Flood-hit farmers and struggling hauliers have given a cautious welcome to Chancellor Gordon Brown's pre-Budget statement, but warned it did not mean the threat of action over fuel prices was over.

Mr Brown delivered a raft of proposals in yesterday's speech designed to make the cost of motoring cheaper without directly tampering with petrol pump prices.

He announced a freeze in fuel duty, a total cut of 3p a litre in ultra low sulphur petrol and diesel from Budget day 2001 which, he said, would be available in every garage next year.

The Chancellor said 1.5p per litre would normally have been added to petrol and diesel from Budget day next year, raising £560 million, which he would now forgo by cancelling the planned increase.

He outlined plans to introduce a 'Brit Disc' for the haulage industry to make overseas motorists pay for using British roads.

The green theme was continued with plans for a fund to help convert or scrap old trucks and invest in training.

Haulier Michael Gallagher, owner of Bradford firm M Gallagher Transport, welcomed the changes as a step in the right direction, especially the reform of vehicle duty which will see the average trucker pay £750 compared to about £2,000 per vehicle.

He said: "It's the right move and it's about time foreign truckers had to pay for using our roads like we do for theirs. It could be too late for some hauliers but the reduction in ultra low sulphur diesel and the other measures will help the rest of us. What we need now is to pay £60 in vehicle excise, like the rest of Europe, and have diesel prices lowered so they match the continent too."

Farmers benefited with road tax on tractors and agricultural vehicles abolished from 2001.

But the speech failed to appease the Road Haulage Association. Regional manager Edna Gill said: "We were looking for a 32p a litre of diesel rebate in fuel under the essential user scheme to address competitiveness problems.

"Using the Chancellor's own figures, the total package is worth 8p a litre, a quarter of what we were looking for."

She added the Brit Disc would be difficult to enforce because it could discriminate against other EU hauliers and warned: "I think the Fair Play on Fuel campaign will continue until the Government addresses this competitiveness issue and gives us a level playing field."

A spokesman for the north eastern branch of the National Farmers Union (NFU) welcomed the abolition of road duty for agricultural vehicles. He said: "Farmers need all the assistance they can get at the moment, especially with the floods. It's also good some of the hauliers are being helped which will have a positive impact on the farmers.

"But it is too early to say whether those protesters who were involved in the fuel action, which the NFU took no part in, will accept the measures."

The speech also made room for inner city rejuvenation with measures, as reported in Tuesday's T&A, designed to bring people back into city centres such as Bradford.

The most disadvantaged communities would see a stamp duty exemption, tax relief for converting empty properties above shops to flats and tax credit for clearing up contaminated land.

Councillor Margaret Eaton, leader of Bradford Council, said: "Anybody would be appreciative of extra resources, but I would want to see the detail of the plans and what exactly they are proposing. The devil is often in the detail. Although I do say additional resources for Bradford are always welcome."

Bradford Chamber of Commerce and Industry welcomed some of the initiatives but said more could have been done to simplify the tax system and help firms.

John Pennington, deputy president of the chamber, said: "Further streamlining of the tax system is still needed if the Government is serious about encouraging a genuine entrepreneurial culture."