Pressure mounted on David Cameron to reduce petrol prices last night as Scotland’s First Minister pledged to cut fuel north of the border by 10p a litre.
With motorists facing record prices, Mr Cameron is under growing pressure to make good on his opposition promise to bring in a fuel duty stabiliser, which would reduce tax when basic fuel prices rose.
The idea was all but ruled out by the independent Office for Budget Responsibility but the Prime Minister last week hinted it was still on the agenda.
Now Scotland’s Alex Salmond has put his government on a war footing with Westminster by making a cut in petrol tax a key pledge in his bid for a second term in office.
Mr Salmond, who faces Scottish Parliamentary elections on May 5, told the Sunday Express he would be taking the battle to control the nation’s economy to Downing Street. His opening salvo was a promise to cut pump prices by 10p a litre if a campaign for Scotland’s own fuel price regulator was successful.
Mr Salmond said it was “extraordinary” that drivers in oil-rich Scotland were facing pump prices of between £1.20 and £1.30 a litre. “Before the election, George Osborne said he would have a fuel price regulator, which was originally an SNP proposal,” he said. “The idea being as oil prices increase you use that additional money, that unexpected bonus to offset against the fuel duty so you can provide some stability in fuel prices. You can take 10p off a litre. Oil revenues flowing into the London Exchequer will be £10billion this year, another £1billion from recent price increases, and yet we are paying the highest petrol prices in the world. It’s an unbelievable position. How on earth can you arrive at a situation where Europe’s leading oil producer, along with Norway, is in that position? No other country would stand for it.”
Mr Salmond said he would fight for new powers to introduce a fuel price regulator.
A 10p cut in fuel duty in Scotland would cost £500million a year. The First Minister predicted that public anger over the “forgotten” Tory election pledge to introduce a Fuel Duty Stabiliser would become a political albatross to the Tories as tuition fees proved for the Lib Dems.
He said: “As this issue hits home I think it could be George Osborne’s ‘tuition fees’.”
His comments came as the Federation of Small Businesses urged the Prime Minister to deliver on the fuel duty stabiliser promise. John Walker, Federation chairman, said the double whammy of VAT rises and record fuel prices had left many small firms on a “knife edge”.
Thanks to Daily Express & FRV for the tip