The Government must introduce dynamic road user charging by 2030 to ensure the road network is adequately funded, a new report has claimed.
Funding Roads For The Future, published by the Association for Consultancy & Engineering, argues that the existing model of road network funding through fuel duty, VED and the HGV levy is failing in the face of new technology and changing social trends.
It says that the complexity of introducing a new road taxation model in the UK means the Government must take the initial steps now to implement such a scheme. This would include introducing reforms to Vehicle Excise Duty and HGV Road User Levy to ensure these taxes raise sufficient revenue for the National Roads Fund from 2020-21.
Reforms to Vehicle Excise Duty, it says, must ensure sufficient revenue is raised in light of the expected significant uptake of zero-emission vehicles in the next decade. Reforms to HGV Road User Levy must remove offsets against VED for UK-registered firms and introduce a dynamic per-distance charge instead of the current per-day charge.
The per-distance charge would be based on a range of variable, such as the type of journey (on motorways or country lanes for example), type and size of vehicle, vehicle emissions, time of day, and type of business (owner-driver, large haulier, UK or foreign-owned, etc).
Quoted on the UK Haulier website, ACE Chief Executive Dr Nelson Ogunshakin OBE said: “The way our roads are being used is changing rendering existing funding arrangements obsolete. Reform has to begin with HGVs who have the most to gain from any improvements to our roads. Reform of HGV road user levy, fuel duty and vehicle excise duty is a great opportunity to test both the concept and delivery of a truly dynamic road-user charging system that will ultimately mean fairer funding for all. It is vital that the Government starts these conversations with the industry now.”
Some of the other recommendations of the report are to:
- 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.
- 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 input of ACE’s Road Sector Interest Group. Dave Beddell, Managing Director – Strategic Highways (Europe) at AECOM and Chair of the group commented: “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 to create an investment framework that supports a modern and sustainable road network.”