Road charging inevitable
September 1st 2010

Road charging is set to be one of the key transport debates over the coming years, says Roger Williams, chief executive officer of the UKWA

In an attempt to force foreign hauliers who operate in the UK to make a financial contribution to the upkeep of Britain’s roads infrastructure, the last Government proposed the introduction of the Lorry Road Road User Charge (LRUC).

First mooted by Alistair Darling in 2002 and slated to come in to effect in 2008, the LRUC was supposed to be different to the European road tolling schemes which raise revenue from domestic as well as foreign traffic. The plan involved foreign hauliers paying around 15p per kilometre for the privilige of using UK roads. This, Mr Darling and his bean counters worked out, would raise an extra £139m annually for the UK Exchequer.

Generally, the UK transport industry was in favour of the scheme as it was felt it would go some way towards making UK hauliers more competitive against their foreign counterparts who pay considerably lower fuel taxes.

However, on closer inspection, it was found that not only did the sums not stack up but that the scheme was massively overcomplicated and, it was concluded, would be virtually impossible to administer. As a result, the plan was quietly dropped. Despite the collapse of the LRUC idea, the issue of HGV road user charging is still very much on the political agenda and the Coalition has stated that it is committed to working towards the introduction of some form of road charging that will result in a fairer system of haulage taxes.

In its recently released Progamme for Government, the Coalition gave no details of how a road charging system might work but emphasised that it has every intention of introducing “a new system of HGV road user charging to ensure a fairer arrangement for UK hauliers”.

With much of the Coalition’s transport programme focused on measures to make the transport sector greener, it is becoming clear that road building is not considered a priority. Indeed, stated plans to reform “the way decisions are made on which transport projects to prioritise, so that the benefits of low carbon proposals (including light rail schemes) are fully recognised,” have led many commentators to contend that any revenue raised by the introduction of road charging is unlikely to go towards the development of the road network.

This is disappointing because it is clear that with congestion worsening on many key routes, greater investment is needed in the UK’s road infrastructure.

Of course, it could be argued with some conviction that the money used to rescue our failing banking system, would have been better invested in a roads building programme. It is certainly the case that, as the level of congestion increases so too does the average journey time for hauliers which, in turn, means extra supply chain costs. It would be disastrous for the economy if our poor transport system held back the recovery.

The haulage industry is engaging with the Government on ways of delivering HGV road charging schemes that might not only generate revenue for road building programmes and reduce congestion but also result in a more “level playing field” for UK and foreign operators to compete on.

However, while a range of options exist for HGV road user charging, commercial vehicle operators, quite rightly, expect to be able to see some advantage from any charging scheme.

If, for example, the London and Durham Congestion Charge models are rolled out across other towns and cities around the country, but lorry drivers still find themselves sitting in traffic jams, road pricing will only have succeeded in pushing up the shelf price of the products they are delivering. But,more positively, should, the introduction of a charge result in less traffic in and around our towns and cities allowing more deliveries to be made in a shorter time, then the whole economy will benefit.

Road charging is set to be one of the key transport debates over the coming years and the fundamental problem of how to deal with the demands on the road network by a growing population and a recovering economy will not go away.With the need to recover the public finances dominating Government thinking, the introduction of road charging schemes is perhaps inevitable. Let us hope that the opportunity to use such schemes to benefit the UK haulage industry and the broader infrastructure of the nation is not lost.

Having felt let down by the previous Government’s depressing failure to grasp the key role that the haulage industry plays in the success of the UK economy,UKWA’s members – who comprise the nation’s leading third party logistics service providers - will be watching the developing situation with interest.

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