Door left open to pay-per-mile road charging after minister ‘misspoke’

The Government has appeared to leave open the possibility of a future pay-per-mile road charging scheme, despite the Transport Secretary telling MPs there were “no proposals” for such a system during Commons questions.

Heidi Alexander made the comments on Thursday when pressed on how next week’s Budget might affect motorists.

Responding to a warning from Conservative MP Charlie Dewhirst that mileage-based charging would “disproportionately impact rural drivers”, Alexander insisted the Government had no plans for a national pay-per-mile scheme.

However, a source close to the Transport Secretary later clarified that she had misspoken and had intended only to rule out a national road pricing system — a broader category that includes tolls and congestion charges. The clarification has fuelled speculation that the Chancellor may still pursue some form of mileage-based levy as part of wider tax reforms.

Alexander reiterated that the Government was “firmly on the side of drivers”, highlighting £24 billion of capital investment earmarked for upgrades to motorways, A-roads and deteriorating local infrastructure. Fuel duty raised nearly £25 billion in 2024–25, but the rapid shift to electric vehicles threatens to reduce that revenue sharply in the years ahead.

Earlier this month, it emerged that Rachel Reeves was considering a 3p-per-mile charge for electric vehicle drivers, potentially taking effect from 2028 after a consultation. The proposed system would charge drivers based on estimated mileage rather than any form of digital tracking.

At the time, a Government spokesperson said ministers wanted “a fairer system for all drivers whilst backing the transition to electric vehicles”, confirming that any framework would be accompanied by grants of up to £3,750 to help with upfront purchase costs.

The apparent walk-back on Alexander’s Commons remarks now raises fresh questions over how the Chancellor intends to plug the looming revenue gap created by rising EV adoption — and whether a form of mileage-based taxation will feature in next week’s Budget.