Plenary, 05 Oct 2000

Meeting date: Thursday, October 5, 2000

Official Report 715KB pdf

---

Fuel Duty

Good morning. Our first item of business is the Scottish National Party debate on motion S1M-1238, in the name of Kenny MacAskill, on fuel duty, and two amendments to that motion.

On a point of order, Presiding Officer. The Executive has indicated that it is not putting up a minister to respond to this debate. It is putting up a junior minister—[Interruption.]

Order. I must be able to hear the member's point of order.

In view of the seriousness of this debate, do you view the decision of the Executive not to put up one of their front-line ministers as a gross discourtesy to the chamber and to the SNP?

The question of who speaks in a debate is not a matter for the Presiding Officer. It is entirely a matter for the parties.

Here we go again. Only a few weeks have passed and yet again we are having a fuel debate. That should be no great surprise. It is a major issue, after all. However, it is an issue on which the UK Government takes no action and in which the Executive takes no interest, as is shown by the absence of ministers from the chamber today. We are left with an amendment in the name of the voice of agricultural labour and a summing-up by the voice of Brian Wilson.

In the previous debate on this subject, we were told tales of a workers' Government faced down by a bosses' strike. If the Executive was to be believed, hauliers and farmers overtly and covertly colluded and connived to undermine the democratic fabric of our nation. We heard claims ranging from a Minister for Justice talking about mob rule to a Labour member raising the spectre of Allende. I trust that that will not be repeated today. It was repugnant then and it remains so now.

The actions of the peaceful protesters have been vindicated by a poll in The Herald. The actions were supported by 70 per cent of Liberal Democrat voters and 62 per cent of Labour voters. It may have been a bosses' strike—I do not think so—but it was a popular protest. Did the Government listen? It did not. Following the abuse and invective, we were faced with intransigence and arrogance. The Prime Minister acknowledged that there was a genuine and sincerely held grievance, but he refused to act. He said:

"I am listening - but I was also elected to lead."

There is merit in strong government. We cannot have leadership by whim and fancy. However, this matter is no mere whim of a small section of the population or a token fancy of a specific sector of our economy. It is a popular grievance on an area of legitimate social and economic concern. Governments in other countries have listened and acted; ours has sought to cloak itself in the language and imagery of Thatcherism.

What has happened since the previous debate? Has there been a cut? Has aid been given to fuel-dependent industries? Has there been an acknowledgement that we are out of kilter with not just the rest of Europe but the rest of the developed world? Has the absurdity of the fact that the largest oil producer in the European Union has the most expensive fuel in the developed world been acknowledged? No.

All we have seen is preparation for future demonstrations and blockades. Jack Straw, rather than addressing the underlying malaise, is tooling up for confrontation. The Government is seeking to punish those who protested. Legislation is being introduced to deal with the situation, à la Thatcherism. If they cannot be persuaded, they must be punished—that seems to be the Government's attitude.

The Government is seeking to punish those whom they think have participated by default. In the Government's view, the guilty parties in that respect are the oil companies. Hence, a windfall tax is mooted. Again, if they cannot be persuaded, they must be punished.

There is a need for investment in North sea development, and taxation has a role to play in encouraging and promoting that. However, the North sea oil industry in Scotland does not require punitive taxation that has been imposed by a Government in a fit of pique.

What is the underlying situation? The problem has not gone away. The price of fuel gets higher, the social costs increase and whole sectors of the economy weaken. The tourism figures for outwith Edinburgh and Glasgow are down and are getting lower. Because of high fuel costs and the high pound, the Highlands and Islands are now a high-cost holiday destination. Lib-Lab policy is pricing tourists out of Scotland, and the tourism industry may take years to recover.

The haulage industry continues to struggle and the number of continental drivers continues to rise. This has been a matter not of taking freight from road to rail, but of taking jobs from Scotland and giving them to European competitors.

The difficulties faced by a generation of fishermen continue to multiply. Despite having rebated fuel, they still require to compete with trawlers from France, Spain and elsewhere. Other nations are providing packages of support, whereas Labour's high fuel costs are an albatross around the necks of our fishermen.

According to David Blunkett, farmers are subsidy junkies. Perhaps George Lyon will tell us whether he agrees with that. Doubtless the Deputy Minister for Highlands and Islands and Gaelic will advise us whether, as a representative for the Western Isles, he feels that farmers are subsidy junkies. He can support or repudiate that scurrilous remark. The costs are still high, but the banks continue to hound and hover above many a farm. Where has the real windfall gone? The prime recipients of the largesse that has flowed from the rising tide of oil prices are the Chancellor of the Exchequer and his Treasury war chest.

On 1 February 1999, our illustrious First Minister sagely predicted that oil prices were likely to stay at around $10 to $12 a barrel for the foreseeable future. What happened? The price rocketed to more than $30 a barrel. As a result, the Treasury war chest burgeoned. On monthly oil price averages and National Audit Office estimates, the Treasury has received an additional £5.2 billion since the First Minister's bold prediction.

The windfall does not stop there, however. The Prime Minister has been pleading poverty on the additional VAT that goes to the Treasury as a result of increasing petrol prices. At the height of the crisis, he told us that the additional receipts would not be enough to fund a reduction of a fraction of a penny in the price of fuel. His Government thinks differently, however. In a parliamentary answer, we were told that every additional penny on the pump price raised £50 million. Since the First Minister's words of wisdom last year, the price of petrol is up by more than 10p and the Treasury's VAT receipts will be up by more than £500 million. In that is the windfall and in that the solution. The Government in Westminster, which has the relevant powers reserved to it, has the available resources to act—the money is there. There need be no cuts in other budgets and there are no excuses left.

Our motion accepts that this Parliament does not—at present—have power over fuel duty, but that does not mean that the Executive or other elected members can absent themselves or abdicate responsibility on an issue that is so fundamental to our people, economy and country.

Individuals have demonstrated and opinion polls have disclosed; it is now for this Parliament to articulate the nation's call for a cut in fuel duty. It is absurd that we have an Administration that takes perverse pride in the outrageous price of fuel. It is as if it has said, "We've put it up, so we'll put it higher; they've suffered, so they can continue suffering; we've started, so we'll finish." But it is we who are being finished off. That is why the most important point is that the cost of fuel must be cut.

The key sectors of our economy must be saved. As has been said, some fuel-dependent industries are hanging on by their fingernails. A package of measures must be considered and must be implemented. Those measures will vary, depending on the industry concerned and on the outcome of discussions between representatives of those economic sectors and the elected representatives of the people.

On road haulage, I wrote to the Minister for Transport and the Environment, asking her to consider an essential user rebate. She said that that fell under a reserved power. In committee yesterday, however, she indicated that she was considering extending the fuel duty rebate to community buses and other worthy schemes that we have been promoting for more than a year. What is the logic that allows her to extend the fuel duty rebate to buses but not to lorries? Why is the minister competent to give a rebate to the bus industry but incompetent to give a rebate to the road haulage industry? Similarly, fishing and farming need specific packages. That has been done in France and Spain, so why not here?

The motion is about standing up for Scotland, about speaking out for Scotland and about representing our nation on an issue that is fundamental to our citizens, our industries and our economy. The power to vary the rate of fuel tax is of course reserved, but that does not mean that the Executive should have no view or say or that it should absent itself from the debate and from responsibility. Are Executive ministers not responsible for the economy? There is a Minister for Enterprise and Lifelong Learning. Do they not care about fishing and farming? There is a Minister for Rural Affairs. Do they not care about road haulage? There is a Minister for Transport and the Environment.

Discontent over fuel prices has been growing, but when the going gets tough, the Executive goes. It is still open to the Parliament to discharge its duty to represent and look after the interests of the people of Scotland. Even if the Executive goes AWOL, members can still remain attentive. Even if the political elite in Labour does not have the courage of the people's convictions, the Parliament can and must act. A clear message must resonate from this chamber in support of our people, our industries and our national interest. If there is not unanimous support for the motion it will be clear—and SNP members will make it quite clear—that Labour does not listen, Labour does not care and Labour is the problem. Get the price of fuel down or get them out. Roll on Falkirk West.

