Small businesses have urged Sadiq Khan to keep support in place for them as London marks one year since the Ultra low emission zone (Ulez) expanded to cover the whole city.
The Federation of Small Businesses (FSB) claimed the decision to close the mayor’s £210million scrappage scheme on September 7 does not give firms enough time to swap their non-compliant vehicles for cleaner alternatives.
Sole traders and businesses with 10 or fewer employees have been able to apply to the scheme since January 2023. The cap was raised to 50 employees six months later.
Transport for London (TfL) said 17,704 vans or minibuses belonging to small businesses have been scrapped under the scheme, with grants to those firms totalling almost £115million.
As of February, 96 per cent of vehicles driving in London on an average day were Ulez-compliant and did not pay the £12.50 daily charge. However, the figure for vans was 89 per cent, and for minibuses 80 per cent.
Laura Timm, the FSB’s London policy chair, said rising compliance had come “at a cost to struggling small businesses”, adding: “The TfL quote ‘Every Journey Matters’ has resonated with small firms over the past year as many sectors, from construction to arts, entertainment and recreation, have had to rethink business decisions and operations.
“Smaller businesses, particularly on the cusp of the M25, have had to absorb the extra cost or pass it onto their customers where feasible and fair.”
Ms Timm said providing only three weeks’ notice before closing the scrappage scheme, and doing so during the summer holiday, “does not feel supportive” for businesses.
The FSB called on Mr Khan “to continue to provide financial support and grace periods up to the end of 2025 to enable small businesses to have more time to access the options available”.
Grace periods, which temporarily exempted small firms from Ulez charges while they waited for their new vehicle to arrive or for an old one to be retrofitted, expired three months ago.
Christina Calderato, TfL’s director of strategy, said scrappage scheme demand was “now much lower than when it was first introduced” and encouraged anyone still driving a non-compliant vehicle to apply before it closes.
“Any application made before the proposed deadline is guaranteed to be processed,” she said. “Once approved, van and minibus applicants have up to six months to scrap their vehicle.
“The expanded Ulez has brought cleaner air to five million more Londoners. Harmful NOx pollutants from cars and vans are estimated to be 13 per cent and seven per cent lower than a scenario without the expansion, amounting to a total reduction of 424 tonnes in NOx emissions. This is equivalent to removing 200,000 cars from the road for one year.”
The anniversary of the zone’s expansion was celebrated by Izzy Romilly, sustainable transport manager at the climate charity Possible, who said: “The leadership shown by the Mayor of London in pushing forward with this world-leading policy has led to London being on track to meet the UK’s legal air pollution limits by 2025 – much earlier than originally expected.
“The Ulez expansion has shown how effective clean air policies can be, despite fierce opposition from a vocal minority. Now, we need politicians in London and across the UK to go further and faster with cleaning up our air and tackling the climate crisis.”
Antonia Jennings, CEO of the Centre for London think tank, similarly praised the Ulez, but questioned whether the policy has gone far enough. She pointed to polling carried out by Savanta in March, which found that 41 per cent of Londoners were in favour of the introduction of a 'pay-per-mile' charge, compared with 27 per cent who were opposed.
She said: “With the successes of Ulez plain to see, it's time we take bolder action. Pay-per-mile is a more progressive form of taxation. The money gained could be directly invested into sustainable transport. It's a model which would further tackle the causes of air pollution in the capital, to create a cleaner and healthier city for all Londoners.”
The mayor explicitly ruled out introducing any such charge in his recent manifesto, and reiterated the pledge following his re-election in May.
