The £100 Billion Giveaway
Fuel duty has been locked in political fear since 2010. November’s budget is the chance to restore fairness and fiscal sanity.
Fourteen years. That’s how long motorists have enjoyed a freeze on fuel duty.
It started as a political gimmick in the austerity years and has since ossified into sacred policy, repeated by Chancellors too scared of a Daily Mail headline to touch it. In real terms, duty has collapsed. The Treasury has haemorrhaged close to £100 billion that could have gone to schools, hospitals, and public services.
The freeze is not some neutral policy. It’s a state subsidy for petrol and diesel that benefits the better-off at the expense of everyone else. Car owners, on average, are wealthier than non-car owners. Meanwhile, public transport users have been quietly rinsed year after year with rising fares. London commuters see the price of a travelcard climb with inflation, while drivers enjoy a decade-long holiday from contributing fairly.
It’s also a climate absurdity. Britain claims to be serious about net zero, yet its tax system is designed to lock in oil consumption. Freezing duty undermines any attempt to shift behaviour. A steady, predictable increase would push more people towards EVs, hybrids, and better transport alternatives. Right now, the government is essentially paying people to keep burning fossil fuels.
The politics of it are cowardly, too. Ministers know full well the freeze makes no fiscal or environmental sense, but they’re terrified of backlash from the tabloids or a Reform UK soundbite. Yet the longer this goes on, the more painful the eventual correction will be. We cannot forever keep fuel artificially cheap while everything else in the economy adjusts to reality.
Yes, fuel prices bite in rural areas where alternatives are scarce. That’s where targeted support should come in. But shielding the whole country’s motorists at vast cost is not fairness, it’s a subsidy for middle-class car dependency.
If the Chancellor wants to show she’s serious about economic credibility, climate policy, and honesty with the public, she should end the fuel duty freeze in her Budget this November.