Transport experts question Cardiff’s workplace parking levy proposal

Kieran Molloy, Local Democracy Reporter

Transport experts have questioned Cardiff Council’s plans for a workplace parking levy, warning it could amount to an unfair “double tax” on businesses and their employees.

The AA and the RAC Foundation both raised concerns after the council confirmed it was exploring the introduction of a charge on employer-provided parking spaces to help fund improvements to public transport.

The proposal, which follows years of speculation over congestion charges and clean air zones in the Welsh capital, remains at an early stage. The council says any scheme would be subject to public consultation before being introduced.

A workplace parking levy is an annual charge paid by certain employers based on the number of parking spaces they provide for staff. The money raised would be ring-fenced to fund transport improvements, such as bus services and cycling infrastructure.

Council documents use a figure of £750 per employer-provided parking space for modelling purposes, although the final charge and which businesses would be affected have yet to be decided.

The only other place in the UK to operate a workplace parking levy is Nottingham, which introduced the scheme more than a decade ago.

Jack Cousens, the AA’s head of roads policy, told the Local Democracy Reporting Service the levy was likely to be viewed as a tax on workers if employers chose to pass on the cost.

“The most common argument against a workplace parking levy is that it is a tax on workers,” he said.

“The council aims to use the levy to raise funds to improve public transport services.

“Essentially this means a section of the city’s travelling public will be targeted (assuming that employers will pass the levy on to their employees) for the benefit of the rest. This is not fair and equal taxation.”

Mr Cousens also argued that workplace parking spaces are already taxed through business rates, meaning a workplace parking levy would effectively amount to a “double tax”.

He said: “City centre workers are some of the most regular and best consumers and customers feeding money into shops and services at a time when town and city centres are seeing lower footfall and spending.

“Undermining that source of income, because the workers having to fork out more of their money on travel and parking means they have less to spend in shops, is not very clever.”

Steve Gooding, director of transport policy think tank the RAC Foundation, said the fact Nottingham remained the only UK authority with such a scheme highlighted the challenges councils faced in introducing one.

“The fact that Nottingham is the only place in the UK with such a scheme hints at the difficulties – politically and practically – of implementing the levy even though the national enabling law was passed more than a quarter of a century ago,” he said.

“Cardiff Council is explicit that its proposal is a way of raising money to support public transport but businesses will rightly ask why they should have to pay for something that might not benefit them.

“One of the reasons firms offer parking is that often trains and buses don’t – and won’t – service their premises.”

Mr Gooding also questioned whether businesses with employees driving electric vehicles would be treated differently if environmental objectives formed part of the justification for the levy.

Consultation

Cardiff Council’s cabinet member for climate change and transport, Cllr Dan De’Ath, stressed that discussions were still at an early stage and that any proposal would be subject to extensive consultation.

“The reason we are exploring a workplace parking levy is that Cardiff faces increasing congestion and pressure on its transport network while current funding falls far short of what is needed to deliver the step-change in public transport that residents and businesses tell us they want to see,” he said.

“The assessments carried out to date indicate that a workplace parking levy is the lowest-burden option capable of generating a significant and reliable funding stream for transport improvements.

“Despite concerns raised when the scheme was first proposed, Nottingham has continued to attract investment and grow its business base, with improved transport links regarded as an important factor in supporting the city’s economic development.”

Cllr De’Ath said the council would work closely with businesses as proposals were developed. He added that without a new source of funding, Cardiff would struggle to deliver the transport improvements needed to support economic growth, reduce congestion, improve air quality and provide residents with a high-quality public transport network.

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