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Alan McKinnon – Professor of Logistics

Lorry Road User Charging (LRUC): REPORT SERIES

In 2004-5 I was actively involved in a debate over the UK government’s plans for lorry road-user charging (LRUC).  The declared objective of LRUC was to ensure that British and foreign hauliers paid similar levels of tax for their use of the UK road network.  This was a very worthy goal, but unfortunately the scheme that was being proposed by the government was much more complex and expensive than required to meet its declared objective.  It was estimated that several £ billions would have to be invested in a sophisticated electronic road tolling system and accompanying fuel duty rebate system, yet only around £140 million of new revenue would be generated annually (from foreign hauliers). In May 2004 I published a report which was very critical of the government’s plans and thereafter became regarded as one of the main opponents of LRUC.  This led to numerous press articles, conference appearances, radio interviews, high level meetings with government officials and written and oral evidence to the Transport Committee of the House of Commons. 

The original presentation was followed by a report co-authored with David McClelland.

Report series

Report 1
Lorry Road User Charging: A Review of the UK Government’s Proposals (May 2004)

This report, co-authored with David McClelland, set out an alternative method of taxing trucks, which would have achieved the declared objective at much lower cost and risk.

click here to download a copy

 

Report 2
Taxing Trucks: An Alternative Method of Road User Charging (July 2004) 

This second report proposed an alternative method of meeting the government’s declared road charging objectives at much lower cost and with much less disruption.

click here to download a copy

This report was presented to the House of Commons Transport Committee.  In its report on the LRUC, published on the 24 March 2005, the Committee stated (link to report –see below):

‘..there is a serious risk that millions of pounds of tax payer’s money could be unnecessarily wasted...When the procurement process has identified a potential technological solution, the Government should undertake objective comparisons of the different solutions including Alan McKinnon and David McClelland’s alternative system, using a standard set of criteria such as cost effectiveness, risk of fraud, burden on industry and technical robustness.’

The House of Commons Transport Committee Seventh Report ‘Road Pricing: The Next Steps’ can be downloaded from:

http://www.publications.parliament.uk/pa/cm200405/cmselect/cmtran/218/21802.htm

Our alternative scheme was then subject to an internal review by the government’s Customs and Revenue (C&R) department which concluded that it would not work. Initially the government refused to publish the results of this internal review though were forced to do so when I made an application under the Freedom of Information Act. 

 

Report 3
Alternative Method of Road User Charging for Lorries: Response to Feedback (March 2005)

In this third report, again co-authored with David McClelland, I responded to C&R’s criticisms of our alternative scheme arguing they were much too negative.

Click here to download a copy

 

The outcome

The LRUC saga ended on the 5 June 2005 when the then transport secretary, Alasdair Darling MP, announced in the House of Commons that this truck charging plan was being scrapped.  It was estimated that, by that time, the government had spent around £50 million on its LRUC plans.

In 2014, the government introduced a much simpler, cheaper ‘vignette’ system to charge foreign-registered trucks for their use of UK road, finally doing something to correct this long term tax anomaly.

Click here to download a copy of my original presentation on this subject delivered at the 2004 Commercial Vehicle show in Birmingham, which first highlighted the deficiencies in the LRUC scheme.

 

 


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© Professor Alan McKinnon 2018

Kuehne Logistics University
Hamburg
Germany

contactme@alanmckinnon.co.uk

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© Professor Alan McKinnon 2018

 

Kuehne Logistics University
Hamburg
Germany

 

contactme@alanmckinnon.co.uk

 

Contact me

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