Friday, 3 December 2010

Commentary - Urban congestion charging needs governance reform

One of the biggest problems facing any policy makers seeking to introduce any form of congestion pricing in a city is not a matter of technology, or designing an appropriate geographically based charge, or even the political difficulties in gaining support, but rather something more mundane, but arguably more important - governance.

No city that has introduced a substantive form of congestion charging has done so without addressing this issue, and it comes down to having one entity responsible for all of the charged roads.   London has 33 local authorities, which almost certainly could not have come together to set up the congestion charge unless there had been an overarching authority responsible for arterial roads (Transport for London).  Singapore similarly has one agency responsible for its charged roads.  Stockholm's congestion charge is the responsibility of two agencies.  Cities with many local authorities face limitations as to what can be done with road charging.   This was alluded to this week in Australia where it was reported in the Brisbane Times that Brisbane has an advantage in having a single local authority, compared to cities such as Sydney which have 43.

The solutions to this depend very much on what the policy objectives are.

Governance reform that merges local authorities or at least merges control of arterial roads is one option, as has been seen in London.   This is what is likely to be necessary if the intention is to introduce area or cordon charging.   The key reason being to have only one entity responsible for procurement, but also one entity responsible for all of the work related to congestion charging around signage, redesigning intersections, rephasing traffic signals and the like.   These are all activities often ignored in the discussion of congestion charging.   It is very important that one entity is responsible for ensuring good standards of service are offered to motorists with the congestion charge, but also ensuring smooth traffic flows (and good use is made of revenues).

Many investigations into congestion pricing consider the important financials and economics, with assessment of costs, revenues, demand impacts, impacts on congestion and emissions.  However, far fewer consider whether the existing governance of roads in the city concerned is appropriate.

The unspoken truth is that most cities run roads like bureaucratic centrally planned services, with very much an engineering focused approach.   These transport departments or streets units or whatever are not focused on delivering front office customer service to motorists.  The closest they get to this is parking fines, which are typically treated as offences.   Roads are not delivered as utilities to paying customers, and this is the problem.   Road pricing means motorists are customers, they have queries, they will hold accounts, they will change account details, have disputes and need to be told when prices, terms, conditions and offers change.   That level of communication, handling of money, need for service and need to be responsive is not built into government monopolies typically.

The model I advocate for getting motorists on side with congestion charging is to develop a more retail, more service oriented approach with a dedicated organisation that is about delivering roads as a service to those paying for them.  That means delivering what users want, not what engineers think they should have nor what politicians think.  However, that is another story.

Those interested in progressing road pricing should never assume that existing agencies or organisations are well placed to manage a road pricing programme or be sufficiently dynamic to unlock the full range of benefits available.   It is a critical area of work that is often neglected as most of those interested in road pricing have engineering or economics backgrounds, not backgrounds in public and private sector governance and institutional reform.

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