Boris Johnson is the latest figure to complain about fuel prices and call for a "fair fuel stabiliser" to offset rising petrol prices.
Under this policy proposed by George Osborne, tax on fuel would fall as oil prices rise so as to "stabilise" the price.
According to Osborne (PDF)
"Currently, when oil prices rise, the government receives a windfall increase in tax revenues, mainly due to taxes on North Sea oil production. And when oil prices fall, the government suffers an unexpected shortfall in revenues for the same reason."
Unfortunately for George the idea of a government "windfall" from rising oil prices is a myth. As the Sunday Times economics editor pointed out on his blog recently:
"Why is a fair fuel stabiliser, a Conservative policy before the election and now back in the news, not a good idea? Because, according to the Office for Budget Responsibility, it is a myth to say that the government gains from a temporary (or permanent) rise in oil prices."
And indeed if you take a look at the OBR's report from last year, you see that:
"Allowing for offsetting effects, particularly from the impact from a weaker economy means there is very little or no improvement in the public finances that could be used for stabilising the pump price."
In fact as these OBR spreadsheets show, rising oil prices can actually decrease the amount of tax taken by the government overall:
So if the government wants to introduce a "Fair Fuel Stabiliser" they will have to do it by raising taxes, charges and fares even more elsewhere.
And while motorists may save a few pennies, public transport users will continue to suffer ludicrously unfair and unstable travel costs.
In any case, for most families the effect of a fair fuel stabiliser would be barely noticeable with even George estimating (in 2008) that it would save them just "over £90" a year.
And with the cost of a single tank of petrol well on its way to that, it will be the fairness of that overall price and not its "stability" that most voters will focus on.