Last Thursday, the Government shut the door on the idea of road pricing for Auckland, saying that it would prefer to undertake “a year-long negotiation with the council on an agreed 30-year programme focusing on reducing congestion, and boosting public transport where that reduces congestion.”

The following day, the road/infrastructure lobby undertook a bit of a media blitz pushing for more construction. As part of that, we got sent this press release from the Auckland Chamber of Commerce:

Media Release

12 June 2015

Auckland – defined by congestion

The Auckland Chamber of Commerce strongly supports the initiative of Government to seek a negotiation with Auckland Council on an agreed 30-year programme focusing on reducing congestion, and boosting public transport where that reduces congestion.

Michael Barnett, head of the Auckland Chamber was responding to news reports that Transport Minister Simon Bridges and Finance Minister Bill English have sent Auckland Mayor Len Brown a letter proposing a negotiation and ruling out allowing Auckland to bring in motorway charges to help fund transport projects.

“The Auckland business community overwhelmingly agrees that immediate action to address the City’s transport congestion is required,” said Mr Barnett.

In short, congestion is bad. Really bad. It’s a crisis deserving immediate action… in the form of a year-long talk-fest between local and central government.

Of course, it’s difficult to find reliable empirical evidence that Auckland’s congestion levels really are that bad. Average commute times are a cruisy 25 minutes – well below many other cities. NZTA research has found that the actual cost of congestion is neither (a) largely a monetary cost for businesses or (b) anywhere as large as people claim. While people like to claim that congestion costs “billions” annually, a more realistic figure is $250 million. The one source that does claim that Auckland has world-beating congestion, the TomTom index, has serious methodological flaws.

Nevertheless. Even though its empirical basis is shaky, the Auckland Chamber of Commerce’s recommendations for projects are not crazy. In fact, they seem to be on Auckland Transport investment radar already:

A good outcome from Government and Auckland Council working together would be a package of fast-tracked projects aimed at:

  • Improving public transport services’ reliability and frequency
  • Getting as much use as possible out of the transportation system we have
  • Removing parking from major arterial routes to create more usable road space.
  • More high occupancy lanes to encourage a reduction of sole occupancy cars.
  • Strengthened integrated traffic management covering arterials and motorways.
  • Expanding park and ride facilities at main trunk rail and busway stations.

But even if the ideas are sensible, “fast-tracking” them will be expensive. We simply can’t build everything at once. Even if Government was willing to give Auckland Council more tools to raise revenue – which is unlikely given its refusal to consider road tolls – capacity constraints in the civil engineering business would make it hard to do much more.

To its credit, the Chamber seems to recognise this and agree that we need to prioritise use of our scarce resources:

“Good leadership is about partnership,” said Mr Barnett. “It is about understanding that we have limited resources, so we must learn to prioritise correctly,” he concluded.

Which leads me to my point. If congestion is such a big problem, why don’t we use congestion pricing to make sure that we’re prioritising use of our road network efficiently?

I find it very strange that business groups aren’t more enthusiastic about this idea. If congestion is really as bad as they say it is, why aren’t they loudly advocating a policy solution that would actually address it? (Road-building doesn’t work.) Surely freight companies and construction firms would benefit from the resulting reductions in traffic, even if they had to pay a bit for them.

In my experience, congestion pricing is one of those ideas that virtually all economists agree on. It’s like free trade in that regard – there might be some disagreement about the fine details, but most agree that it’s a good idea. But it hasn’t gotten as much attention in other quarters.

So here, for example, is William Vickrey, who won the Nobel Memorial Prize in Economics for his pioneering work on the topic:

Known among economists as “the father of congestion pricing,” Professor Vickrey sees time-of-day pricing as a classic application of market forces to balance supply and demand. Those who are able can shift their schedules to cheaper hours, reducing congestion, air pollution and energy use — and increasing use of roads or other utilities. “You’re not reducing traffic flow, you’re increasing it, because traffic is spread more evenly over time,” he has said. “Even some proponents of congestion pricing don’t understand that.”

He has admitted that his ideas have sometimes not been well received by those who set public policy because, “People see it as a tax increase, which I think is a gut reaction. When motorists’ time is considered, it’s really a savings.”

And here’s urban economist Edward Glaeser commenting that more megaprojects aren’t the best fix for transport issues:

Infrastructure investment only makes sense when there is a clear problem that needs solving and when benefits exceed costs. U.S. transportation does have problems — traffic delays in airports and on city streets, decaying older structures, excessive dependence on imported oil — but none of these challenges requires the heroics of a 21st century Erie Canal. Instead, they need smart, incremental changes that will demonstrate more wisdom than brute strength…

IMPLEMENT CONGESTION PRICING: We should expect drivers to pay for more than just the physical costs of their travel. We should also expect them to pay for the congestion that they impose on other road users. If you have a scarce commodity, whether groceries or roads, and you insist on charging prices below market rates, the result will be long lines and stock outs, like those that bedeviled the Soviet Union decades ago. Yet U.S. roads are still running a Soviet-style transport policy, where we charge too little for valuable city streets. Traffic congestion is the urban equivalent of a stock out.

