road pricing lessons – the experience to date

A world-wide review 1

www.tecmagazine.com tec MAY 2007

Road pricing lessons –the experience to date

SOME HISTORICAL BACKGROUND

Charging for the use of highways has a long history in Eu-rope. Users paid to travel along the turnpike roads and bythe early nineteenth century there were in the UK alone1,100 turnpike trusts administering 23,000 miles of road em-ploying 20,000 pikemen. The Turnpike Trusts knew all aboutcharging:

• Collect the money as users pass• Make sure the toll points cannot be avoided• Vary the charge according to the type of road user.

Today the UK’s road user charging system (fuel duties andvehicle licences) yields revenues which far exceed the costs ofmaintaining and expanding the road network and have fornearly 80 years been treated as part of the government’s gen-eral taxation revenue. The amounts of fuel duty paid by dri-vers do, of course, increase with the size of engine, the dis-tance travelled and both the amount of congestion on theone hand and excessive speed on the other hand. In someways therefore such duties might seem to possess many ofthe characteristics required in a road user charging system.The difficulty is that, on their own, fuel duties are too bluntan instrument for tackling traffic congestion. They wouldneed to be far higher to reduce traffic at the times and loca-tions where congestion is a problem and such high levelswould penalise those who depend on their cars, particularlythe inhabitants of rural areas. A more focussed pricing mech-anism is therefore required.

Development of the economic theoryThe economics of charging users to fund the capital costs oftransport investments were first explored by the French

economist Dupuit in the 19th century in relation to thecanal system. Dupuit formulated the theory that usersshould be charged the full marginal cost of their journey andthat investments in infrastructure should be made up to thepoint at which the marginal costs began to exceed the mar-ginal revenues.

Road pricing, first as a means of paying for roads and sec-ond as a method of controlling traffic congestion, was cham-pioned after the war in both the UK and the US by many no-table economists including William Vickrey, Denys Munby,Gabriel Roth, Alan Walters (later to become Mrs Thatcher’seconomic advisor), Michael Thompson and many others.

The Smeed Report, written by a committee chaired by Pro-fessor Ruben Smeed of University College London and com-missioned in 1964 by the Ministry of Transport, was proba-bly the first European report to focus on road pricing as ameans of controlling traffic congestion. The Smeed Commit-tee concluded that ‘practical pricing methods could probablybe devised’ and that the ‘net gain to the community from thehigher speeds consequent on the reduction and reallocationof traffic would be about £100 - £150 million per year’ (in thewhole UK).

THE SINGAPORE EXPERIENCE

BackgroundThe work of the transport economists first took root, not inEurope, but in Singapore. Singapore’s area licensing scheme(ALS) was introduced late in 1975 and required vehicles todisplay a special licence to enter the CBD during the morn-ing peak periods. In 1989 the scheme was extended to coverthe evening peak and in 1994 to cover the whole day. It ini-tially applied to cars but was later extended to taxis, lorries,

Malcolm Buchanan MA, MSc, FIHT, MICE, MILT, Chairman, Colin Buchanan

When in 2005 the government announced theTransport Innovation Fund (TIF), it tooksometime before it became clear that“innovation” meant road pricing and had little todo with innovative public transport systems. Two

years later, as the government finds itselfconfronted with massive bills for investments inthe tram systems judged to be necessaryprerequisites for the introduction of a bewilderingrange of road pricing schemes in the

conurbations, it is timely to review world-wideexperience of road pricing to date and to attemptto identify the characteristics of a good road usercharging scheme and the conditions necessaryfor successful implementation.

1843 TurnpikeTrust prices fortraffic categories

2 A world-wide review

tec MAY 2007 www.LocalGov.co.uk

buses and motorcycles. Car pools were exempt until 1989.The ALS was supplemented by a road pricing scheme (RPS),applying to the expressways, in 1995. The high manpowerneeds and the difficulties of varying and focussing the roadpricing charges led to a switch to electronic road pricing(ERP) in 1998. This is still operating today.

Singapore’s ERP scheme operates in parallel with the 130%tax on the price of new cars and the quota system which to-gether control the number of cars in the country. Comparedto these two draconian means of controlling car ownership,the impact of road pricing in Singapore must be relativelysmall. The fact that the car ownership restrictions mean thatonly the wealthy have access to private cars further reducesany impact likely to arise from road pricing.

