Will the New Chancellor stick to his Tory leadership campaigning promise and freeze Fuel Duty in the March 11 Budget. Maybe he will cut it!

March 11th marks the first Budget of this massive majority driven administration. Will Fuel Duty be cut?

SAJID Javid back in June 2019 vowed to freeze fuel duty for at least two more years – while launching Britain’s drive to ‘net-zero’ emissions.

He said in his push to become Tory leader: “People drive because they don’t have other transport options, and they need to make a living, pick up the kids from school, and bring groceries back from the supermarket.

Pre-empting criticism from the Treasury, a campaign source insisted the move wouldn’t ‘cost’ money – as it leaves more in people’s pockets to spend elsewhere. 

FairFuelUK report produced by CEBR shows what the Freeze in Duty has achieved since Jan 2011

1. Had the freeze not occurred, the fuel duty escalator’s impact on CPI would have reached 6.7%. It is now 1.6%!

2. Had the fuel duty escalator continued as planned from 2011 onwards, fuel duty today would be 83.33p per litre rather than 57.95p per litre, 43.8% higher.

3. The CEBR estimates that this would translate in overall fuel prices being 24.0% higher, circa £1.65 to £1.70 per litre. Combining this with their statistical analysis between fuel prices and various general price indices, they find that this would translate into the following:

* 6.66% higher consumer prices
* 5.22% higher output producer prices
* 20.33% higher input producer prices
* 5.14% higher prices for road freight

4. The yearly impact of higher inflation across all of this, would have eventually reached £14.5 billion per year, in funding all UK’s outstanding government debt. That’s over £116bn in cumulative debt funding costs over 8 years.

5. The CEBR estimate that household expenditure is £24.2 billion higher per year due to fuel duty being frozen. This equates to approximately 1.21% of total GDP.

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