And here’s economist Matthew Turner, who co-authored one of the most comprehensive studies of “induced traffic”, which I discussed here:

So what can be done about all this? How could we actually reduce traffic congestion? Turner explained that the way we use roads right now is a bit like the Soviet Union’s method of distributing bread. Under the communist government, goods were given equally to all, with a central authority setting the price for each commodity. Because that price was often far less than what people were willing to pay for that good, comrades would rush to purchase it, forming lines around the block.

The U.S. government is also in the business of providing people with a good they really want: roads. And just like the old Soviets, Uncle Sam is giving this commodity away for next to nothing. Is the solution then to privatize all roads? Not unless you’re living in some libertarian fantasyland. What Turner and Duranton (and many others who’d like to see more rational transportation policy) actually advocate is known as congestion pricing.

And here’s the OECD in its latest country report on New Zealand:

A just-released OECD economic survey blames years of under-investment in infrastructure for the city’s roading problems. It calls for a mix of tolls and congestion charges to alleviate peak-hour traffic pressure and help fund new roads and more public transport.

“Placing a cost on travel during peak periods could incentivise drivers to travel at different times (off-peak), if they are not required to be on the roads, or could encourage more carpooling and use of public transportation,” the report says.

In short, if you’re worried about congestion, you need to take congestion pricing seriously. There are undoubtedly reasons why we may not want to implement congestion pricing, ranging from technical feasibility to equity concerns. But in my view it’s ridiculous for business groups and politicians to get all up in arms about the issue – and promptly rule out one of the few realistic solutions.

What do you think about congestion pricing?

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  1. All congestion pricing, tolls, taxes whatever you want to call it will simply be added to the price of the goods you buy. No freight company will absorb additional costs as their margins are already thin and competition is fierce in that sector. As always, be careful what you wish for.

    1. The huge improvement in the efficiency of their freight operations would more than offset the relatively small charge. In some cases you could have the same truck and literally doubling the amount of goods they can move each day.

      The prices we pay for products would get cheaper with congestion pricing.

    2. You seem to suggest that the charge will raise more than the often quote ‘billion dollars’ that congestion costs the city. As long as it is less than that and congestion is reduced goods should in fact be cheaper.

    3. I suspect many freight companies who you say will object to the charge, will do so because they know that they are as guilty as everyone else on the road of making “low value” trips.

      The alternative to charging is what?
      Do nothing and let the companies margins get even thinner as they spend more time in ever worsening congestion?
      Or have them put up their prices to you and me? The very thing you object to.

      So prices will go up whether we do congestion charging or not.

      A strawman argument.

    4. Mate, you seem to have a strange approach to cost-benefit analysis. Your preferred policies have only benefits and no costs, and policies you don’t like have all costs and no benefits. Reality just doesn’t work that way!

      So let’s make it real. Let’s say you’re a trucking company. It costs you roughly $100 to keep a truck on the road for an hour. Now let’s say that you have the opportunity to take advantage of a congestion pricing scheme that will charge you $5 for road access during the peak times, but cut your trucks’ average travel times by 15 minutes.

      Does this (a) increase or (b) decrease your cost of doing business? Show your work.

      1. I had to explain this very thing to my boss who is very much against congestion charges and PT investment. My change out rate is around $150/hr – so to save 10 minutes being stuck in traffic for work we should be willing to pay up to $25. That doesn’t even cover the cost of running the car or the fact that if I’m late to a meeting there are 5 other people standing around at the cost of $2.5/minute/person waiting. Now my boss wants motorway tolls, congestion charges and PT investment to get people off the road so he can make more money.

        1. My boss in london was happy for the congestion charge as it saved him money with getting things delivered.

  2. A distinction really needs to be drawn between congestion charging and motorway tolls. Congestion charging is not primarily for raising revenue, its a small charge to nudge people in a certain direction. See this fantastic 8 minute TED talk on how that other isthmus city Stockholm eliminated congestion literally overnight by instigating quite a small congestion charge of 1 or 2 Euros. So importantly this small charge would more than make up for the time saved fro freight companies I suspect, whereas the small charge is enough to make commuters change behavior. Fasinatingly, initially 70% of people were against this congestion charge, after 5 years 70% were in favour.
    Motorway tolling is not time related – you pay it no matter what time you are using the motorway, they amounts tend to be higher as they are primarily for money raising not a behavioral change mechanism.

