Fuel duty increase cancelled

Economic Secretary Chloe Smith faced a difficult round of interviews as she attempted to explain the decision to scrap a planned fuel duty increase on BBC's Newsnight.

Conservative MP Nadine Dorries has blamed the Chancellor George Osborne for what is being regarded as a very poor performance by the junior minister.

Asked whether Ms Dorries would be disciplined for her attack on Mr Osborne, a source close to the Prime Minister said: "Nadine is Nadine, isn't she? What can you do?"

Economic Secretary to the Treasury, Chloe Smith, said the freeze on fuel duty announced today would be funded through underspend in Government departments, but would not be drawn on which departments.

She told BBC2's Newsnight:

Conservative Tim Yeo, chairman of the energy and climate change committee told Channel 4 News tonight that the Government's u-turn on fuel duty would not have been his "top priority" and he "regrets" the option was chosen.

Mr Yeo said: "I think the priority should have been to continue working to take low income families on less than £10,000 out of tax. That's a coalition priority and I think spending the money that way would have reached lots of low income families."

Brian Madderson, chairman of the Retail Motor Industry, has told ITV News that it was "excellent news for motorists" that the Chancellor has scrapped plans to increase fuel duty this year.

Mr Madderson said that although the decision was to "defer" the move, it would "give more time" to prepare for the George Osborne's Autumn statement.

Conservative MP Chloe Smith has told ITV News that the Government's u-turn on fuel duty was "important" in order to "put the money to good use". Ms Smith said that the Government were looking into 'departmental under-spends' to support the u-turn.

Gareth Hodgson from Advanced Delivery Forwarding in Derbyshire has told ITV Central that with the Government scraping fuel duty, he will be able to hire another worker with the extra money available.

The Labour leader Ed Miliband has told ITV News that the Government was "forced" to make a u-turn on fuel duty increases, due to its 'unpopularity' in the Commons.

Mr Miliband said that the Chancellor had not u-turned on what voters had "most objected to in the Budget."

Liberal Democrat MP Danny Alexander has told ITV News that the Government's u-turn on fuel duty increases was "the right thing to do" and that the Chancellor was "helping to ensure families and businesses are being helped by the coalition".

Shadow Chancellor Ed Balls has told ITV News that the Government's u-turn on fuel duty tax is the "fastest in history", questioning why the Chancellor has "taken so long" in reversing his decision and not reverting on other tax rises.

The CBI has responded on the Government’s decision to postpone its planned 3p-a-litre rise in fuel duty in August until January next year. Dr Neil Bentley, CBI Deputy Director-General, said: