My Speech in Parliament 14 May 2008

I spoke recently in Parliament about Vehicle Exercize Duty VED. I took every opportunity to use the speech to bash Tories, but still managed to take up lots of time so no one else could speak on this.

Although I am critical of the Government’s proposals, I will not join the Conservatives in the Lobby tonight, as they will not be surprised to hear. That is not just because this is an Opposition day debate but because of the sheer hypocrisy of their position. They accuse the Government’s proposals for graduated vehicle excise duty of being dressed up as an environmental measure but solely designed to increase and raise tax revenue, yet when the Conservatives propose precisely the same policy it is apparently the work of environmental visionaries that we should follow and that should lead the debate.

I do not think that the right hon. Member for Wokingham (Mr. Redwood), for whom I have great affection, has claimed to be an environmentalist, but he has claimed not to be a climate change denier. That rings rather hollow if one reads his blog of 4 April 2008—my excellent researchers have fetched it for me. The opening paragraph begins:

“Anyone in power who believes that global warming is happening”. Those are not the words of someone at the forefront of the environmental movement. I remember the right hon. Gentleman saying, “Who believes it’s happening?”, as if it is not. I remember public quotes from him—I have not been able to dig them out so I will have to rely on my memory—about not being able to identify the 4x4s that are “allegedly” responsible for contributing to global warming. There is a deep brand of scepticism about the entire climate change agenda in parts of the Conservative party, and we need to recognise that.

That does not necessarily apply to the leader of the Conservative party, who has been very forthright about the subject. On the “Andrew Marr Show” on 7 October, he said: “You can see the very strong commitment to the environment and yes, green taxes, as a share of taxes do need to go up. That’s not necessarily popular, but I think it’s right.”

He is absolutely right—it is not necessarily popular but it is the right thing to do. The question for the Opposition, if they want to walk the walk and look like a Government in waiting, is this: when will it be the right thing to do and time to come off the fence? At the moment, the Conservative party has an interesting and comprehensive document—I will give it that. It is the quality of life document, which was put together by Zac Goldsmith and the right hon. Member for Suffolk, Coastal (Mr. Gummer), and it has three specific proposals that relate to the matters we are debating. It says:

“It is therefore necessary to be much more subtle in the way we design taxes so that they achieve their ends with the least possible pain…Fiscal incentives for environmental improvement can be highly flexible, applied to industry, as in the case of the Landfill Tax, or aimed at directly influencing consumer behaviour, such as the banded system of Vehicle Excise Duty.”

The Conservative motion, unless I am reading it wrongly, effectively seeks to scrap the banded system of vehicle excise duty. The document goes on to commend purchase tax:”In contrast, an emissions-related tax directly at the point of purchase would increase the price differential between clean and polluting new cars more steeply. Such a tax could be phased in over time as automakers respond by bringing a greater range of efficient cars to market.”

It then recommends graduated VAT of between 5 and 17.5 per cent. on new vehicles.

On vehicle excise duty, the document could not have been clearer:

“We recommend more modest changes in VED, aimed primarily at influencing the used car market where annual running costs comprise a larger proportion of total costs. These levels of VED may also lead to slower depreciation rates for cleaner cars, thus indirectly influencing new purchase decisions. On this basis we propose increasing the VED differential between the top and bottom bands of emissions performance, capped at a maximum of £500.”

That £500 figure is considerably more than the Government are proposing. There will come a time, as my hon. Friend the Member for Birmingham, Northfield (Richard Burden) said, when the Conservatives will have to come off the fence, grasp the bullet and adopt some policies rather than make interesting suggestions.

The motion shows that the Conservatives are prepared to will the end but not the means, and I look forward to a time when they come up with clear, substantial and coherent policy. I believe that the motion misses the point. It calls for the abolition of increases in vehicle excise duty instead of addressing the point of concern for those in my party and elsewhere in the country, which is the retrospective nature of the policy. For Labour MPs, it is the retrospective nature of the measures, with the abolition of the 2006 exemption, that is the nub of the argument.

I agree wholeheartedly with the graded vehicle excise duty—in fact, I was one of the Back Benchers who lobbied for the proposal when I first came to this place. It has made a difference by informing consumer choices. I agree with incentives to make green choices pay. I would go as far as loading purchase taxes quite heavily on new gas guzzlers, with bans of 4x4s from residential streets, if necessary, and higher charges for the most polluting vehicles. I have no problem with incentivising green choices and with making it more expensive to do the wrong thing by the environment. However, I do not agree—and I hope that this came across in the interventions that I and other colleagues made—with denying to the people who can least afford it the opportunity to make an informed and empowered choice in favour of the environment and their family budgets.

