UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 103-iii

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

TRANSPORT COMMITTEE

 

 

TAXES AND CHARGES ON ROAD USERS

 

 

Wednesday 28 January 2009

MS MICHELE DIX, MR KULVEER RANGER and MR NICK LESTER

CLLR SHONA JOHNSTONE, MR JASON GOODING and CLLR JOHN WALSH OBE

MR GRAHAM DALTON and MS GINNY CLARKE

Evidence heard in Public Questions 257 - 446

 

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Oral Evidence

Taken before the Transport Committee

on Wednesday 28 January 2009

Members present

Mrs Louise Ellman, in the Chair

Mr David Clelland

Mr John Leech

Mr Eric Martlew

Ms Angela C Smith

Sir Peter Soulsby

Graham Stringer

________________

Memoranda submitted by Transport for London and SPARKS

 

Examination of Witnesses

Witnesses: Ms Michele Dix, Managing Director, Planning, Transport for London, Mr Kulveer Ranger, Director for Transport Policy, Mayoral Team, Greater London Authority, and Mr Nick Lester, Chair of the SPARKS Network and Corporate Director of Services at London Councils, the SPARKS Programme, gave evidence.

 

Chairman: Good afternoon, and do Members have any interests to declare?

Mr Clelland: A member of Unite.

Mr Martlew: A member of Unite and a member of GMB Union.

Graham Stringer: A member of Unite.

Chairman: I am a member of Unite.

Sir Peter Soulsby: I, too, am a member of Unite.

Q257 Chairman: Could I ask the panel, please, to introduces themselves, their names and their organisations?

Ms Dix: I am Michele Dix. I am the Managing Director of Planning at Transport for London.

Mr Ranger: Kulveer Ranger, Director of Transport Policy for the Mayor of London.

Mr Lester: I am Nick Lester. I am Corporate Director of Services at London Councils and I Chair the SPARKS Network, which is an international network of public authorities interested in cross-border enforcement and traffic laws.

Q258 Chairman: Thank you. Could you tell us what the real objectives of the Central London Congestion Charge are? Is this about reducing congestion or is this about raising revenue?

Mr Ranger: I can give you our view at the moment, because obviously it is a new administration. We look at the historic objectives which were set for this policy, but I believe the initial objective is really to ease the pressure of congestion in the central zone and this is the manner of actually making that happen, but I would probably ask Michele, who was probably around at the start of the development of that policy, to maybe expand on that.

Q259 Chairman: Mr Ranger, you have said two things. You have introduced a slight note of caution, talking about the previous administration, and you said "initially" the Charge was about congestion. Do you have some idea that the current Major might want to change this?

Mr Ranger: No, that is just how we have seen the view from when the Charge came in and then how it was evolving, that it was really an initial presentation that the Charge was there to reduce congestion. However, it did morph into other elements. It did raise a certain amount of revenue, which cannot be ignored, and it has had an impact in terms of air quality as well. So there were other elements which sort of emerged from implementation of the Charge.

Q260 Chairman: How important do you see the revenue raising aspects to be at the moment?

Mr Ranger: Revenue is obviously built into the TFL business plan and so it plays a role in our assumptions of what we can do in terms of what TFL's objectives are and how we look to appropriately spend that money on transport benefits. So we have to take that into account when we are looking at the Charge and how it is operated.

Q261 Chairman: But how important is the revenue raising aspect of the Charge to London's transport plans?

Mr Ranger: In the context of the amount of revenue it raises, I think the net revenue raised is in the region of approximately 130 million per year. Now, in the context of the annual spend that TFL has that is not a huge figure, it would be a single digit percentage, but obviously that is still a lot of money we are looking at and how that gets spent. Previously, in 2007, about 82% of that went into bus services.

Q262 Chairman: But are there any discussions taking place at the moment about the future of the Charge?

Mr Ranger: Not of the Central London Congestion Charge, no. Sorry, there are in terms that there is a new contract which is coming in and the Mayor, Boris Johnson, did make a manifesto commitment about making the Charge fairer in its operational terms, so there are discussions about that.

Q263 Chairman: But are there any discussions about changing the nature of the Charge or changing its objectives? Have any of you been involved in any discussions of that sort?

Mr Ranger: Not in changing the nature of the Charge at the moment.

Q264 Chairman: What would you say the achievements of the Charge have been?

Mr Ranger: I think the key has been that at the implementation point there was a drop in traffic levels or the time taken for journeys through Central London. Actually, at this point I will ask Michele to expand on that because she was obviously involved at the point of implementation and also at the point of where initial benefits are flowing through.

Ms Dix: I just confirm that the primary objective for the Charge being introduced was to reduce congestion. That is why it was introduced. In order to reduce congestion you have to reduce traffic levels, and in order to reduce traffic levels we had to set the Charge at such a level that it would make people change the way in which they were travelling. As a consequence of that, there were net revenues which were generated by the scheme and as an important part in making the scheme acceptable in terms of Londoners (i.e. talking about the original Central London scheme) those net revenues generated by the scheme and the promise that they would be spent on transport improvements in London further improved the acceptability of the scheme when it was introduced. So even though raising revenue was not a primary objective, it was something which stemmed from the Charge that was set and certainly improved the acceptability of the scheme. In terms of what it achieved, when it was first introduced - and I am talking about the original Central London scheme - it instantly reduced traffic levels, car traffic, by 30% and overall traffic by some 18%. So simply by having less traffic on the road we got a 30% reduction in congestion. Therefore, it met its primary objective, which was to reduce congestion. It also raised net revenues and, as Kulveer has said, net revenues that are currently raised are of the order of 130 million per year and by law all that has to be ploughed back into transport improvements in London.

Q265 Chairman: But the congestion levels have now come back, have they not?

Ms Dix: The congestion levels have come back, but the reason why we had a congestion reduction in the first place is because we reduced the traffic levels, there was less traffic, and if the transport network had stayed the same (i.e. did not affect any of the roads on which the vehicles were running) and you still maintained low traffic levels you would still see that reduction on congestion now. What has happened since the Charge was introduced is that that space on which the vehicles have been running has been changed and a significant change has been a series of roadworks, long-term roadworks which have taken capacity out of the road networks, and also improvements which have been made to Central London to enhance the benefit to other users, so improvements for pedestrians, improvements for buses, improvements for cyclists, all good things but the net effect of that is that the effective road space has been reduced.

Q266 Chairman: Who has taken the decisions to reduce the road space available?

Ms Dix: The various authorities are responsible for the roads in Central London. The boroughs are responsible for a large percentage of the roads in Central London and TFL is responsible for a fewer number of roads, but the decisions about the sorts of schemes which were being made were to pursue a wider set of policies other than just reducing congestion for road users.

Q267 Mr Clelland: Just on that, are you also saying that the level of congestion in London is now acceptable or would you like to reduce it further, and if you want to reduce congestion further how does that fit in with the Mayor's objective to make congestion charging fairer, which presumably a lot of people would think would mean less expensive?

Mr Ranger: I think what we are looking at is a policy which worked at its implementation and then the benefits of it were gradually eroded through the applications of other policies. I think we do want to see less congestion in Central London and we want to really continue the trend of modal shift onto public transport. In the context of that, we want to have policies which actually are complementary to the Congestion Charge, rather than compete with it. So if there is capacity on the road network that is freed up, if we start to immediately remove that capacity and apply it to other areas, taking away road space or putting in more bus lanes, then we are removing that benefit that people are actually paying for. So if we make the space, we must work out what is the best way of using it. That is not a case of saying, "We want to see more vehicles coming in because there is space." So we see the Congestion Charge as a fundamental part of a series of policies which includes smoothing traffic flow, so having this, as Boris has put it, a "holy war on holey streets." There are a million holes dug in London's roads every year by various companies who are trying to improve the infrastructure, the drains, et cetera, but we need better coordination of that so that the benefits of the Charge can be felt by people on the road network. We want to ensure that the buses can run at a level that they are not impacted by those things. We want to have a permit scheme so that if people abuse the way they are providing infrastructure and improving the road network they can be fined at a significant level so that they may not want to do that again. We need to look at the policies which can be implemented to complement the Congestion Charge, not take away its benefits.

Q268 Mr Clelland: Does that mean that the Congestion Charge will be at the same level, be lowered or be increased? What is your view on that, the level of charging at the moment?

Mr Ranger: We are keen to retain the level of charging there is at the moment, but we want to make it fairer.

Q269 Mr Clelland: What does that mean?

Mr Ranger: I think it is fair to say it is probably accepted that the Charge itself and the implementation of it was a pretty blunt policy, the technology and the approach. We want to make it a bit more sophisticated so people do not feel like they are being penalised, for example if they go one minute past the time of having not paid they immediately get a Penalty Charge Notice. Now, one of the things we are looking to bring in is a means of account billing so that people can say, "Well, I'm going to use this. I need to travel by car and so I'll have it set up so that I can pay it automatically," and not just, "Oh, I've gone over by five minutes and suddenly I'm feeling like I'm being victimised or penalised for having driven in when I needed to do it." So there is a certain sense of fairness that needs to be brought into how the Charge is applied, but also there needs to be a benefit being perceived by people who are paying for this Charge. There is no point in people saying, "Well, we're going to pay, but we're paying for the same level of congestion and traffic that we had previously without it." There is the argument that if you took it away, if you had not had it for this period of time, you would probably have more traffic. So there is still a value to having the Charge. We are not making that case. What we do want to see, though, is that people feel the benefit of what they are paying for.

Q270 Mr Leech: Has there not always been a bit of a confusion with TFL and the Mayor (whoever the Mayor may have been) about what the Charge is all about because you said it was first introduced to tackle congestion but then some vehicles are now exempt from the Charge. The former Mayor wanted to introduce a 25 charge for the highest polluting vehicles and to exempt other vehicles which were low emitters and obviously that would have an impact on taking some vehicles off the road but putting other vehicles on the road, so it is not necessary to actually decide exactly what the Charge is for now and look at whether or not you can arrange it so that it tackles both carbon emissions and at the same time tackles congestion?

Ms Dix: When the original Charge was introduced, even though it was primarily to reduce congestion it was recognised that there would be environmental benefits as a result of introducing the Charge. It was also recognised that it was an opportunity perhaps to incentivise the use of vehicles which were less polluting, so there was 100% discount for alternative fuel vehicles, vehicles which emitted less air pollutants, and that has been running since the Charge began. There then was a discussion about whether or not that policy needed amending because some of those vehicles which are entitled to that 100% discount actually emitted high levels of CO2 and when climate change became a bigger issue on the agenda it was looking to see whether or not that particular discount could be modified in some way so that you deterred the higher CO2 polluting vehicles, which led in turn to the CO2 proposition, but to say that congestion charging should not be used for anything other than congestion does not fit with where we are because the Low Emission Zone, which is another of the schemes in operation, is actually a road user charging scheme using the same powers as the Central London congestion charging scheme and that is there to encourage drivers of diesel engine vehicles to move towards cleaner engines. But you are right in saying that we have to be clear about what the objectives of the schemes we are promoting actually are and there has been some confusion.

Q271 Mr Leech: If tackling congestion is still one of the central planks of the Congestion Charge and given that vehicle levels on the roads are up to pre-Congestion Charge levels now - I thought that was the information we were given?