I move,

That the Parliament acknowledges that Scotland is the largest oil producer in the European Union yet has the highest fuel prices in the developed world; notes that the Scottish economy as a whole and fuel dependent industries in particular are paying a heavy price as a result of high fuel prices; recognises that both individuals and entire geographic areas, in particular rural and island Scotland, are suffering; further recognises that the root cause of high fuel prices is taxation; notes that as a result of the recent increases in world oil prices Her Majesty's Government will receive a revenue windfall in excess of £4.4 billion, and therefore calls upon the Scottish Executive to hold a summit of interested parties to address the fuel situation, introduce a package of measures to address the needs of fuel dependent industries, and make urgent representations to the Chancellor of the Exchequer requesting him to make an immediate cut in fuel duty and give a commitment to work towards the European average.

I, too, welcome the opportunity to debate again the implications of current levels of fuel tax in Scotland. Gordon Brown is a latter-day Fagin. He is not just picking a pocket or two, he is raiding every sporran in the land. He is probably the first Scot to take the breeks off a Highlandman.

The truth about fuel prices in Scotland is not just chilling but squalid. Britain has one of the cheapest pre-tax petrol rates in the European Union. Once tax is slapped on, Scotland has the highest fuel prices in Europe: 10p a litre more than in France and 30p a litre more than in Germany. How did that come about? In May 1997 the average price of petrol was 59p a litre; now it is 86p. That is an increase of 44 per cent. In May 1997 the tax element was 45.7p a litre; now it is 61p. That is an increase of a mind-boggling 34 per cent.

Chancellor Gordon Brown pledged in 1997 not to increase taxes. In a series of budgets, however, he has done exactly the opposite and imposed rates of 12 per cent above inflation on diesel. In the most recent budget, he promised that fuel tax would be put up by the rate of inflation, but that led to a very tricky little manoeuvre. For the purposes of that increase, inflation was measured at 3.3 per cent; however, when pensions were put up by the rate of inflation, inflation was measured not at 3.3 per cent but at 1.1 per cent—hence the insolence of the additional 75p a week.

Miss Goldie has not mentioned the most interesting statistic, which is that tax on petrol was 33p a gallon when the last Conservative Government came to power and 222p a gallon when it left power.

With some basic arithmetic, Mr Rumbles would notice that the Conservatives were in power for 18 years rather than three years. What the Labour Government and his unseemly pals, the Labour Executive, have achieved is truly remarkable.

It seems that it is all right to slap tax on the petrol-buying motorists but still give pensioners a raw deal. If you are a Scottish farmer, fisherman or haulier, heaven help you. If you are an elderly widow living in Blair Atholl, Inveraray or Arran, heaven help you. If you are a family in the central belt and need a car to take the children to school or the parents to work, heaven help you. If that were not bad enough, the same Labour Government, and the same Labour Executive that is supported by Mr Rumbles's party, propose to pile on the agony with workplace parking charges and road user levies. No wonder that the motorist in Scotland feels betrayed, abandoned and helpless.

Can anything be done? Of course it can, and the Conservatives have said that they will do it—a vital and meaningful, but prudent, cut of 3p a litre. For the rest of this year, that would cost the United Kingdom £525 million. That is a fraction of the £5 billion revenue that the chancellor is getting this year alone over and above his own forecasts.

Talking about chancellors, can Miss Goldie remind us which chancellor put VAT on fuel?

It was, indeed, a Conservative chancellor, as Mr Crawford knows. A Labour chancellor would have had no alternative and a Scottish nationalist chancellor, heaven help us, would have had no alternative either, because that ruling was in line with the European dictate at the time. The VAT on fuel has been a fraction of the fiscal policy of this Labour Government.

Will the member give way?

I am sorry, Mr Stone, but I am running out of time.

Why would a cut of 3p a litre be more significant in Scotland than anywhere else? Our geography makes the car essential and the public transport alternative is very limited. In the Highlands and Islands, for example, average incomes are less than 80 per cent of the Scottish average. Car and other transport users cover distances that are almost double the Scottish average. A total of 65 per cent of the people live more than one hour's drive from a major centre, as compared to 10 per cent nationally. Average fuel costs are between 10 per cent and 20 per cent higher. Our 3p cut would pack a punch with people and business. Current price levels are roasting business. The road haulage industry is in crisis.

I am sorry, Mr Stone.

Our vehicle excise duty is 11 times that of France. We have the highest-taxed diesel in Europe. Tourism should be our flagship industry, but the flag is pretty limp and the ship is certainly low in the water. A study published last July by the Forum of Private Business found that the cost of fuel is destroying rural tourism where businesses depend on tourists travelling by bus or car. Petrol prices ranked higher than the weak euro as a factor in that.

It is indeed desirable that this subject is debated. I hope that a resounding message is going via the junior minister to his colleagues in the Scottish Executive. It is clear that what happened in the blockades of last month will undoubtedly happen again—it will happen again in the middle of winter, when neither Scotland nor the rest of the United Kingdom is well disposed to cope. I hope that the junior minister has something comforting to say to the Parliament about his consultations with his colleagues at Westminster. Unless the Scottish Executive's colleagues in government at Westminster are prepared to make some concession on fuel prices, the future for the United Kingdom is extremely bleak, and the future for Scotland is the bleakest of all.

As for the Scottish nationalists' motion, although I am glad that it was lodged and that we have an opportunity for debate, the Presiding Officer will forgive my cynicism when I point out that the authors of that motion belong to a party that is committed to a high-tax, high-risk regime. It has become perfectly clear in debates in this Parliament that the Scottish nationalists, especially in the form of Mr MacAskill, have a love of making serial commitments with uncosted implications. I fear that their vision is a chimera—a fanciful dream to dazzle—but not a prudent, workable solution. That is why the Conservatives lodged an amendment.

I will deal briefly with Liberal Democrat amendment. In so far as the Liberal Democrats know what they are doing—which, in itself, is remarkable—they too are committed to high taxation. They would put 5p on a litre. Moreover, there would be an uncosted deficit if they removed the tax disc from cars with an engine capacity below a certain level—by their own calculations, they will not replace that lost revenue. That means more fuel tax for the road user. Perhaps Mr Ian Jenkins has revealed his party's position more patently than anyone else. He said:

"The Liberal Democrats favour environmental taxes and agree with the principle that the polluter pays".—[Official Report, 22 June 2000; Vol 7, c 670.]

One cannot drive a motor vehicle without polluting. I therefore conclude that Mr Jenkins wants the motorist to be taxed again and again.

I move amendment S1M-1238.2, to leave out from "is the largest" to end and insert:

"has the highest fuel prices in Europe owing to the high levels of taxation levied by Her Majesty's Government; notes that this position is reducing the competitiveness of Scottish business; recognises that the essential car user, particularly in rural Scotland, is suffering and calls upon the Scottish Executive to make representations to Her Majesty's Government in order to reduce taxation in general and fuel tax in particular."

As Kenny MacAskill and others have rightly said, fuel duty has become the burning issue for the majority of motorists in Scotland. Not only do they pay the highest fuel tax in Europe, but until recently they received very little in return—no improved roads, no alternative public transport and no relief for rural motorists, who are hit disproportionately hard. This is not a new issue in the Highlands and Islands—it has been around for many years. Motorists in the central belt are only now having to pay more than 80p for fuel, whereas in the Highlands and Islands 85p has been a normal price for petrol—the norm there is now 90p to £1 a litre.

Motorists and hauliers are angry and upset—with good reason. For every litre of petrol that they purchase, 62p goes on tax and VAT. What do they get back? I remind Annabel Goldie that, under the Tories, who invented the fuel price, we saw—

Will the member give way?

I hope that the member will allow me to make some progress. I will let her in later.

I have a point of information for Mr Lyon. Fuel prices arose some time during the 1890s when the motor car was invented.

I am taken aback by that comment.

I was going to point out—in case the Tories had forgotten it—that the tax and VAT element of fuel rose from 33p a gallon for four star in 1979 to 222p a gallon in 1997. Tax and VAT rose to 222p under the Tories, yet we have crumbling roads, because of cuts in local authority budgets, and a motorway system that at times has more cones than cars. Did the money go into public transport? Not a penny. The rail system was starved of investment. Now we have a privatised rail system that provides a worse service than British Rail did. At the same time, rail fares increased above the rate of inflation. We also ended up with a privatised bus service, resulting in the complete disappearance of rural buses, whereas in towns and cities 10 buses appear at once.

