Thursday 28 January 2021

MPs: CAZs are ‘right policy, wrong approach’

An all-party parliamentary group (APPG) of MPs has recommended a full government review of the current approach to clean air zones (CAZs), with particular regard to the impact of charging zones on hauliers facing tight profit margins.

The APPG for road freight and logistics’ Report on Clean Air Zones discusses several methods by which government might reduce the burden on the sector by refining the scheme, particularly in light of straitened operating circumstances resulting from the Covid-19 pandemic.

Mike Penning, chair of the APPG and a former transport minister, said in his foreword to the report that he supported government efforts to help businesses replace the most polluting vehicles and journeys.

But he added: “These measures must be introduced at the right time and must be implemented in a way that drives meaningful behaviour change, and not a stealth tax as it is perceived by many within the industry.”

Penning continued: “As the government looks to rebuild our economy post-Covid, it is essential that this includes ensuring that those sectors most affected by Covid-19 can rebuild and restart as quickly as possible.

“This must include reviewing existing and planned policy to see if it will be an impediment to ‘bouncing back’.

“The road freight and logistics sector are vital to a thriving and growing economy.

“Despite this, it has always been a sector that operates to exceptionally tight margins, with many in the sector facing a perilous future with insolvency a very real threat.”

In recent months, the APPG has been gathering evidence from a wide range of organisations about the planned introduction of clean air zones to help identify possible policy improvements prior to their introduction.

“We found several problems including an inconsistent approach geographically, poor levels of support and guidance from central government and challenges for companies in upgrading to compliant vehicles,” said Penning.

“These issues have been brought into sharper focus because of Covid-19 with the supply of Euro VI vehicles within the haulage sector moving from weak to non-existent.

“As a result, these companies will be unable to upgrade to compliant vehicles, even if they could afford this substantial cost.”

Recommending that CAZ rollouts should be paused until at least January, the report pointed out that four out of the five original local authorities involved had now rejected charging zones.

“As such we recommend that the government pause and reflect and review how all measures can tackle our air quality challenges,” Penning continued.

“This should include reviewing the evidence base and how cities and towns have risen to the challenge outside of CAZZs and how targeted funding can best help support our communities to tackle this issue.

“We do not and have not sought to prejudge any review of the evidence base and believe that CAZs will continue to be a necessary option for some areas, but believe that whilst it remains an option it should not be the first option.

“As such we have set out a range of recommendations to ensure that where needed that CAZ drive meaningful behaviour change rather than penalising haulage companies.”

The report found that it was “hard to disagree with the view that the implementation of CAZ policy shows a lack of understanding of industry”.

“Take for example, a haulier who in 2016 took the decision to upgrade to a Euro V vehicle and in doing so significantly cut their emissions.

“This haulier spent around £80,000 only to be told a year later that they would need to upgrade again or face CAZ charges. Even with a delayed implementation to 2021, this vehicle will be less than halfway through its lifecycle.”

It advocated that, in light of Covid, the CAZ policy should be “redesigned with a clear and consistent national standard that considers vehicle replacement cycles”, possibly allowing Euro V HGVs a ‘grace period’ before becoming eligible for CAZ charges.

“This would remove the rigidity in the system and would not penalise those who upgraded to the cleanest vehicle of the time and would provide much needed certainty and time for businesses to plan,” said the report.

“It would also crucially place the focus on removing the more polluting Euro IV and below vehicles from our towns and cities.

“This phased charging scheme should also look at providing a new, centralised fund to support commercial vehicle operators in upgrading their vans and trucks.

“There would need to be strict criteria including a limit on funding per businesses and it should include specific and targeted funding for small businesses and single operators.

“Alongside this, consideration should be given to whether there can be a role for leasing HGVs as a short-term solution, with the scheme being used to cover some of the leasing costs.”

It also recommended that local authorities provide a ‘sunset clause’ for operators who primarily operate within a charging zone, and who may need longer to meet requirements.

“For example, this could include supporting those businesses whose lease agreements will run beyond the start date of the CAZ and would be prohibitively expensive to get out of.

“Special consideration should be given to the removals sector, whose business model is based on travelling in and out of towns and cities, but their vehicles remain parked for many hours at a time.”

Further recommendations included a single national payment portal to cover all road charges, clear national direction and guidance to drive common standards, and the daily charge for HGVs to be limited to £50 across all charging zones.

The goverment should also carry out a full review of CAZ policy in light of reported improved air quality during the pandemic, the MPs said.

The Road Haulage Association (RHA) welcomed the report’s publication, saying it was clear that the way forward was investment in emission standards, supported by regulation that recognised vehicle lifecycles of at least 12 years.

RHA environment policy head Chris Ashley said that the association had consistently argued there were better ways to achieve clean air.

“The current CAZ approach fails to recognise the industry’s huge £1.9bn investment in Euro VI vehicles that, despite CAZ, has slashed NOx emissions from trucks by at least 59 percent since 2013,” he said.

“It also fails to account for the market supply of the desired Euro VI vehicles which, during the second quarter of 2020, plummeted by 75 per cent as Covid-19 hit the economy.

“To press ahead with CAZ as if nothing has happened is madness. It unfairly targets HGVs, and the government must urgently review both its evidence-base and approach before proceeding.”

The full APPG report can be accessed via the RHA website, here.

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