Fuel duty could rise for first time in nearly a decade, the Chancellor has suggested, as he told MPs he must find the money needed for the NHS.

Philip Hammond refused to back Treasury analysis supporting the fuel duty freeze and instead hinted he will increase the tax on petrol and diesel in his Budget later this year to help support the struggling health service.

Addressing concerns raised by Conservative MPs the Chancellor said the decision to freeze fuel duty since 2011 means the Government has "foregone" £46 billion in revenue and expects to miss out on £38 billion more if the freeze continues.

He appeared to make a moral argument for increasing the tax, urging MPs to consider "the other side of this coin" and warning the same amount of money is double what the Government spends on NHS doctors and nurses each year.

Furious campaign groups warned last night that hiking fuel duty would hit every part of the British economy and result in higher food prices, transport costs and put pressure on families already struggling to cope.

Jack Cousens, head of roads policy for the AA said: “The Government talks about helping those who are ‘just about managing’, but a hike in fuel duty would be a hammer blow to household budgets across the country.