UK Budget - RAC reacts to fuel duty and pothole funding announcements

Image: Getty. All rights reserved
Image: Getty. All rights reserved

Following announcements made by the Chancellor in today's Budget, please see two statements from the RAC.

Fuel duty freezes continue for another 12 months

RAC head of roads policy Nicholas Lyes said: “We welcome the Government’s decision to keep the 5p fuel duty cut in place for another 12 months. The cut has given drivers some much-needed relief in what has been the most torrid year ever at the pumps, with price records being broken even after duty was cut. Given the importance of driving for consumers and businesses, duty should be kept low to help fight inflation.”

Pothole funding

RAC head of roads policy Nicholas Lyes said: "While welcome, another £200m is unlikely to make a big difference to the overall quality of our dilapidated local roads.

"We need to significantly increase funding for local road maintenance and improvement so councils can resurface roads properly rather than patching them up and hoping for the best. Last year the Government spent £1.125bn on local roads in England which is in stark contrast to the £7bn that went into major roads from car tax, despite local roads covering so many more miles."

VAT on public EV chargepoints (no announcement made)

RAC head of roads policy Nicholas Lyes said: “We’re disappointed the Government has not brought the 20% rate of VAT on public charge points down to match the 5% levied on domestic charging. A third of drivers do not have access to a driveway or a garage so will continue to be put off going electric or, if they have already have, penalised by high public charging prices, exacerbated by paying more in VAT than they should have to.”

Find out more about current UK petrol and diesel prices via RAC Fuel Watch.

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Diesel tops £2 a litre for first time ever
RAC head of policy Simon Williams said: “This is a pump price threshold that no-one wanted to cross – the average price of a litre of diesel has risen to a record 200.01p and is showing no signs of slowing, heaping more misery onto motorists. The cost of filling up an average family car is now £110, almost £32 more than it was at the start of the US/Iran war. This will be very challenging for households and companies that drive a lot of miles, from commuters, haulage and delivery firms, businesses with large fleets all the way through to sole traders. In a cruel twist, it’s diesel vehicles, which were once considered the most cost-effective option for lengthy journeys, that are now burning a hole in people's pockets.
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Price of diesel reaches record high
RAC head of policy Simon Williams said: "The average price of a litre of diesel has now reached the highest level in UK history at 199.18p, in what will be a financial blow to households and businesses that use their vehicles regularly. The cost of filling up an average family car is now almost £110, £31 more than it was at the start of the US/Iran conflict. By eclipsing the previous highest price of 199.09p seen in June 2022, the diesel price has entered new uncharted territory. This spells pain not only at the pumps for drivers, but for everyone who buys goods or services that rely on diesel lorries and vans; undoubtedly these increased costs will be passed on to consumers.
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Diesel teeters on brink of all-time high
RAC head of policy Simon Williams said: "The average price of diesel is teetering on the brink of a new all-time high at 198.32p, taking the cost of a 55-litre fill-up for a family car to £109.
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The RAC is an iconic British driving services brand and has been championing drivers since 1897. Today it is one of the UK’s most trusted names, providing complete peace of mind ® to over 15 million drivers across breakdown cover, insurance, and mobile servicing and repairs.

Its nationwide patrol force attends more than two million breakdowns every year, while its position as the UK’s leading independent insurance broker helps motorists find the right cover with confidence. The RAC has also reshaped the service, maintenance and repair market with its Mobile Mechanics, who carry out servicing and repairs at drivers’ homes or workplaces.

Committed to innovation, the RAC is fully electric ready with mobile EV charging technology for stranded drivers, and a suite of digital and data‑led solutions that make motoring easier and more affordable for consumers and fleets. These services come together in myRAC – the all‑in‑one app for vehicle maintenance, cheaper fuel finding and breakdown assistance.

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