TfL nets £6m annual windfall from c-charge changes, expects minimal improvement to air quality

c-chargeTransport for London expects to receive an additional £6m per year as a result of recent changes to the congestion charge.

Last month Mayor Boris Johnson and TfL announced the current Greener Vehicle Discount (GVD) for less polluting vehicles would be replaced by a new Ultra Low Emission Discount (ULED) for zero or ultra-low emission vehicles.

As a result of the changes, vehicles such as the Toyota Prius and Fiat 500 TwinAir would no longer be exempt from the congestion charge, although drivers of vehicles already registered would continue to receive their discount for a ‘sunset period’ of three years.

A briefing prepared for the Mayor, and published this week on the City Hall website, says the change to the discount scheme will “result in additional Congestion Charging income of £2-3m per year.”

Two other changes to the congestion charge scheme are also expected to generate cash for TfL.

A decision to axe the option to pay the congestion charge in shops will save £600,000 per year, but will cost £1m to implement suggesting TfL may have to pay to exit contracts with suppliers.

Transport for London says only 6% of payments are now made over the counter.

Increasing the penalty for driving into the congestion zone without paying the charge from £120 to £130 is expected to “result in £20.5m extra net income over the Business Plan period 2013/14 to 2021/22, at no cost to TfL.”

Overall TfL expects to receive an annual increase of £5m-£6m as a result of the changes.

According to the briefing note, the changes were unpopular with members of the public and business who responded to a TfL consultation.

The proposal to scrap the GVD and introduce the new ULED was opposed by 59% of respondents, the decision to axe over the counter payments was opposed by 53% and increasing the penalty was opposed by 50%.

13% of respondents claimed the penalty charge increase was “an unjustifiable way of TfL raising revenue”.

The proposals received greater backing from stakeholder organisations, including bodies under the Mayor’s control and local councils, who were also consulted.

The Mayor’s briefing states that although the Greener Vehicle Discount (GVD), introduced by his administration in 2010 “increased the proportion of lower emission cars using the zone by around 30%,” it also “caused additional congestion valued at around £1.5m net in 2011.”

The report warns that if the current exemption remained in place, “up to 6,000 GVD eligible cars could be seen in the zone daily by the end of 2013”.

When the changes were announced, a City Hall spokesperson said they were “in line with the Mayor’s aim to improve air quality in London by reducing emissions from private vehicles”.

However the briefing says replacing the GVD with the Ultra Low Emission Discount is “likely to lead to a small reduction in air pollutant emissions” but that “the effect of the proposals would not be significant given the small size of the impact.”

Commenting on the briefing note, Simon Birkett, Founder and Director of the Clean Air in London campaign, said: “This new information shows again what a catastrophic mistake it was for Boris to incentivise the purchase of vehicles emitting carcinogenic diesel exhaust. Boris does not seem to understand the difference between greenhouse gases (e.g. carbon dioxide) and air pollutants that kill people and cause asthma in children and COPD in adults (e.g. dangerous airborne particles and nitrogen dioxide).

“Worse, by giving long notice of the changes and extending the sunset period for a year, Boris is encouraging a short-term surge in the sales of diesel vehicles. London needs fewer and cleaner vehicles and truly ‘technology neutral’ policies that consider air pollution holistically not just carbon dioxide.”

Jenny Jones, Green party member of the London Assembly, commented: “There was no mention prior to the Mayor being elected of these extra costs and increased charges. I have no problem with the Mayor making sensible changes, but I think that a lot of people will feel that Boris is hitting them in the pocket without any prior warning.”

Commenting on this report, John Mason, Transport for London’s Director responsible for Congestion Charging, said: “The objective of these changes is to make the Congestion Charge scheme greener and more efficient, not to raise revenue.

“Any net revenue from the Congestion Charge is reinvested directly into the capital’s transport infrastructure. We have clearly listened to concerns raised in the consultation, for example by extending the sunset period for people that will lose their discount.”