The political Think Tank Policy Exchange says road pricing in the UK would give an immediate, large boost to economic performance, and is calling for the Government to introduce a system where motorists pay according to the distance, time and place they travel.
It says that, as it stands, congestion on UK roads is costing the economy between 1.4% and 2.5% of GDP every year, and the problem is set to get worse, as more people move to electric vehicles, and the marginal cost of driving falls.
“What’s more, the shift to electric vehicles will in the coming years create a fiscal blackhole in the region of £40 billion for the Government, as the Exchequer loses out on fuel duty and VAT revenues,” it adds.
Its paper argues a system of variable road pricing can help the UK solve both these dilemmas, delivering direct benefits of between £15 billion and £30 billion a year for the UK economy, replacing lost fuel-related tax revenues, and leaving the majority of motorists either with the same tax liability as they currently have, or saving them money.
Driving Growth, by Roger Bootle, Ben Sweetman, Andrew Gilligan and James Vitali, and with a foreword from Edmund King OBE, offers a comprehensive study of road pricing. It traces its origins as an idea in thinking of economists, considers how it has been implemented in various countries around the world, and puts forward a political manual for how road pricing might be delivered in the UK.
(Picture – Policy Exchange)
