Tuesday, 2 December 2014

Dartford Crossing goes electronic free flow, but tolling politics still poorly handled

On 30 November 2014, manual tolling finally ended at the Dartford Crossing - the 4 lanes each way tunnel/bridge crossing of the Thames that connects the eastern ends of the M25 ring motorway around London.  Already the southbound toll booths that lead down from the QE2 bridge have been removed as is seen here in FleetNews, with the northbound ones to be removed in coming months

Dartford Crossing toll plazas at the southern side of the tunnels/bridge
The system that has been introduced is an electronic free flow system that relies on automatic number plate recognition, and requires all motorists using the crossing to either:

- Set up a pre-pay account that deducts the toll every time the vehicle crosses a tolling point;
- Make one-off payment via phone, online, retail outlet or by post no later than midnight the day after the crossing is made.

Of course, while the tolling has been automated, the booths have yet to be removed, which caused some chaos on the first day as many motorists stopped to try to pay for a toll at empty booths with barriers raised.  The problem being that, on weekends, most users are not regular enough to be aware in advance of the change.  I suspect also that there will be a deluge of penalty notices that might be sent out, although I suspect the operator would be wise to not send out any such notices for the first day, and subsequently focus enforcement on any repeat violators.

With full removal of the toll booths, there should be a significant improvement in the quality of service of the road, with congestion of 7-11 minutes on average being largely relieved. 

Tailbacks northbound at Dartford Crossing toll plaza should be no more


Why?

Because with congestion relieved, the toll prices are being increased by 20% (although there is a 13% discount for those with accounts) and there is no indication about what the money raised is for.  It is, in essence, being treated as a tax, or more accurately, as one of the government's most profitable ventures.

Dartford Crossing toll prices with discount for account holders

Although it is legally a congestion charge, the toll does not vary at peak times, or by direction (even though there is a reasonable case for doing this), although it does not operate for 8 hours a day (overnight) to encourage heavy commercial traffic in particular to use the M25 at night.

Revenue from the tolls comes to £74 million per annum of which £36 million is spent on maintaining the tunnels, bridge and the approach roads.  Notwithstanding that the vehicles using the roads also generate general taxation revenue from fuel duty, it is difficult to argue against the half of the revenue actually spent on the road, yet there is absolutely no publicity about this.

However, what about the other revenue?  Not only do those using the road pay fuel duty and have no general revenue dedicated to the road, but they also generate essentially a 100% profit yield over and above the cost of operating and maintaining the crossing.   Understandably, many who pay are grumpy at this, and UKIP has been campaigning to get rid of the toll (which is unlikely to be successful, but highlights the public policy failure from Treasury and the Department for Transport in how the toll is treated).

Parallel to all of this is the proposed Lower Thames Crossing, which essentially is for an additional crossing either parallel to or to the east of the existing ones.  Consultation over this crossing indicates it would be tolled, but why is this not being more widely publicised now?

Proposed Lower Thames Crossing. Option B has been ruled out so far.
Now it is unlikely that the DfT could convince Treasury to put the surplus revenues from the Dartford Crossing into a dedicated pot to capital fund the new crossing, but it may be appropriate, for accounting purposes, to assess exactly what that would be, and to sell the existing toll as a contribution towards pre-funding the new crossing.

In other words, the toll surplus could be used towards offsetting the debt of the new crossing, which would at least be consistent with the one purpose of a toll that is widely (if grudgingly) accepted - using it to pay for the road being used.

Then, it might just gain some acceptance, particularly given the decision to increase the tolls in parallel with the removal of manual tolling.  Politicians could argue that the toll exists in part to maintain the crossing, and in part to help fund a new one.  Simply saying it is a congestion charge doesn't wash when no other major highway in the country has such a charge (and there are many segments of motorway that get regularly congested).

Does it make sense from an economic point-of-view to "pre-fund" the Lower Thames Crossing?  Not exactly, as it is more equitable to recover the costs of new capacity from the future users by borrowing to pay for it and recovering from the tolls.   However, if the policy environment was one of optimising economic gain, then there wouldn't be fuel duty and decisions on what road projects to fund wouldn't be made for political reasons.

Of course, it is worth nothing that the current toll is legally a "congestion charge", but unlike the central London congestion charge none of the net revenue is used on transport projects (whereas the London one is legally required to spent net revenues on transport).  There could be scope to tie net revenues from the crossing into upgrades of M25 junctions recently announced by the government, given that it is functionally if not nominally or legally, the same road.

Meanwhile, I hope there isn't a news story in a few weeks about a little old lady who gets a huge fine for not paying the toll, whilst also reporting about the proportion of foreign lorries that aren't fined. The compliance strategy for the crossing should already have addressed this, and will not be fully public (as it involved some discretion as to who to pursue).

In any case, until a link is made between the toll and the crossing, motorists will resent tolling at Dartford Crossing and more widely across the UK.  Given the long term unsustainability of fuel tax as a way of charging for road use, shouldn't policy makers be taking steps to increase the palatability of tolling rather than continue with the narrow Treasury thinking that treats hypothecation of revenue from what is a direct user charge as a tax?

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