Every weekend we dig into the archives. This post by Peter was first published in July 2016.

Congestion pricing has once again hit the political radar, with the news that the Auckland Transport Alignment Project has recommended it as an option to more efficiently manage the transport network. They find that variable road tolls – highest during peak periods on busy roads and low (or even zero) at off-peak times – are the single most effective intervention to improve traffic flow.

ATAP - Interim Report - Manage Demand

On the whole, it looks like support for the idea is on the rise, which is positive. That suggests that the work that Auckland Council’s consensus building group did a few years back has contributed towards a better public conversation on the issue. That’s good, as it’s a challenging idea to sell to people.

The NZ Herald’s editorial on the topic was tentatively supportive and showed a reasonable understanding of the core principles of congestion pricing:

Transport Minister Simon Bridges conceded this week, “we can’t keep building new lanes on highways. We will need a combination of demand-side interventions if we are going to deal with congestion over the next couple of decades”. He prefers the term “demand-side interventions” to taxes, tolls or charges but those are what it means.

Unlike the council, the Government does not advance these for revenue raising but for reducing traffic on the roads. It clearly thinks road rationing is more politically acceptable than revenue raising and the AA agrees. Feedback from members, it says, showed support for tolls as long as people could be convinced it was for congestion benefits, not simply revenue.

However, the Herald’s editorial also exhibits a common misunderstanding about congestion pricing, arguing that free routes must be available as an alternative to tolled routes:

The joint report for the council and the Government this week did not suggest how road travel might be charged. Mr Bridges said one option was to track all traffic with GPS technology which is being trialled in Singapore and Japan. But that implies no roads would be free at times the charge applied. Travel is a basic freedom. We could welcome the chance to pay to use a fast lane when we need one, so long as free lanes remain.

The Herald’s position is basically in line with NZTA’s existing tolling policy, which states that:

…a road tolling scheme may be established to provide funds for the purposes of one of more of the following activities, namely, the planning, design, supervision, construction, maintenance, or operation of a new road, if the Minister of Transport is satisfied that:

  • the relevant public road controlling authorities (including the Transport Agency) have carried out adequate consultation on the proposed tolling scheme;
  • the level of community support for the proposed tolling scheme is sufficient;
  • if an existing road is included in the scope of the tolling scheme, it is physically and operationally integral to the new road in respect of which the tolling scheme will be applied;
  • a feasible, untolled, alternative route, is available; and
  • the proposed tolling scheme is efficient and effective.

However, I think that both NZTA and the Herald are being too hasty in assuming that the untolled alternative route has to run parallel to existing roads. Alternatives can exist in time as well as in space.

Stu Donovan described the maths behind this last week. Transportblog reader Bryce Pearce also dug up a good practical example: apparently Singapore’s road pricing scheme allows people to travel for free most of the day. For example, if you are trying to drive on Lorong 6 Toa Payoh at 8:30am, you’ll have to pay $1. But if you leave an hour earlier or an hour later, you won’t pay anything:

ATAP took a similar approach when choosing how to model congestion charges. As the following diagram shows, the ATAP scheme would increase peak and inter-peak pricing, relative to current fuel taxes, but decrease charges in evening periods. Consequently, people would have options to save money for certain types of trips, for example, by shifting supermarket trips from the afternoon to the evening:

ATAP - Interim Report - Road Pricing Differences

Arguably, being able to travel for free on the same road, at a slightly different time, is even better than being able to travel for free on a different, more circuitous road at the same time.

There are obvious user benefits to the approach of varying tolls by time of day. It allows people to make better choices that respect their individual preferences for time, timeliness, and money.

But there are also important system-wide benefits from variable tolls between different time periods. Because congestion can be quite sensitive to changes in the number of cars on the road at a given time, encouraging even a relatively small number of people to shift the time at which they travel can lead to large benefits.

