Birmingham Clean Air Zone profits could hit £50 million for the city council

Birmingham City Council on track to make £50 million from the Clean Air Zone by the end of 2023

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Birmingham City Council is expecting to make £50 million profit from the city’s Clean Air Zone by the end of 2023. The information comes from a report to cabinet seen by the Local Democracy Reporting Service.

The council says it is hoping to reinvest the majority of that money to encourage cleaner modes of travel within the city and push towards its target of net zero emissions. Birmingham’s Clean Air Zone began in 2021 amid hopes to reduce the amount of high-polluting vehicles entering the city.

Vehicles that emit a high amount of emissions and still wish to enter the city have to pay a fee under the scheme, known as CAZ. These vehicles risk a penalty charge if they fail to pay this fee.

Birmingham City Council says revenues generated by the Clean Air Zone will cover the cost of its operation, including the maintenance of cameras, operational staff etc and are “not intended to generate substantial surplus proceeds”.

From the period between the scheme opening in 2021 and the same period in 2022, the Clean Air Zone generated a profit of £25.604 million according to council figures. It is now expected to double that income in the period between 2022 and 2023 with profits expected to hit £50 million.

Birmingham City Council says it has already allocated a large amount of the profits towards schemes such as hydrogen buses, cycle lanes, the University Train Station and the Camp Hill Line stations.

But with overall revenue for the scheme expected to exceed the amount predicted in 2021, the council could now find itself with almost £20 million in spare cash.

Council chiefs say £13.250m of this money could be used to implement more signage across the city, implement more carbon-free modes of transport and support the delivery of resident parking schemes.

Clean Air Zone BirminghamClean Air Zone Birmingham
Clean Air Zone Birmingham

In the report, a representative for Birmingham City Council said: “Revenues from the Clean Air Zone are generated from two sources.

“The first of these is the daily fee that applies to a journey through the zone in a vehicle that does not meet the emission standards of the zone and a valid exemption is not in place.

“The other source of revenue is the penalty charge that applies for non-payment of the relevant daily fee.

“The original plan for the Clean Air Zone assumed that 95% of the people who should pay the daily fee would do so within the 13-day payment window.

“The actual current payment rate is just above 80%. On this basis, the volume of penalty charge notices issued has been higher than assumed in the original prediction.

“This report recommends for approval additional allocations of CAZ net surplus revenues. The proposed allocations total £13.250m and are subject to the net surplus revenues from the Clean Air Zone being realised. ”