Brown will cut tax for lorry drivers to head off protests

Big cuts in road tax paid by lorry operators will be announced by Gordon Brown tomorrow in an attempt to head off another wave of fuel protests.

Big cuts in road tax paid by lorry operators will be announced by Gordon Brown tomorrow in an attempt to head off another wave of fuel protests.

The Chancellor will unveil a shake-up of the complex system of vehicle excise duty (VED) as the centrepiece of his package of measures to help hauliers. The changes will reward hauliers who switch to lorries which do less damage to roads and the environment.

In tomorrow's draft Budget, Mr Brown will also announce an increase in the basic state pension in a move aimed at quelling the anger of pensioners over this April's 75p-a-week increase. It could rise by between £4 and £5 a week in each of the next two years, giving a total rise of between £8 and £10 a week by 2002. The Chancellor will say all pensioners need help during the transitional period before a new pensioners' credit takes effect in 1993.

Mr Brown is confident his shake-up of road tax for lorries will take the heat out of the hauliers' protest. He will say the reforms are consistent with the Government's environmental objectives.

The changes will go much further than moves announced in the March Budget, when the VED rate for 40-tonne lorries was cut from £5,750 to £3,950 and the charge for the less road-damaging 38-tonne lorries reduced by a further £500 to encourage their use.

Mr Brown also plans a "Brit disc" under which all hauliers would need to buy a £1,500 disc to use British roads. British firms would have the cost refunded through their VED, unlike foreign-based competitors.

There were signs last night that hauliers' leaders would welcome Mr Brown's reforms. The North Wales farmer Brynle Williams, one of the leading figures in the People's Fuel Lobby, emerged from a meeting with Lord Macdonald of Tradeston, the Transport minister, to say he was optimistic that a "sensible and amicable conclusion" could be reached.

But some fuel campaigners dismissed as not enough Mr Brown's plan to announce a freeze on the duty on petrol next April. They want a 26p cut. Today William Hague will reject the freeze, saying it would merely "lock in" in high levels of fuel tax. The Tory leader will say the petrol crisis, floods and problems on the railways show Tony Blair and his government have "lost control".