Ms Dix: No, the traffic levels are still low. What I was saying was that traffic levels dropped to about 18% when the Charge was first introduced. Traffic levels have stayed low, they are about 20% now, and that is the strange thing. That is what we could not understand when congestion was growing, because traffic levels were still low, and the reason why congestion rose is because the space they were operating on was getting smaller.

Q272 Chairman: So you are distinguishing between the amount of traffic and the congestion that is caused?

Ms Dix: Yes.

Q273 Chairman: You are saying that the traffic has still reduced?

Ms Dix: Traffic levels are still low. They are 20% less in the Central London area. It is the road space on which they operate which has shrunk and the relationship between flow and congestion normally, if everything is kept the same, is that if the flow goes down, then congestion goes down.

Q274 Chairman: So it is 20% less than before the Charge?

Ms Dix: Than before it started, yes.

Q275 Mr Leech: I accept that point entirely. If the levels of congestion are at the same level as they were pre-Congestion Charge, has any consideration been given to actually changing the way the Charge is levied to make sure that every vehicle which goes through the zone pays at least something so that you can then argue that everybody is paying if they are congesting roads?

Ms Dix: There were lots of discussions when the scheme was originally proposed and since because of lobbying about whether or not the discounts which are given are appropriate. Lots of people would like to see the vehicles they are using discounted for a certain reason, so residents do not pay the full charge, they are entitled to a 90% discount. Residents would like 100% discount, but those who live in the area who have to work and move around the area get a 90% discount. Blue Badge holders get 100% discount. Certain operational vehicles associated with the emergency services get 100% discount. So there are discounts given to certain users. When the CO2 charge was proposed and a higher charge was being suggested for high CO2 vehicles and 100% discount was being proposed for low CO2 vehicles, a lot of concerns were expressed as to whether or not that was the right thing to do because if cars that are readily available and small were 100% discounted that could lead to more people driving in the zone and then eroding the original objective of the scheme, which was to reduce congestion. So reducing congestion is the primary aim, but if other things could be satisfied by the scheme then they were considered.

Q276 Sir Peter Soulsby: I cannot recall what was argued at the time, but I am sure that there were predictions made both for what would happen to congestion, what would happen to traffic, their figures, and what would happen to revenue. How has the reality measured up against what was predicted?

Ms Dix: In terms of the short-term, very well because the forecast for the traffic falls and the short forecast for congestion were pretty much within the range that TFL had forecast. In the first year, though, the revenues that were forecast were lower than the forecast because of some of the assumptions about those people entitled to discounts. They were at the higher end of the spectrum than we had predicted. But nearly all the forecasts we have since made for the impacts of the scheme, where there has been a control, have been correct. What we had not presumed and had not realised was (a) the level of interventions that were going to take place on the road network through utilities (as Kulveer has said, a lot of work is being done now to try and manage that because it has not always been in TFL's remit to do so) and (b) the knock-on effect of some of these other policy areas, because all the work had assumed that the road space would not be changed. But now we are aware of that, then our modelling work reflects it.

Mr Ranger: Could I add to some of the things Michele is highlighting there? The Charge has reduced the number of vehicles coming in, but traffic congestion levels have gone up, so we have thought about roadworks and the impact of those on traffic levels. There were other things as well, such as the re-phasing of traffic lights, and that has had a very significant effect on the flow of traffic through Central London, as has the view in terms of actual road space being eroded for a variety of reasons, some of which we are concerned about, which is why one of the first things we did as an administration coming in was to ask TFL to present to us all schemes which have a significant impact or reduced road space and actually some of the feedback we have received from traffic engineers is that when considering interventions on the road network they were not actually asked to consider the impact on traffic flow. So you have got a great scheme such as congestion charging, which is trying to reduce and improve the level of congestion and traffic flows, yet you have got other people working away who are not paying any attention to what their actual objectives are.

Q277 Chairman: Are these different people in different authorities, or are they different departments?

Mr Ranger: Different departments within transport -

Q278 Chairman: There was no coordination on central policies between the different departments of the authorities?

Mr Ranger: I would say, yes. There were competing messages being provided through different policies.

Ms Dix: There was also the need to satisfy other policy areas, so if there is a policy area to promote the use of buses and improve the reliability of buses, to improve bus lanes, then that was a policy area which also being pursued at the same time along with reducing accidents through to saying all reds at traffic signals for pedestrians, extending the green time. One of the activities which did take place was to bring traffic signals in line with standards for the amount of green time allowed for pedestrians to cross and that did take some space away. I think what people had not realised was the sensitivity of the network in Central London to what might at one location seem a trivial change, but if you are making those changes at a series of locations in such a critical part of the network they all add up, and it is that we have observed.

Q279 Chairman: The impact of one decision on the broader picture?

Ms Dix: Yes.

Q280 Sir Peter Soulsby: I would just like to follow up the revenue predictions which were made at the outset and the extent to which those have differed from what was predicted, particularly perhaps the extent to which the proportion of revenue which comes from fines has differed from what was originally expected.

Ms Dix: I do not know that it has necessarily differed because the proportion assumed from fines depended on the level of compliance and originally people did not necessarily comply, either because they forgot or they did not know, or in some instances they thought maybe they could get away with it, but the level of enforcement associated with this scheme was very high and we have seen a marked decrease in the number of PCNs which have been issued from the early days. So we had a range of forecasts but we were not being reliant on the PCN revenues. They only form 25% of the revenues that are collected at present and that is despite the fact that we have put in a lot of measures to try and make it easier for people to pay and also we introduced Pay-Next-Day, which was a big improvement as far as the public were concerned because if they forgot come midnight on the day they travelled, they then actually had another whole day, and that saw PCNs fall by 15%.

Q281 Graham Stringer: The administration of the scheme is about 50% of your income. Do you think compared with other schemes around the world that is fine?

Ms Dix: It is high according to the figures we have about other schemes around the world and we have been around the world talking to other areas to try and understand the differences. Some of the differences relate to our scheme having a high level of enforcement and the enforcement costs being attached to the total costs of the scheme, whereas in some countries enforcement costs are not in the figures quoted. Also, to make it more convenient there are lots of different ways in which you can contact the organisation and lots of different ways in which you can pay for the Congestion Charge and they add to the cost of running it, but we have actually issued a new contract for the congestion charging scheme and there will be cost savings in the way it is operated going forward.

Q282 Graham Stringer: Roughly how much?

Ms Dix: Sort of 10 to 15 million.

Q283 Graham Stringer: So not a huge percentage but a reduction?

Ms Dix: Yes, but they are savings.

Q284 Graham Stringer: When Ken Livingstone came to this Committee before the scheme started he said that he was going for the simplest scheme so that it would work and he said his political career depended on it. I was involved in the discussions around the Congestion Charge in Manchester and that was a much more complicated scheme, in fact it was a double scheme. They have tag and beacon as well as number plate recognition and 14 day accounts or longer to pay, and yet when I compared the costs of the proposed Greater Manchester scheme with yours they were much less. Do you think that was credible? Are you unbelievably inefficient, or were we being told porkies in the Greater Manchester scheme? It must be one or the other.

Ms Dix: All I would say is that when the work was originally done for the Central London congestion charging scheme before the scheme was adopted by Mayor Livingstone the estimates for the set-up and the operation of the scheme were considerably less than those which actually came back when we procured it, i.e. because of the complications of the scheme. I am not saying that people have told porkies at all, but I am not sure that unless you have procured it you have actually got the full range of costs. But I do believe we are trying to reduce the costs which we have on the system. We are aware of these comparisons across the world and there are ways in which we could reduce costs by removing some of the services.

Q285 Graham Stringer: Let me ask the question again. Do you think it is credible to run a more complicated scheme for something like a quarter to a third of the administrative costs you are using?

Ms Dix: Without looking at the Manchester costs in detail, I cannot say what they have included or not, but I would always want to have a look and be, I suppose, a bit sceptical. I was certainly sceptical about the Edinburgh figures.

Q286 Graham Stringer: About a quarter of your income comes from fines. Do you know the composition of the people who pay those fines, how many of them are from outside of London?

Mr Ranger: 2% of PCNs that are issued are for foreign vehicles.

Q287 Graham Stringer: From people outside? I get constituents in Manchester who write to me and say they did not understand the Congestion Charge. They have not been sent a fine for it, which they would have been happy to pay, the original Charge, but they just did not know how to do it. I just wondered what percentage of that 25% of your income comes from people who just did not understand it because they did not live in London or the South East.

Ms Dix: I am afraid I do not have that figure in my head, so I will have to come back to you on that, unless you know, Nick?

Q288 Graham Stringer: Do you think you could tell us, because it is a concern?

Ms Dix: Yes, I will find out for you. It is just not a number I have in my head.

Chairman: You can send that information to us.

Q289 Mr Martlew: I think, Chairman, we should put it on the record that we did invite the Mayor to come and he was unavailable. I think it is unfortunate because obviously the panel we have got before us are very reticent to go on about future policy, whereas I am sure Boris would not have had that constraint! Looking at the technology which is being used, if you were starting again would you be using GPS? Would you look at a totally new technology?

Ms Dix: If we were starting right now we would probably think about using tag and beacon technology. Certainly we did a lot of trials of different technologies in London and their suitability for application in London. This is since the original scheme was introduced. All these trials were done sort of 2005, 2006, to understand whether the technologies which were being advocated by others would work in London. We were concerned whether or not if we had GPS technology the number of satellite readings, the accuracy of picking people up on a particular road would work in particularly Central London where we have got a lot of high buildings. So some early trials did not convince us that it was ready for a link by link charging system. We looked at tag and beacon, which was to read vehicles as they came in the zone or different locations in the zone in order to automate the scheme more and the results of those trials were much more compelling.

Q290 Mr Martlew: The Committee visited the Netherlands and obviously we had deep discussions about their scheme and they are going for the GPS scheme. One of their objectives, the main objective, is to reduce congestion. I accept they do not have such a number of high buildings, but I think it was Mr Ranger who said billing people out. Surely that is the way forward, sooner or later, whether we get Galileo or whatever? The technology you have got now is rapidly becoming out of date, is it not?

Ms Dix: We can use the camera technology which exists now to introduce the billing system which Kulveer is talking about. If we want to introduce accounts we can use the camera system we have got available. If we want to introduce more flexibility in the system we would have to move to a new technology such as tag and beacon. If we want to get to a distance based charging scheme, whether or not you would want to invest all that technology just for the Central London area and all ticked by time of day when in fact congestion in fact exists all day long, it might be inappropriate to have a complicated piece of technology if you have got a simple problem. If there was ever a need to look beyond Central London and have a wider distance based charging scheme, then you would need to improve the technology, but if you want accounts right now you do not necessarily need to change the technology.

Q291 Mr Martlew: My final question: do you think the sort of Congestion Charge around a city like we have got in London and like they have not got in Manchester has had its day? After the referendum in Manchester, do you think that if we go forward it is going to be a national charging scheme?