Is it any wonder that motorists feel angry and upset? They pay 62p a litre in tax and get nothing in return. We were told by the Tories that the tax would be a green tax—in reality it was nothing more than a stealth tax. The Tories and the Labour party have raised fuel tax and other indirect taxes to fund cuts in income tax. That is dishonest politics and the chickens are coming home to roost. At least Tony Blair has acknowledged that fuel tax is being used to fund public services.

Will the member give way?

I know that Duncan Hamilton always likes to intervene on my speeches, but I have been talking for three minutes and I must make some progress.

Hague's Tories have now seen the error of their ways: they have discovered a new economic miracle on planet Portillo. We have heard all about it this week. The Tories are going to cut fuel taxes, income tax, business tax and tax on savings. However, the really clever thing is that at the same time they are going to outspend Labour on health, education and pensions.

Do Hague's Tories really believe that the voters will buy that or is it an indication of Hague's desperation that he must jump on every populist bandwagon that comes along? The problem with bandwagons is that, when you are waiting for one, three turn up at once.

We have heard precious little about the Liberals' amendment, which says that they will impose

"a cap on fuel taxes in real terms for five years".

Does that mean that they are committed to increasing excise duty by the rate of inflation for the next five years, no matter what happens to world oil prices?

It means a cap on fuel taxes, which is the same as the SNP's policy.

Talking of jumping on political bandwagons, I will turn to the SNP. We have had four different fuel policies for an independent Scotland in the past few years. In 1997, the fuel price escalator was an integral part of the SNP's spending plans. That commitment was given in the SNP's manifesto for the 1997 election, under the heading "Paying for Scotland's Future". The SNP's 1999 manifesto also included the fuel tax escalator. However, on 10 July, John Swinney, the new leader of the SNP, changed the policy. At the Scottish Grand Committee, he stated that the SNP would freeze fuel duty. A few weeks later, he said again that it would freeze fuel duty, but that the freeze would be at the level from before the increase in March. Alex Neil's fundamentalist wing of the party wants a 20 per cent cut in fuel duty. So we have a choice of four policies. Take your pick.

The SNP is not serious about fuel duty. It has used more than half its parliamentary time in the chamber to discuss reserved issues.

Will the member give way?

Will the member give way?

Order. The member is in injury time, so there is no giving way.

That demonstrates clearly to the people of Scotland that the SNP has abandoned Westminster and that it has no interest in raising Scotland's problems in the right forum, which is Westminster. The SNP is an irrelevance in Westminster. It has completely walked away from that Parliament.

Our amendment deals with the real concerns of motorists in Scotland, especially rural motorists, who have been disproportionately hit by fuel tax. The amendment goes a long way towards addressing those concerns.

I move amendment S1M-1238.1, to leave out from "acknowledges" to end and insert:

"notes that fuel is a matter reserved to the UK Parliament; recognises that rising fuel prices and haulage costs create particular financial and social difficulties for individuals and businesses, especially for remote, rural and island areas of Scotland, and further recognises that the Liberal Democrats have opposed all fuel duty increases since the introduction of the fuel escalator under the last Conservative government and support (a) a cap on fuel taxes in real terms for five years, (b) investment of additional resources acquired through increased VAT in public transport, (c) the encouragement of fuel-efficient cars by abolishing Vehicle Excise Duty for the most fuel-efficient vehicles and (d) targeted assistance for Scotland's remote, rural and island communities to alleviate the additional fuel price that these areas incur."

I will clarify for members that, although the chair allows injury time for interventions, once a member is beyond the allotted time there should be no more interventions. Members should not accept interventions and members should not try to intervene.

What an unedifying sight we have seen so far—the Conservative bandwagon and the SNP funeral cortège, driven by Kenny MacAskill. They had nothing positive to say about Scotland's economy. As usual, it was all doom and gloom. The Labour party understands the concerns of motorists; it has addressed the issues and is spending more on transport than has ever been spent before.

Let us introduce some facts. The oil price has increased from $10 at the start of last year to $35 a barrel now. That has had an effect on the price of fuel. The increase in fuel duties this year was the lowest for 11 years. Cutting fuel duty would be worth £2 a month to the average motorist, but would cost the public finances £1 billion. I am amazed by the spending strategies of the SNP and the Conservatives. Perhaps I should not be surprised by the SNP, because it spends, spends and spends. Indeed, I recollect that the SNP finance spokesperson borrowed a calculator during the party's press conference to launch its spending plans for Scotland.

The Tories forget some of the history behind their past strategies. Why did they introduce the fuel duty escalator? How did we get here in the first place? We have an environmental problem to deal with; we cannot get away from that fact.

It is popularly accepted that, by 1997, the United Kingdom's environmental obligations under the Kyoto agreement had been met. That is why the Conservatives were prepared to cease the application of the fuel escalator, and voted to that effect in the House of Commons.

Indeed; that is correct. The estimated increase in fuel duty between 1996 and 2000 will have saved emissions of between 1 million and 2.5 million tonnes of CO2 per annum by 2010. That was the rationale for the escalator. We acknowledge the impact that the escalator has had on the economy. Ours is the party, through the Chancellor of the Exchequer in London, that has taken away the fuel duty escalator and—to answer George Lyon's questions—made commitments to transparency on where the money from increases in petrol taxes will be spent. The Tories taxed motorists and did not spend on infrastructure. Under Labour, and under the coalition in Scotland, we are doing the opposite. The Minister for Transport and the Environment recently announced historic spending increases on transport.

I thank Andy Kerr for giving way. He seems somewhat coy about the Labour party's professed policy. Is it the case that the chancellor is committed to increasing excise duty at the next budget by at least the rate of inflation?

No, that is not correct. The Labour party's policy is to address society's needs; that includes the needs of motorists and the road haulage industry as well as the health service, education, infrastructure and social inclusion—all the massive spending priorities on which we are delivering.

In Kenny MacAskill's paradise, he always talks about Norway, the Netherlands, Iceland and even France, all of which have higher vehicle taxation. Once that higher taxation is combined with the road user charging schemes on the continent, it can be seen that the cost to our motorists is much more on a par with the cost to motorists elsewhere.

Yes, it costs £50 to fill up a typical car in the UK, while it costs £42 in France and £44 in Holland, but those other countries have road user charging schemes and taxation on the motorist is much higher than in the UK. If Kenny MacAskill cared to consider the facts, he would find that that is true.

We all acknowledge that road haulage is central to the modern economy in Scotland. The Select Committee on Environment, Transport and Regional Affairs's 15th report states:

"We have not accepted the principal argument advanced by our witnesses from the road haulage industry, that fuel prices and VED"—

vehicle excise duty—

"are too high, and should fall. We believe that in the past haulage rates have been unrealistically low, and have not reflected the true costs imposed by the road haulage industry on our society."

Is not it amazing that many Scottish haulage firms are in trouble? Is not it amazing that many such firms are closing down and their services are being replaced by foreign drivers who do not spend any money in the UK and pay nothing towards wear and tear on our roads?

The foreign cabotage rate in this country is 0.06 per cent. We are hearing the usual scare story from the Tories. The real cost to society of motoring is estimated at £42 billion; revenues are £23 billion. The effect of cheap fuel is dramatic. Consider America, where petrol cost 35 cents a litre in 1995 and consumption was 1,600 litres per person. In the European Union and Japan, petrol costs between 60 cents and 90 cents a litre and consumption is 500 litres per person. We must face some hard realities about our environment and our economy.

It was Labour that first met the Road Haulage Association, and John Reid who agreed to remove the fuel duty escalator. Labour has listened to the industry on the improvements that can be made to its vehicles. Labour is delivering at a national level.

On George Lyon's point, it is one thing to levy money from motorists, but another thing to spend that money on infrastructure. The difference in Scotland is that we have the commitment to spend that money, which is being delivered through the public transport fund. Money is going to local authorities to repair roads and bridges. That is how we repay the motorist.

I remind members that we have two debates this morning, so we need to keep the debate moving along swiftly. I ask for four-minute speeches.

Members of all parties will agree that in rural Scotland the motor car is a necessity, not a luxury. However, Labour taxation policy on the use of the motor car in rural Scotland treats it as if it were a luxury, not a necessity.