ObjectivesThe objectives of road pricing in Singapore have changedover the years and gradually become focussed purely on thecontrol of traffic congestion. The original ideas of encourag-ing car pooling and the use of public transport have beengradually abandoned as a part of this process. By the samelogic the extent of the scheme has had to be expanded ascongestion has become more widespread. Today road pric-ing is used in Singapore to match the traffic speeds on themajor radial roads to pre-determined targets. The extent towhich these targets are achieved is regularly reviewed andthe prices are adjusted accordingly.

Current Payment technologyThe original road pricing schemes in Singapore, the ALS andthe RPS, both relied on paper licences being displayed as thevehicles passed through manned control points. The pay-ment systems have gradually developed from the originalarea licence, which entitled the driver to enter the restrictedpart of the CBD, to today’s sophisticated and automated deb-iting of pre-paid cash cards as drivers pass beneath the entrygantries between the hours of 0800 and 1900 on Mondays –Fridays.

Cars in Singapore wishing to pass through the ERP cordonhave to be fitted with an in-vehicle unit (IVU) and a storedvalued smart card. The IVU was produced specifically for theERP system and the smart cards were produced by a consor-tium of local banks and have multiple uses. Different IVUsin different colours are produced for different classes of vehi-cle. The ERP gantries are fitted with antennae, vehicle detec-tors and enforcement cameras. All these are linked to a con-troller at each site and data is transmitted back to a controlcentre.

The control centre processes all financial transactions be-

fore these are sent to the banks for settlement. The numberplates of vehicles passing beneath the gantries are alsoprocessed at the control centre and, when required, lettersare printed and sent out to non-payers. In addition tolaunching a major programme before the start of ERP tocomplete the installation of 680,000 IVUs in eligible vehicles,great attention was also paid to publicity. The IVU fittingprogramme took 10 months and the publicity programmewas in place for more than a year before the launch date ofERP. Live tests at no charge were run before the ERP gantriesfinally read ‘in operation’.

Prices The ERP charge for passing a gantry varies between c0.25 andc1.2 and applies to all inbound trips beneath a gantry. Thiswas 10-50% less than the previous ALS scheme but applied toall trips rather than being a flat charge for the day. All theoriginal concessions for car sharing, public transport, etchave now been removed and buses pay 3 times the cost ofprivate cars, reflecting their greater use of roadspace.

Annual revenue and cost/g1 collectedThe ERP scheme in Singapore now produces a revenue ofabout c40 million and the collection cost is about 21 centsper c1 raised.

EnforcementThe gantries photograph cars with an insufficient cash bal-ance on their smart card or with no IVU. The photographsare transmitted to the control centre where registration num-bers are read automatically using OCR. Vehicle owners arethen issued with letters requesting the payment and in caseswhere there is insufficient cash or no smart card in the IVU,an administrative charge of c5 is added. A summons followsif payment is not made within 28 days. This carries a penaltyof c35.

Effect On congestionBecause the ERP system replaced the previous ALS/RPSschemes, it is difficult to estimate what the effects are com-pared with having no road pricing. However, it is notablethat ERP essentially reduced the charge for 1 pass through agantry from c1.5 in peak periods and c2 in the interpeak to afigure between c0.25 and c1.25 On the other hand ERP ap-plied to every pass beneath the gantry whereas the ALSscheme required one payment per day. Despite its cheaperprice the ERP scheme reduced traffic by 10-15% during itshours of operation compared to the ALS scheme. This isthought to have been because the lower charge applied tomore trips, a finding corroborated by the fact that significantdecreases in traffic were observed in the interpeak period.

Today the focus of the ERP scheme on controlling conges-tion is maintained by periodically checking the actual speedsagainst the targets set for each road and then adjusting thecharge rates. Charge rates are published so that drivers stillknow what they have to pay.

Likely developmentsSingapore has clearly learnt that the more it is possible to tai-lor congestion charges to traffic conditions the easier it is toeffectively control traffic congestion. The managers of thescheme now seem to see the future as involving expansionsof the charging system rather than even more sophisticationregarding the setting of the charges, though these are stillunder constant review. Expansion, for example to an island-wide system, might possibly justify a switch to GPS technol-ogy rather than the present gantries, though the managers ofSingapore are still focussed on the control of congestion

A Singapore ERPcharging point

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rather than the raising of revenues or the institution of is-land-wide road user charging for its own sake.

