London has always been a leader in transport innovation. But with a fast-growing population and economy, the capital now faces a number of road-related transport challenges:

• Congestion has been growing in London, due to the reallocation of road space, population growth and a recent reversal of the longer-term decline in overall vehicle usage.
• Traffic-related air pollution has remained consistently above legal limits, harming the health and wellbeing of all Londoners, particularly children.
• Car dependency has led to a decline in physical activity and social connectivity.
• The number of people killed or seriously injured on London’s roads remains high.
• The dominance of cars and other vehicles on London’s roads blights the public realm and deters people from enjoying active lifestyles.
• Very little of the driver taxation collected by central government is spent on London’s roads, creating an imbalance between the relative financial contributions of drivers and public transport users to overall transportation system costs in London, as well as a poor-quality road network.
• The current charging scheme does not fully compensate for the negative impacts of vehicle usage, which harm the poorest and most vulnerable in society the most.

Well-designed road user charging can help manage the demand for limited road space and reduce overall motor vehicle usage in favour of public transport, walking and cycling. But the way London’s road users are currently charged has major drawbacks:

• When it was introduced in 2003, the Congestion Charge (CC) was world-leading and successfully encouraged the more efficient use of road space, but its effectiveness has diminished with the pace of growth in London and changing travel patterns.
• Although desperately needed to address a growing air quality crisis, the Ultra Low Emission Zone (ULEZ) – like the CC – does not reflect the level of vehicle usage; a driver who drives 1 kilometre is charged the same as one who drives 50 kilometres.
• Both the CC and ULEZ can be seen as unfair to people on low incomes.
• A growing number of road user charging regimes have been introduced or are planned for London – each with different vehicle standards, hours of operation, charge amounts and payment arrangements – creating an increasingly complicated system for the capital’s drivers to navigate.

New technologies and changing public attitudes now present an opportunity to replace the current patchwork of road user charging schemes with a more sophisticated system that captures the true cost of journeys. The following design principles should form the basis of such a scheme, which the report calls City Move:

1. A distance-based scheme, with charges set in advance and varying according to vehicle characteristics, and recently observed local congestion and pollution levels at given times.
2. A single City Move London transport platform that allows users to compare, plan and pay for journeys across the full range of modes, proactively suggests alternatives and offers additional services.
3. An account linked to the individual, not the vehicle, enabling a fairer approach to charging, including targeted discounts and options to split the charge between passengers.
4. Charging levels set against specified objectives, with revenue spent on London’s roads, public transport and associated environmental and public realm measures.
5. A website and smartphone app for user registration, journey planning and payment, satellite navigation for journey verification and roadside cameras for added enforcement.
6. A level of service or ‘delay repay’ guarantee, with drivers getting a partial or full refund where a journey takes significantly longer than estimated.
7. A system of Mobility Credits to promote uptake of the app and encourage healthier and greener ways of moving around.
8. A dedicated business account for managing all commercial vehicles, with cheaper pre-booked off-peak delivery slots to encourage retiming and consolidation.

A new smarter and more comprehensive scheme would offer substantial benefits both for the city, and for individual users. For users, the scheme would be:

Simpler

• Replaces a multitude of charges with a single system that is easy to understand and use.
• Tackles both congestion and pollution at the same time.
• Integrates additional driver services.

Smarter

• Reduces vehicle delays and makes journeys more reliable.
• Operates through smart technology that compares alternative journey options, enhancing choice for customers and promoting behaviour change.

Fairer

• Reflects the impact of individual journeys in terms of road surface damage, economic costs and environmental damage.
• Ensures that everyone that contributes to congestion and pollution pays, rather than just those within the narrow boundary of the current schemes.
• Charges less for drivers using cleaner vehicles, travelling in less congested areas or outside peak times, or in areas poorly served by public transport.
• Allows a more targeted and equitable approach to charging.

For all Londoners and the city as a whole, the scheme would be:

More efficient

• Promotes the use of public transport, walking and cycling, as well as car sharing, for more efficient use of space.
• Is able to adapt to different objectives as vehicle technology develops or new policy challenges emerge.
• Ensures that roads are self-financing and frees up funding for public transport and public realm improvements.

Healthier

• Reduces harmful emissions of all the main transport-related air pollutants.
• Improves road safety, particularly for vulnerable road users.
• Encourages people to socialise, exercise and lead active lifestyles.

Greener

• Incentivises a reduction in overall motor vehicle usage, as well as switching to cleaner vehicles.
• Encourages people to choose sustainable modes: public transport, walking and cycling.
• Allows for the creation of better green infrastructure and public realm throughout the city.

Our modelling shows that if drivers on the most congested roads are charged the equivalent of a cup of coffee or a bus ticket, emissions and air pollution could be reduced by up to a fifth. Analysis of the impact of a scheme based on the principles above on different user groups shows there would be no disproportionate disadvantage to any particular group.

This report elaborates the features of a scheme, based on the design principles set out, that can deliver these benefits. To realise these, the report calls on the Mayor of London to:

1. Develop a single, distance-based road user charging scheme to replace all existing schemes by the end of the 2020-2024 Mayoral term.
2. Prepare for implementation by developing a customer platform, upgrading the required GPS and mobile network capacity and conducting a pilot to test the technology.
3. Introduce the user platform across London from the beginning to maximise the number of drivers benefitting from the scheme’s smart features and incentives, while gradually extending the charging regime, starting with areas of high demand and poor air quality.
4. Collaborate with other cities across England to introduce elements of the scheme in the implementation of Clean Air Zones, to improve overall air quality and meet health objectives.
5. Work with government to replace existing vehicle and fuel taxes with a national distance-based system, while enabling towns and cities to implement complementary schemes that tackle local congestion and pollution.