£8 charge could ruin firms

Ken Livingstone's surprise bid to raise the congestion charge to ?8 placed him on a collision course with key business leaders today.

The Mayor insists the £3 rise is vital to further drive down traffic levels, "build on the successes" of the current scheme and to raise up to £60 million for transport projects.

Announcing a major consultation on the £3 rise, he unveiled a raft of sweeteners, including a pledge to cut the " hassle" facing motorists paying the charge.

But today major business groups said the 60 per cent increase, which could sweep in as early as next July, could bring many firms to the brink of ruin.

The Federation of Small Businesses said an £8 toll would "badly damage" many of its members, costing them up to £800 extra a year. Spokesman Nick Winch said: "This rise cannot be justified. Those who pay the charge are, for a large part, businesses that have no option except to drive in the zone."

One of the angriest attacks came from business campaign group London First - once noted for its staunch support of Mr Livingstone's congestion charge.

Julia Lalla-Maharajh, director of communications, said: "Businesses will be angry at this proposed rise - especially as improvements to the system that we have been calling for have not been made, even at the current ?5 level.

"Business will not support a rise unless the Mayor makes significant inroads into the 'hassle' factor facing motorists - the changes he is proposing do not go nearly far enough."

London First called on the Mayor to launch an automated pre-payment scheme for all congestion-charge users and to allow motorists to pay the toll up to midday the next day as a minimum requirement before raising the fee. It said he should bring the scheme's " closedown" time forward half an hour to 6pm to give theatres and restaurants a boost.

Ms Lalla-Maharajh also said the Mayor's Transport for London department should urgently address congestion hotspots such as Trafalgar Square.

Lynne Featherstone, chairman of the London Assembly transport committee, said the existing scheme should be properly assessed before the charge was raised to ?8. She said: "Ken Livingstone is not being fair to Londoners. As with the increase in bus and Tube fares, he did not mention this huge rise before the June elections."

London Chamber of Commerce chief executive Colin Stanbridge said the ?5-a-day charge had resulted in 70,000 fewer car journeys a day into central London - sparking an "extremely negative impact" on retailers and restaurateurs.

He said: "We would be extremely concerned that, if the charge were to rise by 50 per cent or more, these problems could be exacerbated - especially for marginal businesses that are least able to afford them."

He added: "We support the principle of congestion charging but are troubled that the clear defects in the scheme as it stands have not been addressed prior to proposals such as the westward extension, and now price increases."

The Freight Transport Association - which represents thousands of businesses delivering goods into central London - said it was "appalled" by the Mayor's "outrageous" proposals for a rise to ?7 for commercial vehicles.

However, pressure group Transport 2000 welcomed the proposed rise.

"It is not just a good idea, it is essential," said London campaigns manager, Richard Bourn. "The current charge is negligible compared to parking costs and a rise is necessary to stop traffic creeping up again. We welcome it."