Fleet News

Industry view: road pricing

ROAD pricing is likely to prove one of the most controversial and contentious questions to face any government in the next five to ten years.

But road pricing is needed. Of that, there is no doubt whatsoever in my mind. We simply have to change the way we use our road network.

Already our motorways are crowded all day, with a scarcely-discernible reduction in traffic flows for what used to be called the ‘off-peak hours’.

Our main roads and town centres are little better and pedestrians suffer from the resultant poor air quality. We have to encourage people to use our roads less or at less crowded times.

Transport minister Alistair Darling said in June 2005 that change was needed if the UK is to avoid LA-style gridlock, and I think he’s right. He also said there were concerns about road pricing technology and civil liberties.

He may be right on the second point but he’s wrong on the first. The technology already exists and by the time that road pricing is likely to be introduced it will have moved much further on.

But a much larger and more practical problem than civil liberties is that of getting 30 million motorists to buy into the scheme.

The Institute of Public Policy Research (IPPR), which is close to the Labour Party, believes that Vehicle Excise Duty (VED) should be abolished as a sweetener – something opposed by the police on the grounds that the keeper records would rapidly deteriorate. The IPPR also believes that road pricing may not be as politically challenging as the fuel duty rises in recent years.

This is not a scenario to which I can subscribe. The government has not yet said whether the scheme would be tax-neutral or additional to the present duties on fuel and vehicles. If it’s tax neutral then buy-in from motorists could possibly be achieved. If it’s not, then some form of coercion or mandatory imposition will be required and few politicians will risk their popularity for that.

There is another difficulty here too. If the scheme could be made tax-neutral then who will pay for the projected £100 million that the scheme would cost to introduce? And how would the government fund the ongoing running costs?

Government schemes involving technology, especially computer- based systems on which this would undoubtedly run, have a very poor record of development and implementation. Although admittedly more complex than road pricing, the new NHS computer system is already late. One of the system suppliers has pulled out and the cost could eventually overrun by two and a half times.

There are a host of other issues to be resolved as well. How will rental companies charge their customers? How will the infrastructure of billing and payments work? How will the scheme be introduced? Will we have to have two schemes – one for new and one for existing vehicles? How will enforcement work? And most important of all – what is the deal for the motorist?

If you think I’m being negative about the scheme, then you’re wrong. The prizes of reduced congestion at peak times, better traffic management, improved air quality and lower CO2 emissions are worth striving for.

The BVRLA is fully behind the scheme. We are already in discussions with a major rental company which could be used to trial any system on behalf of the industry and through our participation in the Motorists’ Forum and the Retail Motorist Strategy Group we are working hard to ensure that a scheme would be practical and fair and would actually achieve the objectives it has been set.

The benefits from the scheme could be very significant.

Companies will re-evaluate the business use of vehicles and would, I suggest, make greater use of technology in video and telephone conferencing and use alternative transport where it is more cost-efficient.

For some years now, the BVRLA has used telephone conferencing as an alternative to travelling and we nearly always use the local train for journeys into London, where previously we might have used our cars.

Companies will also look hard at the types of vehicles they operate. If the scheme is linked in some way to CO2 emissions like all other current car related taxes – and I think it should be – then companies will transfer to lower-polluting vehicles. Since, according to research from the International Car Distribution Programme (ICDP), some three quarters of all vehicles are purchased with company money, then these lower-polluting vehicles will eventually wash out into the used car parc to all our benefit.

There is much to be gained from the scheme. Yes, there are issues and difficulties ahead but nearly always something worth achieving does not come easily. The BVRLA will support road pricing provided that its implementation is practical, fair in taxation terms and is not an administrative burden on the industry.

Fact file

  • Road pricing is needed and the technology already exists.
  • The difficulty will be in convincing motorists of the need for road pricing.
  • Making road pricing tax-neutral would be a big help.
  • Details of charging need to be worked out.
  • Benefits could be significant.
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