Chancellor George Osborne
Chancellor George Osborne is to announce his Autumn Statement on economy on Tuesday. REUTERS

George Osborne is expected to announce a limit on rail price hikes and credit easing on small businesses in his Autumn Statement on Tuesday.

The Chancellor's new plan is expected to bring some relief to the households which are under severe squeeze.

In a series of measures to ease the financial burden on the families, the Chancellor will propose a one percent cap on rail fares above inflation beginning next year. Earlier, the government was planning a three percent price hike above inflation for the national network and the London Underground.

But the commuters have to still confront a 6.2 percent rise in fares since the inflation is currently at 5.2 percent based on which the benchmark was set. The country is also expecting a reversal of the proposed 3 pence increase in the fuel price that is to come in to effect in January 2012.

Osborne's is also expected to announce £15 billion credit ease for the struggling small firms in an attempt to prevent the economy slipping back into recession. Under the plan, the government will underwrite the bank's borrowing from the commercial money market, thereby helping them borrow more cheaply. The banks will then pass on the savings to the firms they lend to in the form of lower interest rates.

The new proposals come in the wake of expectation of a not-so-encouraging growth data to be published by Organisation for Economic Development and Co-operation on Tuesday. The watchdog is expected to predict that Britain to go back into recession in the first six months of 2012 because of the eurozone debt crisis.