encouraging had the Government established the consultative process before the crisis? It is a little rich for the Government to say that they will discuss with the road haulage industry what should be done about fuel prices, because that is too late in the day and as a reaction to the understandable outrage that the industry has felt since the Budget.

Mr. Baker

The road haulage industry has been very articulate in making its case in the past few months and has caused all the political parties to consider the issue in more depth than had been the case previously. We should go forward from that point. As I have mentioned, the Conservative motion talks about the loss of 53,000 jobs. I see no evidence for that and I hope that when the hon. Member for North Essex (Mr. Jenkin) winds up he will give us some evidence, because it is worrying for the industry and needs to be justified.

Mr. Jenkin

The Centre for Economic and Business Research conducted an investigation into the continuation of the Government's policies and it forecasts job losses of that magnitude from its economic modelling.

Dr. Reid

It is sponsored by the Road Haulage Association.

Mr. Jenkin

It is run by a former CBI economist. The Labour party is fond of listening to the CBI and it is a respectable forecast. The Government should commission an independent assessment of the competitive position of road haulage in the UK and then we could have a proper debate, but the Government will not do it.

Mr. Baker

I agree that we now need an independent assessment of the situation. We need it even more after this afternoon, because the opposing side have produced "facts" that are incompatible with each other and which do not stack up. We need to find out whether the road haulage industry in this country is competitive. The Government have told us that the KPMG report and others demonstrate the industry's competitiveness, but the Conservatives claim that it is wholly uncompetitive or becoming so, because of the Government's measures. Those are conflicting positions and we need to discover the facts.

Mr. Jenkin

Can the hon. Gentleman not make up his own mind?

Mr. Baker

No, we need the facts. It appears that Conservative Members wish to make up their minds before they have the facts: we would rather wait for the facts.

Dr. Reid

What the hon. Gentleman and the Conservatives have asked for is precisely what we are doing in the haulage forum. Much hot air is produced on this subject, but we have agreed with the haulage forum that we will work jointly with the Freight Transport Association and the Road Haulage Association to discover the areas on which we can agree. If necessary, we will take independent advice so that we can build up a picture that will show whether the industry is—as we think—highly competitive internationally. That does not mean that there are not problems with sectors of the industry.

Mr. Baker

I am grateful for the assurance that there will be an independent element to the Government's talks with the road haulage industry.

Mr. Jenkin

The right hon. Gentleman did not say that.

Mr. Baker

Yes, he did. It is important that the facts are independently verified so that when we next have a debate on the issue we can proceed on the basis of facts that we can all agree on and dispute the interpretation of the facts, rather than the facts themselves.

I do not know whether there is a loss to the Exchequer, and if so how much, from hauliers going abroad to fill up. The Government say that that is not happening, and the Conservatives say that it is. I am not sure that it would make economic sense to go abroad, because one must also take account of the time involved and the fare on the ferry. However, in my constituency some drivers travel a long way to avoid paying a 20p car park ticket and waste far more in petrol. It is not necessarily a question of logic as to whether people go abroad. However, we need to find out whether that is happening and quantify the loss to the Exchequer if there is one.

It is clear from the debate so far that two black holes have opened up in the Conservatives' policy, and they need to be filled by the hon. Member for North Essex when he sums up. The first is the loss of income to the Treasury that will follow the abandonment of the escalator. If the Conservatives wish to pursue that policy, they must recognise that £1.5 billion a year, or more, would be lost to the Treasury. The right hon. Member for Wells (Mr. Heathcoat-Amory) admitted that it would come from welfare. Many people depend on welfare. They have no alternative income and would be very badly hit by cuts. To raise that possibility so cavalierly was not helpful, and it is important for the Conservatives to clarify exactly where in the welfare budget that cut will be made. Will it fall on pensions or the disablement allowance? It is not credible to have a policy that cuts something for somebody but does not say who will pay the price.

The second black hole that has opened up relates to Kyoto. The Government have made a full commitment to meeting the Kyoto targets, and our commitment to that is as firm if not firmer. I had thought, following the stalwart efforts of the previous Conservative Secretary of State for the Environment, that the Conservatives were also committed to Kyoto. However, if the fuel escalator is abandoned, as the Conservatives suggest, that will have an adverse impact on our ability to meet our Kyoto targets.

I have a copy of a press release from the previous Government dated 30 November 1993, following the November 1993 Budget. It states: The Chancellor also announced his decision to raise its commitment to real increases in the road fuel duties in future Budgets … to an average of at least 5 per cent. That implies that 6 per cent. could fit that category. The press release continues: The Chancellor's decisions reflect a number of factors including the need to raise revenue"— so it was a milch cow even in those days— and the need to encourage reductions in UK carbon dioxide emissions. The need to reduce carbon dioxide emissions has not gone away: it is stronger than ever. Environmental analysis demonstrates that the need to take action on climate change is greater than it was six or seven years ago, but the Conservatives appear to be abandoning that policy. That is the second black hole that the Conservatives need to fill.

The hon. Member for East Worthing and Shoreham (Mr. Loughton) earlier talked about two light bulbs. We should become more energy efficient, but the transport sector has increased carbon dioxide emissions when other sectors have seen their emissions fall. The transport sector is, therefore, a big problem in terms of carbon dioxide emissions.

It is also worth bearing in mind the fact that road freight traffic has increased by 67 per cent. since 1980. According to the Library's figures, it is set to double between 1996 and 2026. Whether or not hon. Members welcome that, it is premature to talk about 53,000 jobs being lost when such an increase is forecast. At the same time, rail freight has declined in gross tonnage by 32 per cent. since 1980. We must make efforts to ensure that the maximum amount of freight possible is transported by rail. The Government, to their credit, have introduced rail freight grants and taken other measures to achieve that. To the Conservatives' credit, the one part of rail privatisation that has been a success is the privatisation of rail freight, which has worked well with English, Welsh and Scottish Railways and other companies. Let us agree on that and build on attempts to put more freight on rail. That is not to say that all freight can go by rail as huge amounts of it must go by road. However, we must maximise use of the rail network.

Mr. Loughton

I am glad to hear the Liberals coming around to privatisation following the benefits that it has brought to rail services. Does the hon. Gentleman acknowledge that much freight on rail is carried by diesel-powered locomotives and that the increase in diesel charges will have an impact on the railways? Does he agree that those locomotives are not subject to the same stringent environmental emission standards as lorries, and we need a massive clean-up exercise on the railways?

Mr. Baker

The hon. Gentleman was highly selective in what he said about our view on rail privatisation. I had picked out the one bit that had been a success.

Mr. Loughton

The hon. Gentleman is making progress.

Mr. Baker

Not much, though. The hon. Gentleman made the valid point that locomotives should be as clean as possible. It might be helpful if Railtrack used some of its gross profits—gross in both senses—to invest in railways instead of dressing up regular maintenance as investment. There should be more money for electrification to deal with that problem.

Mr. Peter Snape (West Bromwich, East)

Any independent inquiry into the road haulage industry ought to consider the results of surveys under successive Governments that have indicated that, regardless of the substantial tax paid on them, the heaviest lorries in the UK do not meet their true track costs. Is it not time that there was—to use an overworked phrase—a level playing field for road and rail freight? The tilting of the field for several years has had its impact, and a declining amount of freight is carried by rail, with an equally adverse impact on traffic congestion, road deaths and the environment.

Mr. Baker

I agree entirely. There must be incentives to use rail and there must be no market distortions that discriminate against rail. The Government have begun to deal with the environmental impact of lorries, but we must ensure a greater correlation between environmental damage caused by lorries and charges imposed on road haulage companies. If the industry is working hard to clean up lorries—I think that it is doing so—we must ensure that it is rewarded, but we must discriminate against lorries that pollute.

Dr. Reid

We do.

Mr. Baker

I acknowledge that the Minister has begun that work, but it needs to go further.

We have some sympathy for the Conservative proposal for a Brit disc, because it relates to road usage. We are keener to tax road usage than simple ownership of vehicles. We must look at vehicle excise duties on our lorries, which are well in excess of duties in other European Union countries. That does not necessarily mean a big cut in revenues to the Exchequer, but we must examine the structure of the tax system to put more taxes on road use and fewer on vehicle ownership. Recently produced league tables show just how far out of line our VED is with duties in the EU.

We support the concept of what Conservatives call Brit discs, and we call Euro vignettes. I am pleased that the Government have announced that they will examine the idea. That is a sensible, non-confrontational approach.

I have mentioned Kyoto, but I have not yet dealt with the pollution factor, and it would be wrong to leave that out of a debate of this nature. One in seven of our children suffers from asthma, and up to 10,000 people a year die prematurely because of particulate pollution. Any transport policy must include strategies to deal with those problems, or we shall fail our children and those who suffer from pollution.

The Liberal Democrats support the fuel escalator in principle, but it must not be a milch cow from which there is no return for the industry. We must reinvest the money—hypothecated, perhaps—to ensure that benefits result from the burden of taxation on the industry. My colleagues and I have continually supported the escalator for cars, but we match that support with calls for a cut in VED. The Budget provided a cut for 1100 cc cars, but we want VED to be abolished for all cars under 1600 cc, which would provide a specific link between the fuel escalator and the benefits that arise for transport, both public and private. We voted against the Budget's proposals on the escalator, and we want the Government to make a more explicit link.

We would support increased taxation on motorists and hauliers for environmental reasons. However, there would have to be a quid pro quo, and people would have to be able to see where their money was going rather than watching it disappear into the black hole of the Treasury. Taxation should be shifted from ownership to usage. We have considerable sympathy with the idea of a vignette system, under which hauliers pay according to their use of the road network, but there must be commensurate cuts in VED if that idea is to bring any benefit.

Such measures would help to level the playing field across Europe. The Liberal Democrats have long supported an EU-wide carbon tax to eliminate the kind of inconsistencies to which various hon. Members have drawn attention. The Government have made some promises today and they are listening to the road haulage industry, with which I hope they will continue to work. I hope, too, that the Government will take independent advice on the best way forward for both the industry and the environment.

5.57 pm

Ms Joan Walley (Stoke-on-Trent, North)

This is an important and extraordinarily complex debate. Following the huff and puff and loud talk that we heard from the Conservatives an hour or so ago, the House has settled down to examine real issues underlying the creation of an integrated transport system.

I thank the Government for the green measures introduced in the Budget, for which we have waited enormously long. No one pretends that these hugely complex issues are easy to deal with. How are we to meet our Kyoto commitments? How should we start to think about the environment? How should polluters pay?

