Osborne steals Labour thunder with pledge to freeze fuel duty

The Chancellor used his keynote speech at the Tory conference to offer a £750m giveaway to motorists by cancelling all rises in fuel duty until the next election – but admitted the plan has not yet been costed.

The freeze would be welcomed by motorists across the country, but especially in rural areas where petrol prices are higher and people required to drive further than in urban parts of the country.

But Mr Osborne’s’ failure to set out how the freeze would be funded suggested the announcement may be a hurried response to Labour leader Ed Miliband’s surprise pledge last week that his party would implement a two-year freeze on energy bills if it wins the next election.

“Provided we can find the savings to pay for it, I want to freeze fuel duty for the rest of this Parliament,” Mr Osborne said.

“Conservatives don’t just talk about being on the side of hard-working people. We show it day in, day out in the policies we deliver.”

If Mr Osborne scraps the rise in next year’s Budget as planned, motorists will save £750m a year, leaving pump prices 20p a litre lower than under the plans inherited from Labour, and bringing the total reduction in the tax burden to £22.6bn over the course of the Parliament, said aides.

The possible freeze was announced as Home Secretary Theresa May confirmed for the first time the Tories will pledge to scrap the Human Rights Act in their 2015 manifesto.

Attacking the difficulty successive Home Secretaries faced in deporting Abu Qatada, she said new measures would also be introduced in the forthcoming Immigration Bill to make it easier to deport foreign criminals.

“It’s ridiculous that the British Government should have to go to such lengths to get rid of dangerous foreigners,” she said. “That’s why the next Conservative manifesto will promise to scrap the Human Rights Act.”

Earlier Mr Osborne had given a clear hint of the tough new economic policy which will require future Conservative governments to run an absolute surplus during periods of growth.

Coupled with a commitment to increase infrastructure spending at least in line with GDP growth, the policy means that there will be no let-up in public spending discipline if the Tories win the next election – even after they have achieved their target of eliminating the deficit.

British Governments have run a surplus, by spending less than they take in through taxes and other revenues, in only seven out of the past 50 years.

But Mr Osborne said this is the only way to bring down national debt, paving the way for sustainable tax cuts and preparing the UK for future turbulence in the global economy.

Attacking Labour for running deficits even during the boom years ahead of the 2008 crash, he warned: “This crisis took us to the brink. If we don’t reduce our debts, the next could push us over.”

Mr Osborne also delivered a broadside on Ed Miliband’s economic plans, comparing the Labour leader with Karl Marx, accusing him of a “retreat to the left” and dismissing his proposed freeze on gas and electricity prices as a “quick-fix con”.

By contrast, Mr Osborne said he was offering “a serious plan for a grown-up country”, which would create jobs, keep mortgage rates low and let people keep more of their income free of tax.”