I welcomed the Chancellor's confirmation that there will be no changes to fuel duty which will remain frozen this year. I am proud of the strong action we have taken to help ease the pressure on family budgets.
As a result of the continued action taken on fuel duty since 2011 by the end of 2015-16 the typical motorist will save £9 each time they fill their tank compared to what it would have been had this action not been taken. I know this is a key issue for motorists and I always monitor this issue closely.
Abolishing the paper tax disc does not just remove an administrative inconvenience for many millions of motorists; it could also save businesses around £7 million per year.
The historic aim of displaying a tax disc was to show that VED has been paid. However, the benefits of a paper tax disc have become redundant over time, as the DVLA and the police now rely on the electronic vehicle register to confirm that vehicle tax has been paid. The DVLA continuously monitor unlicensed vehicles, using Automatic Number Plate Recognition (ANPR) data and licensing information. The use of ANPR cameras and wheel-clamping can effectively enforce against those who fail to pay VED; non-payment of VED is at a historical low - the latest figures confirm that over 99 per cent of motorists tax their vehicles on time.
With regards to calls to combine VED with fuel duty, maintaining VED's link with fuel efficiency alongside fuel duty's link with fuel consumption is consistent with economical fuel use. VED revenues make an important contribution to the public finances helping to raise around £6 billion each year. Fuel duty rates would therefore need to be increased significantly to compensate for the loss in VED revenue.