George Osborne promises Tories will freeze fuel duty till 2015 - if they can find way to pay for it

Chancellor battles to join 'cost of living' fight but warns battle to clear Britain's deficit is far from over

Political Editor

Petrol duty will remain frozen until the 2015 general election, George Osborne announced today as he fought back against Labour's promises to tackle Britain's "cost of living crisis."

In his speech to the Conservative Party conference in Manchester, the Chancellor said that, as long as he could find the necessary savings, fuel duty would not be increased before the election. It would mean scrapping a rise of almost 2p a litre pencilled for September next year by the previous Labour Government.

Contrasting the move with Labour's pledge to freeze energy prices for 20 months if it wins the election, Mr Osborne said: "We don't just talk about being on the side of working people. We show it - day in, day out - in the policies we deliver."

A rise in fuel duty due to take effect this month was cancelled in his March Budget. He said then that petrol would now be 13p per litre cheaper than it would have been had the duty not been frozen over the past two years.

The Chancellor also used today's speech to warn that the battle to clear Britain's deficit is far from over. But he also held out the hope that working people would eventually reap a reward for the years of austerity, through tax cuts.

He promised that, if the Tories form the next government, they would "run a surplus" on the nation's books as an insurance policy against a repeat of the crisis that began under the last Labour Government. "Never again. This time we are going to run a surplus. This time we are going to fix the roof when the sun shines," he declared.

Mr Osborne said that would require difficult decisions and "discipline and spending control" in the next parliament.

He insisted that Labour's measures to reduce the cost of living gave the impression that this issue was "detached from the economy". He argued

that Labour's policy of higher borrowing, taxes and mortgages was "not the solution to lower living standards. They are the cause of lower living standards."

The Chancellor said: "The British public know that whoever is elected will face some very hard choices.

Our country's problem is not that it taxes too little. It is that its government spends too much. So while no responsible Chancellor ever rules out tax changes, I think it can be done by reducing spending and capping welfare, not by raising taxes."

He insisted: "The battle to turn Britain around is not even close to being over and we are going to finish what we started."

Mr Osborne hailed the Tories as the party of home ownership and small businesses and claimed it was Conservative rather than Liberal Democrat ministers who were responsible for the Coalition's key policies since 2010.

The Chancellor concluded on an upbeat note, saying: "We're turning Britain around. And we say to the people of this nation: We rescued the economy together. We're going to recover together.

And together, we're going to share in the rewards.For the sun has started to rise above the hill.And the future looks brighter than it did, just a few dark years ago."

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