The growth of zero emission vehicles on our roads is going to lead to a £40 billion hole in tax revenues from lost fuel duty and vehicle excise duty. Replacing petrol and diesel vehicles with electric vehicles does not fully answer the emissions problem. The real (but difficult to confront) solution is: fewer trips by road, less mileage travelled and fewer vehicles on the roads in total.
How do you encourage people to travel less by car, and to take public transport wherever possible, while simultaneously dealing with a lack of income from fuel duty and vehicle excise duty?
The (difficult to confront) solution
Introduce user-pays road pricing. There is clear evidence from around the world that when road pricing systems are introduced, drivers immediately respond by re-routing, rescheduling, taking public transport, and cancelling unnecessary trips. Road pricing is the obvious answer to the Government’s two most pressing problems: road use demand management; and revenue.
The Zero Emissions Vehicles and Road Pricing Inquiry demonstrates the Government is actively considering road pricing as part of its long term strategy.  Road pricing can take many forms and choosing the right type is essential to sustain the road network and encourage environmentally sustainable travel. Here are three possible options.
Option 1- Toll Roads
A road tolling system could consist of ‘payment plazas’ where you pay the toll as you enter the road, or through a free-flow tolling system, using automatic number plate recognition (ANPR).
Option 2- Odometer Self-Reporting
This type of scheme has recently been introduced in the state of Victoria in Australia, applying to only electric vehicles. Drivers provide evidence of their odometer reading to the Victorian Government, and are periodically invoiced the amount owed based on distance travelled.
Option 3- Pay as you go
Greener Transport Solutions’ submission to the Zero Emissions Vehicles and Road Pricing Inquiry suggested a distance and time based pricing model, the distance charge to pay for infrastructure and the time charge to cover congestion and pollution (The distance charge is initially 2p per kilometre for cars, 3p for vans and 6p for lorries).
Option 3 has also been recommended in a report released last week by independent think tank, Bright Blue plus authored by former No.10 Energy and Environment Advisor, Josh Buckland. The report advocates that a user-pays road pricing scheme is the most viable replacement for fuel duty, which is itself a form of road pricing, although we may not see it that way, and that the Government should pilot a voluntary ‘opt-in’ scheme as soon as possible.
Implementing the options: tracking technologies
Option 2 may entail the least amount of administrative burden for the Government, as it would only require a self-declaration of the mileage covered in any year. Garages could submit this data when the vehicle goes in for its annual service.
Options 1 and 3 involve ANPR and GPS technology to track vehicle movements. This comes with concerns around the processing and security of personal data. Knowing an individual’s location is personal data and so would currently be caught by the General Data Protection Regulation (UK GDPR). Public perception is likely to be resistant to the idea, but would this really be any different to what data is already held about drivers in the UK?
A role for the DVLA
The UK’s Driver and Vehicle Licencing Agency (DVLA) already amasses personal data relating to its drivers. This not only includes names and addresses, but also vehicle registration numbers and in some instances tachograph data (showing the speed and duration a vehicle has been driven for). Anyone using satellite navigation apps such as “Waze”, already offers up their location, speed of travel, and travel duration data to the owners of that app, as a condition of its use.
In the case of the DVLA, this data is recorded and processed due to legal requirement. The DVLA gets its powers from various pieces of legislation. Whilst it is unlikely anyone would willingly volunteer their location to the UK Government for the purposes of tax collection, the government could legislate that collecting such location data for the purposes of calculating road tax is a matter of public interest and a legal requirement. The DVLA is already entitled to share the personal data it holds with the police, the NHS, local authorities and the courts. It is also very feasible for the DVLA to share such data with HMRC for the purposes of tax collection.
Whether the government ever feels able to implement a road pricing scheme in the face of the track record of voter opposition remains to be seen, but the problems of replacing the revenue from fuel duty and road tax, and encouraging active travel and public transport over car use, remain.
Maybe its best chance of implementation is via user adoption of a ‘Sky TV for transport’ approach as mobility as a service develops. In that world, users ultimately pay for access to a bundle of transport services and choose which to use – taxi, bus, private car, train – supporting greater innovation in the approach to charging. How about a tariff system that reflects the journey’s environmental impact?
 Road Traffic Act 1988; Road Traffic Offenders Act 1988; and Road Traffic (New Drivers) Act 1995; The Vehicle Excise and Registration Act 1994 and the Road Vehicles (Registration and Licensing) Regulations 2002
About the Author
This post was written by Paul Hirst and Jo-Ann Pattinson. Paul is a Partner and the Head of Transport at Addleshaw Goddard. With over 20 years' experience, he is rated as one of the UK's top transport lawyers with an unrivalled breadth of expertise across the sector. He is Chair of the Northern Powerhouse Partnership's Transport and Connectivity Committee and a member of the Expert Advisory Board for the Institute of Transport Studies. Jo-Ann is a consultant solicitor at Addleshaw Goddard and socio-legal researcher based at the Institute for Transport Studies at the University of Leeds. She specialises in technology, transport and the law, and investigates how technology and the law impacts upon people and society.