Tim Worstall

Road Pricing

On the subject of common sense, more don’t seem to have it:

The grassroots revolt against plans to introduce
pay-as-you-drive road pricing was growing last night, with more than
71,000 people signing an online Downing Street petition calling for the
scheme to be scrapped.

Thousands of opponents are adding their names daily — the number of signatories has risen from 9,000 on Dec 2. The petition (http://petitions.pm.gov.uk) is due to remain online until Feb 20.

The level of the thinking going into this can be seen here:

Mr Roberts, 46, who drives 22,000 miles a year in his
company car, would not have to pay the levy, but said it would be
unfair on those who would. "Does that mean someone would have to pay
for seeing one’s parents or going to cut grandma’s grass?

"Nobody chooses to sit in a congested road and making them pay to do so is outrageous.

1) It’s the threat of having to pay to sit in congestion which will change people’s behaviour and thus reduce congestion.

2) If you insist on going to cut granma’s grass in rush hour then you are imposing costs on all of those around you, costs which you should pay.

In

14 responses

  1. GeoffH Avatar
    GeoffH

    the opposition to road pricing is simple; we don’t trust this government.
    We don’t trust it remove petrol taxes, road funding and all other the other charges on the motorist that already raise far more than the State spends on road construction and maintenance.
    Simply, we fear that road pricing will be additional to the costs the State already imposes on us when we use our cars.
    We are opposed to paying twice. Anyone who isn’t, is a fool.

    Reply
  2. chris strange Avatar
    chris strange

    1. The only way for you to contribute to congestion is to be sitting there in being as delayed as everybody else. Therefore congestion isn’t an externality as if you are part of the cause you are yourself penalised along with and as much as everybody else. So there is no need for an extra charge to internalise it.
    2. The only way for this system to work is for it to track and record every single journey by every single car. It is a privacy nightmare and an unprecedented way of monitoring and controling citizens.
    3. We already pay large amounts to use the roads, the most useful transport network by far, and this proposal is will do nothing to improve them. It will just raise more revenue for the government to be spent elsewhere.

    Reply
  3. chris strange Avatar
    chris strange

    P.S. I think that you linked to the wrong article. The link is to one about the DVLA accidentally revoking motorcyclists licences.
    Tim adds: Oops! Ta.

    Reply
  4. Gavin Kennedy Avatar
    Gavin Kennedy

    “The only way for you to contribute to congestion is to be sitting there in being as delayed as everybody else. Therefore congestion isn’t an externality as if you are part of the cause you are yourself penalised along with and as much as everybody else. So there is no need for an extra charge to internalise it.”
    A congested road is created by the people who are present. Everybody there creates an externality by their presence (not by the importance or otherwise of their journey). Everybody has a right to be there; everybody can avoid the congestion by not being there; but anybody who exercises their right to be there and not somewhere else creates the externality of contributing to the congestion.
    For fewer to be there some device is needed to reduce the numbers present. Arbitrarily rationing access is, er, arbitrary. Exhortation is unsuccessful, and wastefully expensive. Applying a charge and collecting it is more efficient than its alternatives.
    Those who value spending the charge on something else more than they benefit from being congested will tend to avoid being present. If enough drivers avoid the road at those times, there will be no congestion. Those now present pay for their access to fluid traffic conditions; those now absent do not experience the externalities created by their former presence, but suffer the inconvenience of being elsewhere.
    Students of the Coase theorem can now write an essay showing why the same result would be obtained by those now present paying those now absent for their avoidance of creating an externality on those now present (hand into the secretary’s office by Friday 12 noon).

    Reply
  5. Mark Adams Avatar
    Mark Adams

    I’m not opposed to road pricing, just the government’s road pricing scheme.
    Putting a satellite tracker in every car has obvious ulterior motives for a surveillance-obsessed government.
    Furthermore, this is only half a market. What we need are private road companies who would respond to road signals by increasing capacity, rather than a government monopolist who would simply divert the excess profit elsewhere.

