Workplace parking levy must be scrapped or deferred, say business leaders

The Tories are bringing a motion to annul the levy at Holyrood on Tuesday.

Business leaders have called for Scotland’s workplace parking levy to either be scrapped or deferred (Steve Parsons/PA)

Business leaders have urged MSPs to scrap plans to give councils the power to introduce workplace parking charges ahead of a key vote on the issue.

Scottish Conservatives are to bring a motion to annul the workplace parking levy (WPL) to Tuesday’s meeting of Holyrood’s Net Zero, Energy and Transport Committee.

The Scottish Government agreed to handing powers for the controversial charge to local authorities in 2019, as part of budget deal with the Scottish Greens.

Since then businesses have been hit by the Covid pandemic, with many also seeing charges increase as part of the cost of living crisis.

The Scottish Chambers of Commerce (SCC) has written to the committee, calling for the levy to be “scrapped or, at a minimum, further deferred”.

Transport minister Jenny Gilruth stressed the regulations would “provide local authorities with the tools on workplace parking licensing, already held by councils in England and Wales and welcomed in Scotland by our local authority partners in Cosla”.

She added: “Councils in England and Wales have had these powers for over a decade since the Workplace Parking Levy (England) Regulations 2009 were made under the Transport Act 2000.”

But SCC director Liz Cameron criticised the “additional financial burden it places on businesses and their employees”.

She added: “This has become even more pertinent in the wake of the pandemic and the emerging cost of living.”

In a letter to the committee, she added: “Many businesses are still recovering from the financial impact of the pandemic, which has severely reduced trade and significantly increased costs over the past two years, hitting our town and city centres hard.”

She warned that without any cap being placed on the levy, “businesses face a postcode lottery on charges”, adding that East Midlands Chamber of Commerce had found “evidence of businesses having to make people redundant in order to pay the levy, reduce their investments or relocate entirely” after a similar scheme was introduced in Nottingham.

She demanded: “To support Scotland’s businesses and economic recovery, SCC believe the WPL should be scrapped or, at a minimum, further deferred.”

David Thomson, chief executive at the Food and Drink Federation Scotland, said it is concerned that uncapped levies would “subsidise public transport links for other more centrally located businesses and organisations”.

He added: “Whilst the net revenue generated by WPL schemes will raise revenue that could be used to improve public or active transport, our members are unlikely to see any benefits for their staff.

“WPLs are therefore likely to become yet another financial burden on food and drink producers, diverting money from other investment in jobs/productivity.”

David Lonsdale, director of the Scottish Retail Consortium, branded the levy a “recipe for extra cost and complexity”.

Transport minister Jenny Gilruth said councils in England and Wales already had similar powers. (Fraser Bremner/Scottish Daily Mail/PA)

He noted that firms “already pay business rates on the parking places they provide for staff, and so could be taxed twice for such parking spaces”.

As a result Mr Lonsdale said employers might have to “recoup some or all of the cost of the levy from staff”, adding this “could well have a bearing on the cost of living and/or the ability of employers to retain or recruit staff”.

He urged the committee that “any implementation be paused over the coming financial year to aid firms’ recovery from the pandemic”.

A Transport Scotland spokesman said: “Providing local authorities with discretionary powers to implement a workplace parking levy scheme (WPL) supports our commitment to reduce car kilometres by 20% by 2030.

“These powers are already available to local authorities in England and Wales. Any revenue raised by WPL must be used to support the objectives of local transport strategies, which can support greener transport choices and affordable public transport.

“Local authorities will be required to undertake a public consultation and impact assessments, including on the licensing charge, before implementing a WPL scheme.”