12 November 2012 Last updated at 17:26 ET

Labour loses fuel rise delay vote

 

The result was announced to MPs - Labour was defeated by 282 votes to 234

Labour's bid to delay an increase in fuel duty of 3p a litre planned for January has been defeated in the Commons by a government majority of 48.

Labour, which wanted to delay it until at least April saying "it would be wrong" for it to take effect sooner, was defeated by 282 votes to 234.

The party argued the 3p rise would stretch already hard-pressed families.

The Treasury said fuel was "now 10 pence a litre lower than under the previous government's plans".

Consumer organisation Which? said 85% of people it surveyed had expressed concerns about rising fuel prices.

Pollsters Populus interviewed 2,100 UK adults on behalf of Which? online between October 26 and 28.

'Worry'

The survey suggested 39% of people would cut back on motoring costs, while one in 10 said they had used savings to cover motoring costs.

Which? also said the figures showed 8.7 million households curbed their spending on essentials last month, while 6.4 million households used savings to cover outgoings.

The organisation's executive director Richard Lloyd said: "Rising fuel prices are the number one consumer worry and people are already telling us they're having to cut back and dip into savings just to get by.

"On the back of inflation-busting energy bill rises and increasing food prices, consumers can little afford another hit on their household budget. We're calling on the government to think again about their plans to increase fuel duty in January.

"The forthcoming Autumn Statement must focus on measures that will help put money back in the pockets of consumers, because the economic recovery is at risk if we don't increase consumer confidence."

Labour had said the rise would be wrong at a time when the economic recovery was still fragile.

"To boost our flatlining economy Labour has already called for a temporary VAT cut which would take 3p off a litre of fuel," shadow chief secretary to the Treasury Rachel Reeves said.

"But if ministers won't do this the very least they could do is axe January's fuel duty rise at least until April."

'Listening mode'

Labour had urged MPs from other parties - including Conservatives - to vote with it and ignore what it claims are "nods and winks" from the Treasury that a further delay may be in the offing.

But Conservative MP Robert Halfon, who has led the campaign against increasing fuel duty, said he would not vote with Labour until he had seen what Mr Osborne would do in next month's Autumn Statement - when he will update MPs about the state of the economy.

"The cost of fuel is the number one issue. That's why I am campaigning on it," he said. "I have had discussions with various people and it is my view that the government is in strong listening mode.

"If I didn't believe that I would make a point and go in to the lobby with Labour."

Had Labour won Monday's vote it would not have been be binding on ministers but a defeat would have embarrassing the government.

The duty increase was originally to be introduced last August, but in June Mr Osborne announced that he was postponing it for five months, saying it was being funded by what he called "larger-than-forecast savings in departmental budgets".

A Treasury spokesman added: "Since coming to office the government has listened to the concerns of motorists about high pump prices and acted."