Thursday, 19 July 2012

Budapest congestion charge suspended by Hungarian Parliament

Budapest's plans for congestion pricing look set to be delayed, as the Hungarian National Assembly voted against changing the law for it to be implemented, according to the Budapest Times.

14 members of the Hungarian National Assembly voted in favour of the law change, but 305 opposed it. Of those voting for it, most were from the LMP, a leftwing environmentalist party.  It is likely this move was driven by populism, as congestion charging was unlikely to be widely supported in advance of its introduction.
The implications are potentially serious, as congestion charges were a precondition of EU funding already provided for the new metro line (M4) currently under construction.  Given that the Government had previously supported abolishing all central government subsidies for public transport in the city, it leaves the Mayor of Budapest, István Tarlós, in a difficult position.   He faces having to drastically increase public transport fares to maintain services, which will no doubt exacerbate traffic congestion as some users will switch to driving.  Other options include increasing parking charges, or drastically cutting services.   You see congestion charges for Budapest were, in effect, replacing central government funding to subsidise public transport. 

He is unlikely to directly face the wrath of the European Commission, as central government will have to deal with that, but it is likely to be highly embarrassing, and Hungary may face a cut in any future funding if it doesn't match its promises with actions.

I've previously commented on how I thought Budapest faced an uphill struggle to implement congestion pricing in such a short time frame.  Yet I believe it should be implemented, albeit on a more considered timetable, with time taken to develop it in an integrated way, that prices rationally and deals with changes in traffic patterns appropriately.

This now all looks like a potential mess.   An earlier report indicated that tolls on the Danube river crossing bridges might be implemented instead.   This would be simple, although obviously create concerns about being unfair on those from Buda entering Pest.   Yet it is unclear whether this is allowed under current laws.

What is certain is that the issue wont be going away because:
-  The politics of raising public transport fares and cutting services rival those of introducing congestion pricing;
-    Budapest will remain congested, regardless of what is done with public transport funding;
-    The EC will not look kindly upon Hungary breaching one of its conditions for funding for its new metro line.

UPDATEHungary Around the Clock reports that Budapest Mayor István Tarlós says that the subsidy contract with the European Commission for the Metro 4 line, which included the condition that congestion charging be introduced, should now be renegotiated.  The report noted that it was the previous Socialist-Free Democrat leadership and former mayor Gábor Demszky that pledged to introduce the charge by late 2013.

Budapest Business Journal notes that the Mayor has said final decisions on funding for BKV (the Budapest Public Transport Company) will be made in September, including "alternative options". 

Another article noted that while the Metro 4 project is going well, the congestion charge needed a series of park and ride stations on the periphery, and nothing has been done about it.  It has also been noted that it will be virtually impossible to procure and install a system within the planned time.

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