Costs for Motorists

Before we come to the urgent question, let me repeat what I said to the House at the start of this parliamentary Session. The Government’s own ministerial code makes it clear that important policy announcements should be made in the first instance to this House when it is sitting. Some people seem to have very short memories. This announcement has been drip-fed to the media over the past three days. That is not in line with the Government’s own rules, and it is unacceptable. Back Benchers on either side have been elected to this House to hear such announcements first, instead of outside a Morrisons petrol station, on a bus, or on TikTok. Members should be respected. I uphold this House and I respect them, even when the Government do not. The Government have to get their act together and recognise the value of their own Back Benchers.

(Urgent Question): To ask the Chancellor of the Exchequer if she will make a statement on the Government’s plan for costs for motorists.

Mr Speaker, your comments have been fully noted, and I will ensure that they are fed back to the entire ministerial team.

The Government are taking steps to support households and businesses with fuel costs in response to the conflict in the middle east. A rapid de-escalation in the middle east remains the best way to bring down fuel prices. The most impactful step, of course, would be to reopen the strait of Hormuz. That is exactly why the UK Government are playing a leading role in the international effort to get shipping flowing freely. Indeed, I contrast that with the position of the Leader of the Opposition, who would have rushed us to war. [Interruption.]

Alongside this key step—[Interruption.] Mr Speaker, the boys’ club—

Order. I cannot hear what the Minister is saying. We have agreed to an urgent question in order to hear from the Minister. I am proud of this Parliament and of this country, so I want to hear what the Minister has to say.

Alongside this key step, the Government’s priority will continue to be helping families with the cost of living, including through protecting the public finances. The Government are taking action to bear down on prices at the pump, and in November we extended the 5p per litre cut in fuel duty for a further five months. Right now, petrol and diesel are 11p per litre cheaper than they would have been under the plans we inherited from the previous Government.

Some fuels have been more impacted than others by the conflict, and we recognise that. The Government also recognise the pressures being faced by drivers and other fuel users. That is why we are introducing a package worth over £400 million that combines broad support for motorists with targeted support for the sectors most exposed to and affected by higher fuel prices.

Yesterday the Prime Minister made it clear that we will not increase fuel duty this year. The temporary 5p cut will be extended until the end of the year. Taken together, the Government’s decisions will save the average motorist over £120 this year, compared with the plans we inherited from the previous Government.

We also recognise that farmers face substantially increased costs for fertiliser and fuel. That is why we are going further and cutting the duty rate on red diesel by over a third per litre, to the lowest rate in over 20 years. That will help other users of red diesel too.

May I begin by agreeing with you, Mr Speaker, and saying how disrespectful it is that this U-turn on fuel duty has already been released to the media earlier this week? The news was plastered across national newspapers on Monday, and yesterday the Chancellor conducted a visit to a petrol station with journalists, but it has taken until today for this House to be updated. This is a pattern, Mr Speaker—including, of course, the relentless briefings before the Budget last year about tax measures and fiscal forecasts. You would think that a Government with so little support among their own Back Benchers would have more respect for this place.

This change to fuel duty is yet another humiliating U-turn from a Chancellor and Prime Minister whose authority is shot. The Chancellor fought us tooth and nail on this issue. The Conservative party has been campaigning for a fuel duty freeze for months. The Chancellor repeatedly rejected those calls, creating unnecessary uncertainty for motorists and businesses. Why did it take her so long to realise that putting up fuel duty during an energy crisis is a bad idea? Does she really expect us to believe that this is all only happening, as she has suggested, because of better growth?

Let us be clear: the Chancellor has been pointing to the slight upward revision in the International Monetary Fund’s growth forecast earlier this week. That forecast was for growth of 1%, but until April the IMF was forecasting growth this year of 1.3%, so where is the supposed growth dividend? Perhaps the Minister can address that momentarily. Is the Chancellor seriously suggesting that the outlook is better now compared with how it looked at the last fiscal event? On wider measures, will the Minister confirm what has also been briefed to the press and not told to the House: that HM Revenue and Customs’ mileage rates are to be changed?