Ms Dix: I think the referendum in Manchester and also the recent vote in London about the western extension, the vote in Edinburgh and the online petition on charging which we had point to the fact that the acceptability argument is not being won and the rationale for introducing these schemes has not convinced people necessarily that they are the right way forward. So if we had a national scheme would that make a difference? It would only make a difference if you were introducing it and taking something else away.

Mr Ranger: Could I add to that? Going back to some of my original comments, I think we have to look at schemes and how their benefits then get eroded and whether people still see a value in them. I think public transport in London is exceptional in terms of the amount of choice and it makes it unique in terms of why the Congestion Charge was applied to Central London. So in different areas of the United Kingdom it would be difficult because of the uniqueness of London as an area. We have to take into account over the oncoming 10, 20 years and further - I think some of you may have seen the Mayor's document Way to Go, which is looking to present an initial vision for discussion and how we see transport in London. That is looking at some of the major infrastructure we are looking to deliver, such as the line upgrades on the Underground, Crossrail, the cycling revolution bike hire schemes and maintaining and improving the bus network there already is. All of those, plus just the construction periods for those and projects like Thameslink, will have a huge bearing on how we see traffic and congestion in Central London. So we are trying to understand the impact of all those schemes in their periods of delivery as well as in their periods of operation, and then where does congestion sit and how do we deal with it through that period of time. That is some of the work which we are looking to do through the development of the new Mayor's transport strategy in conjunction with revisions to the London Plan.

Q292 Mr Clelland: I am just a bit concerned that Nick Lester seems to be having quite an easy time! What doe the London boroughs think of the Congestion Charge? How would they like to see it developed or what changes would they like to see?

Mr Lester: I think there is a number of views on the Congestion Charge scheme varying from borough to borough. Clearly the boroughs of West London had strong views on the western extension, which they expressed at the time. At the occasion of introduction of the scheme in 2003 the majority of boroughs were supportive. Again, some of the boroughs had problems in detail. I think all of the boroughs are convinced about the need to improve issues such as fairness, which Kulveer Ranger mentioned, the way in which the scheme operates more efficiently for all sorts of reasons and to make the maximum benefit for the opportunities it releases for managing traffic more effectively.

Q293 Mr Clelland: Are any of the boroughs perhaps thinking about having their own congestion measures because presumably the congestion problem in Central London can also be a problem in some of the boroughs themselves? Have they any plans to introduce congestion charges or other measures to reduce congestion in their own areas?

Mr Lester: There is a variety of ways in which people are looking at measures to reduce congestion. There have been some discussions and some thoughts about specific charges in one or two places. Greenwich has been mentioned, Heathrow Airport has been mentioned. None of those have got to the stage of a formal decision to go forward as yet and I know that the authorities in those places, with TFL, are looking carefully at all of the options to see what is most acceptable and most effective to deal with particular traffic problems in those areas. I know that one of the issues which was raised in the context of the Low Emission Zone is the restriction which existed in the legislation, for perfectly good reasons, of having only one charging authority on any one stretch of road. The existence of the Low Emission Zone means that TFL is the charging authority for every road or almost every road in London and so of necessity any borough which had a proposal to introduce congestion charging in any area would need to work very closely with TFL to have a scheme which was acceptable both locally and London-wide.

Q294 Mr Clelland: Give the measurement of opinion on the western extension and given the referendum in Manchester, do you think that any future proposals for congestion charging would have to be accompanied by a referendum or some measure of public opinion?

Mr Lester: I would have thought it was impossible to introduce any form of charging scheme without having a very clear view of public opinion, and indeed that was the case in 2000 when at the first mayoral election for London Mayor Livingstone stood on a clear platform of introducing a congestion charge. He chose not to have a referendum but presumably (although I am putting words into his mouth, which I am very hesitant indeed in doing) he could have advanced the argument that the Election which elected him meant that a referendum was not necessary.

Ms Dix: The public opinion vote at that time was very positive as well, particularly because of the hypothecation.

Q295 Mr Clelland: Is your perception that public opinion continues to support the current Congestion Charge?

Ms Dix: The Central London congestion charging scheme has support; it was the western extension which was in question.

Q296 Mr Clelland: So in his quest for fairness, if the Mayor of London decided to have a referendum on whether he should continue with the Congestion Charge in Central London, you are confident he would win it?

Ms Dix: No, because I think referenda do not necessarily attract the same sorts of views as if you undertook a consultation.

Q297 Chairman: What about the views of business towards the Congestion Charge? How would you assess those?

Ms Dix: Business was very, very supportive of the original scheme. Businesses were very much behind the original scheme, wanted it and were supportive of it. Businesses were concerned about the western extension in the first instance, big business as well as small business, but with the western extension, when it went it and it worked, big business was more neutral on it in terms of the effects it had, but small businesses were concerned and remain concerned because they felt more directly affected.

Q298 Chairman: We have been told that as far as vans and HGVs are concerned, in terms of deliveries, the time saving is very insignificant and therefore is not of much value to them. Has that been reflected in what you have heard?

Ms Dix: There were time savings for deliveries. One of the opponents of the original congestion charging scheme was the Evening Standard and it was one of the first ones to say that it actually saved time following the Congestion Charge with its deliveries. So time savings were gained. Some of the bigger winners were some of the financial services businesses because people getting to and from meetings, et cetera, were saving time. I suppose the biggest winners were those who do not pay (i.e. they had the benefits of the Congestion Charge, they did not pay) and those were public transport users and bus users in the main, but small businesses have felt the impacts of the Charge and small businesses continue to lobby about the impacts of the Charge.

Mr Ranger: I think we have to bear in mind that 95% of people who come into Central London come on public transport or walking and cycling, so there was a small number who were being affected by the Central Zone. I think the western extension was very, very different in terms of the makeup of the people there, the types of businesses which were being affected and the residential population as well. Businesses still, I think, engage and see the Central London Zone as a positive effect.

Q299 Ms Smith: I just want to challenge a statement, Mr Ranger, you made when you said that London is unique in terms of its transport and road networks. Can you explain why you think that is the case?

Mr Ranger: In terms of the number of options people have for public transport, the capacity of public transport, the infrastructure which currently is in place and also the investment that is going into that infrastructure. So by implementing a charge people still have a variety of options and choices about how they can travel if they are not going to take their vehicle, whereas the majority of the rest of the UK I would say would probably not have that level and capacity of public transport which London has.

Ms Dix: Could I just add to that? I think in many ways it is Central London which is unique.

Mr Ranger: Yes, Central London.

Ms Dix: 90% of users are public transport users and it is also unique in the fact that congestion is all day congestion. It does not have a morning peak and an evening peak like a lot of areas, it is all day congestion. So it has different challenges and different options perhaps, rather than being entirely unique.

Q300 Ms Smith: And outer London might have challenges which are more similar to other places outside of London?

Ms Dix: Yes, absolutely.

Q301 Ms Smith: I think you have made the points I would have made. You also said, Mr Ranger, the ultimate question may be, as you go through your work, where does congestion sit. That was what you said. Does this mean in fact that there may come a point where you would actually want to review the operation of the Congestion Charge in Central London? Is this the long-term aim of the current review of the Congestion Charge?

Mr Ranger: No, we are not looking to review the Charge itself in terms of whether it should be there. I think we are looking to see how other policies sit around it so that they are not competing with it and they are not eroding the benefits you are getting for paying your 8 to travel in the Congestion Charge area. I think the man in the street or the person in his car would start to feel it inappropriate if they are having to pay for something which does not provide the benefit that they thought they would get.

Q302 Ms Smith: What kinds of benefits do you think you may be able to provide to the Congestion Charge user?

Mr Ranger: I think that is where if the number of vehicles actually coming into Central London is lower or decreasing then obviously the element of flow in traffic should be either decreasing or stay the same, not increasing, and that is what we would be looking at as a measure. On top of that, we do bear in mind that there is going to be an immense level of activity in terms of construction regardless of what happens around roadworks that will happen in terms of Crossrail and the line upgrade for Thameslink and Olympic deliverables as well, so we will have to bear those in mind when we look at what happens with traffic flow.

Q303 Graham Stringer: Have there been any areas, which I would expect to be just immediately outside the Congestion Charge Zone, which have suffered increased pollution or increased congestion?

Ms Dix: It was a big concern before the scheme went in. People thought all that would happen would be that traffic would divert outside the Congestion Charge Zone into the areas immediately around it. None of the monitoring has picked that up. Quite a lot of the diversion of trips actually took place with people moving from car to public transport, to cycling or walking, and if there was any diversion of traffic which was otherwise going through the middle of the Zone some of that was actually captured on the Inner Ring Road, whereby we did adjust the signals around the Inner Ring Road so that it could take more traffic around because less traffic was crossing to go in. So we were able to do that without actually affecting congestion on the Inner Ring Road, in fact that got better, and some of the longer distance traffic we could not spot. It might have gone to the M25 or somewhere, but you could not actually pick it up on the monitoring. So the answer to your question is, no.

Q304 Graham Stringer: Just to go back to the original point, is it six years this February this scheme started?

Ms Dix: Yes.

Q305 Graham Stringer: So in round terms we have taken 1.5 billion out of people's pockets over that period for a scheme whose objective was to reduce congestion and congestion is the same. Does that mean that the project has been a failure in its own terms?

Ms Dix: I would say for three of those years congestion was reduced. It was only in the latter part of 2006 that we saw this more marked erosion of congestion. I would also say that since a large part of that was attributable to these utility works, which would have happened anyway because everybody wants the gas mains and the water mains fixed, then what one would need to compare is what life would look like with the congestion charging scheme versus life without the congestion charging scheme.

Q306 Graham Stringer: Which you can never do, can you?

Ms Dix: Yes. The difficulty is the person in the street is not going to make that comparison. We have done that comparison theoretically. If you took away the congestion charging scheme, congestion would be far worse than it is observed today, so I say there have been benefits for the Central London congestion scheme. There have been benefits in terms of reduced CO2, there have been benefits in terms of reduced air quality emissions, and those were all positive up until about 2006. So if you looked at it over the six years, yes, there has been a net improvement. It is just that we have started to see an erosion if you simply compare life now with life as it was, but if you compare life now with what life could be like now without the scheme there is still a benefit.

Mr Ranger: I agree that we do have to live in the real world, though, and we see a world, as Michele says, where roadworks do happen. We have to take into account construction and I find it quite difficult to understand that previously competitive policies were not taking into account the effect they would have on traffic and the benefits of the Congestion Charge. So in terms of our administration, we are very focused on looking at policies, looking to be balanced and working with each other complementary to the benefits of the Congestion Charge, hence the emphasis on smoothing traffic flow and everything we can do around that.

Q307 Chairman: Have you had any instructions from the new Mayor to change the way policies are put forward, such as having more coordination on roadworks? Have you been given any different instructions?

Mr Ranger: Yes, the instructions are very clear. We will provide copies of this document for all Members of the Committee, but the Mayor has been very clear. He is a road user himself, he uses his bicycle everywhere he goes, so he, much like every Londoner, feels the experience of roadworks, of traffic light re-phasing or better implementation of street technology, the erosion of road space, and so he wants to see coordinated policies on these areas which are considerate to the impact on each other and the overall flow of traffic.

Q308 Chairman: How much of the money which is raised from the Penalty Charge Notices goes back to improving the conditions, improving delivery facilities and improving kerbside facilities?

