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Gordon Brown gave his strongest signal yet today that the Government will not go ahead with the planned 2p-a-litre increase in fuel duty due in the autumn.
Giving evidence to the Commons Liaison Committee, the Prime Minister virtually pre-empted his Chancellor by saying that past increases had not been implemented.
“I think you will find that in most years since 2000 that the duty has actually been frozen,” he said.
Mr Brown said any decision on fuel duty would be for Alistair Darling in his Pre-Budget Report in the autumn. He added however: “It is clearly a matter that will be looked at very, very carefully over the next few weeks.”
It was the second day in a row that Mr Darling has found others making concessions for him.
Labour MPs admitted yesterday that they had been told by the whips that he would make changes in his controversial plan to charge higher excise duty on heavy polluting cars bought since 2002. The Treasury ministers gave no such guarantee in the debate but MPs believed the whips and the Government won the day. Only six Labour MPs voted against the Government, even though 50 had voiced their concerns.
Mr Brown warned that rising demand for oil from Asia meant that the current pressure on prices could continue for years to come.
“If demand succeeds supply and is likely to exceed supply for years to come, people will expect the price to rise,” he said.
The Prime Minister said that the Government would be bringing forward further measures to help low income families with their fuel bills.
“If we can take measures that will help people cut their energy bills by using energy more efficiently or finding a way that we can help them cut the consumption of energy we will do so,” he said.
Mr Brown said that the Government would also be making announcements on securing future gas supplies as reserves in the North Sea declined.
“For the last 30 years, we have had oil and gas from the North Sea. That has provided a very substantial amount of the energy needs of this country,” he said.
“As the North Sea oil and gas runs down - as it is running down - we are making alternative arrangements.”
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