Despite the fractious tone of the debate, there lurks somewhere a consensus that the motor car is a necessity in rural Scotland, and that action must be taken. Characteristically, I will shed light rather than heat on that debate. We have heard nothing about what the Government will do to alleviate the crisis in rural Scotland; nothing, that is, except what we heard from Mr Brian Wilson, who toured various parts of the Highlands with Alasdair Morrison. He said that the answer is liquefied petroleum gas and that people can get grants of up to 75 per cent to convert their cars to LPG. The problem is that only two makes of car qualify for that scheme. In addition, the cars have to be less than one year old and the only garage that can do the conversion is based in Southampton.

Active steps can be, and have been, taken by other countries. In France, there are 1,000 multi-service shops, selling petrol, which are supported by the Government. In Greece, there was the imposition in 1996 and 1997 of a maximum price outwith Athens and Salonica. In Portugal, there are lower excise rates for the Azores. Greece has lower rates for the Greek islands. In Italy, the rural populace is protected in places such as Gorízia.

Every other European state with its own independent Government is taking action to protect its rural population. The British Government has taken no action and—even after the protests—proposes to take no action.

On derogation, Mr MacAskill said that

"it would be legitimate for residents in Glasgow and Edinburgh to argue that the cost of fuel was offset by lower house prices in rural areas".

How does that statement affect the SNP's argument on derogation?

Mr MacAskill is on record as stating the case for the necessity of urgent action on rural prices. Were Mr Kerr to read our motion, he would find that it says exactly that.

I hope that the Enterprise and Lifelong Learning Committee's suggestions on specific measures to provide protection for rural motorists will be investigated. However, the Executive seems reluctant to impinge in any way on a subject that is reserved to Westminster, even when that subject has serious repercussions for our rural population in relation to farming, fishing and tourism, which have been mentioned by members of other parties.

The sorry truth of the matter is that unless the Parliament is granted more powers, there will be no solution to the problem.

I will give way to Jamie Stone first, then to Robin Harper.

You must watch your time, Mr Ewing.

I thank Fergus Ewing for giving way.

Although the escalator has been done away with, Fergus Ewing will agree that those of us who live in the Highlands are stuck at the top of the escalator. House prices may be low, but incomes are pathetically poor in crofting areas in the north of Scotland. Should not his proposals include an examination of the derogation on VAT? In the Highlands, we pay over 90p a litre, including VAT, which means that we are hit extra hard on the VAT front. Such examination would be a constructive way forward and would mirror what is happening in parts of Europe.

That approach is one possibility, but my own inkling is that a maximum price should be imposed, as has been imposed in Greece.

I promised that I would give way to Robin Harper, given that I so churlishly did not do so during our previous debate on the issue.

You have 10 seconds left.

Good morning and thank you.

Perhaps the member who sums up for the SNP could answer my question. I accept much of what is said about the problems of rural Scotland, but in an independent Scotland, would the SNP sign the Kyoto protocol? The SNP must find an answer to that question. What steps would the SNP take to meet Scotland's environmental responsibilities?

Mr Ewing, please answer that question and wind up.

I am happy to answer Robin Harper's question. The SNP policy is that we are committed to working towards a rate of excise duty on fuel that is in accordance with the European average. I believe that environmentalists should argue, as Robin Harper argues in relation to other environmental issues, that action should be taken on a European basis. What is the point of having 15 or 16 different rates of excise duty? Logic suggests that Scotland would benefit from the lower rate of European tax. That compelling logic is so powerful that not even the Labour Government will be able to ignore it.

If so many of our Scottish National Party colleagues are concerned about reducing taxation in the UK, why are they not standing for next year's Westminster elections? Why do they not make their arguments in the arena where that matter can be addressed?

The truth of the matter is that the SNP is more concerned with a shallow, populist approach than with influencing what happens in UK politics. That approach was characterised by Kenny MacAskill, who gave the game away early in his speech when he referred to recent opinion polls in The Herald and the Sunday Herald. The SNP is more concerned with responding to short-term opinion polls than with setting out a responsible programme.

Week in, week out, we hear from the nationalists about the need for increased public expenditure. Kenny MacAskill is a great advocate of that approach—his favourite issue is roads, but many other members of the SNP have their own hobby-horses. Yet the minute that a populist bandwagon, such as the debate on fuel taxes, comes along, the only question for the SNP is whether it can scrabble aboard quicker than William Hague can.

One difference between William Hague and the Scottish National Party is that at least the UK press puts William Hague's populism under proper scrutiny. I appeal to the Scottish press to subject the SNP's position to the same level of scrutiny.

Where is the SNP's commitment to public services when, the minute some claim about reducing taxes comes along, SNP members jump on board the bandwagon? What would be the position on taxation in an independent Scotland? Would the SNP alter its taxation policy every month in response to fluctuations in the price of a barrel of oil? What effect would that have on the crocodile tears that the SNP regularly sheds for manufacturing industry? How would industry survive in an independent Scotland with that taxation policy?

SNP members advocate moves towards European averages for fuel taxes, but we do not hear them advocating a move towards European averages for other forms of taxation. Would they favour a move towards the 53 per cent of gross domestic product that Sweden levies in taxation, or Norway's 44 per cent?

Bristow Muldoon has spent an awful lot of time asking what the SNP would do. Has not he read the motion? Is not it about time that he started defending his Government's record?

I am surprised that the SNP is wasting its Opposition time on debating here issues that should properly be raised at Westminster. However, Tricia Marwick intervened at just the right time, as I was about to move on to the response from the UK Government, which I think has been responsible.

Tony Blair, in his conference speech last week, said that he is listening to people's anger over fuel duties—the hauliers and farmers, to say nothing of ordinary motorists. He recognises that there is real hardship, but he must also listen to concerns about underfunding in the NHS, and about the need for investment in schools, more police on the beat and better public transport. The real world is full of competing causes, most of them good and deserving, many of them heart-rending. A Government that chooses priorities is not arrogant; a Government that fails to choose is irresponsible.

As Andy Kerr pointed out, Labour's response to transport and environmental problems is also a balanced one that reflects the need for substantial increases in public transport as well as considering fuel taxation. Why do we hear no concern from the SNP about the relative increases in the cost of public transport? Because that is not a short-term, populist issue. Populism can work in the short term in opinion polls, but I am confident that, when it comes to real choices, the people of Britain will reject the shallow populism of William Hague at UK level and its tartan counterpart, as exhibited by the SNP.

As all members know, and as the Liberal Democrat amendment makes clear, fuel tax is a matter that is reserved to Westminster. However, I am delighted that we have a distinctive and realistic Liberal Democrat amendment to the SNP motion. There should be nothing surprising about the fact that we disagree at times with our Labour colleagues on issues that lie outwith the partnership agreement. On subjects such as the fuel tax, we have our differences.

George Lyon's amendment on behalf of the Liberal Democrats quite clearly recognises

"that rising fuel prices and haulage costs create particular financial and social difficulties for individuals and businesses"

in rural Scotland. That is one of the main reasons why the Liberal Democrats at Westminster have consistently opposed all fuel duty increases since the Conservatives first introduced the fuel tax escalator. We have a sensible fuel tax policy that aims to protect rural Scotland. The position that has been adopted by William Hague's Tory party will be seen for what it is: an opportunistic and cynical move. The SNP position of calling for a cut while also calling for increased public spending is quite indefensible.

I believe firmly that the real problem is the public's perception that the Westminster Government feels that it is okay for the price of fuel to rise continuously. People are fed up with what appears to be a never-ending rise in fuel taxes. That is most certainly not an acceptable position for our rural communities. We all know that for much of the Scottish population, there is simply no alternative to travelling by car.

I want to ask about a point of Liberal policy, which promises a cap on fuel taxes for five years. Will Mr Rumbles confirm that that would still commit his party to raising fuel duties year by year in line with inflation, regardless of oil prices? Is that correct or not?

What does a cap mean? A cap is a cap. That is a simple and straightforward phrase and, if Duncan Hamilton listens, he will hear me go on to explain specifically what we intend to do.

The accepted wisdom from the Tories, and now from the Westminster Government, that there should be a deliberate move away from income tax—which is far and away the fairest form of taxation—to indirect taxation such as fuel duty, pretends that people have a choice if they want to spend money on fuel. That is a great mistake. Who does the tax on fuel hit hardest? In our rural areas, it hits the relatively less well-off harder than anyone else.

