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Road Fuel Prices
03 July 2023
Lead MP
Graham Stuart
Debate Type
Ministerial Statement
Tags
TaxationBusiness & TradeStandards & Ethics
Other Contributors: 23
At a Glance
Graham Stuart raised concerns about road fuel prices in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Statement
The Minister highlighted the shocking findings of a recent Competition and Markets Authority report on fuel prices, noting an increase in retail margins, especially for diesel. The financial impact from 2019 to 2022 amounted to £900 million for supermarket fuel retailers alone. He emphasised the unacceptable overcharging during a cost-of-living crisis and announced that the Government would accept the CMA’s recommendations fully. This includes creating a statutory open data scheme for retail fuel prices, an ongoing monitoring function, and implementing a voluntary scheme by next month to ensure price transparency and fair competition.
Tim Farron
Lib Dem
Westmorland and Lonsdale
Question
Shadow raised concerns over the £900 million excess fuel bill imposed on drivers by greedy retailers, highlighting that rural areas suffer disproportionately with higher prices. He questioned why the Government failed to act sooner and demanded the Chancellor summon company bosses for price reductions.
Minister reply
The Minister acknowledged the shadow's points but emphasised that a properly functioning market requires transparency and competition. He stated that the interim voluntary regime starting next month addresses the immediate need, while consultations will follow.
Question
Asked if the Government would monitor price differentials between urban areas to intervene when necessary with the real-time fuel price comparator.
Minister reply
The Minister agreed and highlighted that transparency is crucial for consumers to make informed decisions, especially regarding travelling distances to find cheaper prices.
Kerry McCarthy
Lab
Bristol East
Question
Critiqued the delay in Government action despite early warnings from the Business Secretary over a year ago and questioned why it took so long for the CMA's report to prompt action. Also asked when legal changes would be introduced to make transparency permanent.
Minister reply
The Minister argued that the Labour party’s poor track record on economic management, exemplified by their £28 billion energy borrowing package failure, means they cannot be trusted with market oversight.
Harriett Baldwin
Con
West Worcestershire
Question
When the Chancellor announced that he was cutting fuel duty by 5p a litre, which cost the Exchequer billions of pounds, little did he expect that it would feed through immediately into the profits of fuel retailers. I welcome the steps that the Minister has announced and urge him to act with greater speed in implementing them.
Minister reply
I do not mean to try your patience any more than I already do, but we are furious that these price cuts have not been passed on to consumers. That is why we asked the CMA to investigate and it is why we will implement its findings in full.
Question
The Government have been complacent the whole time, following the 5p fuel duty cut. Why has it taken the CMA so long to establish that motorists are being gouged by 6p per litre compared with 2019? It reported that diesel prices are an astonishing 13p per litre higher this year alone than they should have been.
Minister reply
That is the closest I have ever seen the hon. Gentleman come to welcoming a Government response, so I shall take that with me.
Question
Given corporation tax, carbon taxes, the windfall tax, fuel duties and VAT, is not the bulk of the price at the pump now tax-based? Will my right hon. Friend remind us of how much is tax and urge the Chancellor to reduce some of those taxes to cut the cost of living?
Minister reply
I thank my right hon. Friend for championing the consumer as he always does.
Tan Dhesi
Lab
Slough
Question
In March, the RAC revealed that retailers are making a three times bigger margin on diesel than they were at the beginning of last year, and motorists are seeing absolutely no benefit from the Chancellor’s fuel duty cut. Given the Government’s dither and delay on taking any sort of action, how does the Minister feel when the Government’s flagship policy to help motorists is having little to no impact?
Minister reply
We are furious that these price cuts have not been passed on to consumers.
Question
As my right hon. Friend is aware, I have been campaigning on the issue of fuel prices in west Berkshire for about a year and a half. One thing that has been particularly disappointing is the fact that fuel prices in every single neighbouring constituency are 5% to 8% lower. I welcome the introduction of a real-time fuel price comparator.
Minister reply
My hon. Friend has been assiduous and focused in trying to rectify a problem that the CMA has fully displayed today.
Sammy Wilson
DUP
East Antrim
Question
There is no doubt that fuel costs are driving up inflation, especially in rural areas. Net zero policies, with all their associated taxes—whether it is the emissions trading scheme, green levies or fuel duties—drive up prices too. The Government have a role to play in reducing inflation as well as in transparency on supermarket prices.
Minister reply
The right hon. Gentleman is drawing the wrong conclusion from the sky-high prices of the past year or two.
Mark Garnier
Con
Wyre Forest
Question
Having brought a ten-minute rule motion on this subject some eight years ago, I am delighted that patience has finally paid off. One issue I was raising at that time was the inequality between the prices in towns and those on motorways.
Minister reply
As so often, my hon. Friend has been ahead of me.