    Reply
  6. Kit Avatar
    Kit

    I agree with Mark. Road pricing good. Government involvement bad. The main problem is restricted supply. Sell the roads and cut the planning laws.

    Reply
  7. Gorse Fox Avatar
    Gorse Fox

    Gorse Fox objects because:
    a) invasion of privacy (he has NO doubt that the government will misuse the data)
    b) increased costs – as businesses will pass the costs on to the consumer
    c) increased unemployment – as people will find it unaffordable to drive to work, and have no credible alternative.
    d) it will not affect foreign drivers (until it becomes EU-wide)
    e) it is just ANOTHER tax

    Reply
  8. Jeff Avatar
    Jeff

    1) It’s the threat of having to pay to sit in congestion which will change people’s behaviour and thus reduce congestion.
    I think it not unrerasonable to assume that noone sits in congestion for the fun of it, and any sane person would avoid congested roads if there was any alternative. However, as has been shown during periods of incredibly high fuel prices, the demand for road use is relatively inelastic. People drive, and sit in congestion, because they have no viable alternative. They have to go to work, feed their families, get to the doctor, whatever… Unless and until the entire infrastructure of commerce changes to a “non-peak” model there are going to be a lot of poor sods who have no choice but to either sit in congestion as now, or pay high road charges as mooted.
    I suppose that they could give up work and live off the state. Maybe that’s the ulterior motive – totally embed the “payroll vote”.
    2) If you insist on going to cut granma’s grass in rush hour then you are imposing costs on all of those around you, costs which you should pay.
    That is indeed true. But who, apart from perhaps 0.000001% of complete lunatics would do that in the real world – and if they’re that stupid, they’ll carry on doing it regardless of the cost. Total strawman.
    Road pricing will be Labour’s Poll Tax – should it ever actually happen, which, looking at other major government IT projects, is going to be hideously expensive and even then, very unlikely.

    Reply
  9. Colin Campbell Avatar
    Colin Campbell

    I think in principal, provided the project is well thought out, road pricing is fair. I can remember when the Forth and Tay Road Bridges were first opened, there was a merry hooha about paying for a road. People didn’t object to the ferries which preceded them in the same way.
    Here in Australia, the Sydney Tunnel has just gone spectacularly bust. Not quite sure what went wrong, but the attempts to shunt congested motorists into the tunnel did not work. Seems to be mainly a function of price. $4 for a short section of road.
    Adelaide is currently doing some large infrastructure projects, which are blowing out in price as they do. The government has committed to funding these from taxation. I think that a combination of general taxation and road pricing would get the projects up and running quicker and more fairly share the cost with the real users (and people who benefit most).

    Reply
  10. Glenn Athey (angry economist) Avatar
    Glenn Athey (angry economist)

    Most of the public and business opinion points for a need to invest first and charge later. if motorists see improvements, they will be more willing to take the hit of a new pricing system. Its usually referred to as a hypothecated tax.

    Reply
  11. Matthew Avatar
    Matthew

    It’s worth noting that the costs of congestion are almost certainly underestimated, as there are millions of journeys that must be put off because of it.

    Reply
  12. Terry Avatar
    Terry

    If there is a cost to congestion – and, like you, I contend there is – then doesn’t road pricing exist already? And has it solved the problem?

    Reply
  13. D.Paul Avatar
    D.Paul

    We all would like to play our part in reducing the effect of green house gas on the planet, I assume that most considerate drivers are already contributing to the reduction of co2 by upgrading to a more efficient vehicle. It is paramount therefore for government to encourage this trend, so that in furture all older cars that are less efficient and produce high levels of co2 would be upgraded and all future purchases meet that criteria. NB not by road pricing.

    Reply
  14. David King Avatar
    David King

    They claim that if you build new roads then you would increase congestion but how do they know? Over the last 50 years the road pattern has been extended by approximately 10% whilst car usage is up at least 500%.
    We have already paid for these roads over and over again through road and fuel tax.
    Like many of your contributors I make radial journeys around the South of England and without a car would be forced to return to London from each destination costing me greatly in both time and money

    Reply

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