    1. An excellent point. When road pricing was first raised as a possibility in 2013 or so, Stu Donovan and I wrote a few posts arguing that if we’re going to implement congestion pricing, the aim should be to manage transport outcomes, _not_ to raise money. So, for example, it would be possible to cut the uniform annual general charge component of the rates bill to offset the congestion charge.

    2. And the same effect can be seen in Park n Ride as Matt L’s article on Calgary showed.

      It raises money, encourages economically efficient behaviour and has been proven to work in real situations, in real cities. The only question is why is it not being implemented. What vested interests are being threatened by this?

      Surely the neolib religion should be clamouring for more user pays. That is after all one of the main commandments of the neolib scripture.

    3. Just watched that TED talk. Absolute gold and I think it is so counter intuitive that most people will struggle to accept it.

      I can see a lot of appeals to “common sense” against it. Common sense being a pseudonym for “I have no evidence but I REALLY want it to be true”.

  3. I think the approach to congestion pricing pushed by the Council has poisoned the concept because it is just a money grab and in a stupid way too – pushing drivers off motorways and onto local roads so they can clog up bus lanes and kill cyclists.

    1. I agree with this. The council presented (and designed) motorway tolls primarily as a revenue raising tool. Their analysis indicated congestion would worsen not get better. So they are arguably just as guilty of ignoring and misrepresenting road pricing as anyone else.

  4. Congestion pricing works if there is an equivalent PT option
    A while back Council suggested congestion charging from 6am…

    1. That’s an oversimplification. Other alternatives to paying a congestion charge could include drive at less congested times, or arrange your affairs to drive less often.

      Of course that may not be possible in respect of your journey to work, but it might be possible for plenty of other people travelling for other reasons – and there are plenty of people on the road for other reasons even at peak periods.

      Remember, this is not about you or me personally, it’s about influencing the average behaviour of the population. Maybe you’ll still have to commute by car in the peak hour because you have no alternative, but in return for the charge you’ll have a quicker trip.

    2. But I would certainly agree that to be politically palatable a congestion charge should be joined with a significant public transport upgrade program, so that more people such as yourself do have adequate public transport alternatives.

  5. Hmmm, a pricing-based user-pays solution, that sounds like an extreme left wing solution. No way our right wing national party can go for that.

    1. Exactly.

      Regressive user pay systems are right wing fundamentalism that scares votes away from the centre right – so our government refuses to implement them. Likewise user pays make great conciliatory policies for attracting votes to the centre left – so our council favours of them.

      1. The market economy is right wing fundamentalism? How did we let these fundamentalists impart their ideologies in the control of the food supply? A disaster surely? In all seriousness – market mechanisms are a core part of the makeup mainstream liberal democracies. No need for road pricing to regressive – the surplus can be redistributed progressively (and even absent that it is not going to be regressive).

  6. I’m undecided about congestion pricing, the questions I have are:
    – What are the consequences, both planned and likely unintended of this policy
    – What other options (PT) are available to allow users to mitigate the cost
    – What are the other alternatives for both funding and pricing
    – What are the overheads (system running costs) and how will these be minimised

    Of these the overheads question is the one I’d concentrate on as this is the component that removes potential from the system without actually adding much value.

    Given these questions and value reduction, I think the current solution of a targeted rate is probably better, although we could argue about flat vs percentage, which would be based on your view of how public goods should be funded.

    1. All good questions!

      I think you’re right that congestion pricing is a relatively inefficient way to raise revenue. We have other revenue tools with lower administrative costs – fuel taxes, targeted rates, etc – which I tend to prefer.

      Personally, I’m a bit undecided on whether we should implement congestion pricing to manage our transport system. As I said in the post, I’m not sure that Auckland’s congestion is bad enough to warrant such a scheme. But others are very certain that it is, and I would encourage them to push for congestion pricing.

      I think you’re also right to ask the questions about intended and unintended consequences and the availability of alternatives. One view is that Auckland should defer introduction of congestion pricing until _after_ it gets good PT alternatives in place throughout the city. I guess there’s a trade-off between using congestion pricing as a means to encourage the uptake of alternatives, and using the availability of alternatives to smooth the introduction of congestion pricing.

      1. I don’t think that congestion is bad in Auckland, having driven in London and Sydney. The difference is the range of viable alternatives, which is where Auckland isn’t as good, but the current investment priorities are redressing some of the modal imbalance.

        I’m pretty certain that the tipping point will be CRL, electrification has created a certain amount of momentum, but the intensification that will result from moving West Auckland closer and potentially the rationalisation/changes to stopping patterns of Western Line stations will change the view of Transit services.

