Fuel duty decision next spring

A FEARED hike in fuel duty next year may not go ahead, Jeremy Hunt has assured his MPs.

There was alarm from the Conservative backbenches on Thursday when the budget watchdog said the tax on petrol and diesel would rise by 12p a litre in March.

The record 23 per cent increase would raise £5.7billion for the Treasury, but add more than £150 to the average family’s bills.

But quizzed on the plans yesterday, the Chancellor insisted no decision had yet been made. He said the figure was just an assumption made by the Office for Budget Responsibility (OBR) in its forecast following his Autumn Statement.

‘They have to make judgments, but they were wrong to assume that we are going to increase fuel duty because we have not made a decision on that, it is a decision for the Spring Budget,’ Mr Hunt told LBC radio.

Tory backbencher Jonathan Gullis had written to the Chancellor about the ‘disturbing’ remarks on fuel duty made by the OBR.

‘Such an increase would be the death knell to economic recovery and the Conservative Party’s fortunes,’ he warned.

Last night Mr Hunt wrote back to him to explain that the OBR’s figures stem from its assumption that a current 5p cut on fuel duty will end in March and that the tax would then increase in line with inflation.