Congestion charge creates boom for suburban shops

Beleaguered traders in the suburbs have experienced a mini-boom from the congestion charge as shoppers shun central London.

Beleaguered traders in the suburbs have experienced a mini-boom from the congestion charge as shoppers shun central London.

Even taking into account the general gloom in the retail trade, the analysts FootFall reported yesterday that the number of shoppers within the charge zone had dipped in a way last seen during the fuel crisis of 2000.

But retailers in areas such as Croydon and Wimbledon in south London saw a relative increase in the number of shoppers of 2 per cent compared with the previous week. A study of more than a dozen centres inside the zone showed numbers down by 3 per cent.

David Smyth, marketing manager of FootFall, said: "This is good news for retailers and centres trading further afield, but another blow for those already affected by the closure of the Central Line and the recent heightened security fears."

Business leaders said the figures showed the congestion charge was having a complex but direct impact on economic activity in London. However, they remained divided over its success as they gave their report on the first week of the world's most ambitious road charging scheme. Transport officials reported lighter traffic all week within the zone, with some companies able to carry out more work than normal. The London Chamber of Commerce said it was too early to say if the scheme was a success and was carrying out long-term research into the effects.

The most vociferous opposition came from small businesses and market traders who said their worst fears had been confirmed. Mike Liggins, general manager of the New Covent Garden Market in south London, said the charge would add a major cost to those using the market, even though it lay outside the charge zone. Many distributors have to travel into the zone to deliver produce from Britain's biggest horticultural market. "We are talking about multiple millions of additional pounds," he said.

George Hart, a salesman at a Volvo dealership H R Owen, works at a showroom on the Euston Road, where the front door is outside the congestion zone, but his desk is inside it.

The business has to move up to a dozen cars around London every day and customers pick up vehicles from the showroom. The estimated annual cost is put at £18,000.

"If anyone leaves their car outside it's a £40 parking fine and now you have the £5 charge," he said. "Go through the speed camera on the way home and you've had an expensive day."

London First, which represents 300 major companies, said the early indications were that there had been no significant bad effects and the charge was offset by improvements to delivery times.

However, small businesses said they had been particularly badly affected by the extra costs and time spent on processing the charge. The Federation of Small Businesses claimed the cost to "one man and a van" would be more than £1,000 a year without any significant benefits from the improved traffic flow.

James Millar, chief executive of the home delivery service, Food Ferry, estimated that it would cost more than £40,000 a year for his 10 vans to drive through the zone and to make detours and for the time spent making claims.

Residents from inside the area have also protested to Transport for London over misleading publicity about discounts. Householders were surprised to hear they had to drive for five consecutive charge days to pay the reduced charge of £2.50.

The AA said the true test would come next week. "Numbers of cars are down but this is perfectly normal for half-term week," a spokeswoman said. "We won't know the true effect until Monday."