        1. Congestion is not bad at all in Auckland by any international metric, though compared to the country towns it’s shocking to queue behind another three vehicles at the lights… BUT it’s a huge stick to beat the Council with by these intensely National Party aligned business groups. And the genius of it is that Council has very little power and money to address perceived or real issues in this area, as the government controls the transport spend; in effect AT’s too, as they withhold or allow matching funding through NZTA. And this is a very meddling gov. The RONs are mega projects on a whim.

          It’s power politics, those four pages in the Herald were paid ads for the gov’s line that AC and AT don’t know what they’re doing. And this is not a very credible line, as Peter points out, not least because these business groups have fallen completely in line with the gov opposing the one thing known to work against the bogie of Congestion; Road Pricing. Something that would benefit their members in particular.

      2. In my view road pricing will enable good PT. it will significantly improve the speed efficiency and reliability of road based PT, as well as providing additional demand to make it viable. That’s not to say you can ignore the need for good PT, but I don’t think we need to wait for additional corridor related infrastructure.

  7. The supply of roads is fixed at any given time with any additional roads takes time to build if at all possible let alone desirable. Therefore, the question is how do we manage demand. The usual mechanism when it comes to supply and demand is “price”. By pricing the roads in accordance with demand will mean people will make a rational economic choice in determining the best use of their financial resources. However, I have noticed when it comes to transport and housing basic economics is ignored. For the last 30+ years New Zealand has attempted to apply market forces to pretty much everything but not for this. I think it times to have congestion charges to that demand is lowered to the optimal use of the roads. It would only need to be applied to roads where the demand is greater than supply. The revenue gathered should be put into transportation infrastructure – the first been the CRL.

  8. Isn’t Michael Barnett going to run for Mayor?

    Toronto elected Rob Ford (crack smoking buffoon) because he was going to shift the emphasis away from public transport to more roads and no / low charges for vehicles for the commuters from the outer suburbs. This was possible because once Toronto was amalgamated the voters in the car-burbs outnumbered the public transport-loving voters from the inner city.

    Auckland would appear to be running on the same course…and to roughly the same time frame. If the right conservative candidate can enflame ignorant, short-sighted voters they could / would be a shoe-in as Mayor.

    Then major assets would be privatised and the ratepayers would be pillaged for crony-roading cash and then told “This is what you asked for!”

    …and they did. They just hadn’t thought it through. Must be someone else’s fault. I realise I probably sound a bit bitter. That’s because I’ve this feeling of deja-vu around Auckland’s current state and rate of progress. We could easily go backward before we go forward.

    1. I agree that Ak could get behind a right leaning mayoral candidate, but who is that person? Unless someone with national exposure steps up (like an ex MP that hasn’t disgraced themselves in some way) we’re likely to have Mayor Goff next term.
      Another way of looking at it is that only people who’re engaged with local issues vote in mayoral elections. They’re also quite often aware of real and not real solutions to Aks problems. So a right wing mayor may not be a backwards step. Unless Quax gets elected…

  9. As long as any pricing is time based, ie that it penalises peak driving, or rather incentivises time-shifting, using alternatives, or not making a low value journey at all, then it is clearly the most effective way to reduce congestion dis-benefits. Especially for trucks and trades, both of whom would clearly be more than happy to pay a small sum to drive unencumbered at the peaks.

    If a tradesman added $2-$12 (or whatever) to a callout bill to cover this it would be unnoticeable and he or she would clearly then be able to get to one or more customers a day, thereby fixing my problem sooner, increasing their productivity and therefore either be able to drop rates to raise competitiveness or just get more work done and be wealthier. I see no downside. How could it be cheaper for society to have this person parked on SH1 for any length of time!

  10. What are the most effective practical methods of implementing a congestion charge? Does it still require toll booths, or are there more effective GPS systems that can now be rolled out in bulk?

  11. However. Unlike London, Stockholm, or Singapore, we have an improving but weak set of alternatives to driving: immature and patchy Transit and Active networks and services. And in fact that improvement is already too underfunded and too slow for the latent demand it is unlocking, making it harder to accelerate it. Incentivising more people onto it could make this even more difficult.

    It is also hard to see any system other than motorway tolls, given Auckland’s current setup. This would likely make for a higher optimisation of this lavish network, and reduce its wasteful peakiness. But would this lead to the swamping of local roads? Perhaps part of the answer here would be to ensure that these roads have clear priority for the alternatives, so drivers in the peak would really be offered the choice between a fee for quick mway journey, a slow local road journey, or an optimised PT or Active one?

    1. NZTA have already caused problems for local roads near a motorway onramps with their light system. Tolls would result in even more local roads becoming unusable at peak times.

    2. GPS based road pricing for all roads is now considered to be feasible. I don’t believe we need to worry too much about the PT system as buses will become more efficient etc, but I agree about active modes. However, just like road pricing will enable better PT, it will also make reprioritising road space to cycling easier as the demand for the road space will reduce.

