As more people switch to using electric cars, ministers are looking for ways to recover the money the Government will no longer make through fuel duties (Picture: Getty)
A pay-per-mile road pricing system could be introduced to fill a huge black hole in public finances, it has been reported.
As more people switch to using electric cars, ministers are looking for ways to recover the money the Government will no longer make through fuel duties.
The tax currently brings in around £30 billion a year or close 1.3% of national income, according to the Office for Budget Responsibility.
Road charges are currently limited to congestions zones in London, the M6 Toll in the West Midlands, the Dartford Crossing and charges on various other tunnels and bridges.
But it is understood ministers have held preliminary talks to introduce a nationwide road charging scheme.
A Government source has told The Times that ministers should be ‘making the case’ for a driving charge to help fill shortfall created by a loss of fuel duties.
Last year Rishi Sunak was reportedly considering the idea and was said to be ‘very interested’ in the concept of a national road pricing scheme but it was unclear how charges would be calculated.
Rishi Sunak is understood to have been ‘very interested’ in a national road charging scheme in the past (Picture: REX)
The Department of Transport made no mention of a road pricing scheme in its decarbonisation strategy published in the summer.
A charge for drivers is also not expected to feature in the Government’s net zero strategy which is set to be revealed in the run-up to the COP26 climate conference in Glasgow at the end of this month.
But a Government source quoted in The Times has said that as petrol and diesel cars are phased out there is going to be a ‘very substantial impact on the public finances’.
‘Fuel duty helps to pay for schools, hospitals and other public services which we all care about and unless we want to reduce what we spend on those we need to find an alternative system to raise that revenue.
‘It is absolutely not about raising taxation and most people will understand that,’ they said.
A Whitehall source has also been quoted saying the Treasury was very aware that finances would soon reach a ‘tipping point’ where income from fuel duties falls to such a point that there will need to be a system to replace them.
Under Tony Blair, Labour abandoned the idea of a national road pricing scheme after the proposal to potentially charge drivers up to £1.50 a mile sparked fury.
But government figures have said such as scheme was ‘a conversation’ that needs to be had with the public.
Road charges are currently limited to congestions zones in London and various other toll points and crossings around the country but that could soon change (Picture: Getty)
Polling from the Social Market Foundation think tank which has been shown to the Government has suggested there is now some support for road charging.
Results suggested 39% of people backed the idea when it was presented as a replacement for road and fuel duties.
Edmund King, the president of the AA who was a finalist for the Wolfson Economics Prize to develop a potential road charging scheme said a scheme should not disadvantage drivers in more rural areas.
‘The concern has been that it’s a difficult policy to sell.
‘But there is an acceptance that if you are losing all this revenue that goes to pay for schools and hospitals you need to replace it,’ he said.
The Government has been contacted for a comment.
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