Road Pricing: A Study

Appendix A: Road Pricing Working Group terms of reference

MOTORISTS' FORUM WORKING GROUP ON ROAD PRICING - Terms of Reference

Introduction

1. The Motorists' Forum (MF) has initiated a Working Group to consider what can be done to introduce road pricing efficiently and effectively using existing technologies and business systems and the opportunities (and disadvantages) that could arise for companies who align their technology to incorporate the calculation and collection of road charges.

2. The study will be led by Christopher Macgowan, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT) and will be initiated in October 2006 to provide a final report for the MF Plenary in April 2007. The membership of the Group is:

Christopher Macgowan - SMMT (Chairman)
John Lewis - British Vehicle Rental & Leasing Association
Justin Jacobs - Association of British Insurers
Mike Hollingsworth - SMMT
Geoff Llewellyn - Intellect Transport Group
Ian Simpson - Confederation of British Industry

Steve Gooding - Department for Transport (advisor to the Group)
David Prescott - Secretary to the Motorists' Forum
Phil Jeanes - Expert Secretary to the Group

Representatives from other organisations may be invited onto the group as work proceeds. The MF Secretary (David Prescott) will also attend meetings.

Scope and aims of the study

3. The study will be addressed in a series of stages. In the first stage of the study, the Group will investigate:

• how existing in-car systems already offered on the market can be used to calculate and collect road charges;
• the opportunities (and disadvantages) that could arise for companies who align their technology to incorporate the calculation and collection of road charges;
• the reasons why businesses might not wish to align their systems to the collection of road charges; and
• the organisations the Department should be engaging with to refine thinking on road pricing and how these organisations' members can be engaged with.

4. The outputs from Stage 1 may be used to inform the second stage of the project, in which the MF wishes to develop thinking on what a motorist should expect as part of a "contract" with Government over the introduction of road pricing.

5. The Stage 1 work will be based largely on existing studies and research and the expertise and knowledge of working group members. The working group should not look to commission new research.

Stage 1 Work objectives

6. In Stage 1 of the project, the Forum intends to assist the Government's work in looking at the available technology and seeing what it can deliver in practical terms, specifically the following four topics:

      A. How existing in-car systems already offered on the market could be used to calculate and collect road charges.

7. The former Secretary of State for Transport, Alistair Darling, made clear that Government itself is not going to define and specify all the technology that should be used. Instead, he suggested that thought should be given to 'piggy-backing' on systems already being offered by the market.

8. Some drivers already use a satellite positioning device as the platform for motor insurance (telematics-based insurance). The time of their journeys and where they are is already being collected to calculate their insurance premium. The same information that is collected could just as easily be used by the insurer to calculate the road price for the same journey. In the same way, drivers who already pay a company for real-time navigational information could use that provider to calculate their road price.

      B. Opportunities (and disadvantages) that could arise for companies who align their technology to incorporate the calculation and collection of road charges.

9. No-one would expect these companies to calculate, collect and pass on road charges out of the goodness of their heart. The MF has therefore been asked to provide advice, from a business perspective, on the opportunities that could arise for companies who align their technology to incorporate the calculation and collection of road charges. In particular, consideration should be given to the business case that would support a company making such an alignment in its technologies.

10. There is one final aspect to this strand of work. As the Department looks to work with business to provide practical solutions for the calculation and collection of road charges, it is important that Department should not set specifications that could hinder businesses wishing to align their technologies. The Working Group should consider any regulatory burdens etc that could hinder businesses.

      C. The reasons why businesses might not wish to align their systems to the collection of road charges.

11. However, it is possible that companies themselves may not wish to collect road charges eg they may not wish the public to associate their company as one that collects taxes on behalf of the Government. The Forum's work should therefore also look at the disadvantages that companies could face in aligning their technologies.

      D. The organisations the Department should be engaging with and how these organisations' members can be engaged with.

12. The Department is naturally already in close contact with its stakeholders over all issues surrounding the road pricing debate. However, it has asked the Motorists' Forum to ensure that its consultations are as wide as possible and that it is engaging fully with all those who should be engaged in promoting a greater degree of consensus over the introduction of road pricing.

13. However, the Department is also keen to engage with individual members of its stakeholder organisations so that it can develop a better understanding of the needs of all road users and different sectors of business. It has asked the MF for advice on how this engagement can best be achieved.

Constraints

14. In taking forward this work, it is noted that Government will not have set out in detail the way it intends to develop its road pricing proposals by the time the group starts its work. The group will, therefore, need to base its work on the best information available at the time.

Outputs from the study

15. The Working Group is required to produce an analytical report setting out conclusions and listing clear recommendations that will help Department to shape its work on road pricing.

16. The report will consist of an executive summary (3 pages at most) that summarises clearly and succinctly the findings and separate sections for the four study objectives that set out the background to the matter under consideration, analyse the evidence, come to clear conclusions and make recommendations.

17. The final draft report will be submitted to the Motorists' Forum Plenary for approval and subsequently published (including on the internet).

Timescales

18. The Working Group will meet four times for the purposes of deliberating on the tasks it has been set (although further meetings could be required depending on how the project is proceeding). Below is the agreed schedule for the meetings:

19. The Group's final draft report will be presented to the Motorists' Forum Plenary to be held on Wednesday 18 April 2007.

Administration for the Working Group

20. The Expert Secretary will be responsible for general administration of the Working Group.

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