The Government should introduce dynamic road-user pricing which takes into account a driver’s journey, the time of day, congestion on the network, and even their financial situation, suggests a new report released today (January 24).

Funding Roads for the Future, released by the Association for Consultancy and Engineering (ACE), says that the existing model based on raising funds through fuel duty, vehicle excise duty, and the HGV levy is failing in the face of new technology and changing social trends, such as zero-emission vehicles, ride sharing, and increased urbanisation.

It urges short-term reforms to the existing road taxation system, pushing it towards the longer-term aim of dynamic road user pricing.

Dr Nelson Ogunshakin, chief executive of ACE, said: “Our report argues that in the years ahead only a reformed funding regime based on dynamic road user pricing will manage traffic flows and deliver the significant investment needed to keep the country moving.

“It’s vital that the Government starts these conversations with the public now, as to date there have been suspicions of road user pricing and fears that people will be priced off the road. This doesn’t have to be the case and there is a great opportunity to develop a fairer-for-all road funding system which delivers the first-class road network that this country needs long into the future.”

The ACE report comes after the Government launched a consultation on reforming the current heavy goods vehicle (HGV) levy, which is used to pay for wear and tear on the roads.  Lorries could be charged under a new pay-per-mile regime to cover the cost of damage to the road network.

The Government says it wants to work with industry to reform the levy “in a way that rewards hauliers that plan their routes efficiently, incentivises efficient use of roads, and improves environmental performance, including air quality and carbon emissions”.

Some of the other recommendations of the ACE report include:

• Develop a new overall National Roads Strategy outlining a co-ordinated approach beyond the national network, including introducing a Local Roads Fund to amalgamate and ring-fence funding for local roads.
• Look at short-term reforms to widen the scope of Vehicle Excise Duty to include zero-emission vehicles, therefore securing revenue for the National Roads Fund.
• Reform the existing HGV road user levy, using it as a pilot for the broader introduction of dynamic road user-charging across the network.
• Establish a Local Infrastructure Tariff allowing councils to develop a sustainable revenue stream for local road infrastructure investment.
• Increase private investment in England’s road network.

The report was created with the detailed input of ACE’s Road Sector Interest Group. Dave Beddell, managing director of strategic highways (Europe) at AECOM and chair of the group, said: “Such is the importance of the road network to our national economic and social well-being that we cannot allow the way in which we fund its future development and operation to become misaligned with emerging customer needs. 

“Alongside the increased levels of spend we have seen allocated to parts of the network in recent years comes an equally exciting opportunity for industry to work alongside Government in order to create an investment framework that supports a modern and sustainable road network.”

Ozgur Tohumcu, CEO at connected car technology provider Tantalum Corporation, said: “We welcome ACE’s intervention into the debate around what changes in connected car technology can offer in the field of road pricing.

“This area has, understandably, been pretty unpalatable to voter-drivers and therefore to policy makers too. But as we have seen in the field of emissions and our Air Car product, legislators are coming to understand that connected vehicles with GPS, a SIM card and a payments capability present a range of totally new possibilities to tackle real problems such as congestion, air quality, parking, affordable car insurance and whiplash fraud. The potential here is enormous. From a technology standpoint, Tantalum could do what ACE is recommending today.”

The report can be downloaded from ACE’s website.