Page last updated at 13:53 GMT, Wednesday, 24 March 2010

Budget 2010: Chancellor delays fuel duty rise

Darling announces the fuel duty 'staged' rise

Fuel duty will rise more slowly than previously planned, Chancellor Alistair Darling said in his Budget speech.

A previously announced 3 pence rise in fuel duty will now be staggered, with a 1p rise in April, a further 1p rise in October, and then again next January.

"This staging will ease the pressure on businesses and family incomes," said Mr Darling.

Phasing in the increase rather than raising fuel duty by 3p immediately will cost £550m.

"The decision to phase in fuel duty is the second most expensive measure Mr Darling announced, and a difficult one for the Conservatives to reverse," according to BBC economics editor Stephanie Flanders.

Drivers' organisations welcomed Mr Darling's decision.

"At last there is some relief for cash-strapped motorists," Professor Stephen Glaister of the RAC Foundation said.

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"Over the past year [we] have seen the pump price of unleaded leap by 26.4p to almost record levels," he said.

"Had the full increase gone ahead, it would have added £1.50 to the typical cost of refilling a petrol or diesel car, or £37.50 a year.

"For a family with two petrol cars, that alone would have been four times the average increase in council tax for this coming year."

AA president Edmund King said he believed Mr Darling had responded to public pressure.

"Perhaps the thought of 32 million fuming drivers and voters influenced Government thinking," he said.



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