A positive Net Present Value?No full economic evaluations of the Singapore ERP schemehave been seen, but given its minimal impact on travel be-haviour and its significant achievements in reducing trafficcongestion, it almost certainly performs well against trans-port policy objectives.

THE NORWEGIAN EXPERIENCE

BergenBergen, Norway was the first European city to introduce roadpricing. This was done in 1987 with a deliberate objective offinancing a bypass. Twenty percent of the revenue was usedto improve the city’s bus system. Tolls were initially c1.2 butwere doubled to c2.4 in 1999.

TrondheimTrondheim followed Bergen’s example in 1988 and tolled anew road parallel to an old one. In 1991 the scheme was ex-tended to cover the inner city and converted into an elec-tronic payment system.

OsloOslo followed Trondheim in 1990 with a ring of eighteen tollstations of various sizes on the main roads approaching thecity through the outer suburbs. On the same day the Oslotunnel was opened beneath the city centre. The toll revenueswere used partly to pay off the tunnel debts, but also to fundimprovements in public transport and the environment.

ObjectivesIn contrast with the objectives of road pricing in Singapore,those in Oslo are purely to raise funds for investment in im-proving the road network and providing better public trans-port and environmental enhancements.

Since the introduction of Oslo’s toll ring in 1990 a succes-sion of ‘packages’ of investments has had to be agreed everyfew years. The current package, agreed in October 2006, in-cludes highway investments, capital investments on the railcommuter network and payments to help bridge the gap be-tween fares revenues and operating costs on the bus and railsystems.

Partly because the Oslo toll plazas are located so far outfrom the city centre, the toll charge has very little impact ontraffic congestion within the city, though the measuresfunded itself by the revenues may do so.

Current payment technologyThe toll plazas are set up around Oslo to accommodate threetypes of payment:

• Credit card or cash at manned toll booths• Credit card or cash at un-manned toll booths• Pre-payment ‘coupon cards’ via DSRC.

Over the years the emphasis has increasingly been placedon use of the pre-paid tags and DSRC. These come on astored charge card and it is possible to store about one year’sworth of tags on one card. Thus there may be only one fi-nancial transaction per annum for the payer. A typical tollplaza now has one manual booth, two coin baskets and threeelectronic tag booths all of which are automatic. The tags arefor a number of trips through the booth rather than beingcash cards. About 90 million cars pass through the tollbooths each year.

PricesThe current charge for passing through a toll booth in theOslo area is about c1.5 per in-bound trip. There is no chargefor outbound travel or for buses.

Annual Revenue and cost/g1 collectedThe Oslo toll ring system currently yields revenues of aboutc130 million per annum. This is produced very cheaply at acost of 10 cents per c1 collected. There are not thought to beany direct decongestion benefits or reductions in traffic as adirect result of the tolls. The Oslo scheme is therefore essen-tially for raising money for public expenditure and its valuethus depends on the cost effectiveness of this subsequentpublic expenditure.

• Enforcement• Enforcement of the Oslo system is by camera and MCR. • Effect on congestion

In keeping with a long national tradition of levying tolls tofund investment in new or better roads, the objective of theOslo road pricing system is purely to raise capital. Becausethis is its sole purpose, there has to be a continuously up-dated an agreed package of investment schemes for whichthe toll revenues are destined. As already noted, the originaltoll ring opened on more or less the same day as a new tun-nelled ‘bypass’ beneath Oslo city centre and the revenueswere immediately devoted to repaying the capital debts ofthat scheme. The new road itself had reduced traffic conges-tion but only by 2-3%.

Likely developmentsThere are currently no plans to expand or remove the Oslotoll system. A new package (package 3) of transport invest-ments has recently been agreed between the members of Ak-erhuis County Council and Oslo City Council. This contin-ues a planned division of expenditure between highway in-vestments, rail investments and public transport operationalsubsidies. There is a school of thought to the effect that theplan to use some of the revenue to widen a major radial roadcould lead to more traffic and hence more congestion in thecity centre.

A positive Net Present Value?Since the Oslo toll ring is designed purely to raise funds forinvestment in other transport schemes, its value depends onthe value of those schemes. An alternative way of looking atthe question would be to say that the value is the ‘shadowprice’ of the revenues, net of the costs of collecting them.

