UK transport funding cut by 5% but there is some good news for drivers

Government spending on transport is set to be reduced following the recent spending review. However, more cash has been set aside to fund the UK’s continued transition to electric vehicles, plus to maintain and repair the nation’s decaying road network.

Chancellor Rachel Reeves has just set out the government’s spending plans until the next Parliament in three years’ time, and while funding for the National Health Service will increase by three per cent year-on-year until 2028/29, the Department for Transport’s day-to-day spending will be cut by as much as five per cent.

This is the second-largest department cut as a result of the Spending Review, followed by the Foreign Office, which is seeing a 6.9 per cent reduction in spending, mostly on foreign aid.

However, despite there being less overall funds available, the Treasury now says it plans to invest £1.4 billion over the next three years into turbocharging the UK’s transition to electric vehicles. 

Exactly how the government plans to do this is another matter, although a spokesperson did tell Auto Express that “the Government will consider raising the Expensive Car [VED] Supplement threshold for EVs only at a future fiscal event” – meaning that such a move is still on the cards, potentially for Autumn's Budget.

The UK’s Society of Motor Manufacturers responded positively to the government’s announcement, but chief executive Mike Hawes was keen to point out that “Some support for EVs has [already] been made available, but more substantive measures to incentivise private consumer demand are still needed if world-leading targets are to be met.”

The Electric Vehicle Association England (EVA) also welcomed the investment, but said that “what matters now is how this funding will be spent’. 

The trade body’s Chief executive Vicky Edmonds warned that “VAT on public charging, alongside more planning and regulatory barriers, continue[s] to promote a 'two-tier' system between EV drivers with and without access to reliable and cost-effective home charging."

On that point, an additional £400 million has also been allocated to aiding the rapid deployment of public EV chargers – Government figures show there are now 76,500 across the UK. Unfortunately, there is no word on whether the government plans to cut VAT on public charging in order to address the difference in cost between public and home charging.

It’s important to mention that the Government also pledged £24 billion (or roughly £8 billion per year) over the current parliament to fixing and maintaining the UK’s major roads. The RAC’s head of policy, Simon Williams, hailed this as "wonderful news”, stating that “Local authorities now have a golden opportunity to end the cycle of merely filling potholes and instead begin to be much more proactive in their maintenance. This must include both more surface dressing to keep decent roads in good condition, and resurfacing those that are at the end of their lives.”

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