Carmichael – Murphy backtracks over proposed fuel discount scheme

3.57.00pm BST (GMT +0100) Wed 22nd Jul 2009

Orkney and Shetland MP, Alistair Carmichael has today slammed the Secretary of State of Scotland, the Rt. Hon Jim Murphy MP after a series of parliamentary answers today revealed the government has no plans to introduce any pilot scheme for reduced fuel prices.

Today’s answers to Mr Carmichael from the Parliamentary under Secretary of State for Scotland, Ms Ann McKechin MP appear to contradict comments made by her Scotland Office colleague Mr Murphy who on a trip to the Western Isles a few weeks ago hinted such a scheme was being considered.

Commenting Mr Carmichael said;

“Ms McKechin’s answer today is unacceptable and it is about time this government stopped playing politics with the livelihoods of Northern Isles families and businesses. Just a few weeks ago, the Secretary of State for Scotland seemed to suggest that the government could pilot a cut price petrol scheme and even hinted at suggested locations, yet now we learn there are no such plans.

“This government has demonstrated time and time again that its departments do not listen to each other and now we learn that Ministers within the same department appear not to be talking to each other. The Scotland Office only has two Ministers yet they are giving out what appear to be contradictory statements.

“Ms McKechin and her colleagues in the Scotland Office yet again demonstrate breathtaking complacency to say petrol markets are working properly when those parts of the country most on reliant on private car use continue to pay massively higher prices for their fuel.”

Last year Mr Carmichael led a cross-party delegation to the Treasury to meet with then Treasury Minster, Ms Angela Eagle MP to discuss this issue. As a consequence of that meeting Ms Eagle instructed her officials to look into the feasibility of any such scheme but ultimately concluded the government would not be introducing a fuel duty rebate. Mr Carmichael has put in a freedom of information request to the Treasury asking to see all the research carried out by officials looking into this matter.

As a result of Mr Murphy’s comments made a few weeks ago, Mr Carmichael wrote to Mr Murphy inviting him to visit Orkney and Shetland during the summer recess so he can meet with business leaders, community council groups and residents who can provide first hand accounts about the effect that the disproportionately high fuel prices continue to have on island business and living.

Mr Carmichael has also written to Ms Sarah McCarthy-Fry MP, the new Exchequer Secretary to the Treasury asking for a meeting so the government can clear up the confusion resulting from Mr Murphy’s comments and the subsequent Scotland Office denial of a proposed fuel duty rebate.

Notes:

A full copy of the relevant Hansard can be seen below -

20 July 2009 : Column 767W

Mr. Carmichael: To ask the Secretary of State for Scotland when his Department’s officials last met HM Treasury officials to discuss the proposals for a reduced fuel prices pilot scheme in island communities in Scotland. [287717]

Ann McKechin: Officials in the Scotland Office have discussions with HMT officials on a regular basis on a variety of issues.

Mr. Carmichael: To ask the Secretary of State for Scotland (1) what steps his Department has taken to identify suitable locations for the pilot scheme for reduced fuel prices in island communities in Scotland; [287718]

(2) what plans he has for a pilot scheme for reduced fuel prices in the Highlands and Islands; and when the scheme is planned to start. [287719]

Ann McKechin: The Government have no plans to introduce such a scheme. While the Government recognise the impact of higher fuel prices on those living in island communities in Scotland and in other rural areas across the UK, such prices are set by fuel producers and suppliers as a result of their commercial judgments, driven by market forces. OFT reports have repeatedly shown that markets are functioning properly in rural areas such as North West Scotland and the Scottish islands, but any evidence of anti-competitive behaviour on the part of fuel sellers can of course be brought to their attention.