The location ofthe 18 tollstations roundOslo



THE UK EXPERIENCE

DURHAMThe first UK road pricing scheme was introduced in Durhamin 2002. Its objective was to cut the 3,000 vehicles per daywhich were using Saddler Street to access and circulatearound the Castle and Cathedral precinct above the city. Ac-cess to the area remained open but those using vehicles wererequired to make a payment of c2.8 or produce a valid ex-emption permit at the bottom of the hill on leaving the area.The scheme immediately achieved an 85% reduction in ve-hicular traffic and a 10% increase in pedestrian activity dur-ing its operating hours of 10am to 4pm. There was a 48% re-duction in the number of delivery vehicles entering the streetand the scheme was supported by 70% of people inter-viewed.

LONDONBackgroundThe London congestion charging (CC) scheme was intro-duced on 17 February 2003 in the central area of London. Itcomprised a flat charge for travel on any weekday into orwithin 22 square km of central London. Payment may be inadvance or after the trip, and fines are levied if payment hasnot been received by midnight on the day of travel. Payers’number plates are cross-checked against lists of those of vehi-cles observed entering or driving within the CC area.

ObjectivesCongestion charging in London was introduced with multi-ple objectives including:

• To reduce traffic congestion• To make radical improvements to the bus services

• To improve journey time reliability for car users• To make the distribution of goods and services more effi-

cient

Other objectives implicit in the design of the scheme in-clude the encouragement of energy efficient cars, cycles andmotorbikes, and the improvement of the environment andof conditions for pedestrians.

Current payment technologyPayment may be made before or after the journey and by avariety of means, eg by purchasing a day permit at a shop orvia the internet, but payment is not possible at ‘entry’ points.Fines for late payment begin at midnight on the day of traveland become increasingly severe if payment is delayed.

PricesThe original flat daily charge of c7.4 was raised to c11.9 inJuly 2005. There have always been 90% discounts for resi-dents, concessions for clean vehicles, etc. and no charge forbuses, taxis or motorcycles. The charge increase of 60% is es-timated to have led to a reduction in traffic of only about 6%.This relatively small change casts some doubt on the Londonclaim that revenue raising is not a fundamental purpose ofthe scheme.

Annual revenue and cost/g1 collectedUnambiguous data on costs and revenues is somewhat diffi-cult to obtain. The 2006 Impacts Overview Report identifies anet annual revenue 2005/6 of c174m and other sources(IBM) suggest a gross revenue of c270m. These figures suggesta cost of collecting c1 at 35 cents. TfL’s own figure in 2004/5was 48 cents per c1 collected. (The higher charge will havereduced this figure.)

EnforcementThe London enforcement arrangements involve cross-check-ing the lists of payers against the lists of observed numberplates from the cameras and ANPR. Both these lists inevitablycontain inaccuracies. Heavy fines are levied on offendersand new mobile enforcement units were established in 2005to catch persistent offenders. These measures have led to asteady decline in the number of penalty notices issued.

Effects on congestionThe introduction of congestion charging immediately re-duced traffic volumes entering the charge area by 18% (carsby 35%). This figure has remained quite stable since 2003,the year the scheme was introduced. Congestion delays re-duced by 30% within the charging zone, typically by about1.8 minutes per km. Bus speeds within the charged area im-proved markedly and passenger waiting times reduced, indi-cating better reliability but also reflecting the enhanced fre-quencies resulting from the addition of 200 buses on servicespassing through the charge area.

No serious adverse effects on traffic were recorded outsidethe charged area or on the roads surrounding it. Some of theroad capacity released by the congestion charge is now beingused to provide easier road crossings for pedestrians.

Likely developmentsProposals to roughly double the CC area by extending inwestwards into Kensington have now been implemented.The very large discounts given to residents are forecast tomean that though this will cut congestion in the newlycharged area, it will increase it in the existing area. The pro-posal is therefore controversial and includes a charge freenorth-south through route between the two areas.

Oslo toll plaza

Durham exitcharge point


Loss of tradeThe London scheme has suffered persistent rumours that thehigh charge has caused a loss of trade within the chargedarea. This quickly became a political issue and professor MikeBell of Imperial college was commissioned to investigate. Heconcluded that it was relatively minor.

