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Fuel Duty: Govt Hints It May Axe Increase

(c) Sky News 2012

The Government has hinted that a planned fuel duty rise could be axed, despite ministers having seen off Labour calls for the 3p increase in January to be scrapped.

Treasury Economic Secretary Sajid Javid said the Government understood the pressures facing households and was determined to help with the cost of living.

Robert Halfon, a Conservative backbencher and a prominent campaigner on fuel duty, did not back Labour's demands because he believed ministers were in "listening mode" ahead of Chancellor George Osborne's autumn statement next month.

"I believe it is perfectly sensible and right to wait for the autumn statement, given the Government's record, given that they cut fuel duty last year and given that they have stopped two fuel duty rises," he told the House of Commons.

Labour's call to delay the tax hike until at least April next year was defeated by 282 votes to 234 - a majority of 48.

Mr Javid said: "The Government is doing all it can to help hard-working families with the cost of living and putting money back into their pockets.

"Action on fuel duty is part of this. Fuel duty is currently 20% lower in real terms compared to its peak in March 2000 and 7% lower compared to May 2010.

"If we had continued with the policies of the previous government, quite simply prices would be higher. Fuel would be 10p more expensive per litre.

"I know some will call for a further freeze in fuel duty today. I can assure them this Government understands the financial pressures hard-working families are facing.

"Subject to the constraints of the public finances, this Government is determined to help families with the cost of living."

Labour's Cathy Jamieson, the shadow economic secretary, said the fragile state of the economy meant it was "exactly the wrong time to hike fuel costs".

She (SNP: ^SHEY - news) said: "In the here and now petrol is 15p a litre higher than at the general election, it's 5p a litre higher than in the summer when the Government last deferred a rise, and let's remember that the Chancellor took that decision following pressure from this side of the House."