Mr Ranger: I could not give you the exact figures but I am sure we can provide those for you.

Q309 Chairman: Is there a policy to do it?

Mr Ranger: There is a policy to look at the reinvestment of the Penalty Charge because, as I think Michele mentioned, there is a statutory obligation that that money goes back into providing transport benefits.

Q310 Chairman: But not specifically in that area?

Mr Ranger: On the road surface, is this?

Q311 Chairman: Yes, money from the Penalty Charge Notices. Is there a policy to put revenue from that into conditions which would alleviate the problem of people being able to park?

Ms Dix: Absolutely, in the sense that all the policies on which the money is spent from congestion charging, for which there are net revenues, go on other PCNs that we issue outside the Congestion Charge where there are not net revenues. It might be spent on enforcement. It covers the cost of the enforcement and is offset by the revenues raised. So there are net revenues on other enforcement activities of congestion charging. Revenues which come from PCNs and revenues which come from the Charge are all put into this pot called "Net Revenues" and that has to be spent on a series of measures which were listed as part of the original Congestion Charging Order. Some of that is on improvements to roads, some is on improvements to bridges, some of that has been spent on improvements to developing freight strategies to help businesses.

Q312 Chairman: So it is a general pot?

Ms Dix: It is a general pot, but we have to list each year where that money has been spent. As Kulveer said, 82% of it or so tends to go on bus improvements.

Q313 Mr Martlew: Mr Ranger, you worry me somewhat, your enthusiasm! I am aware of the issue about the re-phasing of the traffic lights. That was to give pedestrians more time. I just get the impression that the motor car is going to be given more precedence under the new administration than the pedestrian. I suppose it could be argued that the pedestrianisation of Trafalgar Square held up the traffic, but it is a massive improvement for London and I understand that the plans for Parliament Square have been abandoned. Have we got a new situation where the motor car is being given precedence again over the people who walk and live in London - apart from cyclists, of course?

Mr Ranger: I would like to put your mind and the minds of the rest of the Committee at ease. We are not pro the motor car. There is no sort of policy here that says we want people to drive more. There is a policy which says we do not want London to come to a grinding halt. We want to be as efficient as possible with the road space that we have because it is not just cars that use it, there are buses, cyclists and everybody else who uses that environment and really we want to at least mitigate the impact of a lot of things that are happening over the next four, five, ten years which will impact on our ability to get people to move through our city. I am quite concerned about the level of diversions and the level of construction and the impact on all the work that is happening on the Underground, the construction of Crossrail, the construction of Thameslink and the construction for the Olympics. It is an unprecedented time in terms of the level of works which are happening in our city and I and the Mayor are quite keen that we make sure that London continues to move and be able to move through that period of time. The way to do that will be to look at what we can do to mitigate how road space is being used and we see that we need to improve the flow. So if that means that people can move a bit quicker -

Q314 Mr Martlew: Across the crossings?

Mr Ranger: No, in fact the re-phasing of traffic lights is without any impact to pedestrians. That is the key there. We are not looking to have a significant impact on pedestrian crossing time. In fact, we are also lobbying and have had discussions with the Secretary of State for Transport and DfT on bringing in countdown signalling, which provides more certainty in terms of - I do not know if the Committee has heard of this - where you see a number as it goes down in terms of how much time you have. It is currently considered to be a blackout period which provides uncertainty, "Should I cross or should I not cross?" But the countdown system has been used in a number of cities, including San Francisco and across California. It is successful and actually can improve safety by 25% where it has been implemented. So there are schemes such as that which we are looking at, as well as turning left on red lights. We need to look at providing policy solutions which can provide space on our road network, but then we look to use that space as mitigation for diversions, for moving people onto bicycles, for improving the urban environment. That is where schemes such as Shared Space, maybe not Parliament Square, but definitely Exhibition Road - I do not know if the Committee is aware of that particular scheme, where you would look to have more people sharing the actual road surface, pedestrians, cyclists, buses and car users. Those are the kinds of ambitions we have. That scheme and Shared Space itself can also provide lower travelling speeds in 25 miles an hour zones. So there are many things coming through. As I say, the key to all of these ambitions and these policies is to ensure that they are complementary and not competing with each other in eroding the benefits they may provide.

Q315 Ms Smith: I just want to explore some of the reasons why the Congestion Charge has not worked perhaps as effectively in the last two years. The only thing I can think of is that perhaps there are more vehicles on the road than has been the case before. What is the reason if that is not the case?

Ms Dix: The primary reason is because the capacity of the road network has reduced. The number of vehicles on the road now is no different from the number of vehicles on the road two years ago. So traffic levels, the number of vehicles on the road, are still lower than they were before congestion charging. They are lower by 20%. So the Congestion Charge has stopped 20% of traffic coming into the zone.

Q316 Ms Smith: That has remained constant?

Ms Dix: That has remained constant. If we had not changed the road network on which those vehicles run - not necessarily us changing it, but if things had not been done to the road network to reduce the amount of road space which is available for those vehicles, we would still see the congestion benefits. So if the capacity or the road space that is available was unchanged, we would still see a 30% reduction in congestion. But what has happened is that every time someone goes along and digs up a road and provides a sort of blockage and perhaps takes one lane out, that reduces the amount of road space available. So the cars that are there, even though there are fewer of them, go slower. Every time someone builds a building and takes the pavement and a bit of road space away, again that takes some of the capacity out. So a lot of that has been going on, particularly in the last two years, but on top of that, as Kulveer says, policies have been introduced whereby we have perhaps taken some road space away without really realising the full impact of it on the network because it has been done in this piecemeal fashion and it is the additive effect of lots of that. So what we are saying is that traffic levels are still low, but the amount of road space available for them to use in Central London has shrunk, probably by about 10%, and that is why congestion has gone up.

Q317 Ms Smith: You have used that phrase "taking road space away". Who has taken it away? It seems to me you are hinting that there is a number of authorities doing that.

Ms Dix: There is a number of people responsible.

Q318 Ms Smith: Is it the boroughs that are responsible in some cases because of planning decisions, is it Transport for London where it has put bus lanes in? Can you perhaps just list the three main examples which add up to this 10%?

Ms Dix: The utility companies for one, so Thames Water and the gas companies who have to do essential works because they are renewing the mains. They are not doing it for fun, they are having to dig up the roads, but in digging up the roads they take road space away and even though it is not for ever (i.e. they fill them back up again) the effect of that is on the network.

Q319 Chairman: I think it might be helpful if you could send us a note telling us the different areas in which this has happened, who has been responsible and how you estimate the impact on congestion levels.

Ms Dix: I would be happy to do so.

Q320 Chairman: Could you tell us what benefits the Low Emission Zone has brought?

Ms Dix: The Low Emission Zone has brought so far a 2% reduction in some of the air quality pollutants which are given out and in terms of the heavy diesel engine vehicles which come into Central London over 95% of them are compliant with the Euro III standard. So of the vehicles which are coming in and are subject to the Low Emission Zone scheme the majority are compliant and as a result of that - and it has only been operating a year - there is a 2% reduction in some of those vehicle emissions, so it is taking us towards the EU objectives which the scheme was set to address.

Q321 Chairman: Finally, how much money is currently being lost because foreign registered vehicles are not paying UK charges like the Congestion Charge?

Mr Lester: Overall in London we estimate that for parking and similar charges between 8 and 12 million a year is lost from foreign registered vehicles. Congestion charging is a similar amount and if you turn that into the economic effect, not just the financial effect, you can double that again, so overall it may be as much as 50 million a year in economic disbenefits because effectively foreign registered vehicles are immune from enforcement on congestion charging, parking and traffic regulation.

Chairman: Thank you very much for coming and answering our questions. It was very helpful.


Memorandum submitted by Local Government Association

Examination of Witnesses

Witnesses: Councillor Shona Johnstone, Regeneration Transport Board, Local Government Association, Mr Jason Gooding, Project Manager, Nottingham City Council, and Councillor John Walsh OBE, Leader of the Conservative Group, Bolton Metropolitan Borough Council, gave evidence.

Q322 Chairman: Would the witnesses like to introduce themselves, please, with their names and the organisation they are representing?

Mr Gooding: I am Jason Gooding and I am Project Manager at Nottingham City Council.

Cllr Johnstone: I am Shona Johnstone and I am a Conservative Member of the Local Government Association's Regeneration and Transport Board and I come from Cambridgeshire.

Cllr Walsh: I am John Walsh, the Leader of the Conservative Group on Bolton Council and a Member of the Association of Greater Manchester Authorities' Scrutiny Committee on Transport.

Q323 Chairman: Thank you. The written evidence we have got from the LGA seems fairly enthusiastic about congestion charging. Do you still have the same views after the Manchester result?

Cllr Johnstone: I think the view of the LGA is that congestion charging may be appropriate in individual areas. Congestion is not a national programme, but it is a local problem in local areas and it may be suitable for those areas subject to full consultation with local residents.

Q324 Chairman: Which local authorities do you think are likely to want to take that forward now?

Cllr Johnstone: There is a number of local authorities which are still part of the TIF programme, Cambridgeshire being one of them. Other authorities include Bristol and, I believe, Reading and a number of authorities are still expressing an interest in ways of addressing congestion in their areas.

Q325 Chairman: What about Cambridge?

Cllr Johnstone: In Cambridge we had a public consultation in 2007. The results were published in 2008 and showed quite a mixed picture, that 60% of the population in Cambridgeshire opposed congestion charging but 60% supported congestion charging if public transport measures were in place ahead of it, so it is a mixed picture. I would say that the public - and I suspect this applies nationally - support investment in public transport but oppose paying additional taxes. So the Cambridgeshire Cabinet decided last summer to set up a transport commission, which is chaired by Sir Brian Briscoe, to look in more detail and take evidence from those in favour and those opposed to the TIF scheme in Cambridgeshire. That is just starting to take evidence now. There is a consultation which closes in March and a number of questions which are being posed by the Commission and they will carry out their work during the remainder of 2009 and I would anticipate that they would report back to the Cambridgeshire County Council Cabinet in 2010.

Q326 Chairman: What is Government saying to you now in relation to transport innovation funding?

Cllr Johnstone: The Government is still supporting local authorities who wish to continue with TIF.

Q327 Chairman: So it is not saying anything different?

Cllr Johnstone: Not as far as I am aware.

Q328 Chairman: Councillor Walsh, what is happening in Manchester now?

Cllr Walsh: The position in Manchester is that the Association of governmental authorities has abandoned the TIF proposals as such and resolved at its last meeting in December that each of the ten authorities ought to go away and produce its own authority list of schemes for future capital programmes. One of the perceived injustices of the TIF proposal is that it had a marginal benefit for a number of boroughs on the fringe of the metropolitan area, Wigan and Bolton to the north and the west in particular. It brought together a number of projects which had previously been floated to be funded by mainstream funding, the Metrolink extension, a number of the rail/bus station improvements, and also a perception that the former Secretary of State in her announcement in July 2007 about additional rail capacity had effectively said that the heavy rail element would be a national programme. The perception was that it was an unfair imposition on Greater Manchester that it would then continue to fund the TIF proposals. The other element of that and the other side of the equation is that one must look at the total proposed package of 2.8 billion, of which 1.2 billion was to come from the Congestion Charge. Within that 2.8 billion programme there was something over 600 million as a contingency sum, there was something over 330 million, or thereabouts, for the charging equipment, which was almost a billion pounds of the 1.2 billion that congestion charging was going to raise.

