Noxious car exhaust fumes and diesel smoke are costing the country pounds11bn a year through ill-health and early deaths, according to a report published by the British Lung Foundation this week.

But, it says, Britons' love affair with the car could be ended by new or higher taxes on car sales, fuel, road use and vehicle emissions. Transport and Pollution - the health costs says the measures are warranted on public health and economic grounds

British Lung Foundation president Malcolm Green warns that air pollution, most of which is caused by petrol and diesel emissions from road vehicles, is causing long and short-term health problems for millions of people in the UK.

'It makes economic and health sense to clean up the air in our cities as an urgent priority,' says Dr Green.

A more strategic 'transport and health' policy is needed, he argues, which should include further use of financial measures to discourage unnecessary car use; the promotion of eco-friendly fuels, using differential fuel duties; more promotion of and investment in public transport, and targeted information to be given to the public in advance of poor air quality episodes.

There should also be further research into the health effects of pollution which could inform future policy changes, he adds.

The British Lung Foundation calculates that the 'suffering, illness and premature death' attributable to road traffic-related air pollution is now over pounds11bn a year - a figure set to grow as the volume of traffic increases.

The most dangerous pollutant identified in the report is PM10, the small particulates which are mainly emitted by diesel engines, and which can penetrate deep into the lung causing a wide range of health problems, including coughs, shortness of breath, asthma, emphysema and bronchitis.

Long-term exposure to PM10s is also associated with an increased risk of heart and lung diseases.

Other harmful air pollutants are carbon monoxide; nitrogen oxides, which damage blood capillaries and the cells of the immune system; ozone; sulphur dioxide, associated with chronic bronchitis and asthma; and lead.

A third of the population is particularly susceptible to the effects, the report says. Most at risk are children under five, people with heart and lung disease, pregnant women, elderly people and those who exercise vigorously outdoors.

For the report, David Pearce, professor of environmental economics and director of the Centre for Social and Economic Research on the Global Environment, quantified the impact of air pollution on quality of life and put a value on the reduced life expectancy it is believed to cause.

'The health costs of pollution are calculated by multiplying the number of pollution-related deaths and illness events that occur every year by the price people are willing to pay to avoid the risks of these things happening,' says Professor Pearce.

Economists regularly use this 'willingness to pay' method in evaluating the impact of different government policies, such as road building, he says.

'In this report, it allows a more accurate measurement of the overall burden of air pollution on someone's life, rather than looking purely at the direct healthcare costs of treating pollution-related health problems. If the direct costs of treating pollution-related illness were added to the pounds11bn figure, the financial burden to the nation would be even higher.'

The report also reveals that the overall bill from road transport, which also includes congestion, accidents, road damage and global warming, is between pounds46bn and pounds53bn. Yet road users pay only a third of these costs.

If people are to make an informed choice between the merits of private and public transport, the health and environmental costs have to be reflected in the cost of vehicle use, the report stresses.

But, according to the Automobile Association, motorists are already heavily burdened, paying around pounds24bn a year, with only pounds6bn ploughed back into transport.

'Drivers should not be made a scapegoat for poor air quality,' says Martin Maeso, AA head of environmental policy. 'Motorists and car makers have been doing their bit for the environment for many years.

'Drivers have paid for catalytic converters, and are having to meet the costs of maintaining them or paying up to pounds300 to replace them.

'Proposed toxic emission standards for 2000 and 2005 will be even tougher than they are today and, by the year 2015, emissions will be half of what they are now.'

Donald Reid, director of the Association for Public Health, welcomes the report but thinks the NHS must set an example and put its own house in order.

'It costs hospitals about pounds300 a year to keep one car parking space available,' says Mr Reid, 'so it is in everyone's interest to discourage car use by staff and visitors.'

Transport and Pollution - the health costs. The British Lung Foundation, 78 Hatton Garden, London EC1N 8JR. Free.

Asthma attacks, emphysema, bronchitis... Barbara Millar looks at what the British Lung Foundation says are the true costs of running a car