The FairFuelUK campaign raises a number of issues pertaining to fuel prices, and I welcome the progress that the Government has made on this issue. As a fellow driver, I am acutely aware of changing fuel prices and the cost of gas at the pump, and understand the importance of low fuel costs for families and businesses.
Annually, fuel prices continue to drop for consumers. The Government’s plan for fuel duty has developed in response to this drop. In the year to August 2016 alone, the price of gasoline dropped by 2.6%. These drops in fuel costs contribute to the low rate of inflation, and relate directly to the fall in the cost of oil from the middle of 2014 to the beginning of 2016. This low rate of inflation keeps costs low for the average consumer and contributes to our economic stability.
I appreciate the significance of fuel costs to business and household expenses, as does the Government. Motorists paid the price of high fuel for many years, and they should not pay extra costs when oil prices fall, as this would clearly be an undue burden. Hence in the 2016 Budget, the Government decided that the main fuel duty would remain frozen for the sixth year in a row. This freeze saves drivers £75 a year on average in comparison with the taxation plans in place before 2010.
The UK market competition monitoring body (the Competition and Markets Authority), conducted a thorough investigation of the fuel retail market in 2013, and found no evidence of anti-competitive behaviour or pump price fixing. The Government continues to offer reduced duty rates on alternative fuels, such as natural gas and biomethane, to incentivise clean fuel use. Going forward, I hope that we can continue to keep fuel affordable for drivers.
I appreciate the Government’s efforts to keep fuel prices low and to promote clean energy use by consumers. We will continue to address fuel prices and keep the tax burden low for consumers.