'3p off fuel' Tory pledge

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The Conservative party today pledged to cut duty on fuel by at least 3p a litre.

The Conservative party today pledged to cut duty on fuel by at least 3p a litre.

Shadow chancellor Michael Portillo said this would save a family with a Ford Mondeo £1.85 every time they filled up their tank and would cost the Government £1.1 billion in a full financial year.

Cuts in public spending would not be needed to fund the pledge because Chancellor Gordon Brown had billions of pounds of extra revenues stored in a "war-chest".

Mr Portillo, with William Hague beside him, said: "We believe that fuel taxes should be lower. It is clear that tax revenues from a number of sources are much higher than the Government estimated.

"Analysts believe that the Chancellor has about £5 billion more than he thought. It is perfectly possible to cut the fuel tax this year without any impact on Government spending or public services. Everyone knows that Gordon Brown has a war-chest. He knows it. Analysts know it, the people know it and I know it.

"It is clear that at least 3p per litre or 13.6p per gallon can prudently be taken off the tax on fuel. This would cost £525 million for the rest of this financial year.

"A cut on this scale would mean that a family with a Ford Mondeo would save £1.85 every time they fill up their tank."

He added: "We are saying today that if he does not make any reduction between now and the election we will implement this policy once elected.

"It seems likely that this can be achieved from higher than expected surpluses, the full year cost being £1.1 billion according to the Government's own tax-ready reckoner. But we have, in any case, identified specific reductions in public spending well in excess of that number so that this tax cut can be sustained in the long term.

"The reduction that we propose is prudent, achievable and moderate and only dogma from a Government that's no longer listening has led it to impose taxes at this level."

Liberal Democrat leader Charles Kennedy, speaking in Bournemouth where his party's annual conference is being held, said: "I don't think that the country will take seriously what William Hague's Conservative Party has got to say about tax on this or anything else.

"They seem to be promising reductions in tax on every available issue and increases in spending on all the right things. Real life isn't like that.

"We all know that William Hague is a populist - you come out with the latest viewpoint and he will back it if he thinks there's a vote in it. That is not responsible politics. People will see through it very easily indeed."