To tackle the problem of continuously rising fuel costs, the Liberal Democrats demand a real-terms cap on fuel prices for at least the next five years. We demand that any extra VAT revenues that the Government receives from the rises in fuel prices be redirected to help public transport and reduce taxes for road hauliers. We would cut vehicle excise duties for lorries, by charging foreign lorries to use our roads, and we would cut vehicle excise duty for fuel-efficient cars.

Liberal Democrat policy would leave Scotland better off. It would help to address transport problems in our rural communities, and would mean a more realistic choice of transport. We do not support the SNP motion, nor the unrealistic Conservative amendment, but urge support for our sensible amendment.

We have heard the usual rants from members of the Lib-Lab coalition: it seems that everybody is wrong but them. It has been stated that fuel tax is there to help the environment, but it has nothing to do with the environment. When someone fills their car up with £60-worth of petrol, £45.60 of that is tax. The tax is all about filling up the coffers at Westminster.

First, I want to focus on the effect on our public services of the punitive level of fuel duty that members have spoken about, especially its effect on the emergency services, which are already affected by years of underfunding by Governments of various shades. Millions of pounds have drained away through spiralling fuel costs; all that money is siphoned off to line Gordon Brown's war chest.

It is estimated that 80 per cent of emergency service funding, for police, fire and ambulance services, goes straight back to the Treasury in fuel duty. That is a ridiculous situation. Money is being given with one hand and taken back with the other. I do not see the sense in that at all.

Accountants' figures revealed recently that Scotland's biggest police force, Strathclyde police, had overspent by £500,000 by the end of the financial year as a result of rising fuel costs. Since Labour came to power, the police force has spent £14 million on fuel, £11 million of which has gone straight back to the coffers of the Treasury in London. We can ill afford to lose that money; the situation is crazy. All too recently, we heard about police manpower shortages, but we could afford to employ more police officers if the Executive dealt with the issue of fuel taxation.

Will Sandra White give way?

No, thank you.

Similarly, the fire service has incurred increasing costs. Fire board costs have risen from £4.28 million to £5.07 million and a significant proportion of that increase is due to increased fuel duties. The health service also loses money that it can ill afford to lose. The cost of fuel for ambulances has risen from £2.77 million to £3.2 million—a rise of 16 per cent over the past three years. Of that money, 80 per cent is siphoned off from health service budgets to the Treasury. That is another ridiculous situation.

Will Sandra White give way?

No, I shall not give way.

My second point concerns an issue that I have raised before in the Parliament, and that I shall probably raise again. Many people in the public sector are pushing to be allowed to use red diesel rebated fuel, which is taxed at only 3p a litre, in contrast to standard diesel, which is taxed at 52p a litre. Red diesel is available to tractors, diggers, road rollers, mobile cranes and even snow ploughs. How can the Executive justify the fact that police cars, fire engines and ambulances must pay 52p a litre in tax when those other vehicles pay only 3p a litre in tax? That situation is a wartime relic—perhaps the Executive is one too—and is no longer justified. It should be stopped now.

Will Sandra White give way?

I am sorry, but I will not give way. Andy Kerr has had his say, and the minister can deal with my point on red diesel in summing up.

If red diesel was made available to public services, millions of pounds could be saved. If the ambulance service had used rebated fuel over the past three years, £7 million could have been saved. That money could also have been used in our hospitals—in the heart transplant unit of the Glasgow royal infirmary, or in the Glasgow western infirmary, which is crying out for radiotherapy machines and for funding for updated cancer research. The money could even have been used to reduce the waiting lists for digital hearing aids. However, the Executive does not seem to see that. Members may laugh, but the people are not laughing; they are crying out for help. This is not funny.

As a matter of urgency, the Executive—or the coalition as I prefer to call it—must make representations to end this absurd anomaly. It is in power; let us see it do something about this matter.

As I have been relegated to speak in the middle of the debate, I feel like a bystander in the latest instalment of the Kenny MacAskill show. We all had a good laugh at his speech this morning. The heavy team sat behind the ministers to barrack and boo. Tavish Scott was at his best, muttering "pathetic" all the way through Kenny MacAskill's speech. When we read the parliamentary sketch in The Scotsman tomorrow morning, how we shall all laugh at what it says about Kenny.

If we take the trouble tomorrow to read what Kenny MacAskill said and to strip away the rhetoric, jibes and cheap points, we might be left with about two minutes of his speech, but it contained an irreducible core that merits careful consideration from members. The heart of his speech was not so far away from what George Lyon said at this year's Liberal Democrat conference, when apparently he spoke about the matter in hand.

Kenny MacAskill is no fool; that may come as a surprise to some members. Many sensible professional and business people take Kenny MacAskill quite seriously. The nationalists are on to a real grievance, which we—as unionist politicians in unionist parties—ignore at our peril.

It was wrong for the Executive to come to the debate today without the relevant minister to respond, and for it to line up its back benchers to say that fuel tax is not a devolved issue and that the SNP is wasting its time by debating it. Unionist government operates at European, British and Scottish levels. We address such issues at every level; if we separate them out and say that they are not our responsibility, we open up an avenue for the enemy.

On 364 days out of 365, Henry McLeish builds his status as the minister in the Scottish Parliament who deals with Westminster, the Department of the Environment, Transport and the Regions, and the Department of Trade and Industry. He says that we have matters in hand, that we make representations and that we champion the Scottish economy all the time—except when we debate fuel. Suddenly we are told that the nationalists are exaggerating, misleading and distorting. Of course they are; that is what they are good at. That is how they got to the Parliament.

When the SNP tunes into a real sense of grievance, the Executive ignores it at its peril, and there is a real sense of grievance about fuel tax. The Liberals have articulated that this morning. Mr Rumbles, who has now left the chamber, did not say what the Liberals would do to protect rural motorists, hauliers and haulage customers, but he articulated the grievance. What are we doing about that? I mean all of us—the Parliament and the Executive. What have we done, in more than a year, about high fuel prices in rural areas? Members must not think only about people in the Highlands and Islands who pay the high prices. We must think about the rural areas where people feel that they are disadvantaged.

Will Mr Tosh give way?

No. I have answered all George Lyon's points.

He did not make any.

That is right.

Throughout Scotland, there is a sense of grievance that we have not addressed. A parliamentary committee has started off down that road. It has identified that high fuel prices are the inevitable consequence of low turnover in remote rural outlets. What will we do about that? There are mechanisms to deal with it. Fergus Ewing mentioned derogation, which is probably not relevant, but are we willing to consider subsidy and fuel duty rebate? Are we willing to do anything? Has any political party in the Parliament presented a properly thought-through policy to deal with the problem? [Members: "Yes."] Well, I did not hear it, but I would be delighted to. We certainly did not hear it from Mr Lyon, who is nodding vigorously.

The job of the Parliament and the Executive is to represent Scotland in the union to deal with this problem for rural areas, including the Highlands and Islands. If the Executive adopts the Brian Wilson position of contemptuously turning its back on the people with whom it disagrees, it should not be surprised when Kenny MacAskill runs his sgian-dubh between its shoulder blades.

Contrary to what Murray Tosh said, I have an articulated argument. As I said in an intervention during Fergus Ewing's speech, the Highlands are being crippled by the high cost of fuel, as are other rural areas.

High levels of fuel taxation are imposed for environmental purposes. However, pollution from the Highlands is a drop in the ocean to what comes from Edinburgh, Glasgow, London or greater Manchester. For that reason, there is a special case for rural areas.

As I have said before, the higher the price of fuel in the Highlands, the higher the VAT we must pay and the harder it hits us in the teeth. One cannot take a broad-brush approach to the fuel issue in Scotland or the UK generally.

Running an ancient Peugeot 205, which is a necessity in the Highlands, is entirely different from the luxury of a second BMW for someone in London SW6. That is why there is strength in the VAT argument. I am sorry that Murray Tosh said that derogation is not worthy of consideration, as I believe that it most certainly is.

I did not say that—will the member give way?

I will not give way to Murray Tosh, but if he says that I have got that wrong, I accept what he says.

Derogation is the way forward. We should have, on the European model, lower VAT in Scotland's rural areas. That is the one way in which we can underpin those fragile economies. That model works in other parts of the EU, and we should duplicate it here.

I must press this matter with the minister. I asked Ms Boyack about it some weeks ago and was told that it was being discussed in the UK Government. I make no apology for pressing the issue again. I will continue to do so until we get a fair deal for fuel in the Highlands.