No one wants people to be forced out of business, and the only way forward is consensus. For the whole United Kingdom, in constituencies such as that of my hon. Friend the Member for Shipley (Mr. Leslie) and those of the other hon. Members who have spoken, we must bring together fiscal, environmental and transport measures in ways that will meet our international commitments while also taking into account issues such as competitiveness. The same is true of my own constituency and that of my hon. Friend the Member for Stoke-on-Trent, South (Mr. Stevenson); we regularly meet the North Staffordshire chamber of trade. The costs to industry of road traffic congestion are immense. None of the issues that I have mentioned is separate from the matter raised for debate by the Opposition. We must tackle the whole of this complex matter.

I am glad to see my right hon. Friend the Minister of Transport in his place because he has made huge progress. I have every confidence, following the 8 April discussions, that further meetings will involve freight and haulage operators, the Treasury and the Department of Trade and Industry. If we failed to find a way forward, we would send out a message that the Government did not care, but the opposite is true. The Government are determined to deal with the legacy left by the previous Government's failure to produce a policy for integrated transport.

Mr. Swayne

Does not the hon. Lady foresee that there will be a reduction in the number of freight miles as a result of the tax increases? Is not the logical conclusion of any such assumption that a number of haulage firms must inevitably go out of business?

Ms Walley

We live in a time of change, when we must consider our global, international commitments and the basis on which our industry operates. We must understand that it is no longer an option to do nothing about congestion and the environmental problems that we face. Inevitably, at any time of transition, there is also pain. We are all responsible people—at least those of us sitting on the Labour Benches are responsible; and I suspect that many of those sitting on the Opposition Benches also want to be responsible. We must find a way of pinpointing the problems at this time of transition, so that we can deal with them properly through the framework provided by what is being done by the Treasury and the Department of Trade and Industry, and by the policies of the Department of the Environment, Transport and the Regions. When we have identified the problems, we can do something about them in partnership.

That is why I feel that today's Opposition debate is not the action of a responsible party and a responsible Opposition. The debate was opened by the right hon. Member for Wells (Mr. Heathcoat-Amory), a former Treasury Minister, who was responsible for the escalator that is causing so much pain, without any thought of how it would all turn out. Similarly, the former Minister of Transport, who was perhaps responsible for failing to persuade the previous Conservative Government of the importance of introducing proposals for integrated transport, is now the director-general of one of the haulage organisations associated with the direct action. That makes me wonder whether Members of Parliament want to exert pressure so that something is done, or do we merely want to produce a lot of hot air and dissent? Do we not want to be part of the solution? I want to be part of the solution; I want to work with those people in my constituency who ask for debates on this issue, so that we can find a way forward. That is crucial.

I followed carefully the progress of my right hon. Friend the Minister of Transport when he was the Minister for the Armed Forces. I have a special knowledge of his work because I was privileged to have an attachment with the Royal Air Force, and am aware of the tremendous regard in which he was held by members of the armed forces. If he gives anything like the commitment to his current position that he gave to his previous position, we shall have the basis for progress. When I speak to those in my constituency who are anxious about this matter, I want to ensure that they and I can present their concerns directly to the industry forum for road haulage that has been established.

The hon. Member for Banbury (Mr. Baldry), who is no longer in the Chamber, talked about his constituency in the heart of England, where he said that he had the highest proportion of profit-making industries. In my constituency, I represent one of the highest proportions of manufacturing industries. We have a great dependence on freight transport to send our goods to national and international markets, so it is not in our interest to have congestion or environmental problems. For all those reasons, we must find solutions.

My hon. Friend the Member for Colne Valley (Kali Mountford) referred to the environmental health costs; the problems associated with increased asthma and the costs of ill health to the national health service. We must reduce emissions; that is why green taxes are important. [Interruption.] I apologise for coughing, Mr. Deputy Speaker. I think I must take a break to let my voice recover. [Interruption.]

I am grateful for that break, Mr. Deputy Speaker. Perhaps I should speak more softly.

I am pleased that my right hon. Friend the Minister is considering the future of 44-tonne vehicles in the context of the wider debate that is properly being conducted on that subject. It is right that there should be tax concessions in the Budget for the more environmentally friendly 41-tonne, six-axle lorries. It is crucial that we find ways of giving incentives for more efficient vehicles that do less damage to the environment.

Mr. Jenkin

Will the hon. Lady give way?

Ms Walley

I will gladly give way.

Mr. Jenkin

It will give the hon. Lady a breathing space. We entirely agree with her on that point. The problem is that, after the massive increase in the vehicle excise duty for 40-tonne vehicles, the incentive offered by the Government for the 41-tonne, six-axle lorries is not sufficient. I have a fax from a Manchester Renault dealer in which he sets out the figures for his customers. He states: The figures clearly show 'stalemate', they do not take into account the interest loss on the road fund licence difference … but only 0.5 mpg down … The only certainty is that in future years fuel costs will continue to rise. Because six-axle trucks burn more fuel, he concludes that it is not worth buying a six-axle truck. The incentive is not enough. If the hon. Lady supports that policy, I urge her to make representations to her right hon. and hon. Friends in the Treasury to ensure that the differential is widened to create a sufficient incentive.

Ms Walley

I am grateful for that intervention. However, we are not talking about doing something overnight; we are talking about the long term—a five-year and a 10-year programme. We want to ensure that industry can compete in the long term. However, I will gladly recommend to my right hon. Friend the Minister that the matter should be considered in detail in the round table discussions with the various haulage operators.

However, I want to point out that this is a matter of swings and roundabouts. Previous speakers have vividly pointed out that, although the duty in this country might be higher, other costs are higher in other European countries—for example, labour costs and tolls. All that must be put in the picture. I feel strongly that singling out one particular issue, without considering the whole matter, is the wrong way forward; it is not responsible. It is important that we do not do that.

I have read, with great interest, that people in haulage companies such as Excel Logistics—based in my constituency—believe that techniques and technologies can be further refined to take account of the higher duties. We need to talk to those freight operators and, in partnership, discover what the issues are, so that we obtain the greatest efficiency from every litre of fuel used by haulage and the freight industry.

I want briefly to refer to the Budget measures, which are welcome. Hauliers will benefit from a range of measures: the reduction of the main rate of corporation tax to 30 per cent.; the cut in tax rates for small companies to 20 per cent; and a 10 per cent. rate for companies with profits of less than £10,000. In the long term, those measures will help us to deal with the problem, not by considering only one issue, but considering it as a whole.

The issue is not merely about competitiveness. It is no good for haulage and freight companies to be in business if congestion is so heavy that they cannot get the goods to market, so I want briefly to refer to transport policy. We have heard much about the loss of income to the Treasury if the Opposition motion were to be successful—of course, it will not be.

Mr. Loughton

How does the hon. Lady know?

Ms Walley

I do know—merely from counting the number of Members on the Opposition Benches. That is a good indicator.

Let us not forget the legacy inherited by the new Labour Government—a legacy of under-investment in transport. I welcome the three-year comprehensive spending review proposals whereby £700 million has already been allocated to local transport plans and local road maintenance. I know how many times my hon. Friend the Member for Stoke-on-Trent, South, other hon. Members from north Staffordshire and I attended meetings with Conservative Ministers, but got nowhere. I know how much better is the settlement for local transport plans and road maintenance that was announced under the comprehensive spending review. I am also conscious that we have received an extra £300 million for trunk road maintenance, which is an important issue to hauliers and freight operators. An additional £300 million has been allocated to railways, as well as extra money for freight grants. My constituency contains a substantial rail freight depot whose potential should be maximised. I want other improvements to be made: for example, I want Railtrack to give further consideration to opening up the now abandoned line from Cauldon Lowe, through Endon, to Stoke-on-Trent and so reduce traffic.

All the measures being taken as a result of the Government's integrated transport policies will make an important difference. I do not want to stand here and simply congratulate the Government without adding that, however far we go, we can always go further; we can never do enough, because more is always needed. In addition to the local transport plans, the welcome document "Breaking the Log Jam" and the work that has been done in respect of buses, freight transport and shipping, I should like to add an item to the shopping list: road traffic reduction. Yes, we have made progress on local and national road traffic reduction, but I want to take this opportunity to tell my right hon. Friend the Minister that I want further progress to be made. I want him to agree clear targets in partnership with everyone involved so that we can make progress on national road traffic reduction.

Mr. Baker

Does the hon. Lady agree that it would be helpful if the Government committed themselves to an absolute reduction in road traffic, rather than fudging the issue between having some reduction in road traffic and having a reduction in road traffic growth? We need an absolute target and a date by which the reduction should have taken place, and it would be helpful if the Government clarified their position on that issue.

Ms Walley

If there is one person who can never be accused of fudging anything, it is my right hon. Friend the Minister of Transport. There is a great deal of support for national road traffic reduction targets; however, with those, as with issues affecting road haulage, it is important that Ministers sit down with all those who have a stake in the issue and all those who are concerned about it and find a way of moving forward that commands everyone's support. There is no way that we can impose targets without having in place the mechanisms needed to meet them. If the hon. Member for Lewes (Mr. Baker) is asking me whether I intend to press for that to happen, the answer is yes, I always have done and I shall continue to do so.

The issues affecting the road haulage industry are important, but the Opposition have played no part in helping to resolve those issues through the manner and hypocrisy that they have displayed during the debate—

Mr. Deputy Speaker

Order. The hon. Lady should not suggest that any hon. Member is involved in hypocrisy—a political party, perhaps, but not an individual Member.

Ms Walley

I shall find a thesaurus and look for a more appropriate word, but I think that my point is well made.

The issues are important and we do not underestimate them in any way, but, during the next six months, 12 months, five years and 10 years, what is important is that the Government as a whole—the Department of Trade and Industry, the Treasury and the Department of the Environment, Transport and the Regions—sit down with stakeholders and find a way forward that is in the interests of competitiveness, environmental commitments and environmental health in the constituencies that we represent.

6.15 pm

Mr. Owen Paterson (North Shropshire)

I am pleased to follow the hon. Member for Stoke-on-Trent, North (Ms Walley). I congratulate her on recovering her voice, even though I do not entirely agree with some of her comments.

I have been involved in the issue of road haulage since last July, when I was invited by the local chairman of the Road Haulage Association to visit his business. I went along and took my hon. Friend the Member for North Essex (Mr. Jenkin) with me, as, by that time, I had received several strong letters from RHA members in my constituency about the pernicious effect of the dramatic rise in the fuel duty escalator and vehicle excise duty which were introduced in the first Labour Budget.

Distribution and transport are a key industry in a rural constituency such as mine, where 95 to 97 per cent. of goods are moved by road. All my letters to Ministers at that time to which I refer received no answer of any consequence—only standard replies. In November last year, I introduced an Adjournment debate on the subject, over which you kindly presided, Mr. Deputy Speaker; again, I was given the brush-off. Most of the Economic Secretary's response to that debate was a repetition of the second page of the numerous letters that I had received in response to my letters on behalf of my constituents.

During that debate, I asked whether I could take a delegation from the industry to meet the Economic Secretary, but that request was refused, although she kindly granted me half an hour, as I mentioned earlier. Only later, after real pressure had been applied, was I allowed to take along the director-general of the RHA to meet some civil servants, who apparently had either not received any of the letters that had been sent to the Department or not understood properly many of the representations that had been made. Only after constant pressure, more letters and a major lobby of Parliament did the Government finally begin to listen.

It is a pity that the Minister of Transport has left the Chamber, because I emphasise that, at every stage when speaking at rallies and conferences attended by truckers, I have insisted that they should not disrupt the flow of traffic and annoy the public. I argued that alienating the public just as the truckers were beginning to win the argument would be a mistake.

It was with great interest that we in the campaign began to hear rumours of the KPMG report. It was mentioned by the Deputy Prime Minister, who quoted it as stating: KPMG has examined haulage companies and has made it clear that … business costs are £600,000 higher in the Netherlands and £820,000 higher in Belgium."—[Official Report, 14 April 1999; Vol. 329, c. 222.] I ask the Minister to ensure that the KPMG figures are put in the Library, because the report contains no reference to Holland or Belgium. I read the report for the first time yesterday; I was surprised, because the Government have hung so much on it, to find that it was not about the road haulage industry at all.

The report's title is "The Competitive Alternatives: A comparison of business costs in North America, Europe and Japan". The three main sponsors are the Royal Bank of Canada, Ontario Power Generation and Canada Bell. The preface clearly states: KPMG has conducted a comparison of the costs of doing business in eight countries in North America, Europe, and Japan. Among the other sponsors are 26 Canadian organisations, the Austrian Business Agency in Vienna and the Telford development agency in the United Kingdom. The UK cities mentioned are Telford, Cardiff and Manchester. Only six pages mention transportation.

The phrase on which the Government have hung everything is found on page 6, which states: Transportation costs. Road freight costs are lowest for Austria and the UK". However, that is qualified on page 27, which clearly states: Due to their compact market areas, Austria and the UK offer the lowest road freight costs". It is interesting to note how close USA costs are to those levels, because of the low cost of diesel in the USA, especially when one considers the huge distances travelled in that country. Page 74 carries the warning: Caution must be used in interpreting overall transportation costs, since the modal splits and relative costs of transportation vary significantly among industries, and the specific distribution patterns developed for each industry also affect total costs.

The last page of the report contains a list of companies consulted about road transportation costs. Two of the companies are from north America: one is KPMG Montreal and the other is Crowley Maritime. One company is from Austria, four are from France and two are from Germany and there is one each from Italy and Japan. Those involved in the manufacturing industry will recognise those companies as freight forwarding agencies, rather than road haulage companies.

The company of most interest to the United Kingdom is Brian Yeardley Continental Ltd. I have corresponded with Mr. Yeardley for some time and I telephoned him today. He is amazed that he has been cited as the source of the beneficial regime in the road haulage industry. He can conclude only that, as he files his accounts in February, his accounts for 1997 were used as evidence. He reminded me this morning that, when the Conservatives left power, only Luxembourg, Belgium and Spain had cheaper diesel than the United Kingdom.

There is a fundamental misunderstanding in this area. I think that we should put the KPMG report behind us and the Government should forget this unhappy episode. They have tried to hang everything on the report and it is unfortunate that KPMG has been dragged into the argument. It has conducted an interesting survey of business costs which, I am delighted to say, proves that Telford—which was in Shropshire, but is now a unitary authority—is the best place to invest.

Of all the people to choose, Mr. Yeardley is possibly the worst example because 20 of his 95 trucks are already flagged out to Luxembourg. He made it clear this morning that, unless he receives satisfaction from the forum—I welcome that body and am delighted that it has been established, even though it is nine months too late—and sees some improvement in the current regime, all his trucks will be flagged out to Luxembourg. Mr. Yeardley said: I would be stupid not to as the advantages are so good. Mr. Yeardley warned me before the Budget—this is an important point for Government Members—that he issues weekly bulletins to all his drivers informing them of the cheapest fuel on offer in each European country and advising them not to take on fuel in the United Kingdom. He said: Our depot fuel facility is locked and special permission required to use it.

I know of another company in Kettering that has not filled up a truck in this country since autumn 1997. That is not surprising, because Mr. Yeardley gave me a list of the prices that he pays in the United Kingdom. He pays £702 for 1,200 litres of regular diesel and £690 for ultra-low sulphur diesel, which is levied at 1p less a litre. That means that there is a £260.60 price difference if his drivers fill up in France, a £330 difference per truck every time his drivers fill up in Belgium and an incredible £350.40 if they fill up in Luxembourg. We cannot blame Mr. Yeardley for actively considering moving his entire fleet to Luxembourg.

Mr. Swayne

Is my hon. Friend not being somewhat optimistic by expressing the pious hope that something positive will emanate from the consultative group? The Chief Secretary set the tone in his speech when he told us that there was overcapacity in the industry and that most of the problems were caused by fuel inefficiency in that industry.

Mr. Paterson

I am grateful to my hon. Friend for that intervention. Thanks to the campaign fought by this party—with the full co-operation of the trucking industry—we have at last got a forum and the Government are finally beginning to listen.

My next example is even worse. The dairy built by Müllers is the huge success story in my constituency. The 120 million litres of milk transported to that dairy every year are carried by diesel-fuelled trucks and every one of the 750 million pots of yoghurt is carried by a diesel-fuelled truck. There was an opening at the dairy on Monday—conducted with great grace by Joanna Lumley—and I took the opportunity to talk to Mr. Mattmer, the Bavarian head of the company's logistics division.

I received details of the company's operations. It runs 50 trucks in the United Kingdom and 230 trucks in Germany. Before it built the plant, it ran weekly truckloads from Germany. Running a truck for 100,000 miles a year at an average of eight miles a gallon, the company estimates that there is a difference between the two countries of £18,056.35 on fuel, road tax and insurance. That is a huge sum, and the company told me quite clearly that, unless the regime is changed, trucks in Market Drayton will soon bear German number plates because the German Government have adopted a more sensible attitude to vehicle excise duty. The company is also considering moving to Luxembourg.

Mr. Roy Beggs (East Antrim)

It is only a matter of time before the same thing happens in Northern Ireland. At present, drivers can save £230 on a 250 gallon tank, and no fuel duty revenue goes to the United Kingdom Exchequer. There is already a £4,000 differential on vehicle excise duty. Is it the Government's policy to destroy the road freight industry in Northern Ireland? Is that how they will assist the achievement of a united Ireland? Urgent action must be taken. Is it not a coincidence that tonight's edition of the Belfast Telegraph carries the report that 30 vehicles have been seized in the past week by Customs and Excise, despite the fact that, two years ago, I asked for additional customs officers to be made available? Does the hon. Gentleman agree that the Government must show that they intend to protect our road freight industry?

Mr. Paterson

I am most grateful to the hon. Gentleman for that powerful intervention. Unfortunately, I do not have the figures before me, but my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) asked the Government how much excise duty was lost in Northern Ireland because of smuggling over the border to the Republic of Ireland. My right hon. Friend received the incredible answer that the Government did not know. That is an absolutely astonishing admission: the Government simply do not care.

Mr. Eric Martlew (Carlisle)

I have listened carefully to the hon. Gentleman. Smuggling is an illegal activity, so how does he expect the Government to know how much revenue has been lost?

Mr. Paterson

If trucks from Northern Ireland refuel south of the border, revenue is lost to the Government.

Mention has been made of the beneficial corporation tax rate. It is interesting to note that, although the Labour party in opposition fought every reduction in corporation tax, it is now hanging much on it in terms of the road haulage industry. I urge Labour Members to listen to the following fairly simple figures—they do not need to concentrate quite as hard as the Deputy Prime Minister might. For a typical company with 10 trucks turning over £1 million a year, with each truck doing 100,000 miles at £1 a mile, the fuel element is about 35p a mile. Following the tremendous hike in the Budget, the VED on the 10 40-tonne trucks will be £57,500, with a total of £407,500 on fuel—

Mr. Hayes

My hon. Friend makes a powerful case. Does he agree that fuel excise duties disproportionately affect rural communities and rural companies? Only this afternoon, I spoke to a haulier, Jim Welch of Fowler Welch, and he agreed that fuel duty is particularly damaging because of local links with the agriculture and food industries. Rural Britain is disproportionately affected by the Government's swingeing increases—which is typical of a Government who have done so much to damage the countryside.

Mr. Paterson

My hon. Friend is absolutely right; he understands rural affairs very well. The increases have a crippling effect on constituencies such as ours, where 97 per cent. of freight is carried by road.

I shall finish citing the profit figures. If the company in question has a 3 per cent. profit margin—which is highly unlikely, given the losses and the number of people going out of business—corporation tax will be £6,000. That is nothing compared with a bill for £407,500. The Government do not understand the damage that they are doing to haulage businesses all over the country. Nor do they understand that there is a knock-on effect, because companies that cannot use flagged-out businesses from abroad will have to absorb increased prices. Every business in this country is made less competitive and less efficient than it would be if the Government had a more realistic regime on VED and fuel duty, such as those that prevail in other continental countries.

6.30 pm

Mr. Peter Snape (West Bromwich, East)

Following the hon. Member for North Shropshire (Mr. Paterson) is like following a heavy goods vehicle uphill—he has a billowing exhaust and he does not make much progress. I know that he has made this issue his own as far as the regional press in the west midlands is concerned.

Like most Conservative Members in supposedly safe Tory seats, the hon. Gentleman scraped home at the last election. I wonder what he said to his pals in the road haulage industry about those four Budgets from 1993 to 1997 when the fuel tax escalator was increased by a proportionately far higher amount than the increase under this Government. I remind him that inflation was running out of control at certain times during the previous Conservative Government's period in office. As the Liberal Democrat spokesman, the hon. Member for Lewes (Mr. Baker), reminded us, a minimum increase of 5 per cent. above inflation in those days was much more damaging to the road haulage industry than anything that this Government have done.

I concede that, with his selective use of statistics, the hon. Member for North Shropshire has captured many headlines in the regional press. It is a great pity that some of the people who read those headlines were not here to hear him stuttering through the report which he read rather badly and extremely selectively.

