Fuel Costs: Motorists fume after Chancellor resumes petrol duty increase

From midnight last night, the duty on a litre of petrol and diesel rose by 1.25p, provoking both an angry response from drivers and disappointment among environmentalists.

The decision by the Chancellor to impose an increase that matches the inflation rate brought to an end a three-year freeze on fuel and put petrol prices up to about 88p a litre.

To the concern of green groups, Mr Brown was at pains to point out that he was not reverting to the "fuel escalator" whereby there are regular increases in duty.

He estimated, however, that vehicles were responsible for about one quarter of carbon emissions - and said that the Government needed to promote cleaner petrol.

He extended the 20p-a-litre discount on duty available for cleaner fuels to include the next generation of biodiesel, a discount that would be offered on all new innovative fuels as they are developed.

And the Chancellor was considering proposals to extend the current 40p-a-litre discount for biogas, and said he was consulting interested parties on increasing the level of tax discounts available for company cars using biofuels. Jason Torrance of Transport 2000 applauded the general increase in fuel duty, but argued it was insufficient to bring the cost of motoring in Britain up to "realistic" levels.

And he criticised Mr Brown for failing to increase the tax on "gas guzzlers" such as the bigger 4x4s, also known by many as "Chelsea Tractors".

The environmental group Friends of the Earth criticised Mr Brown for not reintroducing the fuel duty escalator.

Despite the Chancellor's caution, some hauliers warned that the increase in duty could lead to fuel protests similar to those back in September 2000, when blockades prevented fuel tankers accessing some petrol stations, leading to widespread panic buying by motorists.

Nigel Humphries, of the Association of British Drivers, said the decision to end the freeze on fuel duty was "disgraceful".

He said: "We haven't got a problem in principle with fuel duty. It is the fairest way to do it, but it is too high and not enough is spent on transport."

Mr Humphries said the recent Stern report on the economics of climate change suggested that fuel duty did not need to be as high as it is currently.

"We are already paying five times as much as Stern says we should be paying so there is absolutely no sense in it," he said.

Edmund King, executive director of the RAC Foundation, said the increase in duty would go down like a "flat balloon in this season of goodwill". Roger King, the chief executive of the Road Haulage Association, said the announcement came as a "tremendous blow" to UK hauliers who were already at a considerable financial disadvantage to their European competitors.

He said: "This increase has been labelled a green tax. Today's haulier is already operating trucks that are 60 per cent cleaner and greener than they were six years ago at the time of the first duty freeze.

"We, as 'essential users', already make a great contribution towards environmental improvements," he added.

The Freight Transport Association (FTA) said it believed the Chancellor had broken faith with the road freight transport industry by announcing an increase in fuel duty.

The association said the rise would increase industry's costs by an estimated £170m.

The Chancellor announced an initiative aimed at providing an incentive for the use of cleaner fuels in trains, similar to measures for cars.

The tax rate for piloting fuel mixed with biofuels would be reduced from 53p to just 8p.

George Muir, director general of the Association of Train Operating Companies, said that during 2006 the industry had undertaken work on introducing biofuels to the train fleet.

"The railway is by far the most environmentally friendly mode of powered transport and this step will help keep rail travel ahead of the game."

Peter Morris, 59, retired businessman: 'It was predictable - I'm not happy'

"I thought Gordon Brown's announcement today was predictable and I'm not happy about it." So says Mr Morris, who lives near Tenterden, Kent, with his wife, Sarah.

He believes that fuel and air passenger tax rises are a way of raising revenue for defence and maintained that there were other more effective measures that could combat climate change.

"I am highly suspicious about the report's so-called green credentials. I've investigated micro-generation technologies, wind power and rainwater harvesting - all attempts by me to rely on renewable energy sources. But there are all sorts of planning obstacles with regard to wind power and VAT is payable on micro-generation.

"I think Brown's taxes are all about raising money for the £600 million deemed necessary for operations in Iraq and Afghanistan and the other £84m they say they need to counter terrorism, let alone the billions required for Trident.

"They are just wrapping up increased taxes in a socially presentable way.

"I have family in New Zealand who I visit about twice a year. It's going to cost another £80 for myself and then another £80 for my wife every time we travel there. Before we start suggesting to people that they travel by boat around the world we need to look at the use of carbon fuels in America or the pollution caused by manufacturing industries in China.

"I can see why you might want to prevent people from travelling by jet aircraft but then they should invest in the train transport. Having travelled around the UK I know it's cheaper to travel by plane than by train. I drive a 4x4 Landrover Defender and I need that because I live half-a-mile down a farm track, which is barely passable in bad weather. I resent being lumped in with this Chelsea tractor-driver label which means I am liable to be hit with extra road and fuel tax. It all seems rather inequitable."

Sara Newman