§ Mr. Michael Spicerasked the Secretary of State for Energy (1) what would be the effect on the consumer price index of introducing a tax on gas which would make its price equal to that of oil;
(2) what is his estimate of the effect on demand for gas by domestic consumers of introducing a tax on gas which would make its price equal to that of oil.
§ Mr. John MooreIt has been the longstanding policy of the British Gas Corporation to sell gas to industrial and commercial users at a price broadly related to that of the competing industrial oil product. The effect of raising the average price to the domestic customer to that paid by most non-domestic users could478W add around a third of 1 per cent. to the retail price index. If domestic gas prices were to be raised to the current level of prices for oil supplied to the domestic market it would mean an increase of about 1. per cent. to the retail price index. The impact on domestic gas demand is difficult to estimate and would depend on the future relative movement of energy prices and prices generally.