The motion refers to 53,000 redundancies in the road haulage industry. Nobody, not even Conservative Front Benchers, believes those figures. I have heard an attempted justification of them by the hon. Member for North Essex (Mr. Jenkin), who will wind up the debate for the Conservatives. I remind him and the Conservative party that, when I began to work on the railway, over 40 years ago, about 150,000 people were employed in that industry, many of them in the freight moving business. There are not nearly as many of them now, and not many tears, crocodile or otherwise, were shed by the Conservative party when those jobs were lost, partly because of the incompetence of railway management.

I have to say that, when looking back to when the railway industry was in the public sector, I do not recognise the golden age, particularly in freight, that some of my hon. Friends talk about. Much rail freight was lost by incompetence by railway management in the past two decades, but much more of it was lost because of the fiscal unfairness and financial imbalance between the road haulage industry and the rail freight business.

Mr. Hayes

rose—

Mr. Snape

I shall not give way to the hon. Gentleman. He ambled in at the last minute and he has already intervened twice. I do not have the time, let alone the inclination, to take his intervention.

Mr. Hayes

I was just trying to bring the hon. Gentleman back to reality.

Mr. Snape

I am grateful, but, if I came back to reality accompanied by the hon. Gentleman, I would not be here—that is a dead cert.

Mr. Simon Burns (West Chelmsford)

Should the hon. Member for West Bromwich, East (Mr. Snape) not declare an interest?

Mr. Deputy Speaker (Mr. Michael Lord)

Order. Hon. Members must not conduct conversations across the Chamber from a sedentary position.

Mr. Snape

If the hon. Member for West Chelmsford (Mr. Burns) reads the rules, he will realise that I have no need to declare an interest. I shall concede, if that is the right word—I am proud of this fact—that I am still a member of, and pay my subs to, the RMT. I am not paid for that representation, unlike some Conservative Members.

I return to my central point. The imbalance in taxation has brought about the present situation in the road haulage industry. I do not underestimate the problems caused to smaller owner-driver companies by the fuel tax escalator, but members of the Road Haulage Association will be the first to say privately that there is considerable overcapacity in the industry. Whatever many of them say about the price of diesel, they seem to find enough money to drive around and around our major towns and cities to make their protest, and they will say that, at that end of the market, people will cut each other's throat for a back load.

There is no doubt that there is considerable wastage in the road haulage industry: one has only to drive up and down our roads and motorways to see how many empty heavy goods vehicles there are. Unless we get taxation right, putting more freight on the railway system is likely to continue to be an uphill battle, despite the best efforts of English, Welsh and Scottish Railways.

The hon. Member for North Essex, who is winding up the debate, said earlier that the crippling tax system was having a distorting effect on the road haulage industry. I repeat a remark that I made when I intervened on the hon. Member for Lewes: every survey has shown that, at the heavier end of the heavy lorry market, companies do not pay their full track costs. The size of their lorries and the length of their journeys mean that they are the very people who are in direct competition with the rail freight industry, which for many years has been forced to pay its full track costs and, under the previous Conservative Government, achieve an 8 per cent. return as well. Where is the fairness and sense in that?

No Labour Member would claim that the railway industry could carry all, or even a major proportion of, the freight that is on our roads at present, but it could certainly carry a lot more if we did not have a fiscal imbalance.

I hope that my right hon. Friend the Minister of Transport, who will wind up the debate, will make it clear to the road haulage industry that we cannot tolerate the behaviour that it has demonstrated. That behaviour has been supported by Conservative Members. A former leader of the Tory party and Prime Minister would, whenever there was an industrial dispute, point at the Labour Benches and invite Labour Members utterly to condemn that dispute. We have had pretty mealy-mouthed condemnation of the present situation by the Conservative party, which is not the party of law and order because the Conservatives destroyed both when they were in power. Law and order do not mean much to them when their friends are misbehaving.

I hope that my right hon. Friend the Minister will bear it in mind that any concession made as a result of activities by road hauliers will lead to many other people behaving in the same way. The road haulage industry had better distance itself from present events. I am second to nobody in the House in my admiration for Mr. Steven Norris, who currently heads the Road Haulage Association. His industry, at work and elsewhere, is a great example to us all, but he ought to be more upfront in his condemnation of present activities.

Mr. Paterson

Will the hon. Gentleman give way?

Mr. Snape

No.

We cannot have blackmail, and I hope that my right hon. Friend will make it plain to the reputable sector of the road haulage industry that it has its forum and it had better wait for the outcome, instead of holding our towns and cities to ransom, as it is doing.

6.37 pm

Mr. Bernard Jenkin (North Essex)

I make no apology for supporting business in this debate, because the Government are putting business under pressure. I am a little surprised that the hon. Member for West Bromwich, East (Mr. Snape) did not mention his chairmanship of the bus division of the National Express Group and all the subsidiary boards of which he is a member, because I would be astonished if he was not paid for those directorships. The Government have extended the bus fuel duty rebate, so his industry is protected from the fuel duty increase in the Budget, and I am not surprised that he is happy to support the Government in this debate.

Mr. Snape

Will the hon. Gentleman give way?

Mr. Jenkin

No, the hon. Gentleman would not give way to anyone in his speech, so I shall not give way to him.

Mr. Snape

On a point of order, Mr. Deputy Speaker. The hon. Gentleman has just attacked me and will not now give way. I put it on the record that it is not necessary for me to declare any interest that is in the Register of Members' Interests, particularly when I am speaking in a debate that has no relevance to the bus and coach industry. I am proud to be a chairman of a bus company, something that the hon. Gentleman will never be.

Mr. Deputy Speaker

That is not a point of order for me.

Mr. Jenkin

The volume of rail freight has increased because our policy of privatisation brought private investment into the rail industry, and we are pleased about that.

The debate has been dominated by the issue of the fuel escalator, which was raised by the Chief Secretary. I point out to him that when we left office, as my hon. Friend the Member for North Shropshire (Mr. Paterson) pointed out, only three countries in the European Union had a diesel price lower than that in the United Kingdom. The massive differential in diesel prices has opened up under this Government. The Chief Secretary seems unable to understand that an environmental tax would not cease to be an environmental incentive if the Government froze it. Tax would still be 85 per cent. of the cost of diesel. We do not propose to make a dramatic alteration to that duty. We want to reverse the increase announced in the Budget and to discontinue the fuel duty escalator. It is not acceptable for the Government to cower behind silly words to the effect that it is somehow our responsibility that they keep increasing taxes.

The Conservative party's record on the environment is unimpeachable. When we were in office, we met all the targets. The Labour party inherited environmental targets that were eminently achievable, if only it would pursue them. To say that our tax announcements would leave a hole in the Government's finances, when they are raising an extra £9 billion—[Interruption.] No, the Government are increasing the tax take by £9 billion over and above Conservatives' tax plans for the lifetime of this Parliament. If the Chief Secretary does not have money coming out of his ears, I suggest that he consider the spending side of his equation, as opposed to the taxation side. For the Government to retreat behind the suggestion that other business taxes somehow offset the huge cost disadvantage caused by fuel duties and vehicle excise duty is ridiculous.

The Government cannot dismiss the Brit disc on the basis that there is some Brussels diktat which means that we cannot introduce it. The proposal from the European Union, which is on the Minister's desk—he probably does not even know about it—and which requires our consent for France to give a fuel duty rebate to its own road hauliers, gives the lie to that idea. I assure the Minister that the Conservative party will not allow some silly Brussels diktat to stand in the way of a fair deal for the UK road haulage industry.

The Government were elected on a promise—a vow explicitly given by the Prime Minister—not to raise taxes. He claimed that our policies need no new taxes at all". We have called this debate not only because the Government have flagrantly broken their own tax pledge, but because Labour's tax increases are having a devastating effect on UK competitiveness in general, as well as on the road haulage industry in particular.

While the Government say, "Crisis, what crisis?", it is clear that the industry is indeed in crisis. The Government should take this opportunity, as I know the Minister of Transport would dearly love to do, to show that they have listened. However, the only way to prove that is to act.

Today, we have announced that the fuel duty escalator should end. Next week, we shall vote to reverse the Government's fuel duty increases, giving all Labour Members the opportunity to show that they have listened. Today, we are also promoting our proposal for the Brit disc, which would mean that foreign hauliers would have to pay to use British roads just as UK hauliers have to pay for using many roads on the continent. That is a first step to removing the competitive disadvantages that the Government have heaped on UK business.

Will the Minister confirm—

Mr. Barry Gardiner (Brent, North)

Will the hon. Gentleman give way?

Mr. Jenkin

No, I shall not.

Will the Minister confirm that the Deputy Prime Minister got it completely wrong last week? Will he confirm that the Government are indeed considering the Brit disc idea, and that that means unpicking the Budget in order to be able to cut VED rates with the proceeds of the Brit disc? If he introduces a Euro vignette, it will simply be an extra tax on the road haulage industry unless he applies the revenue to the reduction of VED.

Will the Minister admit that the Government have created cost disadvantages for the UK haulage sector and all who are dependent on it? The Government do not need to take just our word for it. The managing director of Fergusons of Northumberland wrote that he had had a meeting with Nissan: The meeting was to inform me that we had been unsuccessful in our bid for a new contract which they had decided to award to a Dutch … company, which, they said, was purely on the basis of price … we are unable to maintain a competitive edge in the UK let alone Europe". Mr. Ken Willis in the west country said: The Government know they have a captive market-we have to either pay up or go under. Mr. John Newton of NWT of Buckinghamshire complained: our foreign competitors have a 16 per cent. advantage over domestic hauliers … The effect on tens of thousands of jobs … will be catastrophic.

The truth is that the Government are still deeply in denial. At the Freight Transport Association conference, the Minister of Transport claimed that he was convinced that you do not suffer from any serious competition and that the fuel duty escalator is here to stay".

The farce of the KPMG report underlines the Government's sheer cynicism and ignorance. The report is intended as a guide for certain types of industrial and service businesses which may be deciding where to locate their operations. It is not aimed at the road haulage sector; nor is it an indication of that sector's competitiveness.

I have spoken to KPMG. It has been taken for a ride by the Government. KPMG will not assume any responsibility for the way in which the Minister and his colleagues have been using the figures. Nevertheless, the Minister is shamelessly using the figures from the report to try to support his ludicrous claims that Government tax policies have not made UK road hauliers uncompetitive.

In fact, as my hon. Friend the Member for Banbury (Mr. Baldry) explained, the reason Britain and Austria offer the lowest road freight costs is what is called our "compact market areas"—that is, our trucks have to travel the shortest distances, in the UK. This factor is utterly irrelevant to the costs per mile of running a UK-registered truck on UK-purchased fuel in competition with EU hauliers on the same roads.

