All proceeds from car tax to be invested in road network in £30bn funding boost

“Biggest-ever” single investment In England’s largest roads to be announced in Monday’s Budget

Motorway

A £30 billion investment – dubbed the “biggest ever” by ministers – will be announced for England’s roads in Monday’s budget, with the bulk of the money funded solely by road tax.

Some £28.8 billion will be earmarked for motorways and major local routes, with £420 million set aside for repairing potholes and damaged local roads, as well as bridge maintenance. A further £150 million will be allocated to tackle local congestion hotspots.

Everything you need to know about VED road tax

The news that all Vehicle Excise Duty, or road tax, will be spent solely on maintaining England’s roads has been welcomed by motoring organisations. Previous research indicated only a quarter of VED was spent on roads, and Monday’s announcement will make good on a promise made by former Chancellor George Osborne in 2015 that road tax would go to roads. 

By allocating all VED paid from 2020 to 2025 to Highways England, the Chancellor of the Exchequer, Phillip Hammond, will be boosting the government-owned company’s budget by an unprecedented 40 per cent. 

Highways England is responsible for some 4,300 miles of motorways and strategic A roads, which make up just two per cent of the country’s total roads, but carry a third of all traffic by mileage, and two thirds of all HGV traffic. The organisation’s £28.8 billion cash injection is expected to pay for motorway improvements, congestion easing and major new roads.

Smaller roads are also to benefit from a cash injection – albeit just 1.4 per cent of the amount of money major roads are set to get. Hammond will set aside £420 million for local road maintenance in 2018 and 2019, with a further £150 million intended to improve local congestion between 2021 and 2023. 

Previous research has indicated, however, that local roads’ annual funding shortfall runs to £556 million, with a one-time patch up estimated as costing £9.31 billion. And while the country’s major roads are the responsibility of central government, smaller routes come under the authority of cash-strapped councils

The RAC’s chief engineer, David Bizley, called the investments “good news for the nation’s motorists.” Bizley cautioned, however, that while he considered it “positive” that local roads would benefit “to some extent”, long-term investments and thinking was required in order to “eliminate the backlog in preventative maintenance that has led to so many potholes appearing during periods of adverse weather.” 

Matthew Fell, chief UK policy director for the CBI (Confederation of British Industry), echoed those comments. Fell said a well-functioning road network formed the “lifeblood” of business, but that improvements are “not just about providing the funds to create new networks”, but should also “expand existing routes and simply fill the pot-holes that plague far too many roads in this country.”

A further £680 million will be added to the Transforming Cities Fund over 2022 and 2023. The fund, which stood at £1.7 billion when it was announced in March, is aimed at improving transport links between city centres and suburban areas, by methods such as cycle networks, trams and light railways. 

And ‘Future Mobility Zones’ will receive an extra £90 million of funding between 2019 and 2022, on top of the £12.1 million previously announced. The Zones will pioneer the use of e-cargo bikes, micro vehicles and electric vans as minsters seek to cut pollution with emission-free ‘last-mile’ delivery vehicles.

Are you pleased that road tax is being invested in the UK's road network? Let us know your thoughts below...

Most Popular

New 2021 Vauxhall Astra teased for the first time
Vauxhall Astra teaser 1
Vauxhall Astra

New 2021 Vauxhall Astra teased for the first time

The new Vauxhall Astra will get electrified powertrains and a more premium image
8 Jun 2021
New Vauxhall Astra prototype review
Vauxhall Astra prototype - front
Vauxhall Astra

New Vauxhall Astra prototype review

A new Vauxhall Astra is on the way and we've driven a prototype ahead of its official arrival
14 Jun 2021
‘Our switch to electric will soon make driving manual cars a lost art'
Gearknob
Opinion

‘Our switch to electric will soon make driving manual cars a lost art'

Want to drive a manual car? You need to take your test in a manual car. So what happens once all driving-school cars are automatic EVs?
8 Jun 2021
'The hydrogen underdog disruptor is back in town'
Toyota Mirai opinion
Opinion

'The hydrogen underdog disruptor is back in town'

Mike Rutherford says hydrogen-powered cars could still be a frequent sight on UK roads
13 Jun 2021
UN report highlights ethical problems with electric cars
Electric car charging
News

UN report highlights ethical problems with electric cars

Analysis reveals lithium refining takes 65 per cent of Chilean region’s water, while 40,000 child miners dig for cobalt in DRC
14 Jun 2021
New Porsche Macan facelift prototype review
Porsche Macan prototype - front
Porsche Macan

New Porsche Macan facelift prototype review

We get behind the wheel of a prototype version of the facelifted Porsche Macan SUV
13 Jun 2021
Illegal car modification hotspots revealed
Volkswagen Polo exhaust
News

Illegal car modification hotspots revealed

Gloucestershire has the highest proportion of illegal car modifications, with altered number plates the most common breach
14 Jun 2021
Ineos Grenadier prototype 2022 review
Ineos Grenadier prototype
Ineos Grenadier 4x4

Ineos Grenadier prototype 2022 review

Can the Ineos Grenadier really fill the mud-splattered void left by the old Land Rover Defender? We take a first drive in a prototype to find out...
15 Jun 2021
'Factories are at a standstill because they can’t get the parts to finish cars'
Car manufacturing
Opinion

'Factories are at a standstill because they can’t get the parts to finish cars'

Steve Fowler points out the fresh issues facing global car manufacturing
9 Jun 2021
New Nissan Qashqai production begins in Sunderland
Nissan Qashqai - front static
News

New Nissan Qashqai production begins in Sunderland

Nissan will offer every school child in the North East of England a place on the Nissan Skills Foundation course to mark 35 years of manufacturing in …
14 Jun 2021
Volkswagen Golf GTI Clubsport vs Cupra Leon 300
Volkswagen Golf GTI Clubsport vs Cupra Leon 300
Car group tests

Volkswagen Golf GTI Clubsport vs Cupra Leon 300

The capable Volkswagen Golf GTI Clubsport goes up against its new Cupra Leon 300 sibling in this hot hatch battle
12 Jun 2021
New hydrogen-powered Land Rover Defender prototype in development
Land Rover Defender
Land Rover Defender

New hydrogen-powered Land Rover Defender prototype in development

The Land Rover Defender FCEV prototype will be assessed for off-road and long-range zero-emission motoring
14 Jun 2021
SsangYong J100 to get tough in the electric SUV sector
SsangYong J100 electric SUV
SsangYong

SsangYong J100 to get tough in the electric SUV sector

The tough looking electric mid-size SUV is slated for production next year and will be joined by a pick-up model
15 Jun 2021
New 2021 Volkswagen T7 Multivan replaces Caravelle
Volkswagen T7 Multivan - front
Volkswagen Caravelle

New 2021 Volkswagen T7 Multivan replaces Caravelle

The Volkswagen T7 Multivan MPV switches to the MQB platform and adds plug-in hybrid technology
10 Jun 2021