Congestion charging 'can benefit business'

Congestion charging can benefit business, new research suggests, provided schemes are part of a wider transport strategy.

Research commissioned by the Confederation of British Industry and the Freight Transport Association found that road pricing - charging for the use of roads through tolls and other taxes - could help businesses make cost reductions.

Despite the cost to business of road pricing, the report claims that this could be offset thanks to the time-saving benefits of decongestion, while businesses would also benefit from money being ploughed into public transport.

However, the report warned that charges should "reflect the cost of congestion" and should not be used simply to raise tax.

In all, it estimates that charging schemes could offer up to an £80 million bonus to businesses each year, based on the study's theoretical city.

Proposals for road pricing schemes in a number of UK cities, including Manchester, Edinburgh, Birmingham and Coventry, were rejected last year, leaving London as the only city with such a system.

Independent research institute Centre for Cities recently called on the Government to abandon the use of congestion charging as an incentive for securing public transport funding if no cities opt for road pricing schemes this year.

Dermot Finch, director of the Centre, said: "A tough post-recession fiscal climate means central government transport grants are likely to dwindle post 2011. The next Government should use the congestion charging pot to start up a new fund for transport projects, together with councils and the private sector."