A positive Net Present Value?In its Impacts Monitoring Report of April 2004, TfL estimatedthe annual costs of Congestion Charging at c186m and thebenefits at c257m and therefore concluded the scheme had anet annual benefit of ca c71m and hence a healthy NPV. Arevised analysis in the June 2006 monitoring report gives anannual net benefit of c128m from the c7 charge (ie before itwas raised) and hence a continuing positive NPV.

THE STOCKHOLM EXPERIENCE

BackgroundStockholm’s road pricing scheme was introduced on a trialbasis in August 2005 with extended bus services (200 extrabuses) and additional P&R sites/services. The congestioncharging started later on 3 January 2006 and was ended on31 July.

The Stockholm scheme charged vehicles 1 – 2c at 18 two-way, toll points, located on roads crossing the inner cityboundary and enclosing an area of about 48 square km (in-cluding water and undeveloped land). The maximum accu-mulated daily charge is limited to 6c per day.

After the Stockholm experiment was concluded, a referen-dum was held with somewhat confusing results. Citizens ofStockholm City voted 52%:46% in favour of keeping thescheme (2% of papers were spoiled). Those living outside thecity, in the 14 (of 24) municipalities that decided to hold areferendum, voted roughly 60:40 against. It has subsequentlybeen decided to reintroduce the scheme and negotiations arein hand to decide on the date and the capital investments tobe funded with the revenues.

ObjectivesThe objectives of the Stockholm scheme were:

• To reduce traffic volumes• To improve the flow of traffic on streets and roads• To reduce emissions of pollutants harmful to human

health• To improve public transport • To improve the urban environment

In order to improve the public transport services some 200additional buses were introduced operating 16 new bus ser-vices. In addition 2800 new P&R spaces were provided, bring-ing the total to 13800. These measures were implementedwell before the charges started.

Current payment technologyBecause the charge varies according to the time of day and acap is set on the total daily charge, the payment due cannotbe calculated until the end of the day. This post event pay-ment also ensures compliance with Sweden’s tax laws (sincethe payment is treated as a tax and not a charge). Paymentscan be made by direct debit via an electronic on board unit(OBU), by bank giro or at 7/11 shops and there is flexibility asto when they are made.

PricesPrices range from c1-2 per cordon crossing in each directionbetween the hours of 0630-1830. The price varies by time of

day and direction. There are concessions to iron out localanomalies for those whose only route to the rest of the re-gion is through the charged area. No charges are made forvisitors from other states/countries. The totals for each vehi-cle are totalled at the end of the day.

Annual revenue and cost/g1 collectedThe annual revenue that would have been collected by thescheme is estimated at c85m. The cost of collecting 1 eurohas been calculated at 21 cents.

EnforcementEnforcement of the Stockholm scheme was designed to be bymeans of camera and ANPR. This has proved so accurate thatit is now also the most significant means of collecting therevenue and has probably rendered the OBUs almost redun-dant. There have also been very few challenges to the pay-ments required. In May 2006 less than one tenth of one per-cent of the payments were queried and only 5% of these wereappealed.

The efficiency of these arrangements may be partly ex-plained by the decision not to charge those visiting the Cityfrom outside the Region, including cars arriving at the cen-tral ferry terminals.

Effects on congestionThe Stockholm Congestion Charge scheme cut traffic acrossthe boundary by about 22% and by somewhat less within theboundary. Traffic on the ring road outside the boundary in-creased by up to 10%.

Congestion within the boundary reduced and the environ-ment was improved. Outside the charged area the position isless clear. Plots comparing journey times in April 2005 withthose well after the scheme was implemented in April 2006indicate increases of 0-15%. This has the appearance of aclear negative impact, compatible with the observed in-creases in traffic. However, other changes were taking placeat the time and the Expert Group, established to monitor theeffects of the Stockholm scheme, concluded that ‘there is agreat deal here that is not the result of the Stockholm trial’.

The Expert Group also noted a reduction of 5-10% in thenumber of injury accidents within the charged area. But thetrial was probably too short to be certain of the long termscale of this effect.

A positive Net Present Value?Economic evaluation of the Stockholm scheme suggests that,judged on its own, the six month trial scheme, involving

LondonCongestionCharging

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heavy capital investment, was a waste of money and had anegative NPV. This was obviously to be expected.

Estimates of the value of keeping the scheme runningshowed a positive annual net benefit of c76m and hence apositive NPV.

The lost value, caused by the pause for the referendum, hasto be judged against the value of the change in public opin-ion and the resulting stream of net benefits which it enabled.

