Wednesday, 1 December 2010

Australian Federal Government advocating road pricing

The Australian newspaper has reported that the Australian Federal Infrastructure and Transport Minister, Anthony Albanese, has launched a discussion paper called Our Cities.  The report claims that without forms of road pricing, such as congestion charges, the congestion reduction benefits of major highway projects will not be sustained.  It makes the long recognised observation that congestion cannot be relieved simply by building new road capacity.

The discussion paper is available here, and seeks feedback by 1 March 2011 on the report.   A brief look at this paper shows that it seeks a National Urban Policy and covers a wide range of infrastructure issues that I will not go into (this is Road Pricing blog after all).  

Key references to road pricing include this statement (p.22):

The option of more effective pricing gives clearer and more consistent signals to commuters and carriers of freight about the real cost of road use or other mode such as air or rail. Road congestion charging has already been introduced in cities like London, Singapore and Stockholm. The experiences and lessons from these international examples are worthy of further consideration. There are also ongoing debates about whether road pricing is warranted, or even cost effective, in Australia’s biggest cities. However, the widespread adoption of affordable Global Positioning System technologies may provide more options in future. The social implications of such approaches will also need careful consideration.

In other words, pricing can take transport closer to user pays and Australia should look at the benefits that have come from the three major international implementations of congestion charging.  The mention of GPS shows interest in moving beyond the limitations of the technologies used in those cities.

Part of the motive is maintaining mobility, but also ensuring environmental impacts are managed as is said here (p.24):

Without the use of complementary demand-side measures, such as road pricing and congestion charging, some proposals for additional road capacity are unlikely to lead to sustained reductions in congestion and may further impact the environment and reduce urban amenity.

On page 25 it mentions that Australia already has electronic toll collection (now with fully electronic free flow toll roads in Melbourne and Sydney) and is developing "cordon zones with congestion pricing", which is perhaps an exaggeration, although it is certainly being investigated.

Page 58 has the consultation questions, although submissions need not be limited to those.  Question 8 is:

What is the role for pricing reform (such as water, roads or carbon pricing) in meeting the challenges of Australian cities?

Clearly the potential is enormous to help manage congestion, and improve the allocation of resources for roads and in the demand for other modes.

The key point is that road pricing is now in the mainstream policy agenda for transport in Australia, at the Federal level.  There is much in this discussion paper, outside the scope of this blog, which I might criticise and much to agree with.   However, it will be interesting to see the response this paper gets from submitters, and if pricing reform is not simply dismissed and put into the too hard basket.  Given the current Australian Federal Government is now a coalition between Labor and a number of independent MPs (after Labor lost its overall majority), it is somewhat bold to be advancing an agenda often perceived as being politically risky.

Australia has seen extensive highway networks built in the past 20 years using private finance and tolling, including many new urban corridors in Sydney, Melbourne and Brisbane in particular.  This has exposed large numbers of Australian motorists to tolls, including most recently peak time congestion based tolls on Sydney Harbour Crossings.   Road pricing in the form of tolls has helped build these roads, and indirectly helped manage the demand generated from these roads reducing transport costs.  The bigger question is whether pricing existing roads to manage congestion can be implemented in Australia.

The main disappointment I have from the discussion paper, from a road pricing perspective, is how it did not raise the option of replacing some existing road charges (e.g. fuel tax and annual registration fees) with road pricing as a way forward.  The National Transport Commission (which advises on these issues) already has alluded to this.

However, it may simply be premature to make that jump, and for now the interest will be whether road pricing moves more clearly onto the agenda for urban transport policy in Australia.

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