A man fighting all manner of folly?
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Professor Alan McKinnon is fighting back against criticism of his alternative to Lorry Road User Charging. But is it a credible
scheme? Jennifer Ball investigates.
The government seems determined to force through its plans for Lorry Road User Charging. But the scheme's fiercest critic, Professor Alan McKinnon, head of Heriot-Watt University's Logistics Research Centre, is equally determined to get the message across that it's too complicated and too costly to run.
The LRUC scheme has three main objectives: taxing foreign hauliers on a similar basis to those in the UK; decoupling the taxation of trucks from cars; and varying taxes on trucks.
McKinnon argues that these aims could be achieved in a far simpler way. He points out that as government has acknowledged it will be at least 2014 before a general system of road charging could be introduced for cars and vans, so the introduction of the technologyheavy LRUC seems premature. in the interim, he suggests, a much simpler system should be introduced.
Streamlining
This would rationalise the three separate tax revenue streams that will exist under the LRUC regime — fuel duty, VED and road tolls. VED would be reduced to the minimum permitted by the EU, leaving fuel duty as the major taxation levied against operators. Existing distance records such as tachographs would be used to calculate mileage travelled and an annual toll charged. UK operators, however, would be given a proportional rebate on the fuel duty they had paid. There would be no incentive to fiddle distance information as the lower the distance travelled the lower the fuel rebate offered.
The amount the operator has to pay would depend on the type of the vehicle, its weight class, number of axles and Euro emissions rating.The fuel duty paid would be rebated against the annual toll; just like the proposed LRUC.
Customs & Excise's main argument against McKinnon's scheme is that it would burden operators with a lot of extra record keeping. However, McKinnon argues that it would rely largely on existing systems of data and revenue collection, some of which could be streamlined with the use of standard data-entry technology.
C&E also continues to lean towards a hightech solution, claiming that it should not be seen as a problem. McKinnon replies that that the government's record in the introduction of large scale IT systems does not inspire confidence — witness the chaos surrounding the tax credit system or the introduction of the new air traffic control system over the past few years.
Anne Preston,chairman of Northallert on haulier Prestons of Potto, agrees with McKinnon's assessment: "I am concerned about the complexity of LRUC. There is a big question mark over the technology. I think it will be long time before we see it in the meantime foreign operators continue to come into the UK running on their cheap fuel.
Complexity
"There are concerns about how we would be able to price a job if there were different charges for different routes and times of day. In addition we don't know who will pay for the technology. In Germany similar electronic equipment costs operators £600-700 a vehicle."
In her view the main advantage of McKinnon's scheme is its simplicity: -Alan McKinnon's idea is much simpler and will be far more cost effective than LRUC. I believe the government should look at his alternative. At present I am not convinced that LRUC will actually he tax neutral." Another argument thrown against McKinnon's scheme is that it could contravene European Union rules by treating foreign and domestic hauliers differently. He counters this with the fact that this is already true of the truck tolling systems in Germany,Austria and Switzerland.
In addition, McKinnon says this is likely to be a feature of LRUC because until the charging systems can work together with a centralised vehicle registration system across the EU, foreign vehicles will have to be registered separately by tolling authorities in each country.
"All the problems that the government has suggested with my system could be resolved with minor modifications," he adds."We have admitted it would not work in Northern Ireland but the government has also failed to reveal how its system would solve the border issue there."
Corruption?
There is also an issue of corruption. The government has also suggested that having the vehicle inspector record or validate the distance reading would leave it wide open to collusion. But as all these inspectors are employed by VOSA, a government agency, it should have confidence in the trustworthiness of its inspec tors. It is also likely that these inspectors will also have a role to play in checking on boardunits with the LRUC system."
High-profile Staffordshire haulier Stan Robinson is opposed to any form of LRUC: "Whatever form it takes we are bound to end up paying more. There will be more paperwork and more people will be able to fiddle it. I would prefer to see VED put onto fuel as the amount of people running without tax in unbelievable.
"People cannot run a vehicle without fuel so therefore they would be forced to pay." Road Haulage Association chief executive Roger King says while McKinnon's scheme has some merit he is also concerned that it would go against EU rules by hindering the free flow of cross-border traffic: "It's a good idea to have a system to benchmark LRUC against, but until the EC gives its support to this scheme we cannot back it.
"This system would not work in Northern Ireland but it's impossible to have a system which only works in England, Scotland and Wales. We will just have to adopt a wait-and-see approach to the LRUC." •