Labour’s pay-per-mile scheme for plug-in hybrids might actually work. Sort of. If they use the right tracking tech, according to the Campaign for Better Transport. One of the bodies advising on the eVED system set for 2028.
Meanwhile Chancellor Rachel Reeves is softening the blow. She’s postponing the end of that temporary 5p fuel duty cut. Trying not to spark a revolt before the election even starts.
The hybrid dilemma
Here’s the current logic. Plug-in hybrids get hit with 1.5 p per mile. Half of what EV owners pay. On top of normal road tax.
The theory is simple enough. Hybrids burn less petrol than traditional cars. So HM Treasury thinks charging them alongside EVs closes the gap in lost revenue from fuel duty. No deficit. Everyone happy.
Except Silviya Barrett from the Campaign for Better Transport sees a problem. Speaking at Parliament recently. She called the Treasury’s assumption “too simple.” They figure hybrids run on electric 50% of the time.
Reality isn’t always 50%.
If you’re only driving in EV mode 20% of the time, you’re effectively overpaying. You’ve already covered the other 80% via fuel duty.
Barrett points out that estimating annual mileage leads to errors. You pay upfront then get rebated later. Or owe more. It’s messy.
Telematics could fix this.
The industry proposal is straightforward. Track the mileage. Send it to a server. Know exactly how much you’re driving on electrons versus petrol. No estimates.
It’s precise. That’s the selling point.
Old tech, new headaches
You don’t need new gizmos. Since 2018 all new cars need in-built SIM cards and GPS. The hardware is there.
But do people want it?
Studies by EVA England show mixed feelings. Most EV drivers accept paying their fair share. Only a quarter want a telematics system. And even then they’d hate it if it tracked location data. Just the miles.
But location data solves other problems. Like border hopping.
People living near Northern Ireland drive across regularly. Or tourists go abroad. A basic odometer check doesn’t know the difference between miles driven in Wales or Dublin. Only GPS knows where you actually drove. Without it the self-submission model has holes you could drive a truck through. Fraud becomes easier too.
And let’s be clear about the rebates. The government doesn’t hand back cash for overpayments. You get credits.
That feels stingy. Especially when public funds are running on fumes. By 2030 the drop in fuel duty creates a £12 billion hole in the treasury.
EVA calls eVED a “necessary evil.” But they want a delay.
Delay it to 2030. Redesign it based on actuals not guesses. Fix charging costs first.
Vicky Edmonds CEO of EVA England is blunt. Get the stumbling blocks out of the way first.
Reeves isn’t listening quite yet. She kept the fuel duty cut going for now. Originally it was supposed to phase out by March. Now it stays. At least until inflation catches up next April.
“The war in Iran pushes up prices.” That was her excuse. Stepping in to protect the pump price.
Does it solve anything? Not really. Just buys time. And the clock is ticking for those electric and hybrid drivers staring down the barrel of a tracker. Or a tax bill. Or both.
