The Chartered Institute of Logistics and Transport UK (CILT UK) has urged the Government to start talks with experts to tackle the impending black hole in income from fuel duty, which is set to deepen with the increasing shift towards electric cars.

CILT UK says we now have the opportunity to develope a fairer, more sophisticated approach to road pricing

Backed by a new report, it’s urging the Chancellor to take the lead on a simple and resistant-to-fraud road pricing scheme, adopting a cross-government approach with the Department for Transport, Department for Energy and Net Zero, and the Department for Housing, Communities and Local Government.

The Government currently generates £28bn annually (2023/24) from fuel duty on petrol and diesel vehicles – some of which is used to repair and improve our roads. But as the shift towards electric vehicles rises, this income is beginning to decline.

The recommendations come on the back of CILT UK’s new report on Paying for Roads which includes recommendations from experts within CILT UK in line with concerns and views expressed by the sector and its members.

The report calls on the Government to consult with a wide body of industry experts – as well as other key stakeholders – to explore and debate future road funding options. The paper also outlines potential routes the Government could take to tackle the issue, analysing past schemes, public opinion, media and political views.

Daniel Parker-Klein, director of communications and policy for CILT UK, said: “We believe that through proper consultation and thoughtful design, an approach can be created which motorists will view as reasonable and balanced – treating all drivers fairly. However, we must ensure whatever scheme is introduced is simple and easy to understand, inexpensive to collect, and resistant to fraud.”

Parker-Klein added: “Any proposal should be national but allow for local input and be designed to incentivise more efficient use of infrastructure, particularly as roads are currently not used to capacity – for example, with single occupancy vehicles. Finally, a new charging scheme should aim to encourage motorists to change their behaviour rather than penalise them. This will naturally help motorists consider alternatives to driving – with a gradual shift towards public transport – easing pressures on our roads and supporting environmental goals.”

Sue Terpilowski, chair of CILT UK’s Public Policy Committee, explained: “The transition to electric vehicles represents both a challenge and an opportunity for our national transport infrastructure. Whilst we face a significant funding gap from declining fuel duty revenues, we now have the chance to develop a fairer, more sophisticated approach to road pricing.”

The CILT report on Paying for Roads is online here.