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Prescott holds road charge veto

CONGESTION BUSTING road charges will be kept in the hands of local authorities, the Government promised this week.

But authorities will have to prove to Deputy Prime Minister John Prescott that all money raised will be spent on 'worthwhile transport-related projects' over the next 10 years.

Details of the proposals for charging motorists are contained in the Government's long awaited consultation paper on reducing traffic congestion published this week. Breaking the logjam sets out plans which could see an extra 2bn made available for local transport by 2005.

The consultation paper says that authorities would be able to keep 100% of revenue generated by a road or parking charge scheme provided they meet guidelines set by Prescott. He will have the power to veto any proposal believed not to be in the broader regional or national interest, it says.

No target date has been given for the proposals to come into law but primary legislation is expected to give local authorities the power to ring fence such charging revenues to fund local public transport schemes over the next 10 years. In reality this is not anticipated before 2001.

The paper promises secondary legislation with guidance on the design of schemes, the scale and level of charges and exemptions from charges.

Proposals will allow local authorities to 'incur expenditure in developing proposals for road user charging schemes'. This could include diverting internal resources or using the private sector to design, build, finance and operate the schemes.

But in a move that has angered many long term supporters of hypothecation of road charges - including the Institution of Civil Engineers - the Government will review how much of the revenues local authorities are able to retain after 10 years.

The concern is that any review will give the Treasury the opportunity to scrutinise where the local authority has spent cash and claw back any additional revenues. Any future shortfall would have to then be paid back out of other funds.

'We believe the hypothecation of ring fenced user charging is the only way forward for local public transport,' said an ICE spokesman. 'But we are concerned that the Treasury may seek to reduce central funding for local transport schemes.'

However, the proposals do make clear that road charging will either be in the form of a zoned charge payable when drivers enter a designated area; or an area driving licence to allow cars to drive in a particular area.

Local authorities are also urged to introduce charges on workplace parking but the paper advises against charges on private non-residential parking such as shopping malls or leisure centres. It calls for local authorities to consider the displacement effect of a levy on commuters who might try to park at local retail outlets and asks them to encourage owners to take measures against this.

The paper anticipates that the first schemes will use displayed permits using a mix of automatic and manual inspection. But it is recognised that a longer term option is an electronic system with roadside receivers and car mounted transmitters. The paper even suggests that toll booths might be used.

However, an electronic charging based on speed or time in a zone has been ruled out as encouraging dangerous driving. Distance based charging is also discounted as impractical.

The Government wants compatibility of electronic charging systems in different zones.

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