Road user charging can help shift towards public transport

BUDGET 2025: The Confederation of Passenger Transport's Alison Edwards sees merit in EV mileage charges

Alison Edwards

Alison Edwards

The big news for the long-term future of transport though is the introduction of a new pay-per-mile road user charge on electric cars.

Road user charging which reflects usage can be fairer and can help accelerate the shift towards more sustainable public transport by encouraging people to think twice before making unnecessary car trips. Switching more journeys from car to bus or coach will ultimately mean fewer jams, faster moving traffic and improved productivity, as a single double-decker bus can take as many as 75 cars off the road. 

The Confederation of Passenger Transport looks forward to working with government as it manages the inevitable shift from charging motorists at the pump to charging them as they drive.

The increase to the National Living Wage, alongside recent changes to employer National Insurance, will intensify wage pressures across the industry, where labour already makes up more than half of bus operating costs. 

At the same time, although extending the freeze on fuel duty offers welcome short-term breathing space, those pressures will return once the staged reversal of the 5 pence cut begins, particularly given the government has again missed the opportunity to exempt bus and coach operators from any rise.

Bus and coach account for under 6% of fuel duty receipts, and exempting the sector would avoid placing £142m per year of pressure on already tight margins, protecting operators’ ability to invest in higher frequencies, new routes and modern, environmentally friendly vehicles. 

Ensuring that essential public transport remains viable will require a realistic approach to the cost base we face, stability in long-term planning, and recognition of the critical role buses and coaches play in the UK’s economic and social fabric.

Alison Edwards is director of policy and external relations at the Confederation of Passenger Transport