I have written to the Minister to invite him to agree with the industry a proper remit for a proper report that is explicitly about the competitiveness of the road haulage sector, to be commissioned from KPMG or any other reputable firm. That has not been agreed to by the forum. The right hon. Gentleman wants to keep it all in house so that he can control the information. I do not see how the dispute with KPMG can be cleared up unless KPMG issues a clear statement, so I invite KPMG to do so. If it declines, one must ask why it does not want clarity in respect of the information in its report. There has been more of a misunderstanding between KPMG in London and KPMG in Canada than the right hon. Gentleman is prepared to admit.

Why does the Minister not take the advice of the hon. Member for Workington (Mr. Campbell-Savours), who asked him in the House last week: Will my right hon. Friend ask his officials, or Treasury officials, to dig out the figures that really matter in this whole argument—the transport cost per tonne per kilometre, by road and by rail, in each European country, including the United Kingdom?"—[Official Report, 13 April 1999; Vol. 329, c. 9.] That is the sort of analysis that is needed, not the hijacking of some other irrelevant report.

As it is, the survey data used in the KPMG report to calculate road freight costs are probably more than two years out of date and do not reflect Labour's first three Budgets. On top of that, the data are based on only one UK haulier, Brian Yeardley Continental Ltd., of Featherstone in West Yorkshire. As my hon. Friend the Member for North Shropshire pointed out, Mr. Yeardley wrote to us: The Chancellor has ensured that we are uncompetitive against foreign hauliers"—[Interruption.]

Mr. Deputy Speaker

Order. Conversations are breaking out across the Chamber. Hon. Members must listen to the hon. Gentleman who is addressing the House. [Interruption.] I repeat: order.

Mr. Jenkin

I was reading an extract from a fax from the company that is the subject of the KPMG report. The fax states: The Chancellor has ensured that we are uncompetitive against foreign hauliers … Each of our vehicles must earn seventeen thousand pounds more annually than our European competitors to cover these extra tax costs.

Finally, Mr. Yeardley, whom the Government would present as the model example of the competitiveness of UK haulage under Labour, has confirmed that his company is one of those that will be flagging out their vehicles to escape Labour's crippling taxes. Nothing could demonstrate more graphically the hopeless fraud of the Government's position. The very evidence that they are using can be exposed as, first, utterly irrelevant, and secondly, out of date; thirdly, it can be confounded by the very facts of the example that the Government are seeking to deploy.

We urge the Government to listen. If 50,000 jobs at Longbridge are worth a subsidy of £175 million when there is massive overcapacity in the motor industry, why will the Government not listen to one of Britain's other vital industries? We urge the Government to scrap the fuel duty escalator, which has now gone far beyond any environmental justification. We urge the Government to reverse the fuel duty increases that they imposed in the Budget, and we commend the Brit disc as a vital first step towards a fair deal for British hauliers and for British business as a whole.

6.49 pm

The Minister of Transport (Dr. John Reid)

This has been an important debate, announced as such by the Conservatives and lauded as their major campaign. It is therefore rather a tragedy that for most of the debate there were no more than three Conservative Back Benchers present in the Chamber. Indeed, at one stage I calculated that all the Conservative Back-Bench and Front-Bench Members could be fitted into the cabin of a 3x3 six-axle articulated truck. When the Conservatives make promises to people outside the House, they should make sure that they keep those promises—at least by turning out to participate in the debate.

The Government recognise the contribution of the road haulage industry to the economy and the well-being of the country. That is why, since we came to power, we have tried to work with the industry. That is why we took such time and such care to develop and publish our strategy on sustainable distribution. We produced a document in consultation with the road haulage industry that was welcomed by the industry only two months ago.

We have developed that partnership into the road haulage forum. It is a calumny to suggest that the Government started talking to the industry only during the past few weeks. We have been doing so from the day that we took power. We have established the road haulage forum to bring together the hauliers' representatives and Ministers to address the problems facing sections of that industry.

Of course, we cannot, and I will not, promise that in this or any other industry no job will ever be lost. That would be an unrealistic and cruel illusion of the sort that is sometimes attributed to old Labour, but which is increasingly associated with the new Conservatives, such as the hon. Member for North Shropshire (Mr. Paterson).

The hon. Gentleman seems obsessed with the report by KPMG and with claims that he claims were made on the basis of that report, which I have never made, and the accusation that that was done without the knowledge or acceptance of KPMG; whereas I explained to him that I went out of my way to invite KPMG to be present as observers when I made my comments on it. I am only sorry that the hon. Gentleman has not been in the House long enough to develop the courtesy or the courage to apologise when he is wrong.

I cannot promise, and nor can my colleagues, a blank cheque from the taxpayer to cover the costs—financial, physical, social or environmental—that any industry incurs. That would not be fair to the taxpayer or, as my hon. Friend the Member for West Bromwich, East (Mr. Snape) pointed out, to the industry's competitors in the rail freight business. However, I can promise that I have listened and will continue to listen to the industry's concerns, and that we will do all we can to ensure that it remains at the forefront of efficiency and competitiveness.

That approach was rejected tonight by the hon. Member for Banbury (Mr. Baldry) and by several of his hon. Friends. They are walking the tightrope and trying to disguise that fact with their weasel words and their refusal to condemn the disruption that has been imposed on the citizens of this country. In the words that their former leader used in such circumstances, they are too frit to stand up to the militants who want to bully the Government into changing political decisions of the House, as enshrined in the Budget.

Mr. Nigel Waterson (Eastbourne)

Big man.

Dr. Reid

Exactly—unable to stand up to the big mouths of the industry, as the hon. Gentleman says.

It is not I who maintain that the road haulage forum is constructive. Let me quote the Freight Transport Association after the first meeting, which stated that it was very impressed and encouraged by the will, intent and urgency of the Forum to get to grips with our industry's problems without delay". Those are not my words, but the words of responsible elements in the road haulage industry.

I repeat what I have said before: the Conservative party will choose either dialogue or disruption as the way forward. I am glad that the spokesman for the Liberal party, the hon. Member for Lewes (Mr. Baker), regardless of his criticisms, showed that he was on the side of rationality and dialogue—as opposed to the Conservatives, who seem intent on encouraging and inciting disruption.

Mr. Baldry

rose—

Mr. Paterson

rose—

Mr. Jenkin

rose—

Dr. Reid

It is too late for cringing apologies.

Mr. Baldry

On a point of order, Mr. Deputy Speaker. The Minister has not had the courtesy to give way. At no time during my speech or that of my hon. Friend the Member for North Shropshire (Mr. Paterson) did we encourage disruption. I hope the Minister will have the courtesy to acknowledge that.

Mr. Deputy Speaker

That is not a point of order for the Chair. It is a point for debate.

Dr. Reid

That is precisely why I referred to the hon. Gentleman's words as weasel words. We should have heard thorough condemnation of the disruption that has taken place in Britain. Tonight's debate has allowed a great—

Mr. Paterson

On a point of order, Mr. Deputy Speaker. Is it a point of debate to misinterpret what an hon. Member has said? I went out of my way to make it clear at every meeting of the haulage industry that I have attended that I condemn—

Mr. Deputy Speaker

Order. Such points made in debate by hon. Members are not a matter for the Chair. They are a matter for debate.

Dr. Reid

The Opposition's attempts to talk out my contribution will not work. I shall continue until I have finished.

Tonight's debate has allowed many hon. Members to express their concerns, some warranted and others less well founded, about the future of the haulage industry and also about wider issues such as the environment, a matter that was raised by my hon. Friend the Member for Stoke-on-Trent, North (Ms Walley). It has allowed us, at least on this side of the House, to look at the multiplicity of factors affecting the industry, rather than concentrating myopically on only one form of tax classification or one aspect of the fiscal duties imposed by the Government.

The debate has allowed us to lay before the House the range of assistance that the Government are already providing to an industry that is basically sound, but elements of which are undergoing the pains of overcapacity. Above all, it has allowed us to expose the hollowness of the Opposition case—or the hogwash, as my hon. Friend the Member for Shipley (Mr. Leslie) called it.

We have seen the Tory party reduced to arguing tonight that the prime factor in business success or failure is not the market, but Government intervention; demanding that we accept European priorities on taxation, rather than British priorities; and meekly acquiescing in industrial and social disruption to change the democratic decisions of the House.

The Tories' case this evening has been based on three propositions. The first is that the British haulage industry is uncompetitive by international standards. The second is that any difficulties being faced by that industry must be the result of Government policy. The third proposition is that the Conservative party is in no way associated with those policies. The first proposition is just plain wrong. The second is a gross over-simplification. The third—that the Tories are not associated with those policies—is the most brazen piece of political hypocrisy camouflaged as righteous indignation, even by the standards of the Tory party of the 1990s.

Let us turn to one or two of the issues that the Opposition have raised—the fuel duty escalator, for instance. They turned up, crying their tears, an onion in one hand and a Yorkie bar in the other, declaring that they were the hauliers' friends and that they have just discovered the fuel duty escalator. The Conservatives thought up the fuel duty escalator; theirs is the party that introduced it; theirs is the party that maintained it between 1993 and 1997; theirs is the party that increased it. Yet they have the cheek to raise it tonight.

Who was the Treasury Minister responsible—the Paymaster General—when the Conservatives introduced the fuel duty escalator? Who was the man who introduced, maintained and increased it? I shall tell the House who: none other than the right hon. Member for Wells (Mr. Heathcoat-Amory).

Mr. Heathcoat-Amory

The right hon. Gentleman is incorrect. Will he withdraw what he has said? If he looks at the record, he will discover that I was not Paymaster General when the fuel duty escalator was introduced. Will he correct the record for the benefit of the House?

Dr. Reid

I shall check the record, although the right hon. Gentleman would be the first to admit that he paraded through the country defending the fuel duty escalator. Will he deny that?

As the Tories go round the country, they claim that of every £10 that is spent on fuel, £8.50 is tax. What they do not mention is that of that £8.50, £7.70 was tax when they left office two years ago. They make claims about the increase in the fuel duty escalator. Under this Government, there has been an increase of 7p a litre in the fuel duty escalator, but under their Government, the increase was 26p. The Tories talk about hauliers going out of business—tragically, some of them are—but 5,000 hauliers lost their jobs under the previous Conservative Government. There is a problem with the haulage industry; the main one is overcapacity. That is one of the things that we want to address in the haulage forum.

Some of these Conservatives spoke as though they had just discovered unemployment, as if it were some unknown phenomenon before it afflicted sections of the haulage industry. I can tell them that we on the Government Benches understand unemployment only too well. We saw it, felt it, suffered it in our towns, villages and communities day after day, week after week, under almost 20 years of Conservative rule. We are neither immune to nor surprised by the effects of unemployment on individuals in the haulage industry. We saw unemployment in whole industries, such as mining and steel and printing. I only wish that, instead of the crocodile teeth then, we had seen today's crocodile tears.

