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Darling scraps LRUC in shock policy shift

7th July 2005, Page 6
7th July 2005
Page 6
Page 6, 7th July 2005 — Darling scraps LRUC in shock policy shift
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The government is scrapping the Lorry Road User Charge report in a dramatic overhaul of its transport tax policy. Dominic Perry reports.

AS CM WENT to press transport secretary Alistair Darling made a shock announcement that the Lorry Road User Charging Scheme was to he abandoned.

He said that although studies had shown the scheme to be feasible the government had decided not to continue with the procurement process. Instead he said that the -experience gained from the project" would be put forward to its plan to charge all motorists for the distance travelled on UK roads.

He adds:-We will continue to work with the haulage industry to ensure its needs are represented." Darling also announced that Chancellor Gordon Brown was to cancel his proposed I September inflation -rate increase, due to increasing volatility in the world oil markets.

Darling said: "Congestion on the roads is a complex problem that will need a range of methods to tackle effectively."

An FTA spokesman said: -We have to be disappointed. Although the LRUC had many imperfections it would have delivered two key benefits, firstly it would have taxed foreign lorries on UK roads and secondly and more crucially it would have generated a separation between goods vehicle taxation and car taxation."

-We will have to see where we go next and how we get that decoupling of industry from consumer use quickly,he added.

The announcement came on the heels of the FTA's suppression of a report believed to be highly critical of the LRUC. The report had been commissioned by the FTA from accountants PricewaterhouseCoopers to conduct a "root and branch review" of the scheme.

However the FTA chief executive Richard Turner, following an extremely heated meet ing of the 82-member national council decided that it was not in the best interests of the association or the industry for the report to be made public domain.

There was speculation that the association had bowed to government pressure to suppress the report which, it was suggested, showed running costs for the LRUC of up to ilbn annually However,Turner refuted these claims saying that: "We want a low-fat version of the LRUC: minimum cost and as simple as possible,and that this was best achieved by keeping the data private.

It remains to be seen whether the "low-fat" version will appear within the government's new umbrella scheme for distance charging.

Roger King. chief executive at the rival Road Haulage Association (RHA) says the FTA's view on the scheme has now swung round to what the RHA has been arguing for all along—a cheap, simple system.

He adds:"Where exactly we are supposed to be in all of this, I don't know, hut we are concerned about where it is going.

dominic.perry@rbi.co.uk


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