  12. The next question is one of timing. It would probably be best if the New Network and Waterview were in place at least. Ideally the CRL; being the radical upgrade to the core of the non-driving systems. But then the CRL faces a funding standoff with government in an ideological bind seemingly unable to move on the matter. So I don’t blame the Council for seeing road pricing as a way to fix both problems, but they certainly should have emphasised its usefulness in and of itself. And by the way ‘revenue gathering’ is no bad thing if it is to be used for a valuable project. In fact revenue gathering is the first role of government at all levels, as it is the only thing that makes anything else it may do possible. What if we just had peak pricing; money to a PT loan servicing account. And free at non-congested times.

    77% of vehicles on the roads are private passenger. A small reduction (say 10%?) in these at peak times and problem gone.

    1. Patrick you really need to see that TED talk (again perhaps) as its central theme is you don’t try and plan the details. When they put on the congestion charges in Stockholm no-one knows where these people went. Some will have time shifted, some worked from home, some biked, some PT’d some moved house to be closer to their work. His central point was to nudge people in the right direction with a seemingly tiny congestion charge (1or 2Euros) and people change behavior. Just like no-one trys to organise the supply of bread to the whole of Auckland, we shouldn’t try to organise exactly where people will go.

      1. Peter Olorenshaw,

        Behaviour change is limited by the supply of travel options. Some people may choose to bike or take public transit, but only if there is a bike or transit network of any use to them. They can’t take an option if it is not supplied. Even staying at home may seem viable at first, but often that relies on increased demand for other kinds of trips (e.g. taking deliveries of bread and flour, instead of driving to shop) which in turn have unique network demands that must be catered for.

        So the general aim should be to broaden the range of travel choices, such that individuals can alter behaviour in response to a nudge. In other words, the policy should account for both supply and demand at once.

        That conclusion actually follows from the excellent point you made: “you don’t try and plan the details. When they put on the congestion charges in Stockholm no-one knows where these people went” — but perhaps for a non-obvious reason.

        Indeed, it’s best not to plan for every detailed trip, because although most individual trips are directed one way or another, the aggregate movement of people is complex, non-linear, non-deterministic and precisely unpredictable. This fact applies for all modes of travel, even walking and cycling.

        However, we can (and should!) still design networks in such a way that a multitude of journeys in any direction remains possible — with the greatest frequency of intersections as practical (i.e. a high degree of connectivity or indirection). There is a network geometry well-suited to the task, if applied at appropriate scales for different modes: a grid. A grid remains agnostic to the purpose of any trip, but enables almost every trip: e.g. it doesn’t care that one might want to buy a loaf of bread, but it does ensure that most people in the network can freely and reliably access most places they want to go — which may well include a bakery.

        Auckland has a near-complete, sometimes excessive grid of roads and motorways (once the WRR is done) for cars and trucks. Auckland will have the kernel of a rail grid once the CRL is in place; but the New Network will create a frequent grid of integrated PT options before it. Auckland’s cycle network, although currently being planned in a seriously questionable shape, could otherwise easily provide an ubiquitous grid across every suburb. Auckland already has walkable urban neighbourhoods in the densest areas of the city, based on former streetcar grids, which are mistreated mainly by small engineering details and occasional motorway severance (low-hanging fruit both).

        Like a fractal, each of these interleaved, mode-specific grids could provide the potential for all sorts of travel. Short trips, long trips, trip chains, multi-modal trips, opportunistic trips, recreational trips, defensive trips, can become plausible, reliable options for most people. At this level of analysis, we’re no longer thinking about the details of every individual trip, or even isolated trunks/corridors/routes of fixed travel demand. Instead, we’re talking about an integrated network that is as indifferent as possible to any particular journey, but enables the greatest range of journeys in the most efficient way across a city.

        By analogy: in a garden, we don’t plan precisely where every seed, root, petal or leaf should grow (or whether any plant will necessarily germinate/pollinate/survive/whatever), but we do need to set up the aggregate conditions for a natural system to unfold, including factors like soil composition, nutrition, hydration, wind protection, sunlight, etc.

        In that sense, the cities that Patrick R mentioned, including Stockholm (from the TED talk), have all done the groundwork with resilient, high-frequency grids for at least two or three travel modes (and growing), cultivating a range of travel choices. Demand management is only effective when there is this capacity for behaviour change, so Auckland absolutely needs to build up its impoverished mobility networks.

  13. how can we make sure the fund raised is used efficiently?

    If they charge the congestion, they have an incentive to keep it as congested as possible so they can charge more. (control the supply)

    In a commercial world company build stuff themself that is cost effective to solve problems. However here we trust the goverment to build stuff that may not be the best value.

