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Road pricing: is pay per km next?

Pressure on transport funding caused by the public spending crisis has thrust nationwide road pricing back onto the political agenda, industry experts said this week.

The fear of spending cuts resurfaced last week after the renationalisation of the East Coast Main Line franchise put pressure on Department for Transport (DfT) funding.

RAC Foundation director and Imperial College London professor of transport and infrastructure Stephen Glaister admitted that “something will have to give” in transport under the threat of a fall in net capital spending.

“The government, or any new government, will be very keen to find new sources of cash flow. It would want to take road pricing more seriously,” he told NCE.

“The government will be very keen to find new sources of cash flow.”

Stephen Glaister, RAC Foundation

Open University professor of transport strategy Stephen Potter agreed that transport spending cuts are inevitable and that the next government would do “something drastic” like introducing road pricing.

Full privatisation of the trunk road network had been mooted since prime minister Gordon Brown told the CBI in May that the government’s 10 year plan to deal with the public deficit would involve more private ownership of UK assets.

“We are ready to sell off a substantial number of assets and are demanding efficiencies in the public sector,” said Brown. But industry experts agreed that the government will shy away from addressing full privatisation.

A sure fire vote loser

Campaign for Better Transport executive director Stephen Joseph said road privatisation would be a “sure fire vote loser” in the current political climate and warned that if done badly it would lead to worsening congestion on the roads.

He added that to make privatisation work, the government might need to look at selling off the national road network and find a way to make it generate good revenue.

“If it’s just the major roads [that introduce road pricing under privatisation] what do you do about parallel roads?” said Joseph.

“If the government does look at road pricing it would need to look at governing it properly.”

Stephen Glaister, RAC Foundation

Glaister agreed that the government faced a problem of perception and would need to address the issue of how to make any form of road pricing credible to the public.

“It would be difficult,” he said. “If the government does look at road pricing it would need to look at governing it properly, which might involve making the Highways Agency a more separate, more independent body,” he said.

He added that the set up of road pricing would not necessarily involve privatisation but suggested a process of “corporatisation” might be more appropriate.

Such an arrangement might mirror the structure of governance in the rail and water industries, where there is a statutory duty to supply, maintain and improve facilities as well as transparency in where funds from user charges go.

“Rail privatisation has failed − there is no doubt about that now. It’s a clumsy financial structure that’s not financially robust.”

Stephen Potter, Open University professor of transport strategy

However, Potter slammed the government’s form on transport privatisation. “Rail privatisation has failed − there is no doubt about that now. It’s a clumsy financial structure that’s not financially robust. The situation with the East Coast Main Line shows how susceptible it is and how it can fall apart,” he said.

Transport secretary Lord Adonis last month went so far as to rule out introducing road pricing in the lead up to, or during, the next parliament.

A DfT spokesman reiterated Adonis’s comments but refused to rule out road pricing as a possibility in the long term. “We can never be categorical, but it would be a long, long way off,” he said.

Dutch to go first

Road pricing is set to be introduced in The Netherlands from 2013, starting with trucks and followed by passenger cars a year later. Fixed taxes on car ownership will be abolished.

There will be a monthly bill to road users and the scheme will include differentiation of costs, according to road category, congestion and pollution level of the vehicle. Vehicles will be equipped with an on board unit that will register kilometres driven via GPS. Foreign cars will also be charged through identification of number plates.

Readers' comments (3)

  • John Mather

    It (road pricing) looks increasingly inevitable. Perhaps we should be focusing our attention on how to make it work properly. And if it allows us to make better use of an increasingly scarce resource (road space) that would be no bad thing. After all, we pay for food, electricity, gas and (increasingly) for water and sewerage on the basis of what we consume.

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  • Road use charges should be introduced not as a way to raise more money, but as part of a reform to take road financing out of Treasury control, and bring roads into the market economy, on the model of electricity, water and telecommunications, with road users paying the costs their journeys impose, and generally getting the roads they are prepared to pay for.

    Modern GPS-based methods enable road use to be assessed and billed as easily as cell-phone use, without invading the privacy of road users.

    Cambridgeshire may have an opportunity to introduce a cost-based road-charging scheme. The County considered applying for a TIF grant for transport improvement, including better road pricing, and then established a commission to consult the public and review the issues. My proposal for a voluntary pilot scheme, with participants paying less than they do now for the use of uncongested County roads, and more for using the most congested ones, can be seen on the Commission’s web site

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  • I can’t help but think that there are a number of other questions that need to be asked.

    I don’t think the issue is that of a government generating cash flow, it is a matter of road users paying for what they use. It has been generally accepted for a long time that using the telephone or travelling by train costs more at peak times – why should travelling by road be different ? The system currently being trialled in the Netherlands is not aimed at raising funds; in fact the cost effect will be neutral for the average road user (about 16.000 km/year). This principle must be the key to gaining public acceptance of road pricing. Obviously If you drive more, you pay more. It is also worth noting that the road pricing scheme in the Netherlands will see the abolition of fixed taxes on car ownership. Is the UK government proposing the same?

    It is not just the short term out of pocket cost for the road user that needs to be considered - however, I think we also need to look further ahead to the potential long-term savings and environmental benefits that a pay per km system may deliver.

    The technology is already available, why not have a trial in the UK?”

    Ernst Malipaard, Director of Transportation, Grontmij UK

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