The Chartered Institute of Logistics and Transport UK (CILT(UK)) is urging the government to start talks with experts to tackle the impending black hole in income from fuel duty which is set to get deeper with the increasing shift towards electric cars.

The recommendations come on the back of a new report titled ‘Paying for Roads’ which includes recommendations from experts within CILT UK in line with concerns and views expressed by the sector and its members.

The government currently generates £28 billion annually (2023/24) from fuel duty on petrol and diesel vehicles – some of which is used to repair and improve our roads. But as the shift towards electric vehicles rises, this income is beginning to decline.

The report recommends that the government sow the seeds of change by consulting with a wide body of industry experts - as well as other key stakeholders - to explore and debate future road funding options. The paper also outlines potential routes the government could take to tackle the issue - analysing past schemes, public opinion, media and political views.

Director of Communications and Policy for CILT(UK), Daniel-Parker-Klein said: "
“It’s no secret that fuel duty in this country stands at just over 52p per litre. But as we see a shift towards electric vehicles, this revenue is drying up. We at the CILT(UK) believe that through proper consultation and thoughtful design, an approach can be created which motorists will view as reasonable and balanced – treating all drivers fairly. However, we must ensure whatever scheme is introduced is simple and easy to understand, inexpensive to collect, and resistant to fraud.”

CILT UK has advised a scheme to be implemented and lead by the Chancellor alongside a cross-government approach with The Department for Transport, Department for Energy and Net Zero, and The Department for Housing, Communities and Local Government.

Daniel added: “Any proposal should be national but allow for local input and be designed to incentivise more efficient use of infrastructure, particularly as roads are currently not used to capacity - for example, with single occupancy vehicles. Finally, a new charging scheme should aim to encourage motorists to change their behaviour rather than penalise them. This will naturally help motorists consider alternatives to driving – with a gradual shift towards public transport - easing pressures on our roads and supporting environmental goals.”

Chair of CILT(UK)’s Public Policy Committee, Sue Terpilowski, explained: "The transition to electric vehicles represents both a challenge and an opportunity for our national transport infrastructure.  Whilst we face a significant funding gap from declining fuel duty revenues, we now have the chance to develop a fairer, more sophisticated approach to road pricing.”

The full report can be accessed here.