Darling 'to delay' fuel duty rise

A planned 2p increase had been due on 1 April

Chancellor Alistair Darling will delay a 2p rise in fuel duty for six months in the Budget, the BBC has learned.

The rise, announced in last year's Budget, had been due to come into effect on 1 April but will be postponed due to soaring crude oil prices.

Earlier Friends of the Earth warned the chancellor that any delay would damage the government's "green credentials".

But the AA said price instability was damaging the economy and urged the government to do more to help.

According to the Office of National Statistics, fuel inflation is the highest since records began in January 1997.

The price of petrol has risen by almost a fifth in the past year and it is now not far off the psychologically significant £5 per gallon mark, said BBC political editor Nick Robinson.

He said that, while the move would rob the Exchequer of some much needed revenue, the rise in oil prices was estimated to have added around £4bn to the chancellor's tax take.

Earlier Simon Bullock, from Friends of the Earth, said: "Abandoning plans to increase fuel duty will seriously undermine the government's green credentials.

"Road transport is responsible for nearly a quarter of UK carbon dioxide emissions."

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He said the "real cost" of motoring had fallen under Labour while traffic had increased by 10%.

But AA President Edmund King said the budget would be the "2p or not 2p Budget".

He said: "Fuel price instability is damaging to people and the economy and while this is largely influenced by the market, we believe the government can do more to help people and business weather the financial damage and uncertainty high prices cause.

David Frost, director general of the British Chambers of Commerce, also urged Mr Darling to scrap the planned 2p rise.