Q329 Chairman: Yes, but this is about the TIF bid, is it not?

Cllr Walsh: The point I make is that if you disaggregate and look at the TIF bid -

Q330 Chairman: No, Councillor Walsh, I am not asking you about the TIF bid. I want to know what is happening now.

Cllr Walsh: What I am saying is that the TIF programme of 1.6 billion of hard expenditure, just over, is now to be reviewed by each of the authorities to look at where that is to be picked up by the regional funding allocation and other mainstream funds.

Q331 Chairman: Do you get the impression that Government is sympathetic to the bid?

Cllr Walsh: There has been a great silence on that matter. I have written personally to the Secretary of State and not had a response in the last four and a half weeks. Other members have asked questions of ministers and we have not had a reply, so it is silent at the present time.

Q332 Ms Smith: I want to ask Mr Gooding why Nottingham has chosen to pursue the workplace parking levies rather than a Congestion Charge?

Mr Gooding: The Council has been pursuing a workplace parking levy now since 2000 when the legislation came into place. Really in Nottingham what we have had to weigh up is that there were obviously two choices, the road user charging, which London at the time pursued, and a workplace parking levy, which Nottingham looked at. We spent a lot of the early years really trying to work out and develop a scheme that would be specific to Nottingham, looking at Nottingham's situation. What was Nottingham's congestion problem? Mainly commuter traffic during peak periods. So that really helped to understand the congestion problem. If it was through traffic then obviously we would have moved more towards road user charging at the time. So we looked at workplace parking and we have developed then proposals over the subsequent years. We have actually developed now a business case which we took out to public consultation, explaining that the purpose of the workplace parking levy was to tackle the growth in congestion. So we are looking at Nottingham's picture. We are looking ahead and we are forecasting that there is going to be increased investment in housing and businesses in Nottingham and we are seeing that therefore there will an increased demand to travel. We believe that with it being dominantly commuter traffic during the peak period a workplace parking levy would be better suited for Nottingham in tackling that greater congestion. There is a real significant difference, though, between road user charging and a workplace parking levy. The workplace parking levy is a much smaller demand management tool. It is far more likely to have a less high direct impact on congestion. It has a far higher indirect impact. To explain that, the charge of a levy is relatively small. What happens is that that charge does not actually reduce a lot of congestion but the revenue which comes from the scheme actually provides for public transport infrastructure improvement, which will have a far higher impact on congestion. With the road user charging scheme what you will see is they normally charge on a daily basis individuals who are travelling in an area, so basically they capture all the people who are using cars in that area. With that they can have a far higher impact on congestion, without a doubt. It also generates a far higher stream of revenue and therefore can generate far higher investment in public transport. The problem you have with that is that, as you see in Manchester and as you see in Edinburgh, it comes with a far higher risk and also with a far higher cost. A lot more cost is required for the road user charging scheme, the infrastructure arrangements. It will normally cover a far larger geographical area than just one council area, therefore it brings complications. With Nottingham and the workplace parking levy it is far more targeted. The workplace parking levy is basically about targeting and charging commuters. If commuters are your problem, if you are looking at smaller areas, then it is normally low-cost, less risk, normally easy to put in and with that also easier to take out should something else more favourable come up in the future. So when we have been looking at the levy there were things about a national charging scheme at the time as well.

Chairman: I think you have explained what it is you were doing, yes.

Q333 Ms Smith: Presumably, though, it would entail also quite severe new measures about parking outside the workplace because that is traditionally what happens?

Mr Gooding: Yes.

Q334 Ms Smith: When the NHS charges its staff to park on site what happens is that all the cars park outside the sites and create mayhem on the road network in any case, so there is a risk here that congestion could increase in a sense in terms of road space with this, so you must have thought about addressing that?

Mr Gooding: Yes. What we have done in terms of our scheme is we are actually preparing, before the introduction of the scheme, to look at traffic management measures because the levy targets an employer who provides a reliable workplace parking levy basis. If an employer then decides to reduce its parking or decides to charge for its parking there is a chance that employees will not be able to park on site and will go and park on the street. With that we are investing up front funding to ensure that we are prepared, so we are really looking at hot spots where we believe employers may pass on the charge or there may already be existing commuter problems. So we are virtually looking at things like residents' parking schemes, but you also look at more simple measures such as limited waiting schemes and other traffic management. So by putting investment in there it means that we are preparing for that. We are also using an element of the revenue stream from the levy to actually fund residents' parking schemes under the traffic management measures during the first three years because although it potentially could happen, it may not necessarily.

Q335 Mr Leech: You have half answered the question I was going to ask actually about residents' parking schemes where obviously there will be a knock-on effect of cars trying to park on residential streets. You say they are going to be funded for three years, so I am assuming that the funding stream from the workplace parking levy is going to continue, so why do you not consider giving residents' parking schemes for free to residents past the three years?

Mr Gooding: What we say is that after three years we will do a review of all the other demands on the revenue stream, so we are also funding travel planning, parking management and residents' parking schemes and traffic management measures. After three years what we will be looking at in the review is whether there is still the demand to have that revenue stream put into residents' parking schemes, whether it is still associated to the workplace parking levy and that there is an increase in the demand for residents' parking schemes, because if it is not then maybe residents' parking schemes should be funded from other revenue sources such as the local transport plan, as they are already. Basically what you would look at there is if the levy is still not having a direct impact. After three years you would expect that any impact the levy has had will have been in the first three years, therefore any instances of displaced parking should be addressed in the first three years. If after a three year review we still decided that there needed to be funding stream, then we would allocate further funding.

Q336 Mr Leech: Have you had any discussions with businesses in Nottingham about the potential for them relocating to other areas to avoid those charges?

Mr Gooding: Yes. That is one of the common themes. There is no getting away from the fact that the levy is applied to a business, so therefore businesses are going to be affected. There has been quite extensive public consultation undertaken with businesses and they have voiced concerns like that, that they will pick up and move out of the city, that they will reduce investment in the city. I do not know how far you would like me to go on this.

Q337 Chairman: Can you keep to short answers, please, because we have got a lot to get through.

Mr Gooding: I will try to. Basically, there is a lot of cost to businesses and congestion is a big cost to business in Nottingham. The workplace parking levy - we have done studies looking at what a levy will mean to the businesses that will be liable to pay in Nottingham and it represents less than 1% of their turnover. We worked out there will be 90% of businesses that will be liable for the levy.

Q338 Ms Smith: Do the businesses themselves accept that work that has been done or are they sceptical about your study? Has there been any assessment of whether or not it will discourage new businesses from coming to Nottingham and choosing to go somewhere else instead?

Mr Gooding: In the scheme one of the things we have done is in terms of businesses we have actually put in a 100% discount within our scheme because the Government does not stipulate a lot of discounts in the scheme. One of our discounts is that any business with ten or less liable spaces will receive a 100% discount. That removes 85% of businesses from having to pay a levy in Nottingham, so we have already tried to lessen the impact. That actually leaves around 500 businesses being liable -

Q339 Chairman: Is that right? You are saying you are going forward with this scheme and 85% of businesses will not be paying it, so you are talking about 15%, is that right?

Mr Gooding: That is right. The 85% of businesses only accounts for 20% of liable spaces. It is almost like 80:20. By reducing the admin and the cost to 85% of businesses we have only reduced the liable spaces by 20%. Therefore, 20% of businesses in Nottingham actually account for 80% of the liable spaces. The work that is going on on the scheme does say that you should look at trying to lessen the burden on smaller businesses.

Q340 Sir Peter Soulsby: Like a number of other cities - and it is true to some extent in the Manchester area - Nottingham has very tightly drawn boundaries and it just strikes me that this is a Nottingham City Council initiative?

Mr Gooding: Yes.

Q341 Sir Peter Soulsby: To what extent have you got cooperation with other local authorities which are part of the Greater Nottingham area?

Mr Gooding: In terms of the workplace parking levy, Nottingham's local transport plan is actually a Greater Nottingham local transport plan, so it is actually done in conjunction with the County Council. So the policies in there are integrated over the plan there. However, Nottingham City Council is only pursuing a workplace parking levy, not the County Council.

Q342 Sir Peter Soulsby: Is that not a potential weakness in the scheme, in that certainly part of the core urban area is outside the City Council's jurisdiction?

Mr Gooding: We only have the powers to put it in within our own administrative area, but if we look at the public transport improvements we are making for Nottingham City Council, it will be far wider spread than just within the City Council. There is the extension to the tram system, there is the bus link networks and the improvements to the station. Really the majority of them are actually in the City Council area, although the benefits are wider spread because the communities actually come from the County Council area but a lot of the congestion impacts are actually within the City Council. The communities actually impact on the City Council area, though they may reside in the County Council area.

Q343 Graham Stringer: I am not clear from your answers. The businesses which are expected to pay this car parking levy, what is their attitude? How many of them are in favour and how many of them are against?

Mr Gooding: With the public consultation we undertook overall we did a lot of direct mailings and lots of communications to try and get businesses to participate in the public consultation. Of the 3,500 businesses which would be liable for a levy, 3,000 of them would not have to actually pay anything, they would just have the licence. During the public consultation exercise over 12 weeks 100 businesses responded to that and of those 83 objected and the rest were neutral and four were in support. In terms of actual issues and consultation only 83 businesses actually took the time to object during the consultation period.

Q344 Graham Stringer: That in round terms is 83% of those who replied, who would pay?

Mr Gooding: Yes.

Q345 Graham Stringer: That is a pretty severe level of objection, is it not?

Mr Gooding: I suppose it would be unprecedented really to expect them to come out in direct support, but you could also argue the fact that there are 3,500 businesses and only 100 took the time to respond. I suppose it depends on how you look at the results.

Q346 Graham Stringer: It does depend on how you look at the results and I can understand why those businesses who would not pay did not respond. I can understand why 83% of the businesses who did respond, who are going to pay, would be against it. How is Nottingham City Council evaluating that work? Is it taking the fact that most businesses are neutral because they are not going to pay as support for the scheme? Is the Council taking the line you seem to be taking?

Mr Gooding: Can you just repeat the question?

Q347 Graham Stringer: You have done a consultation exercise. What is the threshold that has to be passed when you write a report to the Council to say, "We consulted the people affected by this and it is a green light because 83% of them are against it"? What is the threshold you have to get to?

Mr Gooding: Firstly, the public consultation is not a referendum. It was not to say that if the decision came back as "Yes" we were going to do it.

Q348 Graham Stringer: I understand the difference between public consultation and a referendum. Yu have gone out and spent a great deal of money consulting. What I want to know is, do you have criteria in Nottingham for what would be support for the scheme and what would be opposition so that you would not go ahead, or are you just going through the motions?

Mr Gooding: In terms of the consultation, we looked at the consultation response that came in. We then themed and sub-themed, so we basically looked at what the issues were being raised in the representation -

Q349 Chairman: I think what Mr Stringer is asking you is how will you decide what to do as a result of that consultation? What would be there to constitute approval in your mind, or are you just going through the motion of having the consultation?