Grahame Morris
Lab
Easington
Question
May I respectfully point out to the Minister that this is not a town versus country or urban versus rural issue? The RAC has identified that some retailers are grossly profiteering, taking a three times bigger margin than they were at the beginning of last year, particularly on diesel sales. For the avoidance of doubt, will he confirm that the Government scheme he has outlined today will apply to all fuel retailers?
Minister reply
I will write to the hon. Gentleman with the precise details of everybody who will be included.
Question
A couple of weeks ago, I drew the House’s attention to the fact that the same supermarket tanker would unload fuel at 10p a litre cheaper in one place than it would if it came 10 to 15 miles up the road to my constituency. If today’s report does not fix that, it will not have been good enough and the Government will have more work to do.
Minister reply
We have to make sure the market works.
Toby Perkins
Lab
Chesterfield
Question
The hon. Member for South West Bedfordshire asked a good and apposite question. In February, I wrote to all the major supermarkets that have outlets in Chesterfield asking them why they were retailing petrol for 10p more a litre there than they were selling it for just 10 miles up the road in Sheffield.
Minister reply
Transparency.
Question
The good people of Bridport and Dorchester in West Dorset have had to pay up to 20p a litre more than those in towns not far away. Although I welcome what the CMA has had to say in its report today, it does not really deal with the issue we are seeing of rigorous yield management by supermarkets with their petrol prices.
Minister reply
I would be delighted to do so.
Ronnie Cowan
SNP
East Renfrewshire
Question
Now that we know competition on fuel prices has weakened in recent years and led to inflated prices, particularly in my constituency where a campaign for fair prices is ongoing but unsuccessful, may I seek a guarantee that supermarket food prices are not following the same pattern?
Minister reply
Following this report, the Competition and Markets Authority (CMA) has decided to look into supermarkets and will report back as soon as next month.
Richard Fuller
Con
North Bedfordshire
Question
While thanking the CMA for its report and the Government's acceptance of recommendations, I am concerned that price transparency alone may not solve market issues. Supermarket profit margins are increasing while those of non-supermarket retailers are not. Will the Minister follow up with retailers to ensure margin reduction next year?
Minister reply
I thank my hon. Friend for his question and will maintain a monitoring function as one recommendation, providing us with necessary data if further intervention is required.
Dwyfor Meirionnydd
Question
Patchy public transport contributes to high fuel costs for rural households. Despite this, the rural fuel duty relief scheme does not apply to any area in Wales. Will the Minister commit to pressing the Treasury to reconsider the scheme and provide a guarantee of inclusion for Welsh areas?
Minister reply
I thank the right hon. Lady for her question and will ensure that His Majesty’s Treasury is aware of it.
Question
The good people of Scunthorpe spotted this issue some time ago, so I thank my right hon. Friend for his work on it and the measures he is recommending. Has a similar open-data scheme in Germany resulted in competitiveness boosts? If so, when will we see results at the pumps here?
Minister reply
I hope from as soon as next month under a voluntary scheme. My hon. Friend gives me the perfect opportunity to repeat how determined I am to see companies provide data for comprehensive benefits.
Dave Doogan
SNP
Angus and Perthshire Glens
Question
My constituents in rural constituencies face high fuel prices with no public transport, leading them to use their cars at higher costs. They pay the highest delivery prices and lowest wages; transparency on fuel prices will not fix this situation. We need the Treasury to intervene in critical national infrastructure.
Minister reply
I will take that as a further representation to His Majesty’s Treasury.
Philip Hollobone
Con
Kettering
Question
Motorists in and around Kettering have long suspected retailers are inflating prices well above where they should be. Given the letter from the Business Secretary was ignored, will the Minister assure constituents that the Competition and Markets Authority will continue to closely monitor the market?
Minister reply
My hon. Friend is quite right; we will not only put in place a mandatory system for data but ensure ongoing monitoring so further intervention can be based on necessary data.
Jim Shannon
DUP
Strangford
Question
This information on fuel-price competition allows drivers to look for cheaper fuel, saving money. However, an older generation who may not use apps should also have access to easily understood information on fuel funding offers.
Minister reply
I thank the hon. Gentleman for his question and will write to him to inform him properly in answer to his question.
Wakefield
Question
This report shows residents in Burnley, Padiham, and villages have been overcharged for fuel. Does my right hon. Friend think the Competition and Markets Authority now needs to relook at the ownership changes at Asda?
Minister reply
As Minister for Energy Security and Net Zero, that perhaps stretches slightly beyond my brief; however, I am sure others with direct responsibility will follow up on this.
Shadow Comment
Tim Farron
Shadow Comment
The shadow expressed disappointment over the Government's failure to act sooner in addressing fuel retailers' overcharging, which imposed an additional cost of £900 million on motorists. He criticised the slow response from the Government despite clear evidence of price manipulation by fuel retailers and emphasised that higher road fuel prices exacerbate inflation across all sectors. The shadow also proposed expanding the 5p per litre rural fuel duty relief scheme to cover more areas, especially those in need like Cumbria.
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