Congestion charge

Friday 1st April 2005 at 12:12 AM

Drivers in London will be hit by an £8 congestion charge from this summer.

The 60 per cent increase from the current £5-a-day rate was confirmed by Mayor Ken Livingstone today.

The new levy, which may start as soon as July, could raise an extra £50 million to reinvest in public transport, on top of the current £79 million-a-year revenue.

But it is certain to trigger outrage from motorists and businesses, particularly those already suffering the impact of the original charge.

Stakeholder Response: London Retail Consortium

A spokesman for the LRC said: "Despite overwhelming opposition to this, the Mayor has ignored the voice of business. Increasing the charge has little to do with reducing congestion, and more to do with trying to make the weak business case for a western extension financially viable. The current scheme has already surpassed the congestion reduction target set out at its inception; so further reductions are unwarranted.

"A 60 per cent increase is far in excess of the bus and tube fare rises announced in September. There must be real incentives to use public transport, rather than costly deterrents from driving, as all retail is dependent on locations with good accessibility and connectivity with their customers.

"The objectives and benefits of the price increase are not clear enough to justify the extra financial burden on retailers in London. Retailers deserve to see a return on their investment, through the taxes, business rates and the many additional positive investments and contributions they make, that help position London as a premium world shopping destination. Potential future costs, such as a Crossrail supplementary business rate levy will have a tremendous impact on the cost base of business. An increase to the congestion charge could tip this delicate cost balance and will adversely affect the vitality and viability of shops through reduced trade and the removal of consumer choice."

Stakeholder Response: Forum of Private Business

Nick Goulding FPB chief executive said: "Hiking up the congestion charge will devastate the small business community, which is already struggling to cope with the crippling effects of the current toll. We implore Mr Livingstone to listen to the voice of small business and act to protect the sector that is so critical to London's economy. Increasing the congestion charge will be commercial suicide for London."

Stakeholder Response: Construction Products Association

Jean Emblin, external affairs director, Construction Products Association said: "Increasing the congestion charge to £8 is going to make the congestion charging zone (CCZ) even more costly for those supplying essential construction materials.

"We undertook a survey of contractors, and manufacturers and suppliers of construction products in 2003. The survey showed that an overwhelming 85 per cent of respondents believed that commercial delivery vehicles servicing London's congestion charging zone should be exempt from the charge. 80 per cent of product manufacturers and suppliers have said that the charge has affected the cost of supplying products within the CCZ, a fact noted by 83 per cent of contractors receiving such products, with almost 50 per cent of contractors and suppliers passing the increased cost on to their clients.

"Further results indicated that only 10 per cent of those surveyed believed that the charge should be extended to cover a wider geographical area, whilst 75 per cent did not believe that that the idea should be extended to other cities in the country."

Congestion charge

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