Mr Gooding: In terms of the motions, we are going through the public consultation motion, which is a mandatory requirement that we undertake that. By going through the consultation we then identified the issues people raised. By identifying the issues, the Council then put forward its response to those issues.

Q350 Chairman: How will you assess the balance on those issues?

Mr Gooding: Those issues were taken to the Executive Council's Executive Board to consider them alongside things like a public examination, which was a five day examination of all the issues raised by the response, including the public as well as businesses. That was done by an independent examiner, who also took forward a report and it all went through to the Council's Executive Board so that they can make an informed decision looking at the issues raised, looking at the Council's response and an independent examiner's views. They took the decision in principle to proceed with the levy.

Q351 Graham Stringer: Can I ask Councillor Walsh, what lessons have you learnt about public attitudes to congestion charging and road user taxes during the consultation and referendum in Greater Manchester?

Cllr Walsh: I think the biggest single lesson is that the public saw it as being unfair, that there was a perception, a very clear perception by the majority of those who voted that a small number were being asked to pay a disproportionate sum. It was interesting that in fact many large businesses were also opposed to the imposition of the Congestion Charge, fearing it would impact badly on their employees, many of whom were amongst the lower paid members of the community and that is very interesting. It is interesting, as I have described earlier, that the sums involved were at the margins. If you take away the contingency fund, if you take away the cost of the charging equipment, the net sum raised from the Congestion Charge was about 200 million in a project which was valued at 2.8 million and the quantum, therefore, was perceived to be minimal in terms of benefits accruing. The other message which people were giving very clearly when one spoke to them and in the response one had is that it was perceived to be inequitable that projects which were funded by mainstream funding in other parts of the country were being imposed upon Greater Manchester only if they paid a Congestion Charge and that it was "blackmail", which was a word that was often used.

Q352 Graham Stringer: Was there any difference between the attitudes of the general public and businesses? Were businesses more or less hostile than the general public?

Cllr Walsh: There were those members of the business community who were in support of the Congestion Charge. The majority in my perception were opposed to it, but it was interesting in doing private polling and in talking to individuals - and I did quite a lot on the streets, talking to people with petitions and other measures - there was a strength of feeling that I have never previously witnessed from members of all political parties across all sections of the community; it was not confined to any one group, and this was in the boroughs, not just in the city of Manchester but in the boroughs surround it.

Q353 Graham Stringer: What do you think the lessons in public policy are for local authorities and the Government out of the referenda exercise in Greater Manchester?

Cllr Walsh: I think the biggest single lesson is that a politic of taxation, of higher taxation, is never popular and to take that as an option to the public creates, I think, a very clear message that the answer is, no to higher taxation.

Q354 Ms Smith: Mr Gooding again. I am clearly not picking on you, but I am interested in this levy. You talked about consultation with businesses. Does the term "businesses" in the remit of this scheme include the universities? Are the universities classed as businesses for the purpose of this scheme?

Mr Gooding: To the best of my knowledge, yes. The university is liable.

Q355 Ms Smith: Pretty major employers in Nottingham?

Mr Gooding: Yes. They would be because there were several different categories in terms of the consultation and they could have gone in -

Q356 Ms Smith: They would be just one of the 20% that would be included in this scheme?

Mr Gooding: Yes.

Q357 Ms Smith: Would the same apply to the NHS?

Mr Gooding: The NHS is different because the NHS actually receives 100% discount under the Nottingham scheme. So that means that although they would have the licence they would not be liable to pay the charge.

Q358 Ms Smith: Would the same apply to the City Council?

Mr Gooding: No, it would not.

Q359 Ms Smith: So the Council would be liable to pay?

Mr Gooding: All public sector organisations are liable. Mr Gooding was telling you of the discounts. In terms of the Nottingham scheme there are several discounts. There is a 100% discount for the emergency services, Fire and Police, NHS premises, front-line premises, and there is a 100% discount for businesses with ten or less spaces and disabled spaces.

Q360 Ms Smith: Do you know whether the NHS in Nottingham actually does charge for parking at the moment?

Mr Gooding: It does, yes. At its key sites it already has a permit system in place. It is tiered over the salary ranges and types of users, so there are public and private users who pay the charge.

Q361 Ms Smith: If it is already charging its staff, why would it be absent from this levy? It is not always an emergency service, is it? For many people it is a visit to the hospital to see a patient, or they work in a non-emergency sector of the hospital?

Mr Gooding: Yes, it could be administration staff, for instance. The Nottingham scheme actually feels it is in line with Government policy to look at providing an NHS discount, so it has looked at their draft guidance that was available in developing the scheme and feels that is in line with Government policy to look at emergency services and NHS premises and to provide a discount. It also considered things like educational sites, but decided not to pursue that.

Q362 Ms Smith: So education sites would pay?

Mr Gooding: Education sites will pay, yes.

Q363 Graham Stringer: Was the City Council and its depots and departments part of the 17% support for the scheme? You said 83% were against it.

Mr Gooding: No, the City Council did not respond on the consultation in terms of that, although some of its employers could have.

Q364 Sir Peter Soulsby: Could I return to the Manchester experience and just ask Councillor Walsh, you referred a number of times to the way in which the proposal was being perceived and I would like to explore with you whether it was a matter of perception and the way in which it was sold that was the problem or whether there are fundamental lessons about what was on offer that needed to be learnt if the scheme was to be made acceptable.

Cllr Walsh: I think they were probably very perceptive. I think it was actually what was on offer that was the key to all of this. I described earlier that the elements of it covered a number of areas which had previously been and would in other parts of the country have been mainstream funded - additional rail carriages and rolling stock, announced in 2007, in July, by the then Secretary of State nationally. "Why should Greater Manchester have to pay a Congestion Charge to get additional rolling stock?" was a question which was regularly asked. Rail stations - there was a couple of major improvements to rail stations, one in my own borough of Bolton. A bus interchange link to the rail station has been in the programme and was approved for construction in the 2012 - 2014 period, perhaps brought forward by 15, 18 months had the Congestion Charge been implemented. The perception was, "If that is going to happen, why should we have the Congestion Charge?" So it was almost the case that these are mainstream projects which ought to have been, and initially had been, approved for implementation and why therefore impose a Congestion Charge? I think with that argument it was interesting that the neutral stance adopted by the Greater Manchester Transport Authority and AGMA to try to put that message across failed singularly to convince the public that this Congestion Charge would improve and speed up the implementation of these projects.

Q365 Sir Peter Soulsby: Do you think with different benefits on offer it might have been acceptable?

Cllr Walsh: I think the fact is the quantum was woefully inadequate for the pain that would be borne. It would have needed a much larger project or series of projects, it would have needed a much higher incentive and I think the scale involved was de minimis in terms of the actual pain which would have been borne and I think some of the other fears referred to by previous witnesses, though because there were two charging zones proposed for Greater Manchester, an outer and inner, were changing almost by the week because as one community objected the boundaries seemed to change to reflect objections. So there was uncertainty even up to the time of the referendum, or the poll, as to which boundaries would be implemented, but the worry was that you would actually get at a number of points huge car parks created, particularly if the Metrolink was improved, if the cross-city transport links were to be improved on the scale indicated, and there were real fears by residents in those areas on the major arterial roads into the city.

Q366 Sir Peter Soulsby: Do you think the experience of Manchester suggests that a referendum could never be won in any circumstances, or do you think it is just a matter of getting enough in there to make it attractive? I am not suggesting the evidence from Greater Manchester -

Cllr Walsh: I do not believe that a local poll - and it is not a referendum because it is not binding under the Local Government Act - would ever vote for higher taxation.

Q367 Chairman: You think whatever the benefits it would not happen?

Cllr Walsh: I think whatever the benefits the public take the view, and very strongly expressed the view, that they pay Vehicle Excise Duty, they pay the road fund tax, all the taxes they pay, and that therefore to have an additional imposition is inequitable.

Q368 Chairman: So you are saying that in your view the public will never vote for an extra charge even if the benefits are greater?

Cllr Walsh: No, I cannot see on the scale of Greater Manchester - it may well be in other parts of the country one may come up with a more relative scheme, but my perception of the Greater Manchester model is that a poll on that scale with the measures proposed would never produce a "Yes" vote, and I think even in Manchester, which was superficially the greatest beneficiary, a poll of 28 to 72 -

Q369 Chairman: I think that verdict is clear from what we have heard! Finally, I would like to ask you, what impact did the high fuel prices in 2007 and 2008 have on traffic levels in your areas? Councillor Johnstone, can you tell us anything?

Cllr Johnstone: I think it is important to remember that I am representing the Local Government Association and I am from Cambridge, but what I would say is that there was evidence that people were starting to make a switch away from their cars onto public transport, but the volatility of fuel prices over the last 18 months makes it very difficult to use fuel prices to influence travel behaviour. It is clear that travel behaviour was influenced last year, but there would have to be consistency in fuel prices. The other point I would make is that high fuel prices, which we have seen in the past with the fuel duty escalator, actually can impact in a very negative way on rural areas where there is not access and will never be access to really high quality public transport. So I think if the Government were to use fuel prices to try to influence travel choice and travel behaviour they would need to think very carefully about the impact upon the rural communities as well as the impact on congested urban areas.

Cllr Walsh: I have some figures actually which are quite interesting. The forecast for the reduction of traffic into Manchester for peak periods with the Congestion Charge was around 12%. That was within the TIF submission. I think it was the RAC Foundation, though I stand to be corrected on that, which produced some figures before the poll took place which showed that as a result of higher fuel charges and the economic downturn around October/November last year the reduction had been 15%, but if you say to a motorist travelling into Manchester, "Has there been a reduction of traffic?" I suspect he would say, "No, there has not." So although the forecast was a 12% reduction, the current reduction is around 15% because of those factors and the public still believe that there is congestion, so therefore it laughs in the face of the benefits of the Congestion Charge.

Q370 Chairman: Is there any evidence of the impact of the recent fall in fuel prices?

Cllr Walsh: I can only quote the figures that I was given. I think it was the RAC Foundation which published these figures just before the poll was implemented last year.

Q371 Chairman: Councillor Johnstone, have you any information on that?

Cllr Johnstone: I have no recent information on the impact of the fall in prices, but it would not be unreasonable to suspect that people may go back to using their cars. Having said that, the impact of the recession and job losses may well again force more people back onto public transport, so I think there is a lot of work to be done to look at quite what the impact is and why people make the travel choices they do at a particular time.

Q372 Graham Stringer: One supplementary, Councillor Walsh, on this particular issue. We were on the same side in the referendum, but I would be interested in your views. You mentioned in your previous answer that this was not a referendum in actual fact, it was a poll under the Local Government Act and therefore there were different rules and participants had less rights then they would have done under a formal referendum. Do you think that if there are to be these kinds of large referenda, polls, the Government should change the rules, change the law so that there is a clear basis for a referendum in that?

Cllr Walsh: I do not believe - and, as you say, you were closely involved in the polling and the opposition to the implementation - the public have within their own minds a clear thought that this is only a poll and therefore for guidance, as opposed to a referendum, and therefore enforceable. The view was, "We don't want congestion charging and we will vote against it." I do not believe we would have seen a greater different result had it been the one rather than the other.

