Thursday, 23 December 2010

No Dartford Crossing hypothecation, so what should be done?

A curious article has appeared on the BBC News website reporting that UK Transport Minister, Mike Penning, has contradicted an earlier statement that all money from planned increases in the Dartford Crossing tolls would be hypothecated for expansion of the crossing.   This has upset users of the route who feel ripped off by tolls on a route that has been fully paid for (and which generates a substantial surplus after operating costs and costs to maintain the crossing).   What the Minister actually is meaning is that far more than the money from hypothecation will be spent on the road, although I would argue that over time that probably is not true, as the money from tolls should be able to sustainably finance yet another crossing.

Southern side of Dartford Crossings (courtesy Evening Standard)

The Dartford Crossing is the only tolled portion of London's motorway ring road, which is (except for the crossing) known as the M25 (Dartford Crossing is not a motorway because the tunnels have restrictions on certain dangerous goods).  Dartford Crossing consists of two 2-lane tunnels and a 4-lane bridge, providing 4 lanes in each direction.  The first tunnel opened in 1963 with tolls, followed by the second tunnel in 1980 and the bridge in 1991, as traffic grew rapidly.   It is the most easterly road crossing of the Thames and some distance from the nearest road crossing, the severely congested Blackwall Tunnels.  As a result, it carries very high volumes of traffic, with around 150,000 vehicles a day.

The tolls have over time fully paid the capital (including debt) costs for the two tunnels and bridge, so that by 2002 all were deemed to have been fully paid.  As a result, many locals have campaigned for an end to the tolls, which are primarily manually collected (although there is an electronic tag system that operates some barrier lanes).

The problem is that withdrawal of the toll is likely to result in increased demand, so the toll was legally changed from being a toll to what is effectively a congestion charge.  Around £40 million (US$61.7 million) a year is generated in surplus from the tolls.

So a toll is operated, in both directions, on one of the UK's most heavily congested stretches of highway.  The toll annoys the motorists because they know the tolls are far more than what is needed to maintain the route, the toll delays traffic and overall they feel they are paying more to use a road that offers shockingly poor standards of service.   Of course, they are right.

The new Conservative/Liberal Democrat coalition government has made its highest priority to eliminate the UK's budget deficit by the next election, so is hardly going to give up a lucrative source of revenue.  However, its approach does appear to have the elements of a solution that could satisfy motorists if done in the right order.

The government announced earlier this year that:
- Tolls would go up 33% in 2011 and another 25% on top of that in 2012 (£1.50 today for cars rising to £2.50);
- Manual tolls would be replaced by fully electronic free flow tolling;
- Another crossing would be built.

However, as can be expected the only one of those announcements that seems obvious is the increase.  The increase in itself will reduce delays by reducing demand, but it will be seen as not delivering improved service as long as nothing is done about replacing manual tolls and expanding capacity.   

One way of delivering value would be to introduce electronic free flow tolls as a transition, with half of the existing toll booths converted to fully free flow lanes.  Existing DartTag users (which have a non-EU standard DSRC system) should be transitioned to free flow accounts using the EU 5.8 GHz standard, with Automatic Number Plate Recognition (ANPR) for enforcement.   DartTag users already have a 33% discount over cash.   A discount should be maintained with electronic free flow, as it not only incentivises a shift to freeflow accounts, but increases acceptability if there remains an option to pay less.  

It shouldn't be difficult to introduce partial free flow lanes and demonstrate how easy it is to avoid the queues at the toll booths.   Enforcement procedures would need to be developed and applied so that penalties are strictly applied to those using such lanes without paying, but revenue from fines should make this easily self-funding.

Lessons from Dublin's M50 toll transition to free flow should be applied for the final shift to fully electronic free flow tolls, particularly provision of information, call centre capacity and means to pay in advance (and after the event).  Bearing in mind that removing the toll booth queues is critical to delivering value to users of the route in the next few years.

Beyond that is the question of what to do with the revenue, and although it wont be officially hypothecated, there is no reason why it can't be unofficially hypothecated for both maintenance and expansion of the route. 
Three options for increased capacity are already under investigation.  A parallel crossing, a new local crossing that will link the A2 highway to the docks at Tilbury (relieving the existing route of much local traffic and port traffic), or a third bypass far to the east.  Details are here.  Whatever is selected (my bet is that a new local connection or a major bypass to the east would deliver considerable traffic benefits, but I'll let objective appraisal determine that) should proceed, and motorists on the existing crossing should be told clearly that tolls are not simply to be treated as profit.

The three options for new capacity at Dartford

Tolling gets a bad reputation when those who impose it don't treat those who pay as customers, entitled to a high standard of service.  It already generates a cynical reputation in the UK as a way for government to rip off consumers.   If done properly, the Dartford toll can be reformed to remove one of the key sources of congestion and to be used to deliver long term value by enabling the financing of extra capacity.

If what motorists (and voters) see first are increased tolls, no progress on new capacity and no implementation of free flow tolling  (which most commentators don't seem to understand even exists), then British politicians wont be surprised that they aren't trusted on this issue.

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