Monday, 6 January 2014

London seeking to increase congestion charge prices

According to the Transport for London consultation website, it is proposed to increase the price of the London Congestion Charge, along with a wide range of other measures to incrementally reform the scheme.

The proposal would see a 15% increase in the standard charge from £10 (US$16.38) to £11.50 (US$18.84), with a similar nominal increase for registered automatic payment users (£9 (US$14.74) going to £10.50 (US$17.20)), as with fleet users (typically used for goods vehicles).  

Other charges to raise include the "pay next day charge" (the price for those who fail to pay on the day they travel, but pay on the next day) going from £12 (US$19.66) to £14 (US$22.93).

Those subject to the registered residents' discount see an increase in the daily charge from £0.90  (US$1.47- to £1.05 (US$1.72) per day.  Residents are those living within or immediately adjacent to the charging zone. 

The proposed increase would come into effect in June 2014 and is now subject to public consultation.

The intention is that is match inflation.  The basic charge was increased to £10 for the start of 2011, so is a 15% increase fair for mid 2014?  Given that inflation since 2011 has been closer to 3%  per annum, this would appear to be above inflation.

So what will London motorists who pay the charge (who are a small proportion of all London motorists) get for this?

It simply isn't clear.  It is fair to presume that the extra money raised will likely be spent on a number of initiatives around cycling safety on existing roads, and some intersection improvement works, although there has been no announcement of the expected revenue increase.  After all, part of the expectation is that the increased charge will result in a slight reduction in expected traffic levels.

It would be helpful if there was a bit more transparency around this.  Certainly the current Mayor Boris Johnson has presented himself, in contrast to previous Mayor Ken Livingstone, as not being "at war" with motorists and supporting measures to improve traffic flow.  However, very little is publicly announced about measures to achieve this.  Certainly there is no lack of potential projects to improve traffic flow on London roads.

I strongly suspect this increase will go through will little concern, largely because few Londoners pay it from day to day.  Only slightly more than half of London households have access to a car as it is, and cars come well behind trains, the underground and buses as a means of commuting into the charged zone.  However, it would be a good move if there was some indication that without such an increase, some improvements to highways might not proceed.   It is reasonable for those expected to pay to ask that question.  After all, fare increases tend to be touted in terms of paying for improvements (even though in many cases the fares don't may not recover the operating costs of the public transport services themselves), so should increases in the congestion charge.

Other measures

Other proposals are also set out in the consultation, most of which should not be controversial.




- Introducing direct debit as an option for Congestion Charge Autopay: This is a no-brainer, as at present the only means to pay is by credit or debit card.  This simply provides another, slightly cheaper option, for users.

- Introducing online applications for discounts and discount renewals:  At present, those applying for discounts  (e.g. for residents' vehicles or ultra low emission vehicles), must do so by post.  It seems logical to allow such applications to be made online, using scanned documents.  The one exception that will remain is the "Blue Badge" (disabled user's vehicle) discount, which will remain a postal application, in part because it has long been subject to a measure of fraud.  This scheme, which grants extensive parking privileges for the disabled, has long been difficult for government to reform.

- Reforming the NHS reimbursement scheme:  Staff and patients paying the congestion charge as part of an appointment can apply for reimbursement of the charge.  This is supposed to recognise that such trips are not undertaken on a discretionary basis, so the system does not gain benefit from people accessing or working for the public health system.  The reform will be to extend this to Autopay customers, who previously have not had a means to allow for such a reimbursement.  

- Allowing prepay customers to change their date of travel: At present, motorists may prepay the congestion charge up to a year in advance of travel, but must specify the date of travel.  If plans change, this cannot be refunded.  The proposal is to allow changes in advance of the date of travel, for an administrative fee.  This wont be available after the prepaid date.

- Other minor changes:  These are all minor detail changes that are expected to address administrative issues of concern to a small proportion of users.

Conclusion

Whilst the anti-motoring lobby might be expected to oppose any measures that enhance the user-friendly nature of the scheme, almost none of the changes is likely to get any publicity, except the increase.

It would seem odd for the Labour Party, Liberal Democrats or the Greens to oppose the increase, since they have all been in favour of making the scheme tougher, so it is likely that opposition will be fairly muted.  The one group that tends to lose out the most is the freight sector, as lorries and delivery vehicles all pay, but few would argue that they have benefited much from any of the spending from the revenue raised.

London's congestion charge remains a very blunt tool, and its effectiveness is limited largely to the central zone and roads approaching it in the peak.  It is notable that Saturday congestion is far more significant than peak congestion, which reflects the absence of the charge, but also the tendency for leisure trips to be by car when parts of the underground and rail system get regularly closed for maintenance.

However, it would be good practice if the proposed increase included information about expected net revenues, and what the additional revenues will be used for.

Londoners have until 14 March 2014 to comment on the proposals.

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