Liberal Democrat leader Sir Ed Davey is pressing the government to implement an immediate 10p-per-litre reduction in fuel duty until Christmas. The proposal forms part of a wider cost-of-living package intended to provide relief for households facing high energy and travel expenses.
Sir Ed attributed the current surge in pump prices directly to geopolitical conflict, stating, “Petrol and diesel prices are higher than they’ve been for a long time because of Trump’s mad war with Iran, and people need help now.”
The party claims this 10p tax cut would equate to a 12p reduction per litre for motorists. While the policy carries an estimated cost of approximately £2bn, Sir Ed argued it would be self-funding by stimulating economic activity and leveraging tax revenue from VAT, gas levies, and the energy profits levy.
The government is currently navigating a difficult fiscal landscape, with Chancellor John Healey facing pressure to adjust taxes or spending in next month’s budget to manage rising borrowing costs. Current fuel duty remains frozen following decisions by the previous Conservative administration and the subsequent continuation of that policy by Sir Keir Starmer’s government, which in May deferred a planned 3p increase until the year’s end.
In response to the proposal, Labour Party chair Bridget Phillipson noted that the government has already taken steps regarding fuel duty. She acknowledged the Lib Dem position as part of their party conference strategy, telling reporters, “I’m sure John Healey will be open to any and all suggestions… they’ve got their conference, they’re making their pitch, good luck to them.”
Beyond fuel, Sir Ed is set to announce further initiatives at his party’s conference, including a proposal to slash the bus fare cap from £3 to £1, a 10% reduction in rail fares, and the removal of VAT from public electric vehicle charging points.
Additionally, Sir Ed reaffirmed his support for the state pension triple lock, rejecting suggestions from former business secretary Sir Vince Cable that the mechanism is unsustainable. Although party members were divided during a conference Q&A, Sir Ed insisted the policy remains essential for addressing pensioner poverty.
The triple lock currently ensures annual state pension increases based on the highest of three metrics: inflation, wage growth, or 2.5%. Critics argue the system is unaffordable for the taxpayer and inequitable toward younger generations, though Sir Ed emphasized that work remains to be done to bridge current inequality gaps. The report also notes that deciding in May to push back a planned 3p increase in September until the end of this year, fuel duty was frozen under the Conservatives in March 2022 and Sir Keir Starmer’s government continued the freeze. The report also notes that speaking at Q&A on the conference stage, Sir Ed said the policy had been introduced by the Lib Dems during the Conservative coalition to address inequalities and there was still work to do to tackle pensioner poverty. The report also notes that it has not finished the job,” he told party members, who were split in a show of hands about whether the triple lock should be scrapped if the Lib Dems win power. The report also notes that comments or questions about this story, do you have any views.
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