Imperial College London 1 Centre for Transport Studies National Road Pricing – Revenue and Equity Issues Terence Bendixson Secretary, Independent Transport Commission 26 October 2005

Imperial College London 2 Centre for Transport Studies Disclaimer! I am grateful to Professor Stephen Glaister, Imperial College London for the use of these preliminary results from work in progress These results offered here are subject to correction

Imperial College London 3 Centre for Transport Studies Definition of road charging Charges that vary by time and place to reflect Congestion AND Environmental damages Noise Additional accident hazard Local air pollution Global emissions (Global emissions are best addressed by simple fuel duty).

Imperial College London 4 Centre for Transport Studies Big issue: What happens to the revenues? Possible uses: 1.Reduce fuel duty and/or tax disc (tax revenue neutrality)? 2.Improve public transport alternatives? 3.Improve road maintenance and road capacity? 4.Defray the investment and operating costs of the pricing system? 5.Other local or national public expenditure purposes? You cannot spend the money more than once!

Imperial College London 5 Centre for Transport Studies Revenue additional road pricing London

Imperial College London 6 Centre for Transport Studies Revenue neutral road pricing London

Electoral wards, traffic change in various area types Revenue neutral Cent. LondonOuter Lon Outer conurb. Large Urban Medium Urban Small urban Rural Big Urban Inner conurb. Inner Lon

Electoral wards, traffic change in various area types Revenue additional Cent. LondonOuter Lon Outer conurb. Large Urban Medium Urban Small urban Rural Big Urban Inner conurb. Inner Lon

Imperial College London 9 Centre for Transport Studies Note: an increase in traffic is a reflection of lower costs It is a social benefit – assuming roads correctly priced But under a revenue neutral scenario urban dwellers will, on the whole, be worse off To prevent this revenues must be held locally

Imperial College London 10 Centre for Transport Studies Big issues to resolve for a practical policy 1.Who will get reductions or exemptions? 2.What happens to the revenues? 3.What is the meaning of a national scheme? 4.Governance? 5.The case for more road capacity? Several Whitehall departments are affected: DfT, HMT, ODPM, DeFRA, DTI, DCA Successful delivery will require clarity and leadership.

Congestion and environmental charges additional to fuel duty. Additional revenue (2010) = £ 16bn pa

Congestion and environmental charges: reduction in fuel duty Revenue neutral