'Opportunistic' Tories promise cut in fuel duty

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The Independent Online

The pressure on the Government to cut fuel prices mounted yesterday after the Conservatives pledged to reduce the duty on petrol by at least 3p a litre.

The pressure on the Government to cut fuel prices mounted yesterday after the Conservatives pledged to reduce the duty on petrol by at least 3p a litre.

William Hague and Michael Portillo, who refused to promise a cut during last week's fuel protests, announced that an incoming Tory government would reduce the price of both petrol and diesel.

As Labour accused the Opposition of "opportunism", the Tories insisted the £1.1bn-a-year cost could be met from the "war chest" of Gordon Brown, the Chancellor, and higher than expected Government receipts of at least £5bn. If the Treasury no longer had a surplus, they would finance the move from the £3bn of social security savings they had identified.

Mr Portillo, the shadow chancellor, said the move would save a family with a Ford Mondeo £1.85 every time they filled up their tank. "The reduction that we propose is prudent, achievable and moderate," he said.

Accusing the Tories of a U-turn, Labour reminded Mr Hague that last week he said he would not cut taxes because of the protests, saying: "You can't run a country like that."

Alistair Darling, the Social Security Secretary, said: "The Tories may be serious opportunists but they are not a serious Opposition."

The Tory announcement was marred by Liberal Democrat claims that the Opposition colluded with hauliers to stage last week's protests. Bernard Jenkin, the shadow transport minister, was challenged to explain his position after admitting he had advance knowledge of the demonstrations.

Mr Jenkin's wife told a local newspaper in Essex that she and her husband were informed before they went on holiday two weeks ago about the protests. Don Foster, the Liberal Democrat environment spokesman, said: "The implication, if correct, is clear that there was some form of collusion between the Conservative Party and the hauliers and that clearly begs the question of whether there was deliberate collusion against the present Government."

Mr Jenkin said that he had received a fax from hauliers and others informing him that there would be a go-slow protest on 18 September, but had announced this on BBC Radio. "I had no knowledge that they were going to block fuel depots. There's no conspiracy here," he said.

Labour hit back demanding an investigation into Mr Portillo's links to a major US oil company. They accused him of "a conflict of interest" because he is paid up to £10,000 a year by Kerr McGee, an oil company with big financial interests in the North Sea.

The parliamentary standards watchdog has been asked to investigate whether Mr Portillo should have declared his links with the company when he made his announcement of a 3p cut in petrol duty yesterday. Kerr McGee, an Oklahoma-based oil and chemicals firm, which has several UK subsidiary companies, produces 121,000 barrels of oil a day from the North Sea.

"It's a clear conflict of interest and people are entitled to ask the question of whether he is working for the Conservative Party or an oil company," said the Labour MP Fraser Kemp. "If people want to be on the frontbench they shouldn't have obvious financial interests in policy they are making."

MPs are currently required under Commons rules to declare financial links to businesses if they speak in Parliament on an issue from which the company could benefit. But they do not have to mention them when making policy statements outside Parliament.

The shadow chancellor has declared his links to the company in the House of Commons Register of Members' interests, where he says he is an "adviser on international affairs to the Kerr McGee Corporation".

The pressure on Mr Brown to cut fuel duty intensified yesterday as the latest snapshot of the public finances showed a surplus of £300m last month, the first time the Government has been able to repay debt in August for 12 years.

It takes the surplus in the first four months of the financial year to £19.47bn, compared with just £200m a year ago. Ironically, the Treasury benefited from a £300m payment by the North Sea oil companies. These revenues, which are a tax on production, have been boosted by the recent surge in the price of crude oil.

* Brussels is investigating the deal offered by four European governments to end their fuel protests amid suspicions that subsidies offered to truckers or farmers may break EU law.

As Europe's transport ministers met yesterday to discuss the crisis, the European Commission asked France, Italy, Belgium and the Netherlands to list the concessions they offered.

Those who bought off the protests now have a month to explain the detail of the packages so that Brussels can determine if they have breached competition or internal market rules.

* A Welsh radio station blamed for sparking the panic buying of fuel that threw parts of Britain into renewed chaos on Tuesday was cleared of scaremongering by a broadcasting watchdog.

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