Remote islands could see fuel duty cut

Fuel prices in Britain’s most remote areas could be reduced by five pence a litre, under new Government plans.

Chief Secretary to the Treasury Danny Alexander, addressing a Liberal Democrat spring conference in Perth, said the proposals were being brought in to help those living in areas where their remoteness leads to them paying more for their fuel.

Mr Alexander said: “We will be submitting a formal application to the European Commission to deliver a 5p discount on fuel duty for Highland communities, the Northern Isles, the Inner and Outer Hebrides, the Islands of the Clyde and the Isles of Scilly too. These are places, more than anywhere in the country, feeling the pressure of high fuel prices.”

However, whether this proposal comes to be reality will be decided in the EU courts rather than in the Commons. In what could be yet another battle between UK policy and European law, it will be up to the EU whether it goes against its law that states duty should be uniformly imposed across a member state.

We will be submitting a formal application to the European Commission to deliver a 5p discount on fuel duty for Highland communities, the Northern Isles, the Inner and Outer Hebrides, the Islands of the Clyde and the Isles of Scilly Chief Sct. of Treasury Danny Alexander

The price of fuel across the country has peaked at £1.36 per litre but petrol on the Shetland Islands, for example, is as high as £1.46 per litre. This has led to arguments from the Scottish National Party that the proposed 5p duty cut does not go far enough and will not actually cover mainland rural areas.

SNP MP Angus McNeill said: “The Lib Dems need to stop delaying and start delivering for motorists in rural areas. Fuel prices are already so high in the islands a 5p discount will still leave us higher than many areas on the mainland.”

Mr Mc Neill went on to explain how this was far from a new policy for the Liberal Democrats, but another example of where they are failing to impose their policies: “Danny Alexander made the same announcement in his autumn conference speech last October, it sounded good, but the only thing the Treasury has delivered since then are even higher fuel prices. Just why are they dragging their feet on this policy?

“If Danny Alexander wants something new to say in his speech he should commit to cancelling the rise in fuel duty planned next month, and introduce a fuel duty regulator to bring fuel prices down for everyone.”

Speaking to the Western Morning News in relation to southern island communities Mr Alexander said:

“There are still European hurdles in the way. We have to get initial agreement, then we have to get all 27 member states to agree by unanimous voting for us to do this. So it is not without its hurdles. For those areas affected it will be significant, including the Scilly Isles where I know prices are very high.”

Proposals for a fuel stabiliser, a duty index tied to the price of fluctuating oil stocks, has also been proposed. However, the remote areas policy proposal has been supported by a number of ministers including Deputy Prime Minister Nick Clegg, wary that mass alterations on duty may not fall in line with national taxation demands.

As Mr Alexander put it last month: “We’re considering the fair fuel stabiliser idea, but I stress we need to make sure as a country we are bringing in the tax receipts we need to stabilise our financial position.”