Pay-per-mile road charging 'will raise £28bn'

Technology-based 'pay-as-you-drive' road-charging must be introduced within the next 10 years to tackle congestion and deliver £28bn-worth of benefits to the UK economy, according to a new government-backed report by former British Airways CEO Sir Rod Eddington.

The Eddington Report was commissioned by the Chancellor of the Exchequer and the Secretary of State for Transport last year to advise the government on the long-term links between transport and the UK's economic productivity, growth and stability.

The UK transport system supports 61 billion passenger journeys and 250 billion tonne-kilometres of goods moved a year but the report claims congestion on the roads, if unchecked, will increase costs to businesses and freight by over £10bn a year as well as £12bn-worth of wasted time for households within 20 years.

Speaking at the Commonwealth Club in London this morning Eddington warned: "The UK cannot build itself out of current road congestion. Where road space is limited this needs to be utilised efficiently."

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Eddington said congestion-targeted road-pricing could be worth up to £28bn to the UK economy by 2025 and should be a question of "how, not if", although he admitted it is not feasible in the short-term.

"The technology for implementing this does not exist and costs are unknown - but for me, in the end - road pricing is an economic no-brainer. I know that there are barriers to making this happen: we must learn lessons of pilot schemes; the technology must be developed and be cost-effective; overall costs must be reasonable," he said.

Earlier this year the government set up a £10m fund to encourage IT companies to develop the black box satellite-tracking technology that would be needed for a national road-charging scheme in a series of local pilot projects that could eventually lead to motorists being charged up to £1.50 a mile for some journeys at some times.

The Eddington Report claims a 10 per cent reduction in car journey time in urban areas can deliver productivity improvements of 1.1 per cent.