    1. You could cover that incentive issue by allowing council only to collect from vehicles registered within say 500m of a train station. It’s unfair to charge folks who have no alternative, which is why it is a better option for Stockholm than for us.

      1. But the perverse incentive here is to register cars further away. I live in Kingsland, and take the train to and from work. If cars registered more than 500m away are exempt from any congestion charges though, I’ll just reregister it under my parents address in Christchurch to avoid paying tolls if and when I need to drive.

  14. Really simple. If I’m moving thousands of dollars worth of goods and a small charge makes them move faster, great for me and consumers. If I’m taking jonny to soccer practice and he could walk, bike, bus, train, car pool with other jonnys or other options then I rethink that trip. And we can save that $100+ millions on widening, grade separation by the airport etc. Problems solved.

    1. Yup that’s it in a nutshell, so long as there are options for jonny. But even if they are currently poor this is exactly the kind of impetus to get their value recognised. And that’s one of the distortions of underpriced goods; they conceal potential efficiencies.

  15. I’d like to challenge one point from the OP – the cost of plenty of the “fast-track” options…

    Removing parking from major arterial routes to create more usable road space.
    – This costs a few dollars in repainting and new signage

    More high occupancy lanes to encourage a reduction of sole occupancy cars.
    – This costs a few dollars in repainting and new signage

    Expanding park and ride facilities at main trunk rail and busway stations.
    – Yes this would be expensive to PURPOSE BUILD, but imagine a “PT User” badge in your card allowing you to park on nearby streets, akin to a residential parking schem

    Two other ideas I have
    – Get rid of 2-into-1 intersections where two lanes merge immediately after the light. It causes merging congestion/slowdown and it also facilitates unethical behaviour (queue-jumping)
    – Put in those flexible lane-separating flag things (like at the last roundabout before the airport) to stop general undertaking of queues (e.g. Maioro Road onto the SH20)

    The more we can keep people in their lane, the quicker everything moves

    1. I’d add to that a Bus only section for the North bound left hand lane at Mt Wellington, in effect making the left hand lane exit only, reducing the merge congestion created by those who are effectively queue jumping.

  16. I am heartened to see the majority support for congestion charging seen here. A couple of points – congestion charges would actually be a very efficient way of raising taxes – it would be one of the few taxes that bestow benefits on the payees. However it should not be seen as a tax. Is the price you pay for using your phone a tax? Your phone bill is a charge for using infrastructure just the same as a congestion charge would be. This idea that it is a tax (and an extra one at that) is one of the main rallying points for opposition who argue that we already pay for our roads. And we do, in the sense that the national road fund comes from motorists and is used for building and maintaining our roads. The problem with that is that although on average, petrol taxes cover all costs, they don’t come anywhere near paying for waterview etc. Petrol taxes involve huge cross-subsidies between different groups of road users. What we need to do is replace fuel taxes with road charges which pay directly for road use. I don’t know the numbers, but say introducing congestion charges in Auckland allowed petrol to be 5 cents/litre cheaper. This would mean that those people who do not make peak trips – the ‘little old ladies’ going to the mall or workers travelling to suburban locations would be better off. (These are the ‘poor people’ who are invoked to argue against congestion pricing, but who in fact should be better off). As someone said, we should not worry about ‘getting things right’ first. If there were congestion charges, commercially operated transit services would be viable. And they will be quick to appear where they are needed, not necessarily where we think they are needed based on the current skewed demand pattern.

    1. Problem is, when something has hitherto been offered “for free” (or seemingly free), any move to start charging for it gets seen by people as a “tax”, even if it is no different from paying to use things like the phone network.

      What is conspicuous that the same right-wing governments and councils that have assiduously applied charging-at-point-of-use to just about everything else, have always shrunk back from applying it to road-use.

      Same with privatisation. How come the National/Act cabal have never applied their trademark prescription to the roads?

      1. I don’t know DB, Maurice Williamson was the only minister of transport willing to openly support congestion charging. He got shunted off for his pains – probably a victim of the poll based policy approach. Other people have suggested that the anti-congestion charging lobby is an unholy alliance of the greens (who dominate in local politics and don’t want a solution, preferring to use the problem as an excuse for pushing public transport) and conservative forces in the National Party that see congestion as evidence of economic growth and a reason to spend money on infrastructure.

        1. I thought the Greens were pro congestion-charging. I can’t believe Julie Anne Genter would oppose it.

      2. Bollocks. If I’m legally compelled to pay it by a Govt branch, it’s a tax. Nothing at all like entering a voluntary agreement with a phone comp. FFS.

        1. You aren’t compelled to pay it, you would only pay based on usage. No different to other monopolis such as chorus, air NZ etc.

