The Shadow Chancellor, George Osborne, has unveiled a radical new plan to soften the impact of future fuel price rises on families.
The proposed Fair Fuel Stabiliser would reduce duty when fuel prices go up, and raise it when fuel prices go down.
If a Fair Fuel Stabiliser had been introduced at the 2008 Budget, fuel would now be 5p per litre cheaper, shaving £3.50 off a tank of fuel for a Ford Mondeo.
But if, instead of rising, oil prices had fallen below the $84 forecast in the Budget, then fuel duty would have risen.
In either case, forecast government revenues would have been unchanged.
George described the stabiliser as, “A common sense plan to help families, bring stability to the public finances and help the environment by making the price of carbon less volatile.”
This plan has been opened for consultation, and any interested parties are invited to respond. Please see the document below for details of how to contribute.