The Chancellor George Osborne is planning to sell half the government's stake in Royal Bank of Scotland within two years, according to reports.

The faster than expected sale will raise fears taxpayers could lose out to the tune of billions of pounds.

Mr Osborne faced criticism last month when he announced the sale, amid warnings it could cost the taxpayer at least £7bn and as much as £14bn.

At the time Labour said that the public wanted their 'money back in full' and would be suspicious of a rushed sale.

RBS was bailed out by the then Labour government to the tune of £46bn in 2008, at the height of the financial crisis.

Since then there has been a lingering question mark over when, if ever, taxpayers would get their money back.

There have also been warnings from both RBS chairman Philip Hampton and former chief executive Stephen Hester that it could take years to return to RBS private ownership.

Ministers are expected to sell around half, or £16bn worth at current prices, of RBS shares within two years.

The first sales are expected to be as early as this September.

The move comes as the Chancellor prepares to set out a series of changes to the UK's finances when he unveils his summer Budget on Wednesday.

The event will be the first solely Tory Budget for almost 20 years, and will allow Mr Osborne to set out his economic plans without the constraints of the Liberal Democrats.

Among them is expected to be the delivery of his party's promise to end inheritance tax on family homes worth up to £1 million.

He is also expected to set out details of how the government will reach its target of £12bn of welfare cuts.

It is thought that ministers will focus on working age benefits and tax credits, in a move that Barnardo's Scotland has calculated could hit nearly half of all families north of the border.

Mr Osborne could also outline plans to subject benefits payments to a regional cap.

The limit outside London could be as low as £20,000 a year.

Mr Osborne has also confirmed he will create savings worth £250m by ending subsidies for high earners living in council houses.

In England and Wales shops could be allowed to open for longer on Sundays under plans to devolve powers over trading hours to major towns and cities.

A number of Scottish MPs including SNP MPS and Scotland's sole Liberal Democrat Alistair Carmichael have signed a letter calling on Mr Osborne not to increase fuel duty by inflation in the Budget.

The group adds: "He must (also) consider a real cut in this levy, the economist's preferred choice and proven to spawn prolonged growth tax revenue for the Exchequer."

The Conservatives say the Budget will be one for "working people" and will help ordinary employees.

The SNP's depute leader and Westminster finance spokesman, Stuart Hosie, accused Conservatives of risking weakening the economic recovery with unnecessary cuts.

He claimed that the Budget would be "less about boosting productivity and growth - more a sermon from an austerity cult, cutting where it is not necessary and weakening further the chance of a sustained recovery."

Deputy First Minister John Swinney has written to Mr Osborne outlining his opposition to deep cuts to tax credits.