THE Government’s plans for nationwide road tolls were in tatters after it cancelled a pilot scheme for 440,000 lorries.

Ministers had planned to test the technology from 2008 before extending it to 30 million cars. But the scheme was abruptly abandoned yesterday and tolls are now unlikely to be introduced before 2020.

Road pricing had been proposed as the solution to congestion. Drivers would have paid up to £1.34 a mile on the busiest roads to encourage them to travel outside peak hours or use public transport.

But the Treasury was alarmed by estimates suggesting the lorry pilot scheme would cost up to £2 billion to introduce. Every lorry would have been fitted with a satellite tracking device to monitor its movements and deduct the appropriate payment. A similar scheme is operating in Germany after a series of delays which cost the German Government billions of pounds in lost revenue. Even now, a fifth of the scheme’s revenue is absorbed by running costs.

Alistair Darling, the Transport Secretary, said that road pricing would still go ahead over the next ten to fifteen years. He proposes to reduce or scrap fuel duty and replace it with a charge based on the distance travelled.

But ministers are privately questioning the benefits of an expensive road toll system when fuel duty is so cheap and simple to collect and provides a direct incentive to drive a more fuel-efficient car.

The RAC Foundation said that road pricing might never happen because it could prove too expensive to implement.