        2. Which would be no different to all sorts of other avoidable taxes. Still a tax. Compelled by the govt=tax.

        3. @ Tony

          You only see it is a tax because it has been free (or at least, free from user-charges) up to now. If roads had historically been constructed and operated as turnpikes and paying-as-you-go was as normal as paying fares for public transport, you wouldn’t view it as a tax.

          Bus fares are avoidable if you don’t travel by bus. Does that make bus fares a tax?

        4. So what? Does the word tax frighten you? Call it what you like, it’s just a way of paying for a service, in this case, a faster journey, the question is is it a better or poorer way of paying. And clearly it’s a better as it is completely voluntary.

        5. So air NZ fares and electricity transmission charges are taxes? That is an unusual definition.

        6. Tony, according to your definition the small fee that I pay when I choose to use the council pool is a tax. That’s pathetic. It is an admission charge, as is a road user charge.

        7. It’s a fee charged for a service provided by a government organisation. Why would it not be a tax?

          A tax (from the Latin taxo; “rate”) is a financial charge or other levy imposed upon a taxpayer (an individual or legal entity) by a state or the functional equivalent of a state to fund various public expenditures.

          User pays is nothing more than a targeted tax.

        8. Sheesh. Use a car or not. You voluntary choice. If you don’t want to pay, move somewhere you can live without a car. Otherwise, belt up.

        9. Hi Tony

          Nobody’s saying that you have to support or accept congestion pricing. It’s perfectly valid to disagree with the idea of putting a price on peak travel. However, I _also_ think that if you disagree with congestion pricing, you have an obligation not to complain about congestion or ask society to spend money building you more roads. After all, you’ve just turned down the only policy that would actually address congestion.

        10. Matthew, AirNZ and power companies are partially government owned commercial enterprises. Completely different situation.

          Peter, I didn’t say I disagreed. I don’t use the motorways at peak time, I seldom use them at all. In fact I avoid where I can, they terribly boring things. A congestion charge (tax) wont affect me, although I doubt they will have anywhere near the effect most here think they will.

          But a tax is a tax. I guess it all depends on how you want to frame the discussion. Some will say it’s user pays, some will say it’s a behavior influencing charge not too dissimilar to excise taxes on many other so called evils.

        11. And I still say; so what? A tax is simply a cost, and therefore either a high or lower value one.

          Unless of course you are infected by Tea Party nonsense that sees anything governmental as the source of all evil. Then the word tax has all the power of satan…..

        12. We should always be wary of adding further cost to peoples lives Patrick. There are people out there that cant cover their the existing costs.

        13. So Tony, if the government turned NZTA into an SOE it would be completely different? It sounds like it would be just about exactly the same situation in practice to me.

    2. “And we do, in the sense that the national road fund comes from motorists and is used for building and maintaining our roads.” – Let’s get thsi right. The NLTF is used to build and maintain motorways.

      The majority of the money for local roads, especially in the big cities, comes from rates and general taxation.

      There has been some contribution from the NLTF towards local roads but now that has been plundered for the RoNS there isn’t much left to help subsidise roads in low density rural areas. That is one reason why so many rural authorities are struggling to maintain roads.

      So actually it would be fairer to impose a congestion charge on local roads rather than motorways.

  17. I don’t see how a congestion charge is going to affect the price of groceries etc, simply because they aren’t delivered during rush hour. Quite a lot of the major deliveries are made at night with top ups during the day, but outside rush hours. Next time anyone is on a motorway during rush hours they should keep an eye on what trucks are on the road. They would find a majority of them are carting construction materials for roading and building projects, but very few curtainsiders carting goods to supermarkets and the like.
    Another thing worth considering in this debate is where the funds for any road that is not a motorway comes from – out of the rates. So seeing as how the Auckland Council funds all the roads outside motorways it should be free to charge what it likes for those roads.

    1. “So seeing as how the Auckland Council funds all the roads outside motorways it should be free to charge what it likes for those roads.” – That isn’t quite right. A big chunk comes from general taxation.

      There has been some contribution from the NLTF towards local roads but now that has been plundered for the RoNS there isn’t much left to help subsidise roads in low density rural areas. That is one reason why so many rural authorities are struggling to maintain roads.

      But that only reinforces your point as it would be “fairer” (from the POV of those opposed to a congestion charge) to charge a congestion charge on major arterials rather than motorways as those arterials haven’t been paid out of fuel excise tax or RUCs.

  18. Peter,

    >> “But even if the ideas are sensible, “fast-tracking” them will be expensive. We simply can’t build everything at once. Even if Government was willing to give Auckland Council more tools to raise revenue – which is unlikely given its refusal to consider road tolls – capacity constraints in the civil engineering business would make it hard to do much more.”

