Taxes and charges on road users (HC 103-ii) Transport Committee 14 Jan 2009

Evidence given by:
2.45 North East Chamber of Commerce
Andrew Sugden, Director of Membership and PolicyLondon First
John Dickie, Director of Strategy and Policy
3.15 Freight Transport Association
Simon Chapman, Chief Economist
Brewery Logistics Group Mike Bracey, Chairman
Central London Freight Quality Partnership
Donald Chalker, Manager
4.00 British Vehicle Rental and Leasing Association
John Lewis, Chief Executive
Retail Motor Industry Federation
Robin Hulf, Parliamentary Adviser
UK Petroleum Industry Association Ltd
Chris Hunt, Director General(witnesses): uploaded on 22 January 2009.

Q157 Mr. Eric Martlew (Carlisle): On that very point, I am confused, Mr Sugden. At one point you were telling us that any extra money raised should be spent basically on new road infrastructure and at another point we are talking about reducing the taxation. Would it not be better just to make it cost-neutral, which would not give you any more money for roads but would not cost you any more in taxation?

Mr Sugden: May I just draw the distinction that Mr Dickie drew between where we are looking at congestion charging and effectively a pricing mechanism to reduce traffic on our road system versus a replacement for the current motorist taxation. I think they are two different subjects. Where we are looking at a national road user pricing mechanism, we would see that as a replacement to fuel duty. There are other issues, such as the congestion charging proposals that we have been in operation in London and floated in Manchester, where there is a potential for greater investment in public transport and other road networks.

Q158 Mr. Eric Martlew (Carlisle): Perhaps Mr Dickie could address this. Mr Clelland mentioned that we went to the Netherlands where they vary the charge at various times of the day. If we had national road pricing, if you driving into London at a busy period, you would actually be charged more via the satellite. Surely you would not have an extra congestion charge on top of that, would you? You would not have two congestion charges?

Mr Dickie: No, I do not think you would, but there is a distinction which it is important to be clear about between whether you see a national road user charging scheme as a mechanism to raise revenue for transport, which then brings into question the level of surplus, at what level you pitch it, and also what level of substitutability is possible with the current general taxation. That is one set of issues, which is a different set of issues from those surrounding and managing congestion in one particular area. They are similar but they do not necessarily seek to achieve the same goal.

Q159 Mr. Eric Martlew (Carlisle): Why would we introduce a road charging system if it was not to control congestion? You would not, would you?

Mr Dickie: The answer is that you might because you might think the right way to raise money to spend on transport infrastructure is to charge the people who use it, which is a perfectly reasonable approach to take.

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Q176 Mr. Eric Martlew (Carlisle): On the fuel issue, I was in France at the weekend and I noticed that it was a euro per litre and £1 is the same as a euro. I presume this will be an advantage to other hauliers with the weaker pound, and there is almost parity now with the French hauliers. Would you welcome that as an improvement? The main point is on congestion. The answer in the North East I suspect are very different from the answer in London. I suspect the North East is a bit like my constituency where one or two extra roads would be a big advantage or improving the A1, as Mr Clelland always tells me is needed, but in London you are not going to build many more roads, are you? What you need is money coming into the public transport system. Do you think there is any danger, because of the recession, that the private sector will not put the money into Crossrail?

Mr Dickie: For better or worse, to total Crossrail funding is largely public sector. There is a modest amount of funding in the scheme of a £16 billion project which is coming in from BAA, the Corporation of London and Canary Wharf, and those agreements were all signed just before Christmas. I think the private sector for Crossrail is rather secure.

Q177 Mr. Eric Martlew (Carlisle): You do not think it is a threat?

Mr Dickie: No, and the overwhelming bulk of the money is public sector, both Department for Transport, grants to Transport for London and money raised by Transport for London and the Mayor of London, partly through the supplementary business rate that was being debated the day before yesterday.

Q178 Mr. Eric Martlew (Carlisle): Mr Sugden, do you agree that at the moment what we need are more roads in the north of England?

Mr Sugden: There are certainly some substantial issues with individual roads. Mr Clelland is very familiar with some of the issues that we jointly share as being important. I think there is a slightly more fundamental issue to that in terms of where the road user charging and congestion charging plays and that is the approach that we have seen through the Transport Innovation Fund as being the only real substantial potential investment in strategic transport infrastructure in the North East. That comes with a prerequisite effectively of road user charging and whether that is appropriate or not for the communities that need the increase and an improved transport infrastructure. That may not be the direct answer you might have been looking for but it is our major concern.

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.

The full transcript may be read here.

On behalf of Eric Martlew, 3 Chatsworth Square Carlisle Cumbria CA1 1HB