The Chancellor said that the planned increase in fuel duty, due this September, will not go ahead, and added that due to the freeze petrol prices will cost an average of £0.20 less per litre than they would have been under the previous budget plans.

Fleet drivers and fleet businesses will benefit from the fuel duty freeze and it will save them from difficulties usually experienced in connection with high fuel prices, said David Bizley, technical director at RAC. However, the cut in duty that was necessary in order to reverse the penalty charge, is effectively a tax on basically every business in the United Kingdom that uses vehicles, he added.

The RAC wants to see drastic changes and necessary cuts of £0.03 per litre in fuel duty, as the motoring body believes that it will do more good for the British economy than just freezing the fuel duty, he said. The benefits for the economy of a cut in the fuel duty has been demonstrated in studies conducted by the Centre for Economics and Business Research and the National Institute of Economic and Social Research.

The Chancellor also announced extra funding of £200 million for local councils to fix the worst potholes found on roads across the country – although councils will have to participate in a competitive bidding process.

Every penny will be welcomed by many councils in the country because of the bad weather this winter; however, only through consistent funding will the problem with potholes be solved, said Neil Greig, director of policy and research at the Institute of Advanced Motorists (IAM).

Find out how much you could save with our BIK Calculator.