Road Tolls Will Drive Fleet Costs Up, Says ACFO

Government must discuss congestion charging with fleet community

Fears that motoring and administration costs for the business driving community will increase significantly under Government congestion charging plans have been expressed by ACFO.

And, while broadly in favour of Government measures to ease traffic congestion, ACFO, the UK’s leading organisation representing car and van fleet operators, says Transport Secretary Alistair Darling must focus on ‘business reality’ and not let the views of academics hold sway.

ACFO, also says, that just because it can be easily targeted, the fleet community must not bear the brunt of the huge infrastructure costs of establishing the nationwide pay-as-you-drive plan promoted by Mr Darling this week and first outlined in the ‘Road Pricing Feasibility Study’ report to the Transport Secretary published in July last year.

ACFO represents more than 800 fleet operators who are collectively responsible for running more than 650,000 vehicles. Director Stewart Whyte said: ‘ACFO generally welcomes this latest Government acknowledgement that radical action must be taken to beat traffic gridlock.

‘But, it is vital that Mr Darling and his colleagues listen very carefully to the views of the fleet community. The fleet and business communities buy the majority of new cars and vans in the UK and typically drive higher mileages than private motorists. Therefore, the businesses which we represent must play a huge role in the discussion going forward.’

The Government’s plans for congestion charging at rates varying from 2.5p to £1.34 per mile would result in a reduction or possible axing of Vehicle Excise Duty and fuel duty.

Mr Whyte said: ‘While the Government says congestion charging will be revenue neutral there are bound to be winners and losers in any new system. ACFO fears that fleets will almost certainly be worse off as a result of both the tax change and the undoubted rise in administration costs.’

He added: ‘Dealing with the revised expenses claims from drivers will have a massive impact of the administration costs of all companies who rely on staff to drive, particularly in respect of employees who currently claim business mileage. Checking individual drivers’ direct debits will be time consuming in the extreme.’

Although any congestion charging plan could be up to 15 years away Mr Whyte warned: ‘Establishing such a scheme will cost hundreds of millions of pounds in infrastructure and software developments. We already have thousands of uninsured cars on the roads, thousands of motorists who flout VED and thousands of people who take to the roads but who don’t have a driving licence. How does the Government intend to make these people pay-as-they-drive?

‘We are also concerned about the impact on the DVLA systems: the current VED arrangements have been built to keep the vehicle register up to date to help reduce evasion and to improve anti-crime initiatives. Removing VED costs would leave this vital aspect vulnerable. How will that fit into the overall road tolling system?

‘The Government has already recognised that in general fleet cars and vans and employees’ own cars used on work-related journeys are highly compliant with all legislation and the fleet industry should not be penalised for being law abiding. Fleets must not be targeted as a cash-cow to help fund development and transition costs of the new system. And, because businesses buy the majority of new vehicles in the UK, the technology can be easily fitted - how will the Government tackle the fitment of technology to older vehicles?’

He added: ‘The price for being easily-targeted should be a discount on road toll mileage rates.’

Mr Whyte concluded: ‘ACFO is not asking for unique or exceptional treatment on behalf of its members in respect of the road pricing debate. We are merely pointing out the practical reality of a system that the academics probably do not understand in its details. It is therefore vital that ACFO is involved in all the discussions with Mr Darling and his colleagues.’

8 June 2005 Staff

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