What is the congestion charge?
The congestion charge is a daily levy imposed on drivers choosing to drive within central London. It applies between 07:00 and 18:00 on Monday to Friday, excluding public holidays.
The congestion charge zone covers a large portion of central London. The boundaries of the congestion charge zone link points in central London such as Euston Road in the north, Commercial Street in the east, Vauxhall and Chelsea Embankment in the south and Harrow Road and Earls Court in the west.
The scheme is monitored by cameras on roads across the congestion charge zone, which read car number plates and cross-references them against a register of cars that have paid the charge.
Drivers can pay the charge in advance or on the day of travel, but if they forget they can pay up until midnight the following day, but will incur a £2 surcharge, taking the total charge to £12. There are several methods of payment, including telephone, text message, post, online or in a shop. Failure to pay risks a penalty charge notice of £120.
Groups exempt from paying the congestion charge and those eligible for discounts include people with disabilities, residents living within the congestion zone, emergency services and breakdown recovery vehicles, taxis, and drivers of alternative fuel vehicles.
The mayor of London, Ken Livingstone, introduced the congestion charge at £5 a day in February 2003 with the aim of reducing traffic congestion in and around the charging zone. It was increased to £8 a day from July 2005 and to £10 from January 2011.
Among other aims, the congestion charge is meant to reduce the length of journeys within the congestion zone, improve bus services and encourage motorists to use public transport instead of their cars.
The charge also attempts to collect net revenues to improve public transport facilities in London, as, by law, the proceeds raised by the congestion charge must be added to expenditure on public transport in London.
The congestion charge has faced a barrage of criticism since its inception. Opponents have challenged its regressive nature, whereby poorer motorists are charged the same levy as richer car owners, and some have described the congestion charge as a 'tax on the poor'. The decision to impose the levy on key workers, who are not exempt from the congestion charge, was similarly criticised.
The impact of the congestion charge on businesses within the capital has been a major source of contention. Businesses affected by the charge have been vocal critics of the mayor's scheme, because of both the new costs imposed by the congestion charge and concerns that visitors to central London would be deterred by the daily charge.
A study of 334 firms by the London Chamber of Commerce in November 2003 found 79 per cent of shops reported a fall in takings and 42 per cent said the congestion charge was to blame. By January 2005 the same survey found 84 per cent of shops reported a fall in takings, with 62 per cent attributing this to the charge.
There was also controversy about the congestion charge operators, Capita RAS. In October 2003, the firm was fined £1 million for its poor performance dealing with both drivers and equipment. The company was given an extra £31 million by the mayor of London in June 2003 to help administer the charge. The mayor later admitted that he came close to sacking Capita soon after the charge was introduced because of its customer service failings.
But the congestion charge was welcomed by environmentalists as a way of reducing carbon emissions and encouraging people to use public transport, and town planners across the UK have begun looking into the scheme as a way of cutting congestion.
However, the decision to extend the congestion charge zone to the west from February 19th 2007 reignited the debate in London. A Transport for London consultation found 70 per cent of the public and 80 per cent of businesses in the capital were against the extension, which is bounded by Harrow Road, the West Cross Route, the inner southbound arm of the Earls Court one way system and Chelsea embankment. There were particular concerns about the impact it would have on small shops in west London.
To appease his critics, Mr Livingstone announced that, from February 2007, the congestion charge across London would end at 18:00, rather than 18:30, and motorists would be able to pay the following day, for a surcharge of £2. The charge would also be suspended between Christmas and the New Year.
A number of embassies in London refuse to pay the congestion charge as they believe they are exempt under the Vienna Convention, which grants ambassadorial staff immunity from local taxes.
Ken Livingstone also proposed raising the central congestion zone charge for the most polluting vehicles to £25 and this highly controversial charge was due to take effect from October 27th 2008. Defending the move the mayor said: "There will be losers but overall we will all gain." However, the scheme was dropped by Mr Livingstone's successor, Boris Johnson, who was elected Mayor in May 2008.
The congestion charge scheme received a further boost at the beginning of 2008 when researchers from King's College, London and the London School of Hygiene and Tropical Medicine suggested there could be unexpected health benefits from the reduction of exposure to nitrogen dioxide.
According to the researchers: "The results showed that there was little change in pollutant levels in London as a whole. But there were more substantial falls in the charging zone. Levels of NO2 fell the most."
The report added: "Policies affecting a larger geographical area and residential population, and which directly aim to reduce vehicle emissions, are likely to have larger public health impacts."
Following his election as Mayor, Boris Johnson published a new Transport Strategy which included proposals relating to the congestion charge, including the removal, subject to consultation, of the controversial western extension to the charging zone.
Subsequently consultations were undertaken by Transport for London on:
Removal of the western extension of the congestion charging zone.
Introduction of automated payment account system, provisionally entitled CC Auto Pay.
Increase of the daily charge to £9 for CC Auto Pay customers.
Increase of the daily charge to £10 for customers who do not take up CC Auto Pay and continue to pay through existing payment channels.
Removal of the £1 fleet discount so that fleet operators will pay the same per vehicle as customers using CC Auto Pay.
The consultations closed on 2nd August 2010 and the changes took effect from 4 January 2011.
The Western Extension was removed from the charging zone on 4 January 2011.
The daily Congestion Charge rose on 4 January to:
£10 if paid in advance or on the day of travel
£12 if paid by midnight the charging day after travel
£9 if registered for Congestion Charging Auto Pay
Residents registered for the 90 per cent discount:
If registered for CC Auto Pay
90p daily charge
If paying by other methods:
£5 weekly (5 consecutive charging days)
£20 monthly (20 consecutive charging days)
£252 annual (252 consecutive charging days)
The minimum number of vehicles a fleet can register for Fleet Auto Pay has been reduced from 10 to six.
If registered for Fleet Auto Pay: £9 daily charge
If paying by other methods: £10 daily charge
Greener Vehicle 100 per cent Discount:
The GVD will allow a 100 per cent discount from the Congestion Charge for cars that emit 100g/km or less of CO2 and that meet the Euro 5 standard for air quality. Owners must register for the discount and pay an annual £10 fee per vehicle.
Electric and plug-in hybrid electric vehicles 100 per cent discount:
Plug in electric hybrid vehicles are now eligible for the electric vehicle 100 per cent discount. Owners must register for the discount and pay an annual £10 fee per vehicle.
9+ seat 100 per cent discount
In order to receive the 100 per cent discount, owners of vehicles with nine or more seats must now make an annual £10 payment per vehicle.
Source: Transport for London - 2012
"The amount in unpaid Congestion Charges and Penalty Charge Notices owed by embassies is now so large that it could pay for more than 260 new buses on London’s streets, or fund the significant expansion of the cycle hire scheme, or alternatively reduce fare rises.
"It is disgraceful that £50 million is now being denied to Londoners by embassies that dodge paying the Congestion Charge. The small minority of embassies that think it is acceptable to evade paying the Congestion Charge are insulting each and every Londoner."
Caroline Pidgeon, leader of the Liberal Democrat London Assembly Group - 2011