We saw the problems concerning the 10p tax, and we have seen the steps that the Government were rightly prepared to take to put £120 back into the pockets of basic rate taxpayers. Some of the increases in vehicle excise duty rates are in line with that £120 figure; people will certainly be forced to pay £90. It is quite simple to me: we can talk about choice, but choice is always an option for the rich. People on low incomes do not change their car every year or two. They need longer than from now until 2010 to make the changes necessary to cut vehicle emissions without being penalised by higher car tax. I speak as patron of the Berkshire Multiple Sclerosis Therapy Centre, which the right hon. Member for Wokingham will know of. I see constituents of mine and his who scrimp and save to run an old Ford Transit van into which they can run a wheelchair to get the dignity that mobility gives them. Do we really want to hit those people? Do we not want to give people with large families, people on low incomes and people with mobility or disability problems an opportunity to make the informed choice that the timescale currently envisaged in the measure simply does not allow?

That is why I urge my hon. Friend the Exchequer Secretary to reflect carefully on representations on the issue from people who truly are her friends, because there is time to put things right. There is time to phase in, if necessary, the different bands. There is time to end the retrospective nature of the measures, which is fundamentally wrong.

My final point is about the public’s capacity to accept green taxes. In this cynical age, we should all be wary of destroying the credibility of green taxation as an environmental tool, if the public consider the measures that we propose to be either unfair or unclear. I do not often do this, but I commend to hon. Members a bit of reading from the Department for Environment, Food and Rural Affairs website, which is a snappily titled document called “A Framework for Pro-Environmental Behaviours”. It makes depressing reading for those of us who genuinely believe in climate change and who want to lead the public debate and change public attitudes.

Sadly, only 18 per cent. of the public fit into the category of “committed environmentalist”. That might be okay when it comes to voting in local elections, but it is certainly not okay when it comes to doing the right thing. What we learn from the survey is that the public are prepared to recycle more, take a tough line against manufacturers that produce excessive packaging and use recycled light bulbs, because they can see that doing so will save them money. But are they prepared to drive less, fly less or be unnecessarily penalised in their pockets? Sadly, they are not at this stage. However, they need to be, and we need to get them there, because climate change is one of the most serious issues facing our planet.

If we want to undermine the necessary measures in the Climate Change Bill to cut our carbon emissions by 60 or even 80 per cent. by 2050, which we all support, we will do so by being unclear or engendering opposition or a sense of unfairness and cynicism about the policies that we put forward in favour of that agenda.

In conclusion, let me say this to Conservatives Members. You have been shallow and opportunistic, because once again you have been found out willing the ends, but not the means. But you are not all wrong—

The deputy speaker Alan Haselhurst is a Tory, and didnt like this at all. He said ‘I am nothing of the kind. The hon. Gentleman should use the proper language.’

I responded;

I take your strictures, Mr. Deputy Speaker. Through you, I say to the Conservatives, “You have been shallow and opportunistic.”

We should accept that there is merit in reforming the proposals. I ask the Government please to reflect carefully on the sheer unfairness of the retrospective nature of the proposals. There is time to make amendments and do the right thing by the environment without hitting some of the people whom we all came into politics to help and support.

Deferred Divisions: Vehicle Excise Duty (14 May 2008)

Martin Salter: Does my right hon. Friend agree that the right hon. Member for Wokingham (Mr. Redwood) is being unnecessarily bashful? We regularly refer to the excellent document that he produced denying climate change and trashing the green credentials of his party leader. He should be given a wider hearing, and it is my right hon. Friend’s job to ensure that he is.

Martin Salter (Reading West, Labour)

I thank the Minister. It is a similar point. The Minister rightly spoke of allowing people to make choices in order to cut their vehicle excise duty by 2010, but that was predicated on the assumption that people would have enough money in their family budgets to change their cars before 2010. Many of the people whom the Minister and I represent do not have that disposable income. That is the nub of the problem.

Martin Salter (Reading West, Labour)

Does the hon. Gentleman agree that Conservative policy on vehicle excise duty is also unravelling before our eyes? Some eight months ago we had a quality of life policy document from the Conservatives, which was launched in a hail of publicity in September 2007. It proposed that the increase in the vehicle excise duty differential between the top and bottom bands of emission performance be capped at a maximum of £500. A few months later we have on the Order Paper a motion that goes in exactly the opposite direction. Whose policy is unravelling?


After all that serious debate, I thought something lighter more appropriate when someone mistakenly thought i was MP for Reading. (How could they have such an idea I wonder?)

Martin Salter: It is Reading, West, which is the preferable part of the town. Does the hon. Gentleman accept that the early-day motion criticises not the thrust of the policy but its retrospective nature? That is the nub of the debate.

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Published in: on May 22, 2008 at 4:24 pm  Leave a Comment  
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