Tories challenged to support their own pre-election policy

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By a Newsnet reporter

After the Chancellor’s Budget failure to tackle soaring fuel prices this week, the SNP has confirmed that it will bring forward an amendment to the Budget Bill to introduce a Fuel Duty Regulator which would protect jobs in the transport industry and help motorists and businesses.

The mechanism, which was supported by the Tories when in opposition, would freeze fuel duty increases as oil prices rise with a parallel reduction in duty to match the extra revenue from VAT from higher pump prices.  The proposal has been backed by the Road Haulage Association.

Speaking on BBC1’s Andrew Marr programme in July 2008, while in opposition, Mr Osborne said:  “Our proposal is for a fair fuel stabiliser.  What this would mean is that when the price of oil goes up the fuel duty comes down to help families.

“But the quid pro quo is that when the price of oil falls the duty goes up.  So Government is sharing the pain of rising oil prices, but Government is also sharing the gain when oil prices fall.”

Mr Osborne later described the plan as:  “A common sense plan to help families, bring stability to the public finances and help the environment by making the price of carbon less volatile.”

However once in power the Conservative plans for a fair fuel regulator disappeared off the table.  In last week’s Budget, the Chancellor said there would be no change to his plans to increase fuel duty from August despite rising oil prices.  Petrol now averages 139.67p a litre, with diesel at 146.39p a litre, putting the UK amongst the most expensive countries in Europe for fuel prices.

The SNP’s Westminster Treasury spokesperson Stewart Hosie MP said:

“While the Tories have prioritised a tax cut for the rich, there was nothing in the Budget to help hard pressed motorists with the soaring cost of fuel.

“We now urgently need, not just a cut in duty, but the introduction of a fuel duty regulator to permanently bring prices under control.  With the bulk of the pump price made up of tax, the Treasury must stop this highway robbery because soaring fuel prices are hindering economic recovery.

“In 2008, George Osborne launched plans for a ‘Fair Fuel Stabiliser’, describing it as a ‘common sense plan’.  As well as being common sense, it is unanswerable and fair for Scotland, given that we pay among the highest fuel prices in Europe even as Scottish oil revenues surge into the UK Exchequer.

“With record North Sea oil and gas revenues flowing to the Treasury, we need to see some of that money used to bring fuel prices down, and to keep them stable, through a fuel duty regulator.

“The SNP have consistently called for the introduction of a fuel duty regulator, in contrast the only measure Labour introduced was the fuel price escalator that increased the misery for motorists.

“The Tories and Lib Dems promised action before the election.  They have the money – Scotland’s oil money – and the powers to deliver.

“If Westminster will not act, the powers should be passed to the Scottish Parliament so that it can.  If Scotland had control of fuel duty, the SNP government would introduce a fuel duty regulator to lower prices now.”