Hauliers complain about unfair European competition

Using satellite tracking to charge lorries was due to start in 2006.

But a report published alongside the Budget says problems with a similar scheme in Germany could mean the scheme is not be fully running until 2011.

Ministers have said the scheme will act as a pilot for using per-mile charges for all drivers on busy roads.

Timetable

The lorry scheme was aimed at ensuring foreign truckers paid for using British roads, with domestic truckers reimbursed through lower diesel charges.

The Treasury on Wednesday said there would be pilot schemes in 2006, with the technology rolled out a year later.

But the phased introduction of the scheme could take another two or three years.

The German system had to be abandoned because it encountered so many problems and it will not be reinstated until next year.

Getting it right

British hauliers had backed the idea, saying it was unfair that they have to pay European tolls when they drive abroad, foreign truckers face no such costs in Britain.

Richard Turner, chief executive of the Freight Transport Association, said he was disappointed by the delay but pleased the Treasury was determined to get the scheme right.

"What we don't want to do is to go down the German road and introduce a scheme that doesn't work," he said.

The move makes a wider road charging scheme unlikely for at least a decade.

London and Durham are currently the only cities with local congestion charging schemes.