I will address three matters. First, I will address who is responsible for the current situation. Secondly, I will address what we are going to do about it. Thirdly, I will spend some time on the various measures that have been proposed, in particular by our friends on the Liberal benches.

Friends?

That was a joke.

The debate used to focus on who was to blame—the Organisation of the Petroleum Exporting Countries or the oil companies—but we have passed that stage. It is interesting that nobody—apart from the sycophant—has disputed the fact that the Government is largely responsible for the position that we are in.

Will the member give way?

No.

Murray Tosh made an interesting point a few moments ago. He said that it is wrong to suggest that Parliament does not have a role to play. If Parliament is to represent the interests of the Scottish people, it is vital that Parliament takes the agenda forward.

Murray Tosh and I disagree about the role of Parliament. I want it to deal with fuel taxes outwith the union—he would rather that it did so within the union. The point on which we agree is that we need radical, original and creative thinking. We have not heard a great deal of that—certainly not from Liberal members.

Members will know from our motion that the SNP proposes a substantial package of measures: we promise an immediate cut in the rate of fuel duty; we promise immediate measures for fuel-dependent industries; and we promise an immediate summit for all those who are involved to plan a long-term strategy. That is immediate action, which can be set against the long-term inaction of the Executive and the Westminster Parliament.

The baying that we hear from the savages on my right brings me to the Liberals' position.

Will the member give way?

No. I want to deal with the points that were made by one of Mr Stone's colleagues. [Interruption.] Presiding Officer, perhaps you could control those people.

Mr Lyon said that the matter of fuel rightly rests with Westminster. Why is that right? Liberal Democrat members are meant to belong to a federal party and Mr Lyon is on record throughout their election campaign as saying that he believes in independence. However, Mr Lyon and his federal party believe that while they represent their Scottish constituents, it is right that Westminster should deal with the biggest issue in Scottish society. That is an abdication of the Liberal Democrats' role, which shows how far they have moved.

The Liberals announced their policy today. They point out correctly that their policy is to cap fuel tax for five years. I will quote from The Economist of 23 September—hardly a radical nationalist magazine—which analyses the Liberal policy. It states:

"Read the small print, and they are far from promising a cut in fuel tax. Mr Kennedy"—

I remind Liberals that he is their leader—

"in an emergency debate on the fuel crisis on September 18th promised a cap on fuel taxes for five years ‘in real terms'. This would still commit the party to raising fuel duties year by year in line with inflation, no matter how high the world price of oil rises."

That is the fact.

The magazine continues:

"Given the current public mood, this may sound like electoral suicide."

Frankly, given the Liberals' standing in Scotland, would the people know? Would they care? Would they notice? I do not think so.

It is wrong of the Liberal party—just because it has taken Labour's shilling—to pretend that it would cap fuel prices. It would not. Under the Liberal party's policy, fuel duty would continue to increase in line with inflation. The Liberal party supports that and will answer for that disgrace at the next election.

It is clear to Parliament—if only from the frequency with which the SNP uses its parliamentary time to debate fuel duty and other reserved matters—that the SNP thinks that it mines a rich vein of political opportunity. That is telling, because the SNP has nothing to add to the debate. Like the Tories in Bournemouth this week, the SNP has no vision. It has not thought through a position on the future of Scotland. It reacts to events and is tossed and turned on the ebb and flow of populist opinion. On a different day, in a different place and to a different audience, the SNP would present a different policy.

One SNP member says "derogation", one says "environmentally friendly" and another says "freeze the duty". One says "cut it by 2p" and another says "cut it by 10p". Duncan Hamilton wants to run the UK economy, but no SNP member wants to stand for election to the Westminster Parliament.

Duncan Hamilton took no interventions, so he cannot expect to intervene.

The Government listens and leads. We have listened to the concerns of drivers, but we also listen to those who tell us that 18 years of Tory rule did immense damage to our public services. We know that that is true and we are committed to reversing that damage and to building better public services. We will hold strong to our commitment to record spending on the national health service and to making education a priority—with record spending. We will also hold strong to our commitment to record funding for law and order.

The SNP built the fuel tax escalator into its economics of independence. How will it make £100 million of cuts in Scotland in its spending plans? We know how the Tories would make their cuts—at least they are honest. They have planned to make £16 billion of cuts through having fewer teachers, fewer nurses and fewer policemen. Where would the SNP make its cuts?

Duncan Hamilton blames the Government alone, but we acted in concert with our allies. Fuel prices are a global problem. Last year, the four leading oil companies—all multinationals—were expected to double their profits to $35 billion, but there has been a massive contraction in global oil prices and world oil demand. Last week, the United States Government released millions of barrels of oil from its emergency reserves to avoid a crisis. Such action was last taken during the Gulf war.

Can anyone imagine the insular nationalists appealing to international opinion? Would kailyard Kenny MacAskill—wherever he is—ask OPEC to drill for more red diesel?

Although Fergus Ewing tells the European Commission that Scotland wants to play a full role in Europe, he ignores the fundamental principle of the single market and derogation.

Does Allan Wilson go along with Andy Kerr's denial of the officially stated Labour party and Treasury policy of increasing excise duty by at least the rate of inflation at the next budget? Is it true that Labour's policy is founded on the idea that fuel tax is too low?

That is not what Andy Kerr said, nor is it Labour party policy.

Only yesterday, the European Union adopted the terms of a communication on the EU's oil supplies. The communiqué that was issued mentions

"increasing the consistency of national policies and strengthening a common approach . . . resisting the temptation to offset oil prices by cutting and aiming to harmonise excise duties between Member States, in particular by raising minimum taxes".

The EU is trying to address the real problem of the rise in global oil prices.

The nats refer to their green credentials, but it is easy to have such credentials. Dr Richard Dixon, the head of research at Friends of the Earth Scotland said of the SNP:

"Instead of developing serious strategies they are trying to score cheap political points by pretending to be the motorist's friend."

SNP members are undoubtedly trying to be the in-crowd, but that only shows their inconsistency and incompetence. Such a policy has led to a gap in their budget proposals as big as the hole in the ozone layer.

Furthermore, the SNP's inconsistency and incompetence is a symptom of something much deeper. Like the Tory party, it has no constructive vision. Instead, it sees every problem as a problem of the Executive's making and every difficulty as a political opportunity to be talked up and aggravated to gain a few votes.

Will the member give way?

Sorry, I am just concluding.

The SNP does not want to share the problem—that might help to find a solution that would benefit Scotland and its people. The fact that the party has no positive policies and is not interested in helping to govern Scotland is proven by the way in which SNP members return to the issue time and again. The Scottish people will quickly realise that.

We move to the winding-up speeches. Tavish Scott, you have four minutes.

This will be funny.

I thank Tricia Marwick for that warm welcome.

This is an important debate; it is right that MSPs should raise issues that are so important to all parts of Scotland and the Scottish economy. However, it is also right that MSPs should respect the fact that only the Westminster Parliament has the right to change UK tax policies. Murray Tosh's interesting speech highlighted not so much his link with the SNP on the issue, as the fact that the Scottish Tories have no MPs. They are not keen for the matter to be debated at Westminster because they have no members there. To be frank, after listening to Malcolm Rifkind on the radio this morning, I do not think that they will have any MPs after the next general election either. Murray Tosh and Kenny MacAskill also had a veritable love-in for a minute or two.

The Tory party's transport policy changes every day according to which bus goes past. Although Annabel Goldie said that it was all right to cut taxes, she missed the point that was made by so many members from rural, island and remote areas. Jamie Stone, Fergus Ewing and others rightly highlighted the fact that in such areas fuel can cost 8p to 15p more per litre than the average price in Scotland. Annabel Goldie and the other Tories clearly do not give a damn about that—we will hold them to account for that attitude at the next election.

Will Tavish Scott give way?

No.

Jamie Stone said rightly that derogations have merit and should be considered properly and pursued. Fergus Ewing could have been more accommodating on that point.

I did not ignore that issue in my speech. The problem with derogations is that they require EC consent, but such consents are rarely given and only in difficult circumstances. It might be more realistic to find out whether some form of fuel duty rebate is available. Should not we investigate such solutions through our various political opportunities, channels and committees and press for them to be identified and implemented?

