The General Election is just around the corner and essentially no one knows what’s going to happen. The polls are telling us that no party is set to win a majority, meaning the Tories and Labour and will need the smaller parties to help them pass anything into law.
With petrol prices still far above pre-recession levels, many motorists are hoping the next government will attempt to bring them down. Here’s a look at what the major parties have said on the issue.
The Labour Party
May could see the return of the Labour Party to power, but their manifesto is light on any details regarding petrol prices. In fact, there’s not much on transport at all, but we can make some intelligent guesses on what actions — if any — they might take in regards to petrol.
A think-tank — the Centre for American Progress — which has links to Ed Miliband and Ed Balls, the would-be Chancellor in the case of a Labour victory, has called for the fuel duty to be increased by 82 percent. That’s a staggering increase which would heap a hefty extra cost onto motorist’s shoulders.
That increase would make filling up a Ford Fiesta cost an extra £22 each time — a significant rise for many in the UK. But let’s not get ahead of ourselves. Neither Miliband nor Balls have talked about an increase in fuel duty, although it hasn’t be ruled out. In December there was talk of an inquiry into forecourt prices, but this would have been aimed at suppliers and retailers — it doesn’t mean Labour won’t raise the fuel duty.
It’s worth remembering the fuel protests back in 2000 were brought on by much smaller duty increases. It’s highly unlikely the Labour Party would risk causing even larger demonstrations on the whim of an American think tank, but it doesn’t mean they’re not listening.
Fuel duty isn’t the only factor though, we’re also paying VAT on our petrol. This is something we have some actual detail on. The Labour Party have explicitly ruled out raising the tax meaning that drivers will be safe from that at least.
The Conservatives
The Tories also fail to mention petrol prices in their manifesto, but we can use the graph above to see what they’ve done while in power. It’s a mixed bag: three rises, one drop, and then a four year freeze. That’s been fairly good news for motorists recently, but what about the future?
The current Chancellor, George Osborne, recently launched an investigation into petrol companies to find out why cheaper oil did not mean cheaper fuel for motorists, but that’s all we know. As previously mentioned, looking to petrol companies for change doesn’t mean the fuel duty won’t be increased, although he did scrap a planned rise for September this year.
This means we can expect the fuel duty to stay frozen most probably until the end of the year, although that could change. When it comes to VAT, despite Labour accusations that the Conservatives will increase it, Cameron ruled out doing so for five years if he wins. Although he said he wouldn’t raise the tax if he won the 2010 election, then proceeded to do so anyway.
The Liberal Democrats
The Liberal Democrats are still on track to hold a respectable amount of seats. They’re also the only party that Labour or the Conservatives would be likely to form a coalition with. Nick Clegg has said they will join with whoever has the ‘greatest mandate‘.
The Liberal Democrats have claimed the freezing of fuel duty as a victory for their party, so it’s likely they’ll want this policy to continue. They’ve also criticised companies for not passing on savings from cheap oil onto their customers.
Combining these two positions, it’s very likely that Clegg will push their coalition partner to keep petrol prices down. With no strong policies on fuel duty and costs from either Labour or the Conservatives, the Lib Dems could wield enough influence to avoid making motorists pay more for fuel.
The Nationalist Parties
The SNP are set to surpass the Lib Dems in number of seats this May and so they need to be factored in, while Plaid Cymru will also have their part to play in Parliament.
The SNP have attacked high petrol prices, so it’s likely they’ll adopt a similar position. They previously called for a fuel price regulator to bring costs down, while more recently said that extra North Sea oil revenue due to higher oil prices should be used to reduce fuel duty and help rural motorists. Their fellow nationalists, Plaid Cymru, have also called for a cut in fuel for Welsh rural drivers.
It seems that the nationalist parties will be looking to bring petrol costs down in one form or another, and if the Lib Dems join them, that’s a hefty bloc calling for action.
The Result
With so many possible outcomes from this election, we can’t say for sure what will happen, but there doesn’t seem to be much call for a rise in fuel duty, while there is talk of forcing petrol suppliers to pass their savings onto customers. The strongest voices for cheaper fuel are the nationalists and Lib Dems, but they’ll likely be dealing with bigger issues post-election.
By the looks of things, the fuel duty is unlikely to change drastically without a party really pushing for major change. For the time being, oil prices are what motorists should be we watching rather than the House of Commons.
