Chancellor cancels planned 3p a litre tax rise, bowing to opposition from consumer groups and MPs
The chancellor has bowed to pressure from consumer groups and his own parliamentary colleagues by cancelling the planned rise in fuel duty.
George Osborne announced in his autumn statement that he would be freezing the tax on fuel, rather than adding the proposed 3p a litre extra in January. Osborne had already postponed the planned rise on one occasion this year, abruptly announcing in June that the rise due in August would be put off until the start of 2013.
The government averted a backbench rebellion last month, after Labour brought a motion demanding the rise be postponed, by dropping heavy hints that further rises would be delayed again.
It insists that fuel would be 10p a litre more expensive now under plans for a duty “escalator” drawn up by the previous government, which scheduled annual inflation-plus-1% rises until 2014. Osborne cut 1p from fuel duty in the March 2011 budget, but the total tax take, including VAT, accounts for around 60% of the average 133.25p price of a litre of unleaded petrol.
The duty remains at 57.95p a litre of petrol or diesel. The tax brings around £27bn a year into the Treasury, but chancellors have trodden warily since drivers’ fuel protests in 2000 threatened to bring Britain to a standstill.
However, critics have asked how the persistent freezes in fuel duty fit with the government’s deficit reduction priority – a question most famously posed by Jeremy Paxman to Treasury minister Chloe Smith on Newsnight after the duty U-turn in August.
A recent RAC study found almost one in five motorists were driving less due to the increased cost of fuel.
The most corrosive effect of the conviction that we don’t get the truth out of those in power is that it breeds a refusal to listen
This is the truth that so nearly wasn’t told. Remember that on Wednesday, when the independent inquiry on the Hillsborough football stadium disaster finally unleashes a flood of confidential papers, and with them perhaps the justice for which survivors and victims alike have waited too long.
We have known how 96 men, women and children met their horrible deaths ever since the Taylor report was published in 1990. But what we haven’t really known is exactly what happened next: how unforgivable lies about the Liverpool fans’ behaviour came to be spread (and recycled by the Sun), and whether there was a systematic cover-up involving police and politicians, as the victims’ families believe.
And we might so easily never have known. It has taken 23 years for a Conservative prime minister to express “regret” for the Thatcher government’s handling of the tragedy. Without Andy Burnham, a football-mad working class lad from Liverpool, in cabinet this new inquiry probably wouldn’t have been a priority for Labour’s chaotic last months in power. The line between truth and lies, between full picture and misleading snapshot, is terrifyingly thin. We so nearly didn’t know.
Our world is undoubtedly more open and transparent now than it was in 1989: if, God forbid, anything like Hillsborough were to happen again, the truth would surely be harder to conceal. With a mobile phone in every pocket there can never again be just one official account, a monopoly on reliable information in the crucial early hours of a manmade disaster: never again would it be eyewitnesses’ word against the police.
Nick Hardwick, then chair of the Independent Police Complaints Commission, said after the G20 protests that the proliferation of mobiles in crowds had transformed the job of investigating alleged brutality: officers now knew “there is going to be this evidence”, not just that they were being watched. (And he was speaking before pictures of the death of Ian Tomlinson surfaced.) Were anything like this to happen now, there would be a million grainy pictures, a million urgent tweeted testimonies, a haunting archive from beyond the grave: think of the 9/11 victims calling loved ones from the hijacked planes, knowing they were never coming home. We would hear their voices.
It’s surely harder now too (although scarcely impossible), to sustain a government cover-up of any major debacle. A breakneck news cycle, driven by 24/7 rolling news and Twitter, gives officialdom less time to concoct stories: we expect ministerial responses to breaking news within minutes, not days.
Then there is the whole armoury of freedom of information requests, empowered select committees, expert bloggers not beholden to proprietors, and the replacement of journalistic deference with Jeremy Paxman-style showdowns. Public inquiries too have been transformed by sensitive political conversations migrating to text and email which, unlike old-fashioned conversation, leave an electronic trace.
In a thousand tiny ways, it’s now easier than ever to expose a lie: yet we’ve never felt less confident of getting the truth. Polls show 62% of us now think politicians “lie all the time and you can’t believe a word they say“. And paradoxically, all that corrosive suspicion makes us arguably more, rather than less, vulnerable to deception. The trouble with the belief that politicians always lie is that eventually, the cost of lying will inevitably diminish. If dishonesty is assumed, it’s no longer quite so shocking to be caught proving what everyone thinks anyway. And so the political advantage of telling malicious falsehoods about one’s opponent (or one’s own record) increases: after all, what’s the downside?
Something like this now appears to be happening in the US, where the press is grappling with so-called post-truth politics, or the tendency among candidates in election year not just to twist the facts but to keep blatantly doing so even when they’re caught.