Q373 Sir Peter Soulsby: Could I very briefly return to Mr Gooding? It may be something I just missed, either already said or in the evidence we already had, but I just wondered if you could remind us, if we have already heard it, how much Nottingham were expecting to raise from the workplace parking levying? I am not sure we had that.

Mr Gooding: The charge actually starts at 185 per year and it rises up over the first five years to 364 per year per liable parking space. It expects to collect in the region of 6 million, rising to 12 million per year.

Chairman: Thank you very much for coming and for answering our questions.


Witnesses: Mr Graham Dalton, Chief Executive, and Ms Ginny Clarke, Director of Network Services, Highways Agency, gave evidence.

Q374 Chairman: Good afternoon and could I ask you to identify yourselves for our records, please?

Mr Dalton: I am Graham Dalton. I am Chief Executive of the Highways Agency.

Ms Clarke: I am Ginny Clarke and I am the Director of Network Services for the Highways Agency.

Q375 Chairman: Thank you. The Government is still investigating road user charging. What role does the Highways Agency play in that?

Mr Dalton: I think our role is to support the Department and we have been working with the Department for Transport, really looking at the details of how the network is operating and what may need to be done on the network to support a system working, so really a support role on technical matters primarily.

Q376 Chairman: What sorts of technical matters have you been dealing with?

Mr Dalton: The layout of roads and junctions, the different sorts of schemes there may be, so if there was segregation of traffic, how would you lay out junctions, so looking at things like the weaving of traffic and movement of traffic.

Q377 Chairman: Have you done a great deal of work on this?

Mr Dalton: We have done some work over the last six months or so. I would not say it is a huge amount. It was an important work stream last summer for a while.

Q378 Chairman: Is this specifically related to road user charging, or is this general work?

Mr Dalton: The Department was looking at the feasibility of charging for tolled lanes in the context of the managed motorways schemes that we have been working up as a wider scheme and hard shoulder running.

Q379 Chairman: Has the option of charging drivers only on the motorways and trunk roads been considered?

Mr Dalton: The work we have done for the Department has only been about the motorways.

Q380 Chairman: Not on the trunk roads?

Mr Dalton: The Department may have done more, but we have been talking about motorways.

Q381 Chairman: What would you say are the technical issues which will need to be resolved in relation to road user charging?

Mr Dalton: I think the main things we were looking at, while we were looking at it, were particularly about traffic flow and traffic movement and where a charge lane would be and how traffic would move into it and move out of it, the location of signing, particularly in relation to junctions and spacing to junctions.

Ms Clarke: Those were the limits of our areas of involvement to do with the technical aspects of how you would move traffic in and out of the lane, and this was really a follow on from our work on how traffic moves in and out of lanes, whether it is hard shoulder running or high occupancy vehicle lanes.

Q382 Chairman: Have the technical problems been resolved, or which ones are still outstanding?

Ms Clarke: Yes. We would understand what the difficulties would be and if the scheme was then taken forward you would then have to look at those again in the context of the scheme.

Q383 Chairman: What are the difficulties you identified?

Ms Clarke: They are related to actually depending on where you do it, so effectively we understand the difficulties associated with traffic moving in and out of lanes and the issue to be resolved is in which location are the particular volumes of traffic, and that is location specific, so the issue then becomes where you apply it. It is a particular problem.

Q384 Chairman: Do you think the technical problems could be solved?

Ms Clarke: The issues we were looking at, yes, we would expect those to be solvable. If they were not, then how would you manage the traffic to make it solvable? I think that was the issue that would be resolved.

Q385 Chairman: How did this actually operate? Did the Government ask you to look at specific areas and then report back to them?

Ms Clarke: No, we did not look at anything further than that. It was really that basic work about what I would term the road safety aspects of it.

Q386 Chairman: So are you saying you do not see any problems that cannot be resolved from a technical point of view?

Ms Clarke: These are technical problems only about the roads, the traffic moving in and out of lanes. We did not get involved with the charging mechanisms, that aspect of technical things. We were not involved with that work.

Q387 Chairman: So you have not looked at anything related to charging mechanisms?

Ms Clarke: No.

Q388 Chairman: Nothing at all?

Ms Clarke: No, not at the moment.

Q389 Chairman: Have you been asked to?

Ms Clarke: No, this was work done by the Department, not by us.

Q390 Chairman: Have you done any work on the attitude of the public and business towards different types of road user charging schemes?

Mr Dalton: No, we have not.

Ms Clarke: No, not the Highways Agency.

Q391 Chairman: Do you look at the impact of road user charging schemes abroad? Do you have any knowledge of those? Is it within your remit?

Mr Dalton: Not specifically. We do have some quite strong ties with European agencies, particularly like Fortisgarde, and the Belgian authorities and France's authorities, with the work we have been doing there and that has been a lot about traffic management and not about road user charging as such. There have been Highways Agency officials on visits to the United States to see a high occupancy lane in operation just to understand how they do operate and that has been a fact finding trip only.

Q392 Chairman: What would you say you have learnt from those fact finding trips?

Mr Dalton: It has been supporting, as Ginny was describing to you earlier, how you actually get traffic moving in and out of lanes and the differences which maybe the physical set up in the States would have to the UK, where in many cases they have got more space and can actually have a physical separation between lanes.

Q393 Chairman: Did you find anything that helped to solve problems here, or was it just getting more information?

Ms Clarke: I think the differences in our types of freeways, the American systems compared with the English, were sufficient for us to understand how it might be solved, but the detail was still very different, whether it is about left-hand movement or right-hand movement, widths of lanes. Those things are very different, so yes. What we gained was an understanding of how you could make it work, but it did not answer all the issues we would have in road safety terms because of the differences of our roads really.

Q394 Graham Stringer: Have you looked at SSS Systems?

Mr Dalton: We have not as the Highways Agency, no.

Q395 Graham Stringer: When the Government were in favour of road user charging schemes were you involved in discussions with Government about how that would work?

Ms Clarke: Our involvement really was that we were asked to look at the feasibility that any system could be fixed on the roadside, so our involvement was, for instance, if there was going to be a system that needed gantries for supporting equipment. So we were asked to look at the provision of gantries. So that aligns with very much our normal business, the provision of gantries, but we were not involved in any of the technology development.

Q396 Graham Stringer: Did you come across any technical difficulties which you advised the Government it would be difficult to do, or impossible, or easy to do?

Ms Clarke: I think the issue is because they were in quite a narrow band, they were to do with gantries, and the provision of gantries was not a difficulty, that was a possibility because we would be using gantries for other purposes. In that sense, yes, the things we were being asked about were things we could do because they aligned with facilities we would have been putting on the network anyhow.

Q397 Graham Stringer: So there are no fundamental difficulties?

Ms Clarke: Not if that system was used, which is the roadside system.

Q398 Chairman: What was the impact of the high fuel prices last year on traffic on motorways and on trunk roads?

Mr Dalton: On traffic volume, it is very hard for us to determine the rate of any direct attributable impact. The Cortley statistic shows there was a very small reduction of the order of 1% in traffic volumes on the motorways and very fractionally more on the trunk roads in the second quarter of last year and a little bit more in the third quarter, but whether that was due to fuel prices, the economy or whether it was due to the fact that it was a very wet summer and fewer people were taking day trips - there was a lot of other variables at play, so we did not see a big change in traffic volumes.

Q399 Graham Stringer: Is this done by counting vehicles passing a point or is it by measuring delays in journey times?

Mr Dalton: No, those numbers are based on a number of automatic traffic count installations.

Q400 Chairman: So in relation to congestion are you saying there was no impact?

Mr Dalton: I am saying that whilst the numbers are showing there was a very small, of the order of 1%, reduction in traffic volume. It is not clear that that was attributable directly to fuel prices or something else. In terms of traffic journey time reliability, which is the bit we do measure, we have been showing a steady improvement in journey time reliability and consistently for over 12 months and more, and that is still improving. Again, whilst that might be due to fuel prices, it might be due to lower numbers and we have also been investing quite a bit of capital in easing congestion at pinch points on the network to make traffic flow better and we certainly believe that quite a lot of the improvement in journey time reliability is as a result of those investments.

Q401 Chairman: What about the level of accidents? Was there any change there at that time?

Mr Dalton: I do not think we count accidents as such, do we?

Ms Clarke: No. Generally the statistics have shown a continued decline in killed and serious injury, which is the measurement which probably best reflects that, so there has been a general decline in that over the years and that was continued, but there was nothing out of the order in the rate, so the trend was as it had been in the previous year.

Q402 Ms Smith: Does the Treasury consult with the Highways Agency when it is proposing increases in fuel duty taxation, fuel taxation in effect, in terms of its likely impact on traffic levels and congestion?

Mr Dalton: Not to my knowledge, but I have only been in the post for seven months.

Ms Clarke: No, not that I am aware of.

Q403 Ms Smith: What would be the most effective taxation measure, in your view, to reduce congestion?

Mr Dalton: I do not think I am really in a position to answer.

Q404 Ms Smith: Based on your expertise. You obviously have a lot of knowledge and years of experience in dealing with highways issues, motorways, trunk roads, and so on?

Mr Dalton: In terms of the most effective taxation, we run a strategic road network and there would be questions of how much of a network one were to apply any taxation or charge to and if you are talking about a charge that is specific to a journey then you would have to look at how it affected strategic roads that we deal with as opposed to local roads and whether there is any shift. If it were blanket charging, again it would vary by different users, different categories of users. Now, on the strategic roads at the busiest times, our morning and evening peaks, the national transport statistics show the sort of breakdown between commuter travel, business travel, school travel - which I do not think very much is on our network. So for a charge to be effective on attacking congestion on our roads, which is not necessarily the same as on local roads, then you would have to identify which group it was going to get. It may well be something that affects commuters in either forces, the reduction in commuter numbers or which shifts that peak, and a shift in the peak would be quite effective.

Q405 Ms Smith: A shift in the peak would be quite effective?

Mr Dalton: Yes.

Q406 Ms Smith: Can you explain that a little bit more?

Mr Dalton: Effectively something that convinces people that it is worth adjusting journey time and there is behaviour that shows people tend to time their journeys, within reason, to try and avoid the worst of what they may feel is a journey. So they might go in a bit later or a bit earlier and it is conceivable that a charging regime which allowed them to take benefit of, say, a lower charge at a lower peak time that might affect behaviours and just take the top off the peak. That would be quite effective in reducing congestion while still keeping the roads full and running at capacity.

Q407 Chairman: Are you assuming there will be a road pricing scheme at some stage in your own planning?

Mr Dalton: No, we are not.

Q408 Graham Stringer: Are you assuming a tolling scheme?

Mr Dalton: No.

Q409 Chairman: So all the work you are doing assumes no tolling, no road user charging of any sort?

Mr Dalton: That is right. We are not making any assumption or presumption that any form of charging regime will be in place.

Q410 Chairman: Have you been told to act in that way or is it just your idea?