That’s nicely illustrated in the following graph of Auckland Harbour Bridge traffic volumes. The AHB is essentially free-flowing during the middle of the day, when there are around 1300 vehicles per lane per hour. But it is considerably slower during the evening and morning peaks, when the bridge carries more like 1500-1700 vehicles per lane per hour.

Lane Capacities

Because the peakiest bits of the peak are relatively short – perhaps 2.5 hours in total across an average weekday – you could improve the performance of the bridge by charging tolls during a few short windows. People could still travel for free (or at any rate a lower price) during the remaining 21.5 hours of the day.

From my perspective, that’s a pretty good alternative for drivers! But what do you think about the issue?

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  1. I think that the issue is much wider than congestion charges. The material supporting the Clean Cars consultation showed that with even the most optimistic uptake of EVs that emission reduction targets will not be met. So there are arguably two aims: to reduce congestion and reduce emissions.

    If the aim is to reduce emissions then it is a nonsense to provide a tolled and non tolled route. The alternative to tolls is public transport.

    Increasingly our way of funding roads is becoming more inequitable. As more choose to become carless, or drive much less, a model where roads are funded from taxes and rates is less fair. Regardless of whether road taxes are implemented is it time to review how we pay for our roads?

  2. a) Comments in other GA articles by other people have rightly raised the issue that congestion tolls are regressive taxation and will affect those less well off the most.

    b) This is also not unrelated to previous comments I have made about the need to provide full coverage Public Transport networks with max 30min headways & preferably pulsed transfers to provide full urban access to those that are transport disadvantaged (in the face of standard congestion tolling more people will enter this category).

    I’m fully supportive of congestion tolls but:
    Congestion tolling should be undertaken as HOT (high occupancy / tolled lanes) lanes while other lanes remain untolled, and b) should also be implemented.

    1. I’m not a fan of hot lanes either. Either way you are taking a very expensive asset we have all paid for and reserving it for the rich at a below cost price.
      The only congestion charging I’m somewhat happy with is city zone like London (although I’d prefer no traffic at all in city)

    2. The creation of a tolled HOT lanes could easily be counter productive. Where multiple lanes currently exist, turning one into a tolled HOT lane may well prevent this extra lane instead being turned into an exclusive bus lane, or bike lane instead. In a worst case such a policy may actually encourage providing even more through traffic lanes at the expense of local amenity.

      1. Valid concerns.

        But then how does one then address the regressive nature of congestion tolls on the poorer in society?

        1. I was bought up in the Hutt Valley in the 1950’s as Lower Hutt north of the Hospital was being converted from market gardens to State housing. Wainuiomatata from a swamp to more low priced housing, and Upper Hutt from race horse stabling and training tracks, to even more economical housing. Car ownership was low and local employment nearly non existent. What did happen at the same time as all of this house building was a massive government investment in an extensive integrated public transport system got people to work and to the shops and to events. The Hutt railway line was rerouted from west of the river to down the centre of the valley floor, duplicated and electrified. NZ Railways Road Services supplied an extensive bus network through those more distant new suburbs connecting to the trains. Those were the effective 1950’s solutions to the problem you describe. There were subsidies, but they were acheived at a lower cost the the alternatives of private vehicle provision, congestion time costs, oversized roading provision, and excessive emission creation. There is nothing that was done then that cannot be done now.

        2. In the 1950s there was a massive Government led house building program.
          The Government built a massive amount of “State Houses” as rentals for the lower paid but also as temporary and not so temporary housing for employees on the massive infrastructure projects, such a hydro dams etc and state enabled industrial projects, pulp and paper mills. Also as rental housing for government employees that were expected to “move around” Teachers, the armed forces, railway workers etc.
          The government underwrote a massive build to own program as well through the “State advances”. Concessional loans on new build homes only, and an ability to capitalise the universal family benifit paid to every child under 16?
          A new house was just a bare, but a functional, house on a block of land, no contouring, no paths, fencing or outbuildings. Neighbours helped each other with the labour to lay paths and plant hedges.
          It provided a remarkable amount of housing in a very short period.

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