Workplace parking levy

Option: Workplace parking levy (WPL) to fund local public transport

A Workplace Parking Levy is sometimes reported as a tax on parking. More accurately, it is a licensing scheme that charges the occupier of premises or employer for the provision of workplace parking places. The cost may be passed on to the employee but it is left to the local traffic authority to determine who must apply for a license and the appropriate sum per parking place.

• The law

• Case study

• Links to guidance

The law

The Transport Act 2000 Part III ch. II introduces 'Workplace Parking Levy' Licensing Schemes

The Act allows a Local Traffic Authority (LTA)^[1] to develop a licensing scheme that charges for the number of workplace parking places at a business premises. The purpose of the scheme must be to facilitate the achievement of local transport policies. There is no statutory obligation for the authority to carry out a consultation although an LTA may consult the public and stakeholders. The Secretary of State for Transport may require a consultation or inquiry into WPL plans. Any scheme must be confirmed by the Secretary of State who (based on recent practice^[1]) will decide whether he/she agrees that the scheme appears desirable to further local transport policies and will focus on the reasonableness and proportionality of local plans.

The current Government is not against WPL schemes but has required local authorities to demonstrate;

“...that they have properly and effectively consulted local business and addressed any proper concerns raised by local business during those consultations.”

Local Transport White Paper; Creating Growth, Cutting Carbon: Making Sustainable Local Transport Happen. Department For Transport. 2011. p.72, par 7.12.

This might require consideration of exemptions for small businesses and good alternative workplace travel plans for employees.

The licensing scheme is made by order of the Local Authority (known as the licensing authority)^[2] and it must set out the area covered by the scheme, the days and hours when licences are required, the level of charges and the duration of the scheme (if not indefinite)^[3]. National regulations may prescribe certain exemptions or reduced rates or the local scheme may make similar limits on the liability to pay and the amount charged.

Workplace Parking Levy Legislative framework

Under the Transport Act 2000 a Local Traffic Authority (LTA)^[1] is empowered to develop a licensing scheme imposing charges in respect of the provision of workplace parking places to be paid by the occupier of the premises;

• "if it appears desirable for the purpose of directly or indirectly facilitating the achievement of the licensing authority's local transport policies" s.179^[2] (as amended).

This must be confirmed by the Secretary of State for Transport^[2];

• "The Secretary of State takes the view that it is primarily for the authority making the licensing scheme to decide whether it appears desirable for the purpose of directly or indirectly facilitating the achievement of the authority's local transport policies. It is for the Secretary of State to decide whether he/she agrees that the scheme appears desirable and whether the local authority has acted reasonably and proportionately in developing a WPL licensing scheme to achieve them"^[3]. 

This gives a wide margin of discretion to local authorities to determine their own priorities.

The Act does not require public or stakeholder consultation; instead, an LTA may conduct consultation (s.185).

• However, the Secretary of State for Transport may require consultation or cause an inquiry to be held s.185 (3-4), and;

• A local authority is under a general duty to involve local persons in decision-making ^[4].

A scheme is made by order of the licensing authority ^[5]. 

An order must cover certain matters (S.186 Transport Act) :

• area covered by scheme

• days on which, and hours during which, licences are required

• level of charges payable on licences (expressed as a specified sum of money for each licensed unit)

• duration of scheme (if not specified to remain in force indefinitely); and;

• a scheme may cover other matters (different charges for different cases, provision in connection with the making of an application for a license)

An order must be submitted to and confirmed by the Secretary of State for Transport- s.184(1)

• The Secretary of State for Transport may confirm the order with or without making modifications- s. 184(4).  The local authority must then decide whether to implement the scheme with modifications or not at all.

Red Tape Challenge

In 2011, the government launched the Red Tape Challenge in an effort to cut-down on government regulations that may inhibit economic growth.  A main thematic area of this challenge is Road Transportation.  The public debate for this theme is now closed, but the government has published a document outlining all proposed transportation regulatory changes.

Of particular note to Healthy Places - as a result of the Red Tape Challenge public debate, a proposal is being put forward related to workplace parking levies: 'Local Authorities will now have to ensure business interest are properly considered as part of any future proposed Workplace Parking Levy scheme. They must show they have properly and effectively consulted local businesses, have addressed any proper concerns and secured support from the local business community.'