But the most damaging consequence of the conviction that all politicians lie is that it breeds contempt, a kneejerk refusal to listen. Voters tune out, absorbing really big new themes that seem to fit their own prejudices but skipping the boring bits where misleading data is unpicked or the argument challenged. The more we switch off in disgust, the more freedom we arguably give politicians to do the things that disgust us.
After 15 years of writing about Westminster, I’ve certainly been lied to, and not just by politicians. People in any walk of life will sometimes say anything to get out of trouble. Too often for comfort, I’ve seen wild-eyed conspiracy theorists vindicated over everything from phone-hacking to extraordinary rendition of terror suspects. And too often for comfort, I’ve seen people like the Hillsborough families frustrated and failed at every turn while officialdom scrabbles to cover its back.
Yet while it’s unpopular to say so, most people in public life still probably tell the truth more often than not. We are in danger of forgetting that not everything officialdom says is a lie, and that more often than not there are grains of truth on both sides of an emotive story. Sometimes a denial, having been exhaustively tested, must then be accepted – and to say so isn’t naivety or whitewash, but merely respect for the truth. Why demand the facts, if you’re not willing to listen?
MPs on both sides piled in to condemn wicked bankers and incompetent regulators – at least those not on their watch
Quite apart from the latest banking scam, Westminster suffered a small domestic tragedy on Thursday. George Osborne felt obliged to assure MPs in person that he is almost as angry as they are about internet poker players at Barclays fiddling the interest rates on which London’s tottering financial services empire depends. And Ed Balls wasn’t present to roll in the mud at the chancellor’s discomfort!
Tragic or what? This wasn’t Hamlet without the prince or even Macbeth without Lady Macbeth. But it was certainly Julius Caesar without Cassius, Othello without Iago, the devious ex-special adviser who had conspired for so long to persuade the brooding Moor of Kirkcaldy to smother Desdemona Blair, his estranged partner.
When Osborne made his lunchtime report to the Commons Balls was trapped at a local government conference in Birmingham, trading soundbites directly with BBC radio. Not since the chancellor left Chloe Smith to the mercies of Jeremy Paxman in order to have dinner had there been such a skiving off.
“What did you do in the great Barclays war, grandad?” some tot, as yet unborn, will one day ask Lord Balls of Morley and Outwood. “I was talking to local government officers about forging a new and lasting consensus, son,” will come the reply. “Was that the day you finally lost the plot and took up dominoes, gramps?” “Drink up your Fruit Shoots, son.”
It was left to Rachel Reeves, Balls’s deputy and a former teenage banker, to fill the aching void, which she did adequately rather than sufficiently, in the style of Chloe Smith. It cannot have helped her confidence to hear Tory shouts of “Balls, Balls” before she uttered a word. Reeves got in one good line: Bob Diamond of Barclays had described corporate culture as “how people behave when they think no one is looking”. It is what Lord Justice Leveson has been considering.
Naturally Osborne made the best of his opportunity, repeatedly reminding anyone who was still listening that the absent shadow chancellor had been City minister every day during the crucial years Barclays traders had been fiddling the market. Never absent then, eh! Labour and the tripartite regulatory regime it put in place had been “completely clueless” about what was going on, Osbo suggested.
All this was true and MPs on both sides piled in to condemn wicked bankers, incompetent ministers and regulators, at least those in place before 2010 (Tories) or (Labour) since. Only the likes of Labour’s Chris Bryant reminded them that all parties had been so scared of losing Britain’s biggest industry that they had grovelled to the rascally bean counters.
Osborne had a particular problem on Thursday, almost as acute as Iago Balls. Throughout the relevant period he had been urging an even lighter-touch regime to govern the City than the titanium-lite system for which Balls used to claim credit whenever Gordon Brown was out of ear shot. Ask them what they want and give it to them. ” Free money? No tax? Of course.”
The chancellor solved his dilemma by being less cocky than usual and promising that the authorities would pull the bankers’ toenails out, if only (he added with sorrow) Labour’s inadequate bank laws allowed them to be prosecuted for market manipulation.
He goaded Alistair Darling, Labour’s post-Brown chancellor, into pointing out that he could still “take them off the road” to prevent more villainy, if he really wanted to. Osborne promptly got coy.
Amid the uproar one familiar noise could be heard from the Treasury bench – the sound of the Cameroons throwing over another old friend. Splash, splash! Last month it was Rupert, Andy, Rebekah and Raisa the police horse going over the side into the Thames, this month it’s Bob Diamond, his very rough diamond traders and party donors. “Never met them before, officer. Country suppers? What are they?”
It was a shaming day like the one when Argentina seized the Falklands, when the pound was humbled (again) or Anthony Blunt’s treason exposed. Beneath the cheap party banter, hard-boiled MPs seemed to feel it. When I was a banker we were dull but honest, we didn’t treat our customers as punters to be exploited, wailed Tory, Desmond Swayne. When did banking change?
“When you left,” replied Osborne. By happy coincidence that was in 1997 when shocking Tory bank scandals were just giving way to shocking Labour ones.