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VW Golf 2.0 8v - High Fuel Consumption - sandhouse

I have a 2000 Golf 2.0 8v. If I do lots of city driving or short journeys, the petrol consumption drops from 35 to 25mpg or worse - the engine also starts surging / running rough and there is a smell of fuel from the exhaust. The only way I have managed to clear this in the past is to drive quickly on a downhill stretch of motorway, then take my foot off the throttle and let the engine overrun for as long as possible - say 75mph down to 60mph. I usually have to do this several times over a number of trips before it clears.