London considers charging drivers on a pay-per-mile basis

February 23, 2023 by

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London Assembly launches consultation on ‘variable or distanced-based smarter road user charging’

Motorists in London could be charged for every mile they drive under plans being considered by the London Assembly (LA).

Described as having the potential to represent “the biggest change in how daily transport is paid for since the introduction of Oyster and the Congestion Charge nearly 20 years ago”, the LA has launched a consultation on whether road user charging, which could take a “variable or distance” approach, should be introduced to the capital.

A distance approach would see motorists pay depending on how far they drive, while the variable aspect could see differing fees applied depending on if a journey were for work, leisure, or the provision of essential services.

The London Assembly does not have the power to implement such a scheme, but the 25-member body scrutinises the activities of the capital’s Mayor, and can put recommendations to him or her.

The Assembly’s Transport Committee is asking respondents a number of questions on road-user charging, including what technology could be used, whether any such charging should replace existing levies such as ULEZ and Congestion Charge payments, and if discounts should be offered to carers, people with disabilities or those on low incomes.

The consultation also asks: “If the Government were interested in a national distance-based road user charging scheme, would London be a sensible place for a trial?”

On a national level, Treasury and transport chiefs know they face a significant drop of revenue collection from motoring, as legislation forces drivers into electric cars over coming years, and the £28bn central Government receives each year from fuel duty drops away as a result.

The national, cross-party Transport Select Committee has previously investigated what should replace fuel duty, saying it “has not seen a viable alternative to a road pricing system based on telematics”, though neither the Treasury nor the DfT have stated what they plan to do.

Responses to the London Assembly’s consultation are likely only to result in advisory notes and datapoints for City Hall, and possibly Westminster. But with other areas, including Birmingham and Bristol, following the capital’s lead and implementing emission zones similar to the ULEZ, if pay-per-mile road-user charging is introduced, it would be logical for it to first arrive in London, before spreading elsewhere.

The consultation is open until 10 March, with responses invited from anyone who regularly drives into London, or who might be affected by the policy.