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Last fuel duty freeze cost Exchequer around £550m

by - Political Correspondent

The Chancellor last announced a fuel duty freeze back in August, a move that Treasury figures suggest will have cost the Exchequer approximately £550 million.

But officials said that loss would be recovered by underspending in Government departments.

Figures in the Autumn Statement are expected to show how the fuel duty freeze has been paid for.

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PM's spokesman says Chancellor decides fuel duty alone

Prime Minister David Cameron's official spokesman earlier declined to comment on whether the Government might back down on the 3p fuel duty rise.

He said the controversial rise was a matter for the Chancellor.

There are a series of planned rises in fuel taxes programmed in and those will generate revenue which will help bring the deficit down. But what the Government has sought to do thus far is listen to the concerns of motorists and, where it can, delay or cancel those planned rises.

Decisions on tax and duties are a matter for the Chancellor. The Government obviously recognises that the cost of petrol is a significant part of day to day spending and that is why (it) has listened to the views of consumers and motorists and acted over the past two years by delaying or cancelling planned rises.

– PM's spokesman

Balls: Chancellor's made 'nods and winks' on fuel duty

Shadow chancellor Ed Balls said George Osborne had been making "nods and winks" on fuel duty over the past 24 hours to dissuade Tory MPs from joining Labour in voting against the 3p rise today.

I would say to Conservative MPs, I wouldn't take a nod or a wink from this Chancellor as sufficient. I would want to make a clear statement to my constituents - this is the wrong thing to do and I am going to vote with Labour.

– Ed Balls, speaking to BBC Radio 4's World At One

MPs tweet ahead of vote on fuel duty rise

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Will be voting today with Labour colleagues to try to stop the Government's January fuel duty rise. Big concern in #Exeter & #Devon

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Am expecting @edballsmp to face a difficult reception in the Commons tonight, as he argues against his own 3p fuel rise. #opportunismexposed

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Cancelling the Fuel Duty3prise-this is the time for determined, patient lobbying of Chancellor, not parliamentary theatre backing Ed Balls

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FairFuelUK: 'Fuel rise could cost 35,000 jobs'

FairFuelUK spokesman Quentin Wilson with protesters Credit: REUTERS

The campaign group FairFuelUK previously said it believed the tax hike could will raise only £800 million, compared to Treasury projections that it would bring in £1.5 billion.

It could also cost as many as 35,000 jobs, it said.

The group will be campaigning at parliament today ahead of the debate and vote in the Commons.

Its spokesman, broadcaster Quentin Willson, said: "The momentum building up behind FairFuelUK's call to see this damaging 3p rise scrapped is becoming unstoppable.

"The Treasury appears to be listening. We welcome Labour pushing on this issue. Consumers are currently paying an eye-watering 80p-per-litre in combined fuel duty and VAT.

"This is socially unjust and adding another 3p in tax doesn't make sense for economic recovery and deficit reduction."

Conservative MP calls for transparency on fuel tax

Labour had hoped some campaigning Tory backbenchers would support its motion and rebel against the Government.

Conservative MP Robert Halfon Credit: Andrew Parsons/PA Archive

But Robert Halfon MP, who has led the campaign against increasing fuel duty, said he would not vote against the Government until he had seen whether George Osborne responds to mounting concerns in the Autumn Statement, due on December 5.

He said: "The cost of fuel is the number one issue, that's why I am campaigning on it.

"I have had discussions with various people and it is my view that the Government is in strong listening mode.

"If I didn't believe that I would make a point and go in to the lobby with Labour."

Labour calls for temporary VAT cut

With our economy so fragile and prices still rising faster than wages, it would be wrong to go ahead with another tax rise on families and businesses.

To boost our flatlining economy, Labour has already called for a temporary VAT cut which would take 3p off a litre of fuel. But if ministers won't do this, the very least they could do is axe January's fuel duty rise at least until April.

And they could pay for this by clamping down on known tax avoidance loopholes, like the one used by some employment agencies to falsely inflate expenses.

– Shadow Chief Secretary to the Treasury Rachel Reeves
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