I am precluded from addressing some of the other issues raised owing to the number of participants in the debate, but I shall end my remarks with one point. The Conservatives ought to be very careful how far they swing on the pendulum. I understand that last night, under the birth of new Conservatism, the deputy leader of the Conservative party walked away from the free market, telling us that the free market had a limited role. In this debate, we have not even seen new Conservatism; we have seen nouvelle Conservatism.

The new Tories are asking us to believe that job losses are the fault of Government, not of the market, that British taxes should be set not by our people but by Luxembourg and France, that disruptive action by militants should be condoned and dialogue ignored. They are not on a U-turn; they are on a roundabout.

The motion smacks of opportunism and hypocrisy. As their last Chancellor, the right hon. and learned Member for Rushcliffe (Mr. Clarke), said when he introduced the fuel duty escalator, anyone who pretends to support a balance of environmental considerations but attacks the escalator is sailing close to hypocrisy. There is a mayday signal coming from the Tories because they are on a tidal wave of hypocrisy. That is why they will not receive the support of the House in the Lobby.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 139, Noes 341.

Division No. 148]	[7.5 pm
AYES
Ainsworth, Peter (E Surrey)	Clappison, James
Amess, David	Clark, Rt Hon Alan (Kensington)
Arbuthnot, Rt Hon James	Clark, Dr Michael (Rayleigh)
Atkinson, Peter (Hexham)	Collins, Tim
Baldry, Tony	Colvin, Michael
Beggs, Roy	Cormack, Sir Patrick
Bell Martin (Tatton)	Cran, James
Bercow, John	Curry, Rt Hon David
Beresford, Sir Paul	Davies, Quentin (Grantham)
Blunt, Crispin	Day, Stephen
Boswell, Tim	Donaldson, Jeffrey
Bottomley, Peter (Worthing W)	Duncan, Alan
Bottomley, Rt Hon Mrs Virginia	Duncan Smith, Iain
Brady, Graham	Emery, Rt Hon Sir Peter
Brazier, Julian	Evans, Nigel
Brooke, Rt Hon Peter	Fabricant, Michael
Browning, Mrs Angela	Fallon, Michael
Bruce, Ian (S Dorset)	Flight, Howard
Burns, Simon	Forth, Rt Hon Eric
Butterfill, John	Fowler, Rt Hon Sir Norman
Cash, William	Fox, Dr Liam
Chapman, Sir Sydney (Chipping Barnet)	Fraser, Christopher
	Gale, Roger
Chope, Christopher	Garnier, Edward

Gibb, Nick	Paterson, Owen
Gill, Christopher	Pickles, Eric
Gillan, Mrs Cheryl	Prior, David
Goodlad, Rt Hon Sir Alastair	Redwood, Rt Hon John
Gorman, Mrs Teresa	Robathan, Andrew
Green, Damian	Robertson, Laurence (Tewk'b'ry)
Greenway, John	Roe, Mrs Marion (Broxbourne)
Grieve, Dominic	Ross, William (E Lond'y)
Hamilton, Rt Hon Sir Archie	Rowe, Andrew (Faversham)
Hammond, Philip	Ruffley, David
Hawkins, Nick	Sayeed, Jonathan
Hayes, John	Shephard, Rt Hon Mrs Gillian
Heald, Oliver	Shepherd, Richard
Heathcoat-Amory, Rt Hon David	Simpson, Keith (Mid-Norfolk)
Heseltine, Rt Hon Michael	Smyth, Rev Martin (Belfast S)
Hogg, Rt Hon Douglas	Soames, Nicholas
Horam, John	Spicer, Sir Michael
Howard, Rt Hon Michael	Spring, Richard
Howarth, Gerald (Aldershot)	Steen, Anthony
Hunter, Andrew	Streeter, Gary
Jack, Rt Hon Michael	Swayne, Desmond
Jackson, Robert (Wantage)	Syms, Robert
Jenkin, Bernard	Tapsell, Sir Peter
Johnson Smith,	Taylor, Ian (Esher & Walton)
Rt Hon Sir Geoffrey	Taylor, John M (Solihull)
Key, Robert	Taylor, Sir Teddy
King, Rt Hon Tom (Bridgwater)	Thompson, William
Kirkbride, Miss Julie	Townend, John
Lait, Mrs Jacqui	Tredinnick, David
Lansley, Andrew	Trend, Michael
Leigh, Edward	Tyrie, Andrew
Letwin, Oliver	Viggers, Peter
Lewis, Dr Julian (New Forest E)	Walter, Robert
Lilley, Rt Hon Peter	Waterson, Nigel
Lloyd, Rt Hon Sir Peter (Fareham)	Wells, Bowen
Loughton, Tim	Whitney, Sir Raymond
Luff, Peter	Whittingdale, John
Lyell, Rt Hon Sir Nicholas	Widdecombe, Rt Hon Miss Ann
MacGregor, Rt Hon John	Wilkinson, John
MacKay, Rt Hon Andrew	Willetts, David
McLoughlin, Patrick	Wilshire, David
Maples, John	Winterton, Mrs Ann (Congleton)
Mates, Michael	Winterton, Nicholas (Macclesfield)
Maude, Rt Hon Francis	Yeo, Tim
Nicholls, Patrick	Young, Rt Hon Sir George
Norman, Archie	Tellers for the Ayes:
Ottaway, Richard	Mrs. Caroline Spelman and
Paice, James	Mrs. Eleanor Laing.

NOES
Adams, Mrs Irene (Paisley N)	Betts, Clive
Ainsworth, Robert (Cov'try NE)	Blackman, Liz
Allan, Richard	Blears, Ms Hazel
Allen, Graham	Blizzard, Bob
Anderson, Donald (Swansea E)	Blunkett, Rt Hon David
Anderson, Janet (Rossendale)	Boateng, Paul
Armstrong, Rt Hon Ms Hilary	Borrow, David
Ashton, Joe	Bradley, Keith (Withington)
Atherton, Ms Candy	Bradley, Peter (The Wrekin)
Atkins, Charlotte	Bradshaw, Ben
Austin, John	Brand, Dr Peter
Baker, Norman	Breed, Colin
Ballard, Jackie	Brinton, Mrs Helen
Banks, Tony	Brown, Rt Hon Nick (Newcastle E)
Barnes, Harry	Brown, Russell (Dumfries)
Barron, Kevin	Buck, Ms Karen
Battle, John	Burden, Richard
Bayley, Hugh	Burnett, John
Beard, Nigel	Burstow, Paul
Beckett, Rt Hon Mrs Margaret	Butler, Mrs Christine
Begg, Miss Anne	Byers, Rt Hon Stephen
Beith, Rt Hon A J	Cable, Dr Vincent
Bell, Stuart (Middlesbrough)	Caborn, Rt Hon Richard
Benton, Joe	Campbell, Mrs Anne (C'bridge)
Bermingham, Gerald	Campbell, Ronnie (Blyth V)

Cann, Jamie	Galloway, George
Casale, Roger	Gapes, Mike
Caton, Martin	Gardiner, Barry
Cawsey, Ian	George, Andrew (St Ives)
Chapman, Ben (Wirral S)	George, Bruce (Walsall S)
Chaytor, David	Gibson, Dr Ian
	Gilroy, Mrs Linda
Church, Ms Judith	Godman, Dr Norman A
Clapham Michael	Godsiff, Roger
Clark, Rt Hon Dr David (S Shields)	Goggins, Paul
Clark, Dr Lynda (Edinburgh Pentlands)	Golding, Mrs Llin
	Gordon, Mrs Eileen
Clarke, Charles (Norwich S)	Griffiths, Nigel (Edinburgh S)
Clarke, Eric (Midlothian)	Griffiths, Win (Bridgend)
Clarke, Rt Hon Tom (Coatbridge)	Grocott, Bruce
Clarke, Tony (Northampton S)	Grogan, John
Clelland, David	Gunnell, John
Clwyd, Ann	Hall, Mike (Weaver Vale)
Coaker, Vernon	Hamilton, Fabian (Leeds NE)
Coffey, Ms Ann	Hancock, Mike
Coleman, Iain	Harvey, Nick
Colman Tony	Heal, Mrs Sylvia
	Henderson, Ivan (Harwich)
Cook, Frank (Stockton N)	Hepburn, Stephen
Cooper, Yvette	Heppell, John
Corbett, Robin	Hesford, Stephen
Corbyn, Jeremy	Hewitt, Ms Patricia
Corston, Ms Jean	Hill, Keith
Cotter, Brian	Hinchliffe, David
Cousins, Jim	Hodge, Ms Margaret
Cranston, Ross	Hood, Jimmy
Crausby, David	Hoon, Geoffrey
Cryer, Mrs Ann (Keighley)	Hope, Phil
Cryer, John (Hornchurch)	Hopkins, Kelvin
Cummings, John	Howarth, George (Knowsley N)
Cunningham, Jim (Cov'try S)	Hoyle, Lindsay
Curtis-Thomas, Mrs Claire
	Hughes, Ms Beverley (Stretford)
	Hughes, Kevin (Doncaster N)
Dalyell Tam	Hughes, Simon (Southwark N)
Darling, Rt Hon Alistair	Humble, Mrs Joan
Darvill, Keith	Hurst, Alan
Davey, Edward (Kingston)	Hutton, John
Davey, Valerie (Bristol W)	Iddon, Dr Brian
Davies, Rt Hon Denzil (Llanelli)	Illsley, Eric
Dawson, Hilton	Jackson, Ms Glenda (Hampstead)
Dean, Mrs Janet	Jackson, Helen (Hillsborough)
Denham, John	Jenkins, Brian
Dismore, Andrew	Johnson, Alan (Hull W & Hessle)
Dobbin, Jim	Johnson, Miss Melanie (Welwyn Hatfield)
Dobson, Rt Hon Frank
	Jones, Barry (Alyn & Deeside)
Doran, Frank	Jones, Helen (Warrington N)
Dowd, Jim	Jones, Ms Jenny (Wolverh'ton SW)
Drew, David
Drown, Ms Julia	Jones, Jon Owen (Cardiff C)
Dunwoody, Mrs Gwyneth	Jones, Dr Lynne (Selly Oak)
Eagle, Angela (Wallasey)	Jones, Martyn (Clwyd S)
Edwards, Huw	Jones, Nigel (Cheltenham)
Efford, Clive	Jowell, Rt Hon Ms Tessa
Ellman, Mrs Louise	Kaufman, Rt Hon Gerald
Fearn, Ronnie	Keeble, Ms Sally
Field, Rt Hon Frank	Keen, Alan (Feltham & Heston)
Fitzpatrick, Jim	Keen, Ann (Brentford & Isleworth)
Fitzsimons, Lorna	Keetch, Paul
Flint, Caroline	Kelly, Ms Ruth
	Kemp, Fraser
Flynn, Paul	Kennedy, Charles (Ross Skye)
Follett, Barbara	Kennedy, Jane (Wavertree)
Foster, Rt Hon Derek	Khabra, Piara S
Foster, Don (Bath)	Kidney, David
Foster, Michael Jabez (Hastings)	Kilfoyle, Peter
Fyfe, Maria	King, Andy (Rugby & Kenilworth)

