Examination of Witnesses (Questions 500-508)
MR HOWARD
POTTER, MR
DEREK TURNER
CBE, MR JIM
COATES CB AND
MR MARTIN
RICHARDS OBE
26 JANUARY 2005
Q500 Mrs Ellman: Who decides
which areas come under which system?
Mr Coates: You would look at the
cost of congestion on different parts of the network. That information
is available but it needs to be developed in more detail. You
would then have a series of either area schemes for the major
urban areas or corridors for the inter-urban roads to which the
electronic charging regime applied. No doubt on maps in the future
things would be a different colour so that you would know which
roads were subject to charging and which were not.
Q501 Mrs Ellman: Who would
take the decision, the Government or the regulator that you referred
to?
Mr Coates: We think that it needs
to be both central government, that is the Highways Agency for
the inter-urban network, and the local authorities for the areas.
Where they come together then there needs to be some sort of agreement
between them and we think there should be a regulator to help
that discussion take place.
Mr Turner: The Institution of
Civil Engineers believes that a national scheme is an advisable
policy to pursue. What the Institute of Logistics and Transport
is suggesting is a practical way of making a step towards achieving
that but as a consequence it would need a framework that would
be set at a national level to determine which corridors (where
the level of service would be sufficiently low) and which areas
where the congestion was sufficiently severe in the urban areas;
warrant charging when. It would be a national framework but detail
would be determined, as I said earlier, at either a local level
because it is purely an urban area issue, or regionally at the
interface between the Highways Agency and the local authority
where there is diversion potential to local roads.
Mr Richards: One way of dealing
with this question is by having performance targets, level of
service targets, which is exactly how the Singapore system works.
The charges are varied every three months in order to achieve
target average speeds on the different parts of the network.
Q502 Mrs Ellman: What
about the use of tag and beacon technology in that forum?
Mr Turner: Tag and beacon technology
is an interim technology which we looked at very closely as a
potential in London. It is a technology which is here now and
would be usable now but it does not give us the flexibility to
be able to do a national charging scheme. I would see it as either
limited to the major highway network or as part of a stepping
stone to a national charging scheme. You could imagine tag and
beacon technology on perhaps the motorway network and its parallel
routes whilst we were waiting for a GPS system to come into practice.
However, I am not as sceptical as some about the viability of
the GPS systems. It was not viable for the London scheme because
the London scheme has a very defined boundary and it is true that
GPS systems are not accurate enough to get literally down to the
nearest 100 millimetres. However, they are accurate enough to
deal with which road you are on, which is what we hear from the
Norwich Union work, which would enable you to get a distance based
charging system established as a result of the current GPS system.
We are seeing GPS operating in the Norwich Union arrangement,
quite satisfactorily, and also elsewhere in Europe, in terms of
what is now happening in Germany.
Q503 Mrs Ellman: What
should happen to the revenue raised by a charging scheme?
Mr Coates: The government's feasibility
study report, if I may say so, tries to have its cake and eat
it. It talks about all this lovely revenue that can be invested
in better public transport and more roads and it talks about cutting
taxation. The same pound can only be used once so there has to
be some combination of these things. The estimated cost of operating
the system in the government's report is very high and we hope
that that is excessive and that the cost will come down, but inevitably
the cost of running the system takes some of the revenues, so
that part of it is not available to reduce taxes. If you look
at where the congestion is worse and where therefore most of the
payments would be made, where the revenues would come from, it
is in major cities. There is a table in the government's feasibility
report, and it is B11 in Annex B, which shows the average charge
on all roads, which would be 1.9p per kilometre, but on rural
roads operated by the Highways Agency zero and on rural roads
that are the responsibility of local authorities it would be minus
one. In London it would be 14p a kilometre, in other large cities
it would be 13p and in other urban areas between two and five
pence. Because that is where the congestion is most of the payments
would be being made in big cities. We think that in order not
to disadvantage cities, in order to keep that economic purchasing
power within them, that money needs to be recycled in the urban
area, not to be siphoned off and given to people to make travel
very cheap in the countryside, which people in rural areas might
think they would like, but if they found huge increases in traffic
on their roads they might not be quite so keen on. This is a difficult
issue which we think needs to be analysed more and be subject
to public debate and discussion, because it is very important
in getting the public and the local authorities to feel there
is anything in it for them to be quite clear how much revenue
there is going to be and where it is going to be used.