Murray Tosh's remarks seem to be constructive until we consider the Tory attitude to Europe. Every day this week, we have seen on our television screens a Tory party that hates Europe and that would do anything to get out of Europe. The Tory party's main funder—who is to spend £20 million on the party's next general election campaign—spent money on the recent referendum in Denmark. I will take no lectures from the Tory party about Europe. In the 1993 budget, Lord Lamont of Lerwick increased fuel duty by 10 per cent, established the fuel duty escalator and increased fuel prices by a further 3 per cent above inflation—three more taxes for the consumer. That followed the Tories' election campaign in which they said, "No new taxes." We had a lot of new taxes—22 in all.

What about today's Tories?

Will Mr Scott give way?

No, I will come to Annabel Goldie in a moment.

What of William Hague's Tory party—or, after the public confessional on Tuesday, I should say Michael Portillo's Tories—which, I presume, the Tory group in the Scottish Parliament signs up to? William Hague's Tories have the attention span and consistency of a tabloid news editor. The story of the day becomes the Tory policy of the day. To propose a cut in duty after last month's protests is not the action of a responsible party, in terms either of energy policy or fiscal policy—the phrase "blithering nonsense" comes to mind. William Hague's Tories are nothing but knee-jerk opportunists.

As for the nationalists, how many policies do they have? I have counted their policies and today we heard about two more. Let us go through them all. "Paying for Scotland's Future" was one policy. There was no reference to the matter in the party's 1999 manifesto, "On to independence". That makes two policies. We heard John Swinney's policy on 10 July. That makes three. The party suggested a freeze on duty in a parliamentary motion. That makes four. Alex Neil suggested another 20 per cent cut. That makes five. Where is Fergus Ewing? There here is. His proposal made it six policies. Now—to top it all—Kenny MacAskill's motion represents policy number seven. We have heard seven fuel policies from the SNP.

On top of that, we heard great protestations of gloom from the SNP on the radio this morning, when it criticised this debate in the Scottish Parliament. It said that the matter should undoubtedly be debated here and nowhere but here. However, the SNP is sending nobody to Westminster. That party's people are not down there, arguing where it matters. The SNP does not care about Westminster. It has given up on Westminster, but Westminster is where it matters. That is why the Liberal Democrats and Labour send people to Westminster to argue the Scottish case. The SNP is not standing up for Scotland—it has given up on Scotland in that chamber.

As George Lyon rightly pointed out, 50 per cent of the SNP's Opposition time is spent on reserved matters. Duncan Hamilton always attacks George Lyon. What Duncan cannot accept is that George beat him and will beat him again and again.

Will the member give way?

No. I am just finishing.

Liberal Democrats would use investment to support public transport and to support targeted measures for rural and island Scotland. The Liberal Democrat MPs at Westminster have voted against every fuel rise since Norrie Lamont's budget. We have consistently argued for measures to deal with the problem.

It is time for the taxpayer and the motorist to get a fair deal. The policies on investment in public transport and targeted measures for our rural areas will clear the way for that.

We have had an interesting morning. Some major changes in personality have occurred. We saw an almost dignified Mr MacAskill, but I would like to know what Tavish Scott had for breakfast, because it certainly affected him.

Danish bacon.

George Lyon warned me that he wanted an intro for that one.

For Labour, Mr Kerr started with what I almost took to be humility and that is not his usual style. He then went green—but he remains greedy. What has Labour done in three years? Its members talk about the years that we Conservatives were in power. Labour has been in power for three years and what has it done, but increase the price of fuel one way or another in that time?

What about the 222p?

It would be helpful if Mr Rumbles would quieten down for a wee while.

Will the member give way?

Not at the moment.

Fuel duty has a disproportionate effect in Scotland because of distances to markets. Others have said that the Conservatives do not care about rural Scotland. I am sorry, but I represent a rural area. All sectors of the rural economy are being damaged by taxation by the Labour party at Westminster.

Allan Wilson's speech was just a load of emotional blackmail. It was the old story: if people want a hospital, they must pay up through fuel charges. That is the usual line from old Labour. He went on to talk about the £16 billion cuts that we are apparently going to make. How could we cut something that has not been delivered? He should grow up.

The SNP started off on the theme of punishment, which is usually a good subject for the SNP, before it got on to independence—an unusual line of attack. Mr Ewing said that the SNP will work towards equalising tax on a European basis. How? What measures will be taken? At what cost? How will that be paid for? When will the SNP have an opportunity to deliver that?

Do the Conservatives—who say that they want to be constructive today—agree that the people of Scotland want the same level of fuel tax as the average level in Europe? Every party in the chamber should agree to that aim.

I do not argue with Mr Ewing—I ask how that would be delivered. He gave us a vision, but no plan of how to achieve it.

Mr MacAskill suggested selective packages for virtually every industry. What a bureaucratic nightmare. The cost of that would be quite disproportionate. We must consider cuts across the board to ensure that everybody reaps the benefits, because everybody is affected.

The price of competitiveness that Scotland pays cannot be sustained. The Government must hear that point. That price is hitting the rural economy, where almost everything moves by road and there is almost no opportunity to use public transport. The essential car user has had enough.

The Liberal Democrats, through Mr Rumbles, told us that the Government should not listen to the people. That was a strange comment. The Conservative party listens to the people and will deliver. I do not know whether Tavish Scott included the new Liberal Democrat policy on his list, but it is this: indirect taxation will not be pursued but there will be higher direct taxation. That will kill investment and enterprise. The Liberal Democrats might like to clarify that later in the day.

Mr Lyon promised to renationalise rail, although I am not quite sure what that has to do with the fuel tax debate. His party still talks about raising fuel tax, but none of its members has said what they are proposing for taxation in the future.

Tavish Scott was, as I said, extremely excitable this morning. He got on to his usual point about Tories and the EU. However, we like the Common Market—we went into the Common Market—but we do not like having to swallow every piece of legislation that other EU countries think is good for them, but which does not suit Britain. That is the difference between us and the Liberal Democrats.

Does Mr Davidson agree that what has come out of the Conservative party conference this week has been Euro-sceptic all the way down the line, including the shadow Chancellor of the Exchequer's speech on Tuesday? Their message has been: "We don't want to be part of Europe and we will do what we want." The Conservatives want to get out of Europe.

Our position is clear. We want to be in Europe, but not run by it. That is the end of that.

It is right that the Scottish Parliament should discuss all matters that affect Scotland. The view that fuel duty can be discussed only in Westminster is a cop-out and makes no sense. The Scottish people expect the Scottish Parliament to discuss the issues that matter in Scotland. The job of the Executive and the minister is to make sure that that message is passed to the Cabinet in Westminster.

We said that our policy is to reduce fuel tax across the board. The content of Miss Goldie's amendment is a direct response to the public, to whom we have listened. I must point out that we did not make such a move in the middle of a strike—we waited until the situation had calmed down before we made a move. We agree that a strong Government must be a sensitive Government and should not make knee-jerk reactions.

I beg the minister to take the messages that he has heard today back to the Executive and down to Gordon Brown. Scotland has had enough of the Government's fuel taxation policy.

It is enlightening to listen to the Tories talking about the necessity of debating the matter in a Parliament that they opposed so vehemently.

Whenever I hear Kenny MacAskill shout his speeches in the chamber, I wonder whether he has an overdeveloped sense of humour or is an absolute fantasist. Whatever the answer, he would have been an excellent deputy leader of the Scottish National Party. I was also interested to note that the nationalists have turned out in force today—they have filled all their seats. It is interesting to recall that when my colleague Sarah Boyack set out her transport spending plans for Scotland last week—announcing £500 million for Scotland—those seats were empty. In that statement, she announced more money for trunk roads, local roads and public transport—much-needed resources for Scotland's transport infrastructure.

Kenny MacAskill talked about fuel duty rebate being extended to the haulage industry. We must ask him which part of public spending in Scotland he would cut. It is always a pleasure to respond to my friend, Fergus Ewing. I could not help but note that—this is merely a passing observation—when one of my colleagues criticised the Tories, the first member on his feet was Fergus Ewing.

Mr Ewing should know well that EC derogation on fuel prices in rural areas applies only to existing schemes. He chose to ignore the assistance for rural petrol stations and reductions in vehicle excise duty for smaller cars.

Will the minister give way?

I must respond to the points that Mr Ewing made in his speech. He expects swingeing rises in vehicle excise duty in the next budget. The fact is that measures in the previous two budgets have cut £400 million from motorists' car tax bills. That includes a cut of £55 in VED for the drivers of 4 million smaller cars.

