Labour's Ed Balls urges fuel duty rise delay

Labour has said it will attempt to force the government to delay the 3p-a-litre rise in fuel duty due to come into effect in August.

When MPs debate the Budget next week, the party will put down an amendment seeking to put off the increase until at least January next year.

Writing in Tuesday's Sun newspaper, shadow chancellor Ed Balls accused the coalition of "clobbering" families.

A Treasury source said the rise was actually the last from Labour's Budget.

The source, speaking to the BBC, accused Labour of "hypocrisy", adding that Mr Balls had voted for the rise at the time.

The source said that the government had taken action to ensure that fuel was 10p cheaper than it would have been under a Labour government.

In his March Budget, Chancellor George Osborne said the plan to raise fuel duty by 3.02 pence in August would go ahead.

In the Sun, Mr Balls said: "With Britain now in a double-dip recession, the last thing our economy needs right now is another tax rise adding to the squeeze. The government should be giving our economy a boost - not clobbering families, businesses and pensioners just at the wrong time."

Labour says putting off the rise until next year would cost between £500m and £600m.

It suggests paying for it with the £500m underspend in the Olympics budget or by closing tax loopholes and reversing changes to tax allowances for pension contributions for those earning more than £150,000.

Mr Balls said: "Difficult decisions are needed to get the deficit down. That's why Labour put up fuel duty in the past. But we often delayed or cancelled planned duty rises based on the circumstances at the time - including at the height of the global financial crisis."

Last week the prime minister said the rise would be "looked at", but held out little hope for a delay, saying: "I think people sitting at home know that the government doesn't have a bottomless pit of money."

Several Liberal Democrats and one Conservative have already signed a House of Commons motion calling for the rise to be scrapped.

Last month, Transport Secretary Justine Greening said she would consider legislating if the fuel retailers did not pass on falls in oil prices to their customers.