LESSONS FROM THE EXPERIENCE TODATE

The necessary conditionsAlthough some pricing/traffic limitation schemes have beenrushed into place, for example the odd/even number platescheme in Athens and the permit schemes in Milan andRome, there are certain conditions essential to the success ofa road pricing scheme:

• Severe, persistent and widespread congestion• Accurate, computer-based, vehicle ownership and regis-

tration marks records• Other policies (parking control, traffic management, etc)

already in place• Reasonable public transport alternatives available or fea-

sible.

Getting the objectives clearRoad pricing is essentially a transport policy and, like anyother transport policy, should therefore be designed andjudged in terms of its overall performance against the generaltransport policy objectives. A good, comprehensive and dis-crete set of transport objectives is:

• Increase personal accessibility (time and cost) to jobs,shops, schools, etc.

• Improve efficiency of freight movement• Support the economy• Reduce accidents• Improve the environment• Support planning objectives/developments• Be ‘progressive’ (help the poor/mobility impaired where

the choice arises)• Achieve all this at minimum cost to public sector.

These imply a cost/benefit approach to the evaluation of

road user charging schemes, with a focus on public sector ex-penditure/revenues

In practice the promoters of road pricing schemes like toclaim a mix of objectives and the Singapore scheme is the no-table exception where the objective has been graduallyhoned down to the control and reduction of traffic conges-tion. This is the sole objective of ERP. No concessions are of-fered, buses pay three times the charge for cars (since they oc-cupy three times the road capacity) and revenues go straightinto the government’s coffers. Achieved speeds are regularlyreviewed and ERP charges are adjusted accordingly.

Both London and Stockholm claim that their objectivesare primarily the direct reduction of traffic congestion in thecity centres: but both also claim subsidiary objectives of im-proving the public transport alternatives to the car. Partly tofurther this objective both schemes devote a significant partof the road pricing revenues to improving public transportservices (extra buses in London and extra buses and P&R inStockholm). This is claimed to be in order to have sufficientcapacity to carry those no longer using cars, obviously a con-cern in the early days of a new road pricing regime. No calcu-lations have been seen in either city of the extent to whichthese extra buses are actually required by the mode switchersand the extent to which they are really just public transportimprovements, which themselves contribute to the modeswitching.

Both London and Stockholm also claim environmentalimprovements as an objective.

The fund raising objectiveAll road pricing schemes inevitably raise funds, which maythemselves create opportunities for further investment. Onlyin Singapore are such funds transferred, like fuel taxes in theUK, directly into government coffers. The opposite is true inNorway, where fundraising is the sole purpose of the roadtolling around Oslo and where the funds are earmarked forhighway, public transport and environmental improve-ments.

Making road pricing acceptable, selling the idea and se-curing the political willIf road user charging is the successful policy it has beenpainted, there should be little difficulty in getting it accepted.That this may well be true is demonstrated by Singapore’ssingle-mindedness in setting the objective of deploying roadpricing to control traffic congestion and sticking to this aimwithout being diverted onto matters such as improving pub-lic transport or reducing vehicle emissions. However, it mustbe remembered that Singapore’s car users are wealthy andprivileged.

On the other hand Norway, with a tradition of imposingand collecting tolls in order to build by-passes or otherwiseadvance highway improvements, has also made the jump toroad pricing quite effortlessly and without the need for trials,referendums, etc. But to achieve this Oslo had to commit it-self to splitting its road pricing revenues roughly equally be-tween:

• New road tunnels• Improvements to public transport• Environmental improvements

London and Stockholm fall between these extremes: bothhave offered sweeteners including:

• Substantial discounts to residents of the affected areas• No charges to particular vehicles such as buses, taxis,

‘clean’ cars, etc.• Charge-free travel through the area to ‘captive’ car users

Stockholm Roads

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• More buses• P&R• Improvements to rail services

The contrast between London and Stockholm is that theformer got road pricing as a result of having a mayor, whorecognised congestion as a problem, realised that most othershort term solutions had been tried and needed somethingnew and radical. The Stockholm alternative of not commit-ting fully to the road pricing scheme until after it was inplace and then giving the public the opportunity to vote itout appears to be a masterful way of reducing the politicalrisks and allowing democracy to solve the problem. Publicopinion, which was initially opposed to the scheme, (just)swung behind it after its trial. This contrasts with the experi-ence of Edinburgh, where the alternative of holding referen-dums on a succession of alternative schemes, before any wasintroduced, led to a rising tide of opposition and to the aban-donment of the scheme without a trial.

