Treasury winks set to avert fuel duty rebellion

Petrol prices are on an ever upward trend
Petrol prices are on an ever upward trend.

By Alex Stevenson and Charles Maggs

A potential Conservative backbench rebellion over fuel duty appears to have been averted by promises that January's planned increase will be put off.

Campaigning Tory MP Robert Halfon told politics.co.uk he was "100% with the government" after receiving strong indications from the Treasury that it will abandon the 3p hike scheduled for the new year.

"I wouldn't put my credibility on the line if I didn't think they weren't in strong listening mode on the autumn statement," he said.


Another potential rebel, Stewart Jackson, said he would "of course" be voting with the government in the cost-of-living debate. "Labour's opportunist motion on fuel duty is shameless," he tweeted.

Labour is calling for ministers to drop the increase in fuel duty by 3p in January in an opposition debate taking place later.

Chancellor George Osborne is not thought to have offered any definite guarantees that the planned increase will be put off in January.

But heavy hinting that the autumn statement, which will be delivered on December 5th, will include a further deferral of the planned rise looks like having been sufficient to avoid an embarrassing rebellion.

The language of the government's amendment is also thought to have had an impact on the enthusiasm of Tory would-be rebels.

It states that the coalition's moves to cut, cancel and delay fuel rises will save families around £159 on fuel costs by April 2013, and states that under Labour's plans pump prices would be 10p higher than they are now.

Halfon accused the opposition of "playing politics" by pushing the issue to a Commons vote days before police and crime commissioner elections take place.

"I don't know what is in the sandwich box of the chancellor, but I do hope they're in strong listening mode," he added.

The Essex MP wants to use the upcoming auction of the 4G mobile network to pay for a long-term freeze in fuel duty.

Ofcom has announced the reserve price for the spectrum will be £1.3 billion. The bidding process will begin in December before the 4G spectrum becomes operational from next May.

Consumer magazine Which? claimed fuel prices are the public's number one worry, with 85% concerned about costs rising. Executive director Richard Lloyd said the rise could put fragile economic growth at risk.

"Consumers can little afford another hit on their household budget. Like many business leaders, we're calling on the government to think again about their plans to increase fuel duty in January," he said.

"The forthcoming autumn statement must focus on measures that will help put money back in the pockets of consumers, because the economic recovery is at risk if we don't increase in consumer confidence."

Shadow chancellor Ed Balls said the government had its priorities wrong when announcing the vote last week.

"At a time when the cost of living is rising, our recovery is fragile and this out of touch government is giving 8,000 millionaires a tax cut, it cannot be right to hit middle and low income families and small businesses with another tax increase," he said.

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