In one of his more politically important announcements since becoming Shadow Chancellor, George Osborne has promised to introduce relief for motorists facing a double whammy of higher fuel duty and higher oil prices.
At the moment fuel duty automatically goes up when the price of oil goes up. Under the Conservatives’ "Fair fuel stabiliser" the duty will fall when the price of oil goes up. The quid pro quo, however, would see duties rise when oil prices fell back.
Mr Osborne, making the announcement on BBC1, told Andrew Marr that if the Conservative policy was in place today motorists would be paying 5p less than they are currently paying under Labour.
A consultation paper is being launched later today which will determine exactly how the "fair fuel stabiliser" will work.
CentreRight’s Andrew Lilico proposed this very idea in 2000 and again recently.
10.30am: This just in from CCHQ:
"If a Fair Fuel Stabiliser had been introduced at the 2008 Budget:
> Fuel would be 5p per litre cheaper.
> This would save up to £3.50 on each tank of fuel for a Ford Mondeo, or £2.60 for a Vauxhall Astra.
> If, instead of rising, oil prices had fallen below the $84 forecast in the Budget, then fuel duty would have risen.
> In either case forecast government revenues would have been unchanged."