Jeremy Hunt to extend 5p fuel duty cut in Budget boost for drivers after damning poll predicts Tory wipeout

5 March 2024, 06:05

By Kieran Kelly

@kellyjourno

Jeremy Hunt is set to extend the 5p cut in fuel duty once again in this year's Budget, which is expected to cost the Treasury around £5 billion.

The chancellor will extend the fuel duty freeze for the 14th year in a row and a temporary 5p cut will be extended, Whitehall sources have suggested.

Fuel prices rose dramatically in the wake of Russia's invasion in Ukraine, and even rose by 4p a litre last month, though they remain significantly down from the peak sparked by the war.

Mr Hunt is reportedly scrambling to make tax cuts an affordable part of tomorrow's Spring Budget, the last before the next general election.

It comes after a damning poll put Tory support at a 40-year low and predicted the party could have as few as 25 seats after the next election. Labour, meanwhile, would storm to victory with 537 MPs.

Chancellor Jeremy Hunt joins Matthew Wright ahead of the Budget

The chancellor is widely understood to be considering a 2p cut in national insurance, mirroring the tax-cutting move he made in the Autumn statement.

Mr Hunt played down the chances of introducing wider tax cuts in tomorrow's Budget when he spoke to LBC on Sunday.

Speaking to LBC's Matthew Wright, Mr Hunt said his priority was helping people with cost of living pressures. He said his Budget was intended to help grow the economy in the long-term, allowing for broader income tax cuts later.

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"Overall, I think what people want is not gimmicks, they want a long-term, responsible, sensible plan to grow the economy so we can bring down taxes and have enough money for public services in the future - and that's what I'll be delivering," he said.

Mr Hunt is expected to argue that both central government and local authorities will have to spend money more efficiently as the public sector potentially faces more cuts.

Councils will have until July to submit new productivity proposals, which must include plans to use technology to improve services and reduce spending on consultants, The Times reports.

Economics professor says Jeremy Hunt has 'no space' to cut taxes if public services are to function

Mr Hunt hinted at cutting back on public services when he spoke to LBC on Sunday.

"We need to be much better at spending taxpayers' money more efficiently," he said.

"There’s always a reflex to pour more money in and they’ll get better and that hasn’t been the case with some of our biggest public services since the pandemic," he went on to say.

"What we've got to learn to do is run public services more efficiently because if we don’t we’ll end up with taxes not just staying high but getting higher – that will throttle economic growth."

Meanwhile, the NHS is not expected to get any extra funding.