§ Mr. PawseyTo ask the Chancellor of the Exchequer what plans he has to adjust the tax regime on bio-fuels to encourage British farmers to grow the appropriate crops on set-aside land.
§ Sir John CopeUnder the EC mineral oils duties structure directive agreed last year, all substitutes for mineral oils are required to be subject to duty at the same rates as the oils themselves, although there is an optional provision under which member states can introduce a duty exemption for pilot projects. How this directive is implemented in the United Kingdom is a matter which my hon. Friend will consider in the run-up to the Budget. In view of this it would be inappropriate for me to comment further at this stage.
The European Commission has also made a proposal on reduced rates of excise duty for biofuels but this has not yet been agreed. The Government are carrying out detailed analysis of the proposals.