Mr Dalton: Well, as the Secretary of State said on 15 January, "The Department for Transport is not pursuing a national road user charging scheme," or a road user charging scheme on the motorways. The Department was considering it as part of the investment programme which the Secretary of State announced on 15 January, but in deciding to go ahead he decided not to pursue charging in that, so we will progress the schemes without a charging scheme.

Q411 Chairman: Do you think that the managed motorway scheme and active traffic management could be an alternative to road pricing?

Mr Dalton: Can active traffic management be an alternative? You are almost saying - we are proceeding with -

Q412 Chairman: Is it going to deal with traffic congestion?

Mr Dalton: Yes.

Q413 Chairman: Without the need for any kind of road charging policy?

Mr Dalton: Yes, because it is effectively providing 20 to 25% additional capacity on a three lane piece of motorway, turning it into a four lane, and trials on the M42 have demonstrated that that makes the journey time much more reliable. So whilst everyone is moving at a steady speed does not make the quick journeys any quicker, the slowest journeys are a lot quicker than they had been.

Q414 Chairman: Does that mean you have done the calculations on that?

Mr Dalton: No, we actually measured it on the M42 where the pilot scheme has run.

Q415 Chairman: So you feel confident that traffic management schemes and the managed motorway scheme will deal with the problems of congestion?

Mr Dalton: For the foreseeable future, yes.

Q416 Chairman: And how long is that?

Mr Dalton: That depends on what continuing traffic growth may or may not be.

Q417 Chairman: What are you assuming?

Mr Dalton: I do not know what we take -

Ms Clarke: On the M42, when we were looking at that, we were looking at the 1 or 2% increase each year. I think if it was any greater we would assume that we would have to put in or with the local authorities talk about the things which might need to happen, which is the area-wide traffic management, so not just us managing traffic on our roads but actually the traffic coming to the motorway and leaving the motorway. So we effectively protect those benefits of the active traffic management. You would seek to also extend that traffic management out into the wider network. So that was part of one of the things we were looking at and has been mentioned in the Secretary of State's statement last month.

Q418 Graham Stringer: Does having a private company on the M6 toll road taking its tolls affect how you operate in any way?

Mr Dalton: There are protocols in the concession agreement which stipulate that we do not run the two as an integrated piece of road and we will put notification up that the M6 toll is clear when it is clear to give drivers that information.

Q419 Graham Stringer: That was really the question I was coming to. Why do you do that? When I am driving down I do not want to know that the M6 toll is clear, because it is basically always clear. What I want to know is that the M6 between junctions 8 and 12 is clear and then I do not have to pay. Why do you not tell me that? Why do you direct me towards somebody whose business is taxing me?

Mr Dalton: We are fairly constrained in the concession agreement which was clearly signed some years ago on what we can put out.

Q420 Graham Stringer: So you cannot tell me, even though you pay a fortune for those sanctions, that the junction between junctions 12 and 8 is clear?

Ms Clarke: We can do, actually. We provide information about our route through the variable message signs, it is just that the level of information we provide on our route, that information is a choice about what the M6 toll provide. So we sign our route and certainly give you that information, hopefully in advance of you getting to that section so you have the option.

Q421 Graham Stringer: But nearly all the signs say the M6 toll road is free, there is no congestion?

Ms Clarke: They do, but we also have signs which explain the condition on our road as well. They are both there in fact. So if you are coming up the M42 from south of there you will see warnings about our road, about the condition on our road. Some of it might be journey time availability information, the journey time to the next junction. So those are the variable message signs.

Q422 Graham Stringer: But specifically on the M6 travelling south - I do not want to labour this point too much, but it is interesting - you rarely put that information on it. It is nearly always "M6 toll road is free." So what I am not sure is, are you contractually obliged to put that information out at the expense of not being able to put out information about the M6 between junctions 12 and 8?

Mr Dalton: No.

Ms Clarke: No.

Q423 Graham Stringer: If you are not contractually obliged, will you do it, because I do not want to know the M6 toll is free? You can bet on it being free.

Mr Dalton: I do not know what time you travel, but I think the experience is regularly that the M6, even when it is flowing reasonably, is a slower journey and more congested through traffic volume going down the parallel route. That would not normally merit us putting up that it is congested or that there are delays on it and it is the tipping point that we put anywhere. We do not put delays up until there are significant delays on this route.

Q424 Chairman: Does the Treasury consult the Highways Agency about the fuel taxing process?

Mr Dalton: No.

Q425 Chairman: Not at all?

Mr Dalton: No.

Q426 Chairman: Do you have any views on what taxes would help to reduce congestion?

Mr Dalton: Similar to the question earlier. Not really. As I was saying, a tax or charge which shifted demand and spread demand a bit more evenly is the one which would be most effective because we would be making better utilisation of the road.

Q427 Chairman: What would that be?

Mr Dalton: I do not have a view on what that would be.

Q428 Ms Smith: I just want to ask if you have made any measurements of the different impacts of different kinds of uses of the Highways Agency network, in other words what kind of negative impact does freight traffic have on the network in terms of congestion and the cost of maintaining and repairing the network?

Mr Dalton: In terms of the question of congestion, I think it is quite sensitive as to the areas of the network. On a general three lane motorway a freight flow is part of the traffic mix. We do get problems where there are gradients and steep gradients which slow down the freight movements and where you get two lane pieces, particularly at motorways and two lane dual carriageways where overtaking freight trucks can slow down vehicles behind and on those, for example on the A14, we have been trialling overtaking vans on there.

Q429 Ms Smith: Or the A628 perhaps! That has got a real freight problem.

Mr Dalton: Yes. It is not a policy and, as you can imagine, they are not always popular with the freight operators because they effectively if there is a slow moving truck then others are stuck behind it.

Q430 Ms Smith: What view would the Highways Agency have on a proposed shift of freight from road to rail? How would the Highways Agency view that? Would it have a view?

Mr Dalton: I think the first question one would ask is, how big a shift would that be, because it would have to be a very substantial shift to rail for it to have a noticeable impact upon road. Rail is carrying a pretty small percentage of freight now and if it was enough coming off the road for it to be a noticeable reduction of freight on road, I think rail would be running -

Q431 Ms Smith: But in certain parts of the network you said there were pinch points, so it could have a real impact in some areas and actually quite sensitive areas as well?

Mr Dalton: Yes, on routes such as the A14, so Felixstowe across to the West Midlands, there have been rail schemes to take the high containers across and that can only be a good thing as far as the road user is concerned.

Q432 Ms Smith: Yes, and in sensitive areas like the Peak District?

Mr Dalton: If it took noticeable flows off, yes. It would depend what the rail offering was.

Q433 Chairman: If there was not any form of road user charging, you have already said that you think the traffic management programmes we have got will deal with congestion, is that right?

Mr Dalton: Introducing hard shoulder running in traffic management, a managed motorway, which is about having an additional lane available, and controlling speed and having traffic all moving at a uniform speed or bringing the speed down from 70 to 50, for example, gives much better compliance to the speed limit, it gives a much more uniform speed and we find we are able to take a greater volume of traffic going through then. So that effectively is giving us additional capacity.

Q434 Chairman: What would the implications be for the road building programme if we did not have any form of road user charging? Would we need to build more roads?

Mr Dalton: The emphasis is now on the whole not building more roads or new routes. It is tending to be about improvement of what we have got. Now, by switching to active traffic management and hard shoulder running we are in effect budget constrained over this Spending Review period -

Q435 Chairman: No, I am not asking you about that, I am asking about you now thinking ahead and not constrained by budgets. If there is no road user charging, with the forecast for traffic that you already have does that mean we would actually need more roads? I am not asking you if you have got the funds available.

Mr Dalton: Are you talking about the impact for road building?

Q436 Chairman: That is right, yes.

Mr Dalton: For a given amount of money, by using the hard shoulder running we are therefore doing more parts of that motorway network than we would otherwise do.

Q437 Chairman: Yes, but what would the need be? I want you now to have a vision and guess that you have got a budget and told what you have to work with. I am saying that if the traffic projections are as you have got them now and there is no road user charging, does that mean we would actually need more roads than you might be able to provide?

Mr Dalton: I think the reality of the world - sorry, this appears like a lack of vision, but the reality of the world we live in is that we have one large transport system and certainly I do not feel that we have the competition between rail and road, or indeed any other specific mode. Each is trying to do its part. So we are doing - and even with unconstrained funds I think we would still be doing - schemes to look at alternative journey choices, alternative modes as developments come forward.

Q438 Chairman: But would we need more roads?

Mr Dalton: I think we will need improvements to the roads we have got and without a form of allocated charging there will be no disincentive to travel in that sense.

Q439 Chairman: Therefore, do we need more roads?

Mr Dalton: It is a politician's decision really on whether to meet the demand and to put in road capacity for unconstrained demand. I think it is unlikely that that would help.

Q440 Chairman: You think it is unlikely we would need more roads?

Mr Dalton: No, I think it is unlikely the decision would be taken to meet unlimited demand.

Q441 Chairman: Yes, but I am asking you to just think ahead a bit and the projections you have got, assume no road user charging, and the rest of the system stays as it is. Would that mean there would be a need for more roads?

Mr Dalton: Are you just talking of my network or the country as a whole?

Q442 Chairman: No, the things you are responsible for.

Mr Dalton: As Ginny Clarke was saying, with active traffic management and four lane running and more capacity on motorways, then actually the pressure is going to be on the local road network, so it is not our network that is particularly going to need it.

Q443 Chairman: So it would be a problem for the local road network, not for the road charge?

Mr Dalton: Yes. I mean, there will be questions about whether you can get onto the network then. All purpose trunk roads are a different animal. Some of them are not quite heavily used anyway. Some of them are in quite urban areas, so they are different to the question.

Q444 Sir Peter Soulsby: I actually feel quite sorry for you because you can neither advocate building more roads to meet the demand, nor can you advocate managing the demand by pricing people off those roads. You talked earlier about the foreseeable future and being able to squeeze more effectively on the existing strategic network for the foreseeable future. Is it not actually the case that that foreseeable future is actually quite a limited period of time and there has to come a time when either there is a massive extension in road building or the demand is managed by price?

Mr Dalton: To manage growth the demand probably has to be managed. We are doing and will continue to do a lot of other things from simple things like trying to work with the local authorities, the local networks, on integrating with the local network. We are doing things with developers because development increases hot spot pressures on the network, for example just north of Cambridge where a business park development up there is potentially putting huge demand on local parts of the A14, almost turning it into a local road around Cambridge, and that is where we are working with developers, very closely with developers. So as part of this development actually the only credible answer and the sustainable answer is to put in alternative transport modes as well.

Q445 Sir Peter Soulsby: Yes. As I say, I do feel very sorry for you because you are actually faced with having to squeeze more down an existing network in effect, but I think it is the case, is it not, that ultimately your political masters will have to make a decision either to provide a massive extension in road building or to manage demand through some form of road pricing?

Mr Dalton: I think they will have to make the decision on whether to provide more capacity or to manage demand, and I will not go into what that solution might be!

Chairman: I will not ask you!

Q446 Sir Peter Soulsby: I think that is ultimately the strategic decision which will have to be made by Government?

Mr Dalton: It is credible.

Sir Peter Soulsby: I just make the observation.

Chairman: Thank you very much for coming and answering the questions.