Opinion: Government policy on mobility and decarbonisation | Day 3

By Stephen Joseph, transport consultant and former Campaign for Better Transport chief executive

Fleet managers in companies can be forgiven for feeling a bit punch drunk at the moment, with a new UK Government having recently delivered a significant budget, and of course the impact of wider events in the US and elsewhere.

However, with this Government having a large majority, it's worth looking at what their emerging policies and measures are likely to mean for fleets, businesses and the transport world as a whole. At present, some aspects of transport policy are clear, some are emerging and some areas and decisions are still awaited.

In some areas, the Government has laid out its stall clearly. The railways are to be reformed, with most passenger services renationalised. Buses will also be reformed, with more powers for local authorities to regulate and manage them.

More widely, this government is very committed to decarbonisation, including moving the phase-out of petrol and diesel cars back to 2030 from 2035.

There were moves in the Budget to support electric vehicles, underreported (except by Fleet News) but significant. Changes in vehicle excise duty and the company car tax regime will give greater incentives for EVs and increase tax on ICEs.

In some cases, like double cab pickups, the tax increases will be significant. There is likely to be more to come on this as the Government ramps up efforts to make EVs more attractive. In particular, we can expect more measures and funding to ramp up the installation of EV chargers.

Then there are areas where policy is still emerging. The commitment to building 1.5m new homes is clear but the transport implications are still being worked through – where this housing is built, and how it is laid out, will have big impacts on the transport network. 

Similarly, there are commitments to devolving powers and funding to mayors and local authorities but exactly what this will mean in practice is yet to emerge. However, the mayors have been given extra transport funding in the Budget, potentially as a down payment. 

On infrastructure, we have seen support for some schemes – HS2 now looks as if it will get to Euston, and trains are set to run again between Oxford and Cambridge – but some road schemes like the tunnel under Stonehenge have been canned.

On this, as with other spending, we await the full Spending Review in the Spring, though the overall DfT budget is under a lot of pressure – projects like the Lower Thames Crossing (more expensive per mile than HS2) will either be scrapped or delayed – talk of passing it to a private sector consortium to finance, build and toll ignores some of the issues with this and the other big road schemes still around.

There is likely to be more emphasis and priority on better maintenance of existing roads rather than building new ones (again, we saw early signs of this in the Budget).

Then there are areas where the Government is still to make decisions, notably on transport costs and taxation. Fuel duty was again frozen in the Budget, but there is a consensus in the transport and economist worlds that motoring taxation will need fundamental reform if the moves to electric vehicles meet the Government 2030 target, because EVs don't pay any fuel duty. Moves to pay per mile road pricing may be inevitable.

Meanwhile the increase in rail fares, and the bus fare cap to £3, will see public transport getting more expensive, which runs against the Government objectives. 

The Government is also promising a national integrated transport strategy and a road safety strategy but the shape of these is as yet unclear. 

What they may mean is a change in the way in which transport investment is assessed, with more weight given to sustainability factors such as decarbonisation, air quality, safety and transport user priorities, and rather less weight for small time savings by road users.

These will be subtle but important changes, which are likely to influence what gets funded and built. 

So for fleet managers, change is inevitable – but the next year should give a good idea on where at least the UK government is headed.