King, Ms Oona (Bethnal Green)	Raynsford, Nick
Kingham, Ms Tess	Reid, Rt Hon Dr John (Hamilton N)
Kirkwood, Archy	Rendel, David
Kumar, Dr Ashok	Robinson, Geoffrey (Cov'try NW)
Lawrence, Ms Jackie	Roche, Mrs Barbara
Laxton, Bob	Rooker, Jeff
Lepper, David	Ross, Ernie (Dundee W)
Leslie, Christopher	Rowlands, Ted
Levitt, Tom	Roy, Frank
Lewis, Terry (Worsley)	Ruane, Chris
Liddell, Rt Hon Mrs Helen	Ruddock, Joan
Linton, Martin	Russell, Ms Christine (Chester)
Livingstone, Ken	Ryan, Ms Joan
Livsey, Richard	Sanders, Adrian
Lloyd, Tony (Manchester C)	Sarwar, Mohammad
Lock, David	Savidge, Malcolm
McAvoy, Thomas	Sawford, Phil
McCabe, Steve	Sedgemore, Brian
McCafferty, Ms Chris	Shaw, Jonathan
McCartney, Rt Hon Ian (Makerfield)	Sheerman, Barry
	Sheldon, Rt Hon Robert
McDonnell, John	Shipley, Ms Debra
McIsaac, Shona	Simpson, Alan (Nottingham S)
Mackinlay, Andrew	Singh, Marsha
McNulty, Tony	Skinner, Dennis
MacShane, Denis	Smith, Rt Hon Andrew (Oxford E)
McWalter, Tony	Smith, Angela (Basildon)
McWilliam, John	Smith, Rt Hon Chris (Islington S)
Mahon, Mrs Alice	Smith, Miss Geraldine (Morecambe & Lunesdale)
Mallaber, Judy
Mendelson, Rt Hon Peter	Smith, Jacqui (Redditch)
Marsden, Gordon (Blackpool S)	Smith, John (Glamorgan)
Marshall, David (Shettleston)	Smith, Llew (Blaenau Gwent)
Marshall-Andrews, Robert	Smith, Sir Robert (W Ab'd'ns)
Martlew, Eric	Snape, Peter
Maxton, John	Soley, Clive
Meale, Alan	Southworth, Ms Helen
Merron, Gillian	Squire, Ms Rachel
Michie, Bill (Shef'ld Heeley)	Starkey, Dr Phyllis
Milburn, Rt Hon Alan	Stevenson, George
Miller, Andrew	Stewart, David (Inverness E)
Mitchell, Austin	Stewart, Ian (Eccles)
Moffatt, Laura	Stinchcombe, Paul
Moonie, Dr Lewis	Stott, Roger
Moore, Michael	Strang, Rt Hon Dr Gavin
Moran, Ms Margaret	Straw, Rt Hon Jack
Morgan, Ms Julie (Cardiff N)	Stringer, Graham
Morley, Elliot	Stuart, Ms Gisela
Morris, Ms Estelle (B'ham Yardley)	Stunell, Andrew
Mountford, Kali	Sutcliffe, Gerry
Mudie, George	Taylor, Rt Hon Mrs Ann (Dewsbury)
Mullin, Chris
Murphy, Denis (Wansbeck)	Taylor, Ms Dari (Stockton S)
Naysmith, Dr Doug	Taylor, David (NW Leics)
Oaten, Mark	Taylor, Matthew (Truro)
O'Brien, Bill (Normanton)	Temple-Morris, Peter
O'Hara, Eddie	Thomas, Gareth R (Harrow W)
O'Neill, Martin	Timms, Stephen
Öpik, Lembit	Tipping, Paddy
Organ, Mrs Diana	Tonge, Dr Jenny
Osborne, Ms Sandra	Truswell, Paul
Palmer, Dr Nick	Turner, Dennis (Wolverh?ton SE)
Pearson, Ian	Turner, Dr Desmond (Kemptown)
Pendry, Tom	Turner, Dr George (NW Norfolk)
Perham, Ms Linda	Twigg, Stephen (Enfield)
Pike, Peter L	Tyler, Paul
Plaskitt, James	Vis, Dr Rudi
Pond, Chris	Walley, Ms Joan
Powell, Sir Raymond	Ward, Ms Claire
Prentice, Ms Bridget (Lewisham E)	Wareing, Robert N
Prentice, Gordon (Pendle)	Webb, Steve
Purchase, Ken	White, Brian
Quin, Rt Hon Ms Joyce	Wicks, Malcolm
Radice, Giles	Williams, Mrs Betty (Conwy)
Rammell, Bill	Winnick, David
Rapson, Syd	Winterton, Ms Rosie(Doncaster C)

Wise, Audrey	Wyatt, Derek
Worthington, Tony
Wray, James	Tellers for the Noes:
Wright, Anthony D (Gt Yarmouth)	Mr. Greg Pope and
Wright, Dr Tony (Cannock)	Mr. David Jamieson.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments):—

The House divided: Ayes 304, Noes 160.

Division No. 149]	[7.18 pm
AYES
Adams, Mrs Irene (Paisley N)	Colman, Tony
Ainsworth, Robert (Cov'try NE)	Cook, Frank (Stockton N)
Allen, Graham	Cooper, Yvette
Anderson, Donald (Swansea E)	Corbett, Robin
Anderson, Janet (Rossendale)	Corbyn, Jeremy
Armstrong, Rt Hon Ms Hilary	Corston, Ms Jean
Ashton, Joe	Cousins, Jim
Atherton, Ms Candy	Cranston, Ross
Atkins, Charlotte	Crausby, David
Austin, John	Cryer, Mrs Ann (Keighley)
Banks, Tony	Cryer, John (Hornchurch)
Barnes, Harry	Cummings, John
Barron, Kevin	Cunningham, Jim (Cov'try S)
Battle, John	Curtis-Thomas, Mrs Claire
Bayley, Hugh	Darling, Rt Hon Alistair
Beard, Nigel	Darvill, Keith
Beckett, Rt Hon Mrs Margaret	Davey, Valerie (Bristol W)
Begg, Miss Anne	Davidson, Ian
Bell, Stuart (Middlesbrough)	Davies, Rt Hon Denzil (Llanelli)
Benton, Joe	Davies, Geraint (Croydon C)
Bermingham, Gerald	Dawson, Hilton
Betts, Clive	Dean, Mrs Janet
Blackman, Liz	Denham, John
Blears, Ms Hazel	Dismore, Andrew
Blizzard, Bob	Dobbin, Jim
Boateng, Paul	Dobson, Rt Hon Frank
Borrow, David	Doran, Frank
Bradley, Keith (Withington)	Dowd, Jim
Bradley, Peter (The Wrekin)	Drew, David
Bradshaw, Ben	Drown, Ms Julia
Brinton, Mrs Helen	Eagle, Angela (Wallasey)
Brown, Rt Hon Nick (Newcastle E)	Eagle, Maria (L'pool Garston)
Brown, Russell (Dumfries)	Edwards, Huw
Buck, Ms Karen	Efford, Clive
Burden, Richard	Ellman, Mrs Louise
Butler, Mrs Christine	Field, Rt Hon Frank
Byers, Rt Hon Stephen	Fitzpatrick, Jim
Campbell, Alan (Tynemouth)	Fitzsimons, Lorna
Campbell, Mrs Anne (C'bridge)	Flint, Caroline
Campbell, Ronnie (Blyth V)	Flynn, Paul
Cann, Jamie	Foster, Rt Hon Derek
Casale, Roger	Foster, Michael Jabez (Hastings)
Caton, Martin	Fyfe, Maria
Cawsey, Ian	Gapes, Mike
Chapman, Ben (Wirral S)	Gardiner, Barry
Chaytor, David	George, Bruce (Walsall S)
Church, Ms Judith	Gibson, Dr Ian
Clapham, Michael	Gilroy, Mrs Linda
Clark, Rt Hon Dr David (S Shields)	Godman, Dr Norman A
Clark, Dr Lynda (Edinburgh Pentlands)	Godsiff, Roger
	Goggins, Paul
Clarke, Charles (Norwich S)	Golding, Mrs Llin
Clarke, Eric (Midlothian)	Gordon, Mrs Eileen
Clarke, Rt Hon Tom (Coatbridge)	Griffiths, Jane (Reading E)
Clarke, Tony (Northampton S)	Griffiths, Nigel (Edinburgh S)
Clelland, David	Griffiths, Win (Bridgend)
Clwyd, Ann	Grocott, Bruce
Coaker, Vernon	Grogan, John
Coffey, Ms Ann	Gunnell, John
Coleman, Iain	Hall, Mike (Weaver Vale)