Q504 Clive Efford: Mr
Turner, what happened to all those drivers that used to sit in
the congestion charge area in London?
Mr Turner: A large majority of
them transferred to the buses. There was a significant rise in
ridership on the buses. Some transferred onto the inner ring road
and there has been perhaps a 10% rise in traffic on the inner
ring road but we have reorganised the operation of traffic signals
so the journey times for diverted traffic are very much the same,
and some traffic did actually disappear.
Q505 Clive Efford: To
your knowledge has there been any study of the impact of the economics
of driving? Now that we are paying a five pound congestion charge
is it still as cheap to drive around London? Does that mean that
people have considered that public transport is the cheaper or
more viable option rather than paying the congestion charge?
Mr Turner: A retrospective study
of that is part of what I understand TfL are proposing to do as
part of the monitoring work. It certainly was part of my proposals
for the after study when I was there. Obviously, beforehand we
did that work as well in predictive mode and it demonstrated that
there was an economic benefit to the introduction of congestion
charging. My personal view of the way the changes have turned
out, rather than the predictions, is that I still think there
would be an economic benefit as a result of the total scheme,
in fact quite a large one.
Q506 Clive Efford: What
I am trying to drive at is, what do you think the potential is
for raising large amounts of revenue to reinvest in regeneration
of public transport for future road pricing or motorway pricing
schemes?
Mr Turner: I think the potential
in urban areas where there is a significant amount of congestion
is quite high. It is true that the revenue raised in London was
less than we originally predicted but that was for a number of
reasons. One was that the original predictions were based on a
significantly lower number of exemptions and discounts. The second
thing was that the amount of impact the charge had on people travelling
was greater than we expected so we got fewer people paying the
charge. The third thing was that at the time when we did the original
predictions the cost of enforcing and operating the charge was
speculative because there was not an established market place
from which we could estimate. As a consequence of it being the
first scheme, when we went out to tender, the market was very
conservative in its pricing in view of the fact that the cost
of failure would be very high.
Q507 Clive Efford: What
do you think the implications are of that for schemes in other
urban areas, given that this is London, a very big city? Has that
become a disincentive or has it made people question more whether
it is viable to introduce it?
Mr Turner: Unfortunately I think
it has; but my view is that the cost of implementing schemes will
now be lower because the true cost of operating them is now clearer
and also, if you like, we gold-plated the London scheme because
it was the first scheme and we had to ensure that it actually
did work and there was all the extra de-risking that we had to
do which should mean that the costs in future will be less. I
think this is beginning to emerge from studies and schemes that
we are seeing in other places throughout the world.
Q508 Clive Efford: Mr
Richards or Mr Coates, the Local Government Association told us
that the main reason that they have not implemented schemes elsewhere
is that they cannot use the money to reinvest in public transport.
Do you have a view on that?
Mr Coates: Under the law they
can but there is a great problem. Public transport is mainly buses.
Although there may be places where investing in a light rail scheme
would be a good thing most of the existing public transport systems
are buses and outside London they are deregulated. Mr Livingstone
was able to let contracts for a very large increase in the number
of bus services to accommodate people who switched from car to
bus and as a bus user I can say that that has led to a very big
improvement in London's bus services. In the rest of the country
that is more difficult but there is this carrot which the government
is offering to local authorities who are willing to think about
congestion charging, which is that they be given some more control
over the bus services and might be able to do something a bit
similar to what was done in London but it is not quite so straightforward.
Mr Potter: The legislation does
enable them to hypothecate those revenues. That was a big breakthrough
achieved five years ago.
Mr Turner: The one thing that
the recent change has given is the potential for greater local
authority day-to-day say over the running of the existing services.
With regard to the hypothecation of the revenues and the revenue
transfers to bus operatives the benefit that we had in London
was that we could actually have more direct control over the existing
bus services. That is only beginning to emerge elsewhere in the
country as a result of the government's attempt to make these
changes.
Chairman: Gentlemen, you have got it
all in; you were wonderful. We are very grateful to you.
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