Petrol

West Sussex County Times Article

Representing a rural constituency, I am very conscious that people rely on cars.  Naturally fuel supply has been a concern over the past week.

It hasn't always been recognised that it's the tanker drivers who voted for industrial action, which I believe would be totally wrong, and their dispute is with their employers.

I understand the frustration caused by shortages, and I hope that a strike will be averted through sensible talks.  But supply isn't the only problem facing motorists.  The rising cost of petrol hits rural drivers hard.

With unleaded reaching £1.50 a litre, it is now costing us half as much again to fill up our cars as it did three years ago.

The root cause is high world oil prices.  Ten years ago crude oil was selling at an historic low of about $20 a barrel in today's prices.  Today it is selling for about $120 a barrel, having climbed steadily from about $40 a barrel three years ago.

The Government has acted, cutting fuel duty last year, freezing it until this August, scrapping a planned duty rise due then, and introducing a new Fair Fuel Stabiliser to ensure that oil companies contribute more when prices are high.

This represents a £4.5 billion support package for motorists over two years, meaning that while today's petrol prices are still painfully high, they are 10 pence per litre lower than they would otherwise have been.

I know that many people are calling for further help, but any tax cut has to be paid for.  It would not be in the interests of families to increase government borrowing with the result that interest rates rose.

For households with mortgages this would more than cancel out any gain, and businesses need low interest rates to lead the economic recovery.

The Chancellor did act in the Budget to help households.  By raising taxes on the wealthiest, for instance stamp duty on the most expensive homes, he increased the personal allowance by over £1,000, benefiting 24 million people.

So action has been taken to try and help motorists and households in difficult times, while staying on course to reduce the deficit - which is essential for a better future.

Document type

Articles

Published

5 April 2012

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