Hamilton, Fabian (Leeds NE)	Marshall, David (Shettleston)
Heal, Mrs Sylvia	Marshall-Andrews, Robert
Henderson, Ivan (Harwich)	Martlew, Eric
Hepburn, Stephen	Maxton, John
Heppell, John	Meale, Alan
Hesford, Stephen	Merron, Gillian
Hewitt, Ms Patricia	Michie, Bill (Shef'ld Heeley)
Hill, Keith	Milburn, Rt Hon Alan
Hinchliffe, David	Miller, Andrew
Hodge, Ms Margaret	Mitchell, Austin
Hood, Jimmy	Moffatt, Laura
Hoon, Geoffrey	Moonie, Dr Lewis
Hope, Phil	Moran, Ms Margaret
Hopkins, Kelvin	Morgan, Ms Julie (Cardiff N)
Howarth, George (Knowsley N)	Morley, Elliot
Hoyle, Lindsay	Mountford, Kali
Hughes, Ms Beverley (Stretford)	Mudie, George
Hughes, Kevin (Doncaster N)	Mullin, Chris
Humble, Mrs Joan	Murphy, Denis (Wansbeck)
Hurst, Alan	Naysmith, Dr Doug
Hutton, John	O'Brien, Bill (Normanton)
Iddon, Dr Brian	O'Hara, Eddie
Illsley, Eric	O'Neill, Martin
Jackson, Ms Glenda (Hampstead)	Organ, Mrs Diana
Jackson, Helen (Hillsborough)	Osborne, Ms Sandra
Jenkins, Brian	Palmer, Dr Nick
Johnson, Miss Melanie (Welwyn Hatfield)	Pearson, Ian
	Pendry, Tom
Jones, Barry (Alyn & Deeside)	Perham, Ms Linda
Jones, Helen (Warrington N)	Pike, Peter L
Jones, Ms Jenny (Wolverh'ton SW)	Plaskitt, James
	Pond, Chris
Jones, Jon Owen (Cardiff C)	Prentice, Ms Bridget (Lewisham E)
Jones, Dr Lynne (Selly Oak)	Prentice, Gordon (Pendle)
Jones, Martyn (Clwyd S)	Purchase, Ken
Kaufman, Rt Hon Gerald	Quin, Rt Hon Ms Joyce
Keeble, Ms Sally	Quinn, Lawrie
Keen, Alan (Feltham & Heston)	Radice, Giles
Keen, Ann (Brentford & Isleworth)	Rapson, Syd
Kelly, Ms Ruth	Reid, Rt Hon Dr John (Hamilton N)
Kemp, Fraser	Robinson, Geoffrey (Cov'try NW)
Kennedy, Jane (Wavertree)	Roche, Mrs Barbara
Khabra, Piara S	Rooker, Jeff
Kidney, David	Ross, Ernie (Dundee W)
Kilfoyle, Peter	Rowlands, Ted
King, Andy (Rugby & Kenilworth)	Roy, Frank
King, Ms Oona (Bethnal Green)	Ruane, Chris
Kingham, Ms Tess	Ruddock, Joan
Kumar, Dr Ashok	Russell, Ms Christine (Chester)
Lawrence, Ms Jackie	Ryan, Ms Joan
Laxton, Bob	Sarwar, Mohammad
Lepper, David	Savidge, Malcolm
Leslie, Christopher	Sawford, Phil
Levitt, Tom	Sedgemore, Brian
Lewis, Terry (Worsley)	Shaw, Jonathan
Liddell, Rt Hon Mrs Helen	Sheerman, Barry
Linton, Martin	Sheldon, Rt Hon Robert
Livingstone, Ken	Shipley, Ms Debra
Lloyd, Tony (Manchester C)	Simpson, Alan (Nottingham S)
Lock, David	Skinner, Dennis
Love, Andrew	Smith, Rt Hon Andrew (Oxford E)
McAvoy, Thomas	Smith, Angela (Basildon)
McCabe, Steve	Smith, Rt Hon Chris (Islington S)
McCafferty, Ms Chris	Smith, Miss Geraldine (Morecambe & Lunesdale)
McCartney, Rt Hon Ian (Makerfield)
	Smith, Jacqui (Redditch)
McDonnell, John	Smith, John (Glamorgan)
McIsaac, Shona	Smith, Llew (Blaenau Gwent)
Mackinlay, Andrew	Snape, Peter
McNulty, Tony	Soley, Clive
MacShane, Denis	Southworth, Ms Helen
McWalter, Tony	Squire, Ms Rachel
McWilliam, John	Starkey, Dr Phyllis
Mallaber, Judy	Steinberg, Gerry
Mendelson, Rt Hon Peter	Stevenson, George
Marsden, Gordon (Blackpool S)	Stewart, David (Inverness E)

Stewart, Ian (Eccles)	Twigg, Stephen (Enfield)
Stinchcombe, Paul	Vis, Dr Rudi
Stott, Roger	Walley, Ms Joan
Strang, Rt Hon Dr Gavin	Ward, Ms Claire
Straw, Rt Hon Jack	Wareing, Robert N
Stringer, Graham	White, Brian
Stuart, Ms Gisela	Wicks, Malcolm
Sutcliffe, Gerry	Williams, Rt Hon Alan (Swansea W)
Taylor, Rt Hon Mrs Ann (Dewsbury)
	Williams, Mrs Betty (Conwy)
Taylor, Ms Dari (Stockton S)	Winnick, David
Taylor, David (NW Leics)	Winterton, Ms Rosie (Doncaster C)
Temple-Morris, Peter	Wise, Audrey
	Worthington, Tony
Thomas, Gareth R (Harrow W)	Wray, James
Timms, Stephen	Wright, Anthony D (Gt Yarmouth)
Tipping, Paddy	Wright, Dr Tony (Cannock)
Truswell, Paul	Wyatt, Derek
Turner, Dennis (Wolverh'ton SE)
Turner, Dr Desmond (Kemptown)	Tellers for the Ayes:
Turner, Dr George (NW Norfolk)	Mr. Greg Pope and
Twigg, Derek (Halton)	Mr. David Jamieson.

NOES
Ainsworth, Peter (E Surrey)	Forth, Rt Hon Eric
Allan, Richard	Foster, Don (Bath)
Amess, David	Fowler, Rt Hon Sir Norman
Arbuthnot, Rt Hon James	Fox, Dr Liam
Atkinson, Peter (Hexham)	Fraser, Christopher
Baker, Norman	Gale, Roger
Ballard, Jackie	Garnier, Edward
Beggs, Roy	George, Andrew (St Ives)
Beith, Rt Hon A J	Gibb, Nick
Bell, Martin (Tatton)	Gill, Christopher
Bercow, John	Gillan, Mrs Cheryl
Beresford, Sir Paul	Goodlad, Rt Hon Sir Alastair
Blunt, Crispin	Gorman, Mrs Teresa
Boswell, Tim	Green, Damian
Bottomley, Rt Hon Mrs Virginia	Grieve, Dominic
Brady, Graham	Hamilton, Rt Hon Sir Archie
Brand, Dr Peter	Hammond, Philip
Brazier, Julian	Hancock, Mike
Breed, Colin	Harvey, Nick
Brooke, Rt Hon Peter	Hawkins, Nick
Browning, Mrs Angela	Hayes, John
Bruce, Ian (S Dorset)	Heald, Oliver
Burnett, John	Heathcoat-Amory, Rt Hon David
Burns, Simon	Hogg, Rt Hon Douglas
Burstow, Paul	Horam, John
Butterfill, John	Howard, Rt Hon Michael
Cash, William	Howarth, Gerald (Aldershot)
Chapman, Sir Sydney (Chipping Barnet)	Hughes, Simon (Southwark N)
	Hunter, Andrew
Chope, Christopher	Jack, Rt Hon Michael
Clappison, James	Jackson, Robert (Wantage)
Clark, Rt Hon Alan (Kensington)	Jenkin, Bernard
Clark, Dr Michael (Rayleigh)	Johnson Smith,
Clifton-Brown, Geoffrey	Rt Hon Sir Geoffrey
Collins, Tim	Jones, Nigel (Cheltenham)
Colvin, Michael	Keetch, Paul
Cormack, Sir Patrick	Kennedy, Charles (Ross Skye)
Cotter, Brian	Key, Robert
Cran, James	King, Rt Hon Tom (Bridgwater)
Curry, Rt Hon David	Kirkbride, Miss Julie
Davey, Edward (Kingston)	Kirkwood, Archy
Davies, Quentin (Grantham)	Lait, Mrs Jacqui
Day, Stephen	Lansley, Andrew
Donaldson, Jeffrey	Leigh, Edward
Duncan, Alan	Letwin, Oliver
Duncan Smith, Iain	Lewis, Dr Julian (New Forest E)
Emery, Rt Hon Sir Peter	Lilley, Rt Hon Peter
Evans, Nigel	Livsey, Richard
Fabricant, Michael	Lloyd, Rt Hon Sir Peter (Fareham)
Fallon, Michael	Llwyd, Elfyn
Fearn, Ronnie	Loughton, Tim
Flight, Howard	Luff, Peter

Lyell, Rt Hon Sir Nicholas	Stunell, Andrew
MacKay, Rt Hon Andrew	Swayne, Desmond
McLoughlin, Patrick	Syms, Robert
Maples, John	Taylor, Ian (Esher & Walton)
Mates, Michael	Taylor, John M (Solihull)
Maude, Rt Hon Francis	Taylor, Matthew (Truro)
Nicholls, Patrick	Taylor, Sir Teddy
Norman, Archie	Thompson, William
Oaten, Mark	Tonge, Dr Jenny
Öpik, Lembit	Townend, John
Ottaway, Richard	Tredinnick, David
Page, Richard	Trend, Michael
Paice, James	Tyler, Paul
Paterson, Owen	Tyrie, Andrew
Pickles, Eric	Walter, Robert
Prior, David	Wardle, Charles
Rendel, David	Waterson, Nigel
Robathan, Andrew	Webb, Steve
Robertson, Laurence (Tewk'b'ry)	Wells, Bowen
Ross, William (E Lond'y)	Welsh, Andrew
Rowe, Andrew (Faversham)	Whitney, Sir Raymond
Ruffley, David	Whittingdale, John
Sanders, Adrian	Widdecombe, Rt Hon Miss Ann
Sayeed, Jonathan	Wilshire, David
Shepherd, Richard	Winterton, Mrs Ann (Congleton)
Simpson, Keith (Mid-Norfolk)	Winterton, Nicholas (Macclesfield)
Smith, Sir Robert (W Ab'd'ns)	Yeo, Tim
Smyth, Rev Martin (Belfast S)
Spring, Richard	Tellers for the Noes:
Steen, Anthony	Mrs. Eleanor Laing and
Streeter, Gary	Mrs. Caroline Spelman.

Question accordingly agreed to.

MR. DEPUTY SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved,

That this House believes that everyone, including hauliers, must play their part in reducing emissions of carbon dioxide from transport, and that the road fuel duty escalator first introduced by the last Government acts as an incentive to greater fuel efficiency; deplores the hypocrisy of the Conservative Party for doing one thing in Government and another in Opposition; calls on it to explain which areas of public spending it would cut in order to pay for the abandonment of the fuel escalator; welcomes this Government's commitment to promoting a more dynamic business sector, in particular the measures taken to help the road haulage industry. including cuts in the corporation tax rates, freezing the rates of vehicle excise duty for most lorries for two years running, doubling the maximum reduction in vehicle excise duty for cleaner lorries, and reducing duty rates on ultra-low sulphur diesel relative to ordinary diesel; notes that the UK haulage industry benefits from the total tax burden on business in the UK being lower than that of other major EU member states, and lower than the average for the EU and the OECD; believes that the environmental measures this Government has introduced will play an important part in encouraging use of more fuel-efficient vehicles, cleaner fuels and greener modes of transport; and welcomes the dialogue that is now taking place between the industry and the Government in the Road Haulage Forum.