RAC Foundation

1
RAC Foundation

• Pricing, planning and new technology.
• Are they alternatives?
• Sir Christopher Foster
• RAC Foundation for Motoring
• 23July 2004
• To the Conference on Reducing the Impact of
  Vehicles on Air and Environment Quality in
  Cities, Mexico City

2
Pricing Objectives

• Let me start with pricing. Wherever adopted its
  objectives can be
• To alter behaviour
• To raise money
• To give signals for investment, development, but
  also disinvestment, contraction
• To compensate losers
• 2 and 3 most important in private sector
• 1 and 4 more important in public sector
• But they can clash

3
The Smeed Committee on Road Pricing

• My introduction to RP was a member of this
  committee in 1962, the first anywhere? - with
  Alan Walters, Michael Beasley and Gabriel Roth.
• Discussion threw up various problems
• The inter-urban toll road MC lt AC
• In cities the respective roles of planning and
  pricing
• Should one price to reflect current demand and
  supply?
• What social costs?

4
Why so slow?

• Slow development of technology a response not a
  cause?
• Better management of existing roads through
  traffic engineering bought 40 years but is much
  more left?
• Catchment area problems easier in islands
• Belief that one could
• invest ones way out of the problem by more
  roads
• or public transport (without pricing to divert)
• or deter traffic by not investing
• or plan ones way out without demand management
  very slow
• or do it through new forms of transport

5
The nature of political resistance

• Greatest problem to overcome is political
  resistance
• Features just listed are important but also
• Huge uncertainties about technology and
  behavioural reactions
• Common belief that pricing is for private not
  public sector
• Frequent preference for controls
• Parking non-optimal side-effects
• Land use changes often very slow or evaded
• Concerns about the poor
• And public misunderstanding in the Polls

6
How acceptable is road charging?

• In the future would you be willing to pay tolls
  to drive in city centres?
• NOP Automotive Survey March 2002

YES No UK
43
55 Scotland 36
62 London
39 61 age 17-24
31
69 age 65 47
50 social class AB
58 40 social class C2
38 62
7
How acceptable is road charging?

• How acceptable would road tolls be to you if
  there were equivalent reductions in fuel duty?
• NOP Automotive Survey March 2002

8
How acceptable is road charging?

• How acceptable would road tolls be to you if
  roads improved to guarantee better journey
  times?
• NOP Automotive Survey March 2002

9
How acceptable is road charging?

• How acceptable would road tolls be to you as
  part of a package of better roads, public
  transport and traffic management?
• NOP Automotive Survey March 2002

10
Spending the revenue

• Which is the top priority for spending the money
  generated from the tolls?

Road maintenance 19 Better
roads e.g. road widening and bypasses
32 Public transport 34 Public
services 12
11
General Poll Findings
60 felt it would be fairer if motorists paid
tax according to amount of time they drive in
congestion rather than tax on fuel and tax discs.
Only 22 argue that tax on petrol is a better
way of restraining traffic than a charge or toll
for using congested roads. 69 disagree with the
concept of fuel tax rising by a given annual
. 58 think that if charges are introduced for
using congested roads there should be concessions
for those on low incomes. 52 think that the use
of satellites to monitor the location of cars is
an infringement of personal liberty.
12
Opinion in post congestion charge London

• 6 Months after the scheme began more than 50 of
  London residents supported or tended to support
  the scheme, compared to around 30 who oppose or
  tend to oppose it.
• A full copy of Congestion Charging 6 Months On
  can be found on the TfL website at
• http//www.tfl.gov.uk/tfl/cc_intro.shtml

13
How does one overcome resistance ?

• Public discussion
• Dissemination of information from existing
  schemes
• Build up knowledge of elasticities
• demand
• modal and other substitution
• Modelling
• do nothing scenario
• allowing for congestion
• then for congestion charges
• Simulating
• effects of improved bus and other public
  transport
• altered traffic engineering
• new investment to re-direct traffic flows
• land use changes, if any, to aid decongestion

14
Possible combinations of increased capacity and
motoring charges in UK
Annual Increase in Motoring Charges
6
B
No increase in congestion
4
E
D
F
2.2
A
C
Capacity
Do Nothing after 2010 (Average speeds fall by
0.6 pa)
Projecting the 10 Year Plan
High Option
15
Planning for Congestion Charges

• Success depends on elasticities.
• They depend on availability of substitutes
• buses, almost always cheapest option, and
  busways, trams
• other public transport
• less transport-intensive land use solutions

16
Environmental Improvement

• Economics a very different role from tackling
  congestion
• pricing and regulation often a constraining
  influence
• scenario and targeting within a well-defined
  model structure needed at national and local
  levels
• any (indicative) quotes from forecast plans, not
  the other way round
• need to use economic criteria
• Inducing new technology the key
• already moving fast
• competition between manufacturers vital
• pluses and minuses of it necessarily being a
  global development