Pricing Our Roads – The Major Constitutional and Political Issues
New Vision for the EU by Pro-European Economist
Increase interest rates!' voted the IEA's Shadow Monetary Policy Committee (a group of leading economists that meets to monitor monetary policy and comment on other monetary matters) at its July meeting.
Serious constitutional, political and practical issues will have to be addressed by the government if it is to implement road pricing in practice
The important political and constitutional issues considered in the study that must be addressed by politicians are:
- How widely should charging be implemented – over the whole country or just in congested cities?
- Should there be exemptions, such as for off peak users or disabled drivers?
- Who should own and manage the roads and receive the revenue: central government, local government, regional government or private firms and trusts?
- What technology should be used and what are the consequences for civil liberties of different technologies?
- Adding user charges to existing road taxes would yield the Treasury between £10bn and £15bn and would reduce traffic levels by up to 19% but would lead to motorists paying even more for roads than they currently do.
- If the government introduces road pricing and removes existing taxes on motorists there would be little or no net cost to motorists on average but motorists in rural areas and those not travelling at peak times would gain significantly whilst those in many cities would pay much more. Traffic speed would rise by about 20% in London with a 25% reduction in traffic. Traffic would increase by up to 25% in rural and some urban areas. Overall, the road network would be used much more efficiently.Commenting on these findings, Glaister said, “Different road pricing policies can lead to differences of £15bn or more in net revenue, equivalent to 5 pence on the basic rate of income tax. Some schemes also lead to massive amounts of money being shifted from London and some big cities to rural areas and possibly between the working and non-working population. This may or may not be a good thing but these are huge issues with which government has to grapple.”
Glaister commented: “road user charging must be introduced sooner or later and the sooner it is introduced the more good it can do. I am pleased that, after 40 years, politicians have finally accepted the clear economic case for road pricing. They now must address the practical issues our study identifies and move the policy forward to ensure the vision of road user charging becomes a reality.”
Read the full study here.
Different road-pricing schemes are analysed by Glaister and Graham and these different schemes lead to very different outcomes. For example: