170.Schedule 12 contains the financial provisions for road user charging and workplace parking levy schemes.
171.Paragraph 2 defines net proceeds. In broad terms, once the gross proceeds have been received under a scheme, the charging authority will subtract the expenses of establishing or operating the scheme to give the net proceeds. Paragraph 2(2) allows the Secretary of State or the NAW to make regulations determining how net proceeds for local schemes are to be arrived at, and by regulations to treat certain wider expenses as deductable from gross proceeds in the case of a trunk road charging scheme. These relate to the costs of constructing, improving or maintaining the charged road. This will particularly apply to private finance contracts where a private operator may be contracted to build or maintain a road or structure as well as operating the charging scheme on it.
172.Paragraph 2(4) allows a complementary trunk road charging scheme and the local authority scheme which it complements to include the expenses of either scheme within its own expenses. This will allow flexibility for local authorities and the Secretary of State/NAW to agree to apportion costs between the complementary schemes as is most appropriate.
173.Paragraphs 3 and 4 deal with the apportionment of the net proceeds of a joint scheme or of a complementary trunk road charging scheme and the local authority scheme it is supporting.
174.Paragraphs 5 and 6 cover the accounts and funds charging or licensing authorities are required to keep and the treatment of deficits and surpluses between financial years. Paragraph 5 allows the Secretary of State or NAW to make regulations governing the keeping and publication of accounts.
175.Paragraph 7 sets out how net proceeds can be spent for schemes starting in the 10 years after commencement of the charging powers in the Act. It requires that net proceeds will be “hypothecated” and can only be spent in support of the authority’s local transport plan for the first ten years of a scheme’s life. It also makes provision for joint schemes, including ones involving a London charging authority where their share of proceeds must be spent in line with the Mayor’s transport strategy.
176.Paragraph 7 also allows periods of hypothecation that are longer than 10 years to be agreed by the Secretary of State or NAW at the outset for individual schemes. It also allows regulations to make provision, where a scheme is revoked and restarted, or modified, to judge whether the same or a different scheme can be regarded as being in force for deciding when the period of hypothecation starts or ends.
177.Paragraph 8 provides that after the period of hypothecation local authorities must spend net proceeds in accordance with regulations made by the Secretary of State. It would also allow the Secretary of State or NAW to provide that schemes starting later than 10 years after the commencement of the charging powers could be included in paragraph 7’s hypothecation requirements. Paragraph 8 requires that local authorities must spend net proceeds only on things that offer value for money, and allows the NAW and the Secretary of State to issue guidance.
178.Paragraphs 9 and 10 require local authorities outside London to prepare a 10 year general plan for spending proceeds, and more detailed plans linked to the timetable for preparing local transport plans. These have to be agreed by the Secretary of State or the NAW. Paragraph 12 allows the Secretary of State, in consultation with the Greater London Authority, to make regulations about the application of revenues from joint schemes involving a London charging authority.
179.Paragraph 13 covers the application of revenues from trunk road charging schemes. Schemes that are complementary to local authority charging schemes have parallel arrangements; the Secretary of State or the NAW will keep the revenue for 10 years from the start of a scheme where that scheme is started within 10 years of the legislation coming into force. The revenue must be spent on transport purposes. Paragraph 13(2) allows that 10 year period to be extended by regulations. The proceeds of trunk road bridge and tunnel charging schemes will be available for use of the Secretary of State or NAW for 10 years from the start of the scheme, whenever that is.
Commentary on Sections Part Iii: Road User Charging and Workplace Parking Levy Schedule 12