Federation of Small Business calls on Mayor of London to have a ULEZ expansion rethink

    Don't let the ULEZ destroy the London Music Industry

FSB London has written to the Mayor of London, prior to the end of the Ultra-Low Emission Zone Consultation, urging him to rethink the proposal as it will negatively affect too many small and vulnerable businesses.    

  

After the long-running soap opera of Government-TfL week to month bail-outs, FSB London Chair Rowena Howie states in the letter that “FSB lack any confidence that an all-encompassing vehicle scrappage scheme to help small businesses will materialise”.

 

Key Headlines of the Survey

 

• The survey was completed by just under 600 businesses – 77 per cent of those within London
• 84 per cent of businesses responding to the survey oppose the proposal to expand the ULEZ
• Majority of responses from small businesses with 1-5 employees
• 80 per cent of respondents reliant on business based vehicles
• 30 per cent agreed to an Emission-based road pricing system as opposed to the current Congestion Charge, Low Emission Zone (LEZ) and ULEZ
• Of those businesses whose vehicle(s) do not comply – 25 per cent intend to pass charges onto customers, which will create further inflationary pressures; and 18 per cent said they would close their business.
• 19 per cent of small businesses were unaware of the proposed ULEZ expansion in 2023

 

 

 

Many small businesses will have to start making difficult decisions on whether they continue to serve central, inner, and outer London, and FSB London are calling for:

 

• Time to comply by having a similar lead in period to previous Zone extensions. During a cost of doing business crisis, we need London businesses to thrive and with a heavy reliance on service-related businesses, we feel that implementing a ‘no charge’ period until at least 29 August 2024 is a sensible measure.
• An all-encompassing Vehicle Scrappage scheme for small businesses which can be supported by Government, Mayor of London and financial institutions providing low-cost finance.
• A project bank account for any small business paying the charge from August 2023 to August 2025. The funds would be protected in a TfL ULEZ Bank Account, and a business would be able to use the funds towards purchasing a new or second hand-vehicle – subject to an upper limit.  If the fund is unspent then the money will go to TfL.

 

Rowena Howie, FSB London Policy Chair, said:

 

“The expansion of ULEZ will negatively impact thousands of small businesses through a myriad of issues including but not limited to customers choosing not to travel, businesses not being able to provide services in London and employees experiencing increased costs.

 

“To put these additional pressures on small businesses at a time when business has been adversely impacted by COVID-19 restrictions, where uncertainty and planning and reliance on supply chains has been further interrupted by new international trade agreements and where the energy crisis has further pushed up the cost of doing business, will be too much for some businesses to bear.

 

“FSB recognises the climate emergency and the commitment to move to net zero – but the Mayor must support the small business community through a ‘carrot’ and education approach to make greener decisions, discouraging non-essential business private vehicle journeys,  and not to punish essential business journeys at this time of economic crisis.

 

“We need the Mayor to ensure policy promotes a small business friendly Greater London”.

 

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Our position.

Roger Tichborne, the editor of the Barnet Eye is a member of the FSB. Roger wirtes.

Whilst we 100% agree with the objective of the Mayor of London in reducing air pollution, we feel that the ULEZ expansion has not been thought through, the timing coming at the end of the pandemic is terrible and it will be highly damaging to the sector of the economy (music and entertainment) that we operate our business in. 

Like many small businesses, our finances, which were extremely healthy at the start of the pandemic are now precarious. Our revenues for Q2 of 2022 are around 70% of the same period in 2019, which in effect means that we are not operating profitably and are just about breaking even. Our business uses a 2008 registered Ford Galaxy Turbo Diesel for deliveries and our main hire equipment subcontractor uses a similar aged diesel van. We purchased these at the time as the government was encouraging us to use diesel as it was seen as a less polluting option. Our vehicles are well maintained and in good condition, but now have lost all resale value. The pandemic has depleted our financial resources. Our intention was to replace the vehicles in 2021, but we are in no position to take on a large financial commitment, especially when we are not 100% sure of the long term viability of our business or the industry it operates in. 

We completely agree that large companies that have big fleets should comply and we are also of the opinion that people driving gas guzzling cars primarily for pleasure should also be discouraged from polluting. For us and many small businesses, we are in no position to take on the commitment of new vehicles. We believe that the Mayor and the government should offer a viable scrappage scheme and an exemption of two years to small businesses, musicians and other people who are not in a position to viably re-equip at the moment.

We are already passing on the costs of ULEZ to charities that hire equipment from us and require delivery. We have used electric bike delivery services for some bookings, however when an engineer is travelling with the equipment this is logistically not feasable, especially when there are time limitations and several drop offs required. 

We support the FSB's suggestions as pragmatic compromise solutions and hope the Mayor Listens. We beleive that it is in no one's interest if a business such as ours can no longer viably operate. We also ask the Mayor to think of the impact on musicians who are not well off and have old vehicles. Some minor modifications to the scheme would make a huge difference. I'd like to see the Mayor set up some sort of scheme where musicians  (and other affected small businesses) had access at a relatively low cost to compliant, subsidised hire/lease vehicles, with minimal paper work and financial guarantees to ensure that the vehicles can be accessed. 

We are not calling for the abandonment of the scheme, which we generally support. We are however calling for it to be a progressive scheme, not just a ploy to hoover up cash for TFL. All schemes can be improved and we believe that offering suggestions to do this is a positive way forward. If the Mayor of London simply ignores the struggle of small business, he is not serving London's best interests