George Osborne reveals fuel duty freeze until 2015

Speaking to the packed Manchester hall, the Chancellor also signalled more cuts ahead as he vowed to completely overhaul public finances so that the government budget runs at a surplus.

In a personal speech where he talked about his own families struggles in setting up a business, Mr Osborne promised future sustainable tax cuts.

He also vowed to increase capital spending on new infrastructure by inflation each year in the next parliament but fund this by making cuts to departmental budgets.

The speech was meant to position the Tories as the party of “small business and hard working people” as opposed to the “socialism” of Labour following their conference in Brighton last week.

The Chancellor’s promise to maintain infrastructure spending also included a commitment to High Speed 2 rail which would speed up the journey from London to Scotland. Mr Osborne also said he would back shale gas exploration and investing in new nuclear power stations.

The fuel-duty freeze - which is conditional on finding savings elsewhere – will mean that the expected inflation rises will have been cancelled for four years saving motorists a total of £22.6 billion from what had been planned by the previous Labour government. But the centrepiece of his speech was the new principle that the government must run a budget surplus, something which has only been achieved seven years in the last five decades.

Mr Osborne said this is the only way to bring down national debt, paving the way for sustainable tax cuts and preparing the UK for future turbulence in the global economy.

Attacking the former Labour government for running deficits even during the boom times ahead of the 2008 crash, he warned: “This crisis took us to the brink. If we don’t reduce our debts, the next could push us over.”

Labour Treasury spokeswoman Rachel Reeves said Mr Osborne had “nothing concrete to say on helping families with the rising cost of living”. “The few things he has said are already unravelling,” said Ms Reeves.

“His panicky announcement on fuel duty turns out to be just an aspiration if he can find savings elsewhere. This is on top of £1.6bn of unfunded commitments already made by ministers during the party conference season.”