    The inevitabliity of this bottleneck is based on Barnett’s fast-track list which is notably incomplete. There is so much potent low-hanging fruit that it ignores (as does Council/AT/NZTA)…

    It’s hard to imagine that rolling out decent bike grids at a useful rate would strain either engineers or accountants. It’s relatively cheap and quick work, and could often be bundled with ordinary street maintenance. With the funds available already, there’s no reason to believe we can’t do this in the near- to mid-term (if only we had the right plan). On-street cycling even coincides with the fast-track goal of freeing up road space from car parking, and is vastly more efficient than park-and-rides for cars.

    Additionally, serious walkability improvements (network repair, not just footpath maintenance) would be even cheaper and easier, and could contribute to significant modal shifts away from motoring, especially around transit.

    The nice thing about building these features in area-based street grids is that enough value from each project is realized as soon as the paint dries, to make a difference in everyone’s life near it — the incremental payoff streams in real time, rather than festering for 5-30 years as expensive keystone projects unlock dividends in rations (as AT and NZTA want to keep building). Nothing more effective could be cheaper and easier. Why it fails to make it into a businessperson’s list of priorities, I can only speculate.

    With these more effective priorities, I can see room for a congestion charge linked to development — perhaps proportional and/or targeted, I don’t know.

    But ultimately, congestion pricing in Auckland seems frivolous for behavioural change (as it is with revenue):

    * Motorists discount all sorts of costs, even recurring ones, as “fixed” or “one-off” or “a necessary evil” — from insurance to maintenance to licensing to whatever. There is hope for congestion charging in that it’s per-trip, but then so is paid parking which is easily trivialized.

    * Motorists tend to compare the bare price of petrol against the fare-plus-time-plus-discomfort-plus-risk-plus-… of transit or cycling/walking, and totally neglect environmental impact and ignore effective speed. I’m not sure how much difference it would make to add a congestion charge to the mix as long as the alternative modes appear as uncompetitive as they currently do in Auckland.

    * Motorists are also motivated not just by rational, instrumental decisions, but also emotional, affective ones. They predominantly see driving as freedom and freedom as driving, regardless of financial costs, unless shown otherwise by frequent transit or bikeable/walkable street grids that tangibly exist. I don’t know if a congestion charge alone would bring about a shift in this perception; and if we build better infrastructure so that congestion pricing becomes effective, will it even play a big role, given the huge latent demand to abandon auto-dependence?

    * Although a congestion charge can function as a signal, and a good nudge can be helpful, a congestion charge could be perceived as punitive, not just suboptimal, if alternatives are not provided simultaneously; indeed it could actually cause adverse outcomes, especially but not only for those at risk due to social equity disparities.

    [Sidenote: I’m also wary of pricing as there is a risk of presuming an efficient market discovering some kind of “correct” price for externalities when in fact it’s an arbitrary price predicated on signalling. I’d hate for it to create a sense of entitlement (see: “I pay road tax”) or to imply that mass driving is just fine so long as you offset it with credit (not unlike other polluting activities).]

    But I could be wrong about congestion pricing — perhaps Auckland isn’t a special snowflake after all. Either way, it’s pretty clear what needs to be prioritized in fast-track infrastructure terms: something more than Barnett’s incomplete vision, and certainly more achievable.

  19. Aren’t people *already* effectively paying a congestion charge in the form of spending more time sitting stuck traffic? They’ve chosen to drive during peak and sit in traffic, rather than do the same trip outside of peak (or use alternative options) and thus save the time. In other words, the system, by its very nature, has a built-in ‘congestion pricing’ and clearly for thousands of Aucklanders the cost of sitting stuck in congested traffic isn’t high enough for them to alter their behaviour.

    1. Yes, i ‘pay’ when i work from the shore office, by having to get up at an ungodly hour to beat the traffic, and have to leave early to do likewise on the way home. Thankfully it seems most Auckland employers are flexible about start / finish times as they know the traffic is so bad in Auckland and there a often few viable alternatives, would hate to have to stay till 5 and commute home in the peak.

      I’d rather sleep in and pay a congestion charge though.

      I’d rather there was a decent public transport service that didn’t take twice as long and only run every 30 mins during the peak.

  20. What are we trying to achieve? Are we trying to implement a congestion free network? How does the will parking charges fit into this goal? Will charging for parking help achieve the end result we’re aiming for?
    The Minister is able to price the costs to the economy of the congestion then I feel that an initial subsidy of the fares to achieve the congestion free network must be readily calculable as well. He would only need to use a small proportion of that cost to achieve it.
    We would see parking removed from many streets to facilitate steady bus movement and parking charges increased to reduce the attraction of driving and parking in such a way as to relieve the congestion. The congestion charging as outlined by Jonas Eliasson points out are all nudges (it is unfortunate that the Govt has ruled out AC implementing congestion charges) so AC must look at alternatives that will achieve similar results.
    Is it possible to use parking charges which the council does control to change behaviour?

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