Chancellor George Osborne has decided to put off increasing the duty on fuel until next year to the relief of UK motorists and campaign groups. Up until the announcement was made yesterday drivers were facing a hike of 3p on every litre. Previously the Chancellor had insisted that the move was necessary as a way of combating the country’s deficit.

Although opponents are insisting that this is yet another U-turn by the government sources at the Treasury are denying the accusations by insisting that the policy was initiated by the last Labour government. Mr Osborne said that fuel was now 10p cheaper than it would have been had Labour remained in power.

The move has been welcomed by the AA. President Edmund King said that the news was good for motorists ahead of the summer holidays and that any hike in prices would have cast a shadow over the London Olympic Games.

RAC Foundation spokesman Professor Stephen Glaister said the decision was good for the UK economy and would help households struggling to cope with finances. FairFuel UK also said that the announcement would be welcomed by drivers and businesses.

However, some Tory ministers who supported the freeze are said to be angry that they were defending a decision which leaders were intending to give up. Ed Balls, the Shadow Chancellor called the announcement a U-turn adding that the budget was now in tatters following similar reversals over caravans, pasties, churches and charities.