During his 2012 Autumn Statement, he said: "There will be no 3p per litre fuel rise in January."

Subsequent increases will now take place on 1 September each year, the chancellor said, with the amount of the next rise set to be revealed in April 2013.

The decision to scrap the January fuel price hike should help to prevent prices rising by almost 4p per litre with VAT at 20%.

Tyre and servicing firm ATS Euromaster welcomed the move but said reducing fuel duty would have given the economy a much needed shot in the arm.

“Scrapping the fuel duty increase is a positive step; but a 3-6p per-litre reduction would have given the country a far bigger boost,” said group managing director Ian Stuart.

The chancellor also announced a £1bn investment in the UK’s road infrastructure.