Autumn statement: Chancellor scraps 3ppl fuel duty increase

Chancellor of the Exchequer George Osborne today surprised many when he deferred the scheduled 3p per litre rise in fuel duty due in January. He also said he would cancel the inflation increase that was planned for August 1, 2012, currently expected to be worth 1.92ppl.

It means the rise in August will now be around 3p per litre.

These initiatives reduced fuel duty by 10p over the announced rises, said the Chancellor, adding that the moves would make the cost of filling up the average family car cheaper by £144 per year.

Commenting on the news, Andy Dingley, communications manager, Bridgestone UK, said: “The planned 3p a litre increase in fuel duty which was due to take effect in January would’ve added an extra £1.50 on the cost of filling an average petrol tank. With the cost of living ever increasing, scrapping this is a sensible move and will be welcomed by motorists and businesses that rely on the cars.”

Brian Madderson, RMI Petrol Chairman, added: “RMI Petrol believes the Chancellor has made the right decision to cancel the fuel duty increase planned for 1 January 2012.

“The increase would have raised prices at the pump by 4.00 pence per litre (ppl) within days. Based on current average UK pricing this would have pushed diesel to a new record high at over 145ppl and this grade is steadily gaining market share at the expense of petrol.”

Matthew Mycock, managing director at Autoglass, commented: "At last, we have seen some sympathy for UK motorists whose pockets have been constantly hit, left, right and centre in order to keep their cars on the road.  The freeze on the 3p hike until August comes as welcome relief to all those maintaining a vehicle".

He added: "It's encouraging to see 35 new road and rail projects are planned for the UK transport network. However, we would rather see the Chancellor look at the existing pothole-scarred road system, which has turned driving into a daily nightmare for millions of motorists."

The Office for Budget Responsibility does not predict another UK recession but revises GDP growth down to 0.9% for this year and 0.7% next year.

Meanwhile, the government has identified more than 500 infrastructure projects - road, rail, air and broadband internet - that it wants to see built in the coming years.

The Chancellor's fuel duty announcement comes the day after HMRC revealed now change to the Advisory Fuel Rates in its latest review. Click here for details

•  For advice on tactics you can use to reduce you fuel bill, click here