Compelling case for UK road charging, IFS study says

Road Private money could be used for road maintenance in future if the prime minister has his way

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There is a "compelling" case for road charging in the UK rather than the current system funded by taxes on fuel, a study has suggested.

The report by the Institute for Fiscal Studies (IFS), funded by the the RAC Foundation, suggested a "radical overhaul" of road taxes was needed.

Fuel and Vehicle Excise duties raise about £38bn a year but are set to fall.

The Treasury said possible new ways of funding roads would not involve tolls or pricing on existing routes.

It added that revenue from duties was currently rising.

Forecasts from the Office for Budget Responsibility predict tax revenues from duties will fall by £13bn a year, at current prices, by 2029, as cars become electrified and more fuel-efficient.

Plugging the gap would require a 50% rise in fuel duty, according to the IFS.

It recommends moving towards a nationwide system of road charging, including road tolls, to account for this loss of revenue.

The IFS says a solution would be to charge drivers by the mile, with higher pricing in congested areas at peak times. Drivers in the countryside would be likely to pay less.

"Such a move would generate substantial economic efficiency gains from reduced congestion, reduce the tax levied on the majority of miles driven, leave many (particularly rural) motorists better off, and provide a stable long-term footing for motoring taxes without necessarily raising net additional revenue from drivers," the IFS said.

Private roads?

The IFS said that the current system of taxation on fuel "cannot vary according to time and location", and so is "fundamentally unable to account for" differences such as levels of congestion and demand.

"Taxes on road use, however, would be able to do so," it said.

The Treasury and Department for Transport are carrying out a feasibility study looking at "new ownership and financing models" for the roads, with the results due in the autumn.

Prime Minister David Cameron, meanwhile, has suggested that private money be used to improve England's road network.

The government is consulting on charging tolls to motorists, following on from the existing M6 toll road.

It is also considering "shadow tolls" - a fee to the road maintenance company per driver using a road, but paid by the government rather than drivers.

Under the plans, companies would lease motorways and trunk roads from the government, maintaining and perhaps improving them by adding lanes, for which - as long as they meet targets - they would be entitled to a share of road taxes.

The construction of new roads could also be taken on by the private sector.

An online petition against a national road pricing plan by the last Labour government secured two million signatures.


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  • rate this

    Comment number 794.

    The proposals seem to suggest it would be a good idea to charge more when roads are busy. The roads tend to be busy when people are going to work. All I can see is this idea making it even less financially viable to go work

  • Comment number 793.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 792.

    The case for road tolls is a simple one under this Government. If you can afford to pay you can afford to use.
    Id there were any risks to the use of roads for the majority then the Minister for Transport would merelt veto publication of any data just as the Health Minister has with the risks to the NHS.
    Open, transparent Government not under the Con Dems.

  • rate this

    Comment number 791.

    Thirty one million private cars on UK roads, FIVE MILLION deaths worldwide due to the motor vehicle. I have never owned a car, from a very early age I considered the motor car to be a true obscenity. I used to cycle, now I am a pedestrian. When I cycled I was aware of the killing machines all around me, Now when I go out walking I have to consider routes because of the killing machines.

  • rate this

    Comment number 790.

    Propaganda nonsense from the BBC

    It doesn't matter what the government does



    This is all governments can do nowadays
    Governments are incapable of doing anything else

    The only real question is:
    Are our government idiots going to make an even bigger mess of our roads than they managed with our railways?

  • rate this

    Comment number 789.

    If they scrap the other road/fuel taxes, put a tracking box in my car and I have to pay less as a result (There ought to be a subsidy for rural travel), then I'll be happy.
    I don't care what people find from the box, it's not like I have to worry about being caught speeding or being a dangerous driver... I think some people have something to hide when they cite 'invasion of privacy'!

  • rate this

    Comment number 788.

    772.leftrightleftright "Why the debate?" Exactly If the government want to do this they will do it regardless of how much opposition there is from the public.Hand them a petition with 10 million signatures against it and they will do it anyway.David Cameron does what HE thinks is right for the rest of us.He knows best and we don't.However we pay all our taxes for the govnt. to serve us not dictate

  • rate this

    Comment number 787.

    I wonder which government minister will get a nice plum job in the private sector out of this crazy idea?

    We already have something called a Road Fund License which is supposed to cover road maintenance. The only reason these roads are now costing more to maintain than 20 years ago is because they are now maintained by private companies.

    So whats the government solution? MORE privatisation!

  • rate this

    Comment number 786.

    Just now
    Comment number 657.BertFromPoplar
    young joy riders and reckless young motor cyclists - both a plague on the roads
    A study (Clarke et al 2004), found that road users other than the injured motorcyclists are usually the cause of crashes and therefore road safety initiatives should be targeted at those other road users in addition to bikers. makes you think..!

  • rate this

    Comment number 785.

    766. TidalMilky

    "So Fuel Duty and Road Tax raise £38bn per year.
    How much of this was actually spent on Road maintenance? I will take a wild guess and say 50%"

    From the RAC Foundation (2007-08)

    "Road users therefore contribute over £48 billion to the Exchequer each year."

    "expenditure on roads by central and local government amounts to some £9 billion per year."

    ... so around 18.75%!

  • rate this

    Comment number 784.

    Over the last 100 years we have become more mobile which has allowed the country to develop it's talent through technology and efficiency.
    Are they trying to take us back to a time when no-one moved anymore than a few miles from their birthplace?

  • rate this

    Comment number 783.

    May be it's about time the Govt. should stop finding new ways of charging us to extra plug the gap and think of ways they should stop wasting our money. The days of spending what has be extracted from the motorist on the roads has been long gone but we do remember that the Govt. said when the debt on the Dartford crossing has been paid they will take the tolls down which would ease congestion.

  • Comment number 782.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 781.

    The only thing this or any other review is interested in is extracting as much from road users as they can. To the government the motorist is just a cash cow to be milked.

  • rate this

    Comment number 780.

    Which ever way you look at it vehicle drivers are screwed! You will either pay road tax, fuel duty or more in the cost of the food and goods you buy because of transport costs! If anyone thinks that any current main pollitical party gives a damn then you're deluded.

  • rate this

    Comment number 779.

    Get on our bikes? Have you ever seen the streets of some Asian countries? You'd not only get lots of accidents but cars would then be restricted to the speed of a pedal cycle. Plus the Gov would lose billions in duty, plus completely impractical for those that have to travel 15 or miles to work.
    You folks advocating that need to get real!

  • rate this

    Comment number 778.

    764. Syx

    Yes but caps do make me feel better sometimes.

    You're contradicting yourself somewhat - you acknowledge that a proportion of all income goes towards road upkeep, yet you want to license cycles so they pay their "fair share". However as per the former statement, those cyclists with jobs already do.

  • rate this

    Comment number 777.

    Tolls but no road fund licence (like in France) - best option
    Tolls and road fund licence - is what we'll end up with
    I smell another PFI - we'll pay for the roads and the lifestyles of the so called 'investors'. Privatisation with no competition = higher cost and no benefit (think water companies). Surely the first place to start is learning how to resurface a road properly!

  • Comment number 776.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • rate this

    Comment number 775.

    Tolls are all very well .I live in France where most motorways are toll roads.A recently constructed road the tolls are so high that the road is underused .The less traffic the more tolls are raised .Often the tolls are the same as the cost of the fuel .So traffic uses the original roads and continue to be a nusisance to inhabitants elsewhere . With the high rate of tax in the UK tolls are unjust


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