Put simply, as I said, the shadow Chancellor’s party would have had motorists hurtling full speed towards higher fuel costs. It is only because of the action that this Government have taken that we have applied the brake to the hikes that his party would have introduced. The Conservatives would have introduced higher costs; we are keeping the freeze on fuel duty and protecting millions of motorists right across the country. Exactly as I said, we are taking further measures on red diesel and for HGV drivers.

That is on top of additional action that we are taking on the cost of living. The shadow Chancellor and I saw each other in the studios earlier this morning when I was out there talking about the free, unlimited bus travel for children that the Chancellor will update us on—

Order. I just say to the Minister that if that was being said in the studios, rather than to the House, it is not a good example—it confirms that you somehow think that Sky or BBC are more important than Back Benchers, elected by constituents across this country, who must hear it second-hand. It is not acceptable. Do not think that it is a bonus to tell the House that now.

Mr Speaker, the Chancellor will come to the House later on today, and she—

Order. The point I was making was that you said you were doing the studios. You are here now, and I think it should have been announced here first. Do we both agree?

My apologies, Mr Speaker. I had intended to say just then that the Chancellor will come to the House and give a full statement on everything, including the matters that we are discussing.

I am sorry that the shadow Chancellor is so upset and appalled by the recent growth figures. I am in the business of talking this country up rather than down. Indeed, I am grateful to him for highlighting that growth has been revised up, interest rates are coming down, inflation is coming down and real wages are going up. As I said, that is because of the prudent decisions that the Government have taken, all of which are allowing us to take further action on the cost of living.

The action that we are taking on fuel duty is very important. It will save millions of motorists across this country a lot of money. I will address the point on HMRC mileage rates: as I said, the Chancellor will come to the House later and talk about the full package.

I call the Chair of the Business and Trade Committee.

Thank you for facilitating the urgent question, Mr Speaker. I welcome the announcements on fuel duty, but I did not hear the Chief Secretary say anything about remedies for the new costs on drivers of electric vehicles. Those new costs, imposed at the last Budget, are suppressing demand for electric vehicles to such an extent that UK automakers are having to subsidise demand by £5 billion a year. That is imperilling their future and imperilling the target of doubling automotive production by 2035. Can we have a statement about what the Government will do to reform the zero emission vehicle mandate and get in place a plan that leads to a thriving auto industry, not a dying one?

My right hon. Friend makes an important point. I know how passionate he is about these issues. He refers to changes made at the Budget, which were made with the best of intentions and from the point of view of encouraging the use of electric vehicles. I believe that the Chancellor may say something on that later on.

I call the Liberal Democrat spokesperson.

Like so many Labour Government announcements, the announcement to extend fuel duty relief later this year is too little, too late. When we look around the world, we see other countries acting now. Other countries are cutting fuel duty now. Other countries are cutting public transport costs now. That is why we Liberal Democrats continue to call on the Government to cut fuel duty and public transport costs now. What message does the Minister think it sends to people that the Government will take action later in the year when people are feeling the pain in their pockets right now?

On farmers, the Government will be aware that the cost of fertiliser is going through the roof; world prices are up 44%. The Minister says that there will be a further cut in duty on red diesel, but what assessment have the Government made of the cumulative impact of the war in Iran on farmers? It is clear to me that the cut in red diesel duty will not touch the sides when the cost of fertiliser is rocketing through the roof.

The hon. Member makes a really important point about the cost that farmers are facing, but that is exactly why we are taking steps to cut the duty on red diesel by more than a third to its lowest rate in over 20 years. As I said, that will help not just farmers, but other sectors, too, including in relation to freight. I am afraid that, as so often, we hear suggestions from the Liberal Democrats, “Cut this”, “Cut that”, “Try to bring things down”—[Interruption.]—but they are never funded. We manage the public finances—[Interruption.]

Order. The hon. Member for St Albans (Daisy Cooper) has asked her question and I want respect given to the Minister when she is answering it, please.