Oil Prices: Rural Consumers

Earl of Courtown Excerpts

Thursday 29th January 2015 Lords Chamber

Asked by

[The Earl of Courtown]

To ask Her Majesty’s Government what they are doing to ensure that the benefits of lower oil prices are passed on to consumers, particularly in rural areas.

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma) (Con)]

My Lords, Her Majesty’s Government have made it clear to energy providers that it is vital that the benefits of plunging oil prices are passed on quickly to consumers. In addition, we are well on the way to giving 17 of the most rural areas on the UK mainland a 5p per litre fuel duty rebate. The Scottish islands and the Isles of Scilly are already benefiting from this rebate. We continue to monitor price movements closely.

[The Earl of Courtown (Con)]

My Lords, I thank the Minister for that reply. I was particularly glad to hear that the fuel rebate scheme is extended to remote areas of the UK. As my noble friend will be aware, though, the cost of travelling to work in rural areas—in places such as where I live in Gloucestershire—is 24% more than if you are travelling in urban areas. I was wondering if she would be able to extend this fuel rebate system so that it could cover areas such as where I live, where there are relatively higher fuel costs, which also affects people on lower incomes.

[Baroness Verma]

My noble friend is of course right to raise the issue of people living in rural areas. There are a number of factors that account for fuel price differences in rural areas. Often as not, the transport costs are higher and there are fewer competitors in rural areas. My noble friend is right to raise this, and we have spoken to energy companies to ensure that where they can pass on the price reductions they are doing so, so that no one is left out in benefiting from reduced pricing.