Having the powers availableThose who promote road pricing schemes can be sure of onething – that any legal loopholes will be systematically ex-ploited and used to discredit the whole scheme. Having thenecessary legal powers available and being able to deploy andenforce them effectively are thus critical to successful imple-mentation. The arguments in both Stockholm and London,as to whether road pricing is a payment for a service or a tax,are amongst the few loopholes which have so far appeared.

Charge levels and the form of chargeLondon’s initial charge levels were applauded for havingachieved about the maximum possible benefits, but its highcharge of c12 for one crossing of the boundary (or for asmany as are needed in one day) contrasts with the muchcheaper and more subtle charges in the other cities (eg c1-2per crossing and a daily cap of c6 in Stockholm). In additionthe fact that the much lower Stockholm charge has appar-ently achieved a greater reduction in traffic suggests scope formore subtlety in the levels and types of charge and themeans of revenue collection and enforcement. The Londonsystem looks to be an increasingly blunt instrument and it isknown that new approaches and technologies are now underdevelopment.

The costs of revenue collection and enforcementDespite its much higher charges, one euro collected in Lon-don costs 35-48 cents to collect. The equivalent prices are 22cents in Stockholm, 21 cents in Singapore, 10 cents in Osloand 5 cents in Bergen. London’s high costs are hardly sur-prising given the requirement to daily cross-check two largeand inevitably imperfect data sets containing the numberplates of those who have visited the area and those who havepaid. The costs of pursuing non-payers and of catching pay-ment dodgers are also significant.

Stockholm’s cheaper revenue collection costs may be ex-plained partly by its simpler system of posting the charges in-curred directly onto the accounts of those whose numberplates have been identified by the automatic number platerecognition (ANPR) cameras. Legal disputes as to whether theStockholm system is a charge for a service or a tax have beenresolved in the favour of the latter, so it now seems possiblethat when its scheme reopens, Stockholm will not need thetag and beacon system.

New and alternative technologies?The technology of vehicle tracking and charging is currentlydeveloping rapidly and TfL has in hand an impressive pro-

gramme aimed at improving its revenue collection and en-forcement systems, reducing their costs and increasing theirflexibility. Recently published results from this work chal-lenge the view that satellite tracking systems will soon makeit possible to charge all vehicles according to the location,time of day and distances which they travel on the chargedroad network. The work by TfL indicates that notwithstand-ing the fact that the approach is already being used for insur-ance purposes by the Norwich Union, and for goods vehiclesusing the German autobahn network, satellite (GPS) trackingis insufficiently accurate as a basis for urban congestioncharging and will remain insufficiently accurate even whenthe new Galileo satellites come into service. TfL’s research isthus concentrating on tag and beacon systems which cancertainly identify the vehicle and make a charge against itsaccount but could also, as in Singapore, directly debit themoney from a charge card, like an Oyster Card, in the wind-screen.

Given the advances in technology being researched in Eu-rope and already in use in Singapore, it is clear that urbanroad pricing schemes no longer need to be constructed as‘watertight’ cordons or areas within which fixed chargesapply. A much more loosely structured system of tollingpoints, focussed on particular congestion problems and withcharging rates that vary according to their severity, is nowpossible and might be far more effective and acceptable.Once again Europe may need to look to Singapore and its res-olute focus on the purpose of congestion charging being toreduce congestion.

On the other hand if satellite tracking technology can bemade sufficiently accurate in urban areas and if the BigBrother fears can be allayed, it may come into its own if andwhen charging is extended across whole metropolitan areas.

GantrificationOne advantage of satellite technology, were it feasible, wouldbe the elimination of the requirement for massive overheadgantries of the types seen in Singapore and Stockholm or theeven more intrusive toll gates of Oslo. Such structures wouldundoubtedly be most unwelcome in central London andlikely to generate serious opposition to any scheme exten-sions. London has therefore been researching the gantrywhich looks like a streetlight and seems to be on the way toachieving an acceptable compromise.

One advantage ofsatellitetechnology wouldbe theelimination of therequirement formassive overheadgantries.

road pricing lessons – the experience to date

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