It is always a pleasure to explain matters to Sandra White. She talked about red diesel, which is a concession for off-road vehicles. Again, I explain that those vehicles have that concession because they use public roads rarely and do not contribute to congestion or wear and tear on roads. She claimed that the level of fuel duty was nothing to do with the environment. It is estimated that the increases in fuel duties over the past four years will, by 2010, have saved emissions of 1 million to 2.5 million tonnes of CO2 per year.

I hear what the minister is saying. Does he mean that when people are unable to drive on roads in winter, he can make the excuse that road gritters—which get rebated fuel—use the roads only occasionally?

Another devastating intervention from Sandra White, Presiding Officer.

I remind members that budget increases in duty and VAT on unleaded petrol and diesel is the lowest since 1989, at 1.9p per litre. On average, that will cost less than £2 per month for people who travel about 9,000 miles per year.

As much as the Opposition—the nationalists—may malign the Chancellor of the Exchequer, the budget was good news for Scotland. Measures in the previous two budgets cut £400 million from car tax bills. Scotland's motorists and businesses will gain from lower fuel duty increases and many motorists and hauliers will gain through lower vehicle excise duty.

In future, fuel duty rates will be set budget by budget. The chancellor has also made the commitment that any real-terms rises in road fuel duties will be lower and the revenues will go straight to a ring-fenced fund for the modernisation of roads and public transport.

I will highlight some of the transport initiatives that were announced recently by the Executive. The list is long, but I will mention only a few. I cite the rural transport fund for 2001 to 2004, which will be increased by about £18 million as part of the spending review. Support for lifeline services in 1999-2000 was at record levels; the highest ever level of subsidy went to Highlands and Islands Airports Ltd. The revenue subsidy for Caledonian MacBrayne Ltd was also the highest ever, at £15 million. Two CalMac ferries have been ordered since 1997 and both orders were won by Scottish shipyards.

Those figures and initiatives illustrate clearly the Executive's commitment to rural Scotland and to island communities. The investment is not only in transport, but in industry and jobs.

I turn now to rural fuel and the oft-cited Office for Fair Trading report into high fuel prices in the Highlands and Islands. That recently published report identified high costs of distribution in remote areas and low turnover as key factors. It found no evidence of profiteering on the mainland or the northern isles, but the OFT will undertake further investigation into unexplained price differentials in the Western Isles. I can assure members that I will take a keen interest in their findings.

Following the OFT report into fuel prices, a contract has been awarded for a study into bulk purchasing of fuel. The consultation exercise is already under way. It would be premature to speculate on the outcome of that study.

I will finish on another important initiative. Liquefied petroleum gas is not only cleaner than traditional fuels, but cheaper by up to 5 per cent. We are making an additional £0.3 million available in 2000-01 for powershift vehicle conversion schemes in rural areas, which will encourage more people to convert their cars to LPG. The recent spending review increased powershift funding by almost £1 million for the years between 2001 and 2004. Following discussions with the Government, Shell UK has begun a programme of introducing 23 LPG outlets in the Highlands and Islands and the rural north-east. I know that Kenny MacAskill denounces that, time and again. Those are just a few of the significant Executive initiatives of the past 14 months.

Finally, to respond to Tricia Marwick's point of order at the beginning of the debate, it has been both an honour and a pleasure to respond on behalf of the Executive.

That was interesting—it is good to see a minister make such a sturdy defence of the chancellor and his fuel tax rises.

The SNP stands accused of wanting to discuss reserved matters in the Scottish Parliament. Some people have had a go at that, while others have said that it is okay. Things were different when we raised pensioners' issues and the Act of Settlement. When the heat is on, the Executive does not like it. That is why we have heard some spin today.

Incredibly—but not surprisingly—we have not heard the word "listen" once from the Labour, Liberal Democrat or Tory benches.

If David Davidson used the word, he was the only member of those parties who did—I apologise to him. Examination of the amendments that were lodged by Annabel Goldie and George Lyon and the language that was used in support of them reveals that the Tories and the Liberal Democrats have fallen into the same trap as the new Labour Government—

Will Mr Crawford take an intervention?

I will take a leaf out of Sandra White's book. The Executive has had the chance to listen to the Scottish people's views on fuel during the past few weeks, so the deputy minister should sit and listen to me on the issue. [Interruption.]

Order.

Like the Government, the Executive wants to foist on the people solutions to an extremely complex and serious situation. Quick soundbites will not provide the answer, but pragmatism and common sense might.

When will the unionist parties—I except Murray Tosh from this—learn that politicians do not have all the answers? When do they propose to talk to and listen to our farmers, hauliers and fishermen to find out what they think is important? As our motion shows, the SNP wants to establish a summit of interested parties and to begin a dialogue, to listen and to help find a lasting solution.

Many members have, understandably, become hung up on the fuel tax escalator, but if we are to get to the bottom of the issue, we must examine Gordon Brown's statement of intent on taxation policy. In July 1997, he set himself and the Government four key tests for what he saw as good taxation policy. First, such policy must be well designed to meet objectives without undesirable side effects—that is a beauty. Secondly, it must keep dead weight compliance costs to a minimum. Can we see that happening with fuel tax? Thirdly, distributional impact must be acceptable. Fourthly, a care must be had for the implications for international competitiveness. Andy Kerr may look through his notes, but I bet that he will not find that.

The chancellor set those four tests, but he and the new Labour Government have comprehensively failed to pass them. The failure is clear for all to see. As far as undesirable side effects are concerned, we can say pretty safely that something undesirable happened in the past few weeks—fuel was in short supply and the life of the nation was grinding to an abrupt halt.

We need only ask our farmers, fishermen and hauliers—and, indeed, our hoteliers—about the dead hand that crippling tax costs place on their businesses. Even George Lyon would agree that there is a big difference in distributional impact between rural and urban Scotland. He would also agree with the points that were made about low-income car-owning households. However, it is in competitiveness that we see the chancellor's biggest failure.

Will the member give way?

When Mr Stone listens to people in Scotland, I will give way to him.

Andy Kerr said that the price of fuel was not too high.

Will the member give way?

Scotland has the highest fuel prices in Europe. The average cost of the hauliers' tank in Europe stands at £350, while in Scotland it is £868.

Order. The member is not giving way.

Gordon Brown's tests have been blown out of the water. It is time that he and Tony Blair swallowed a couple of humility pills. They should start listening to people and put matters right before Scotland finds itself on the brink again.

I thank Bruce Crawford for giving way—people will talk about us. I am all for listening to the public, but I am also all for telling the public the truth. Will Mr Crawford tell the truth to the people of Scotland—and to the people of the UK, if he wants a wider audience—and admit that the increases in fuel costs are not the result of taxation by the Labour Government? Motoring organisations recognised that the previous budget was the best motorists' budget for years. Will the member acknowledge that?

Well, I am really reeling now. Will Cathie Craigie tell us how her party raised an additional £5.17 billion in oil revenues and an additional £500 million from VAT?

The action that was taken by our farmers and hauliers represented an outpouring of anger by ordinary people over unreasonably high taxation on a vital commodity. However, it was not only the farmers' and the hauliers' protest: it was the people's protest. The First Minister asked in the chamber who the protesters represented. As far as I am concerned, the people who stood at the gates in Grangemouth represented me and millions of other Scots who are fed up with paying Gordon Brown's tax.

The people of Scotland—an oil-rich nation—cannot understand why we must fork out more for fuel than people in any other country in Europe do.

I have seen Pop Up Pirate jumping up and down all day—I have had enough.

The protesters, who were backed by a huge majority of the people of Scotland, sent a wake-up call to new Labour. Unfortunately, new Labour has not listened. Today, the SNP has given Parliament the chance to send its own message to the new Labour Government. The Government should sit down with our hauliers, our fishermen, our farmers, our people in the tourism industry and others and give them the relief that they so desperately require. If new Labour sits down with those people, it should really listen to them.

The people will say that the situation is like Chinese water torture and that they do not know how long they will be able to stand the pain, so the Government should stop attacking them and give them relief now. There is no need for the Labour party to prove how tough or strong it is; it is time for listening and for common sense and pragmatism. If new Labour is not prepared to do that simple and dignified thing, it should pass the powers to decide on fuel taxes and other fiscal matters to the Scottish Parliament—let us sort out Labour's mess.