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Strong support for motorway tolls?

An article in today’s Herald notes the results of a survey undertaken by the NZ Council for Infrastructure Development, which looks at different levels of support for different ‘alternative’ funding mechanisms for paying for Auckland’s transport system.

Pollsters have found almost two-thirds support from Aucklanders for motorway tolls to ease congestion and raise extra transport money.

A finding of 63.8 per cent support in principle for tolls – published today after a survey of more than a thousand Super City residents – comes amid Government resistance to imposing tolls or raising fuel taxes to plug a $10 billion to $15 billion funding gap.

Some further details are available in the NZCID press release:

To fund transport improvements, respondents were given a choice of increasing rates, fuel taxes, cark park charges, an airport tax on international travellers, a charge on all traffic entering the CBD, and an average $2 toll on the motorway network. Of these, the $2 average toll was the only option attracting more support than opposition: 46% support a $2 average toll; 33.4% oppose and 18% are neutral.

Motorway network tolls were then explored in more detail. It was explained that higher tolls in busy periods would incentivise commuters to drive at different times, use different routes, car pool, take public transport or walk or cycle. This would reduce traffic on the motorways, meaning faster journeys for users of the tolled network, and tolls would also raise revenue for investment in new transport solutions including roads and public transport services.

Under this scenario, 64% of respondents gave in principle support to tolls on Auckland’s motorways varying in price and times at which they are charged, if this reduces congestion and helps fund major transport projects. 36% did not support this idea.

Majority support remained strong regardless of household income or political party support. Tolling in principle was supported by 47% of those who use the motorway system twice a day or more.

Of the four pricing packages surveyed, the option of a $2 charge in peak periods (7am – 9am) and $1.50 between 4pm and 6pm, was given the most support overall.

The point at which tolls cross over from being seen as “fair value” to “expensive” overall was: $0.76 in Off-Peak for travel between 7pm and 7am; $1.25 in Inter-Peak for travel between 9am and 4pm; $1.70 in Peak traffic 7am to 9am and 4pm to 6pm. Price tolerance varies according to frequency of motorway use: Less frequent cross over point $2.70 at peak, 2 x per day users $1.50.

Among frequent motorway users who were prepared to pay tolls, the average maximum was $4.75 per day for cars and vans and $5.80 for heavy commercial vehicles. These levels apply regardless of the frequency with which respondents use the motorway system.

Accuracy of polling methods is something I’m not an expert at, but I know that Horizon Polls have often been criticised in the past for the method chosen. I’m not going to go into that issue in too much detail.

Overall I must say that I’m rather surprised how much support the concept has with the general population, if the poll is reflective of that. Overseas cities have generally struggled to implement any sort of network/congestion pricing scheme – even in cities with much better public transport systems than we have here in Auckland. I guess the general feeling amongst the population is that something really needs to be done about the transport system – and there is perhaps a greater willingness to pay for that improvement than we had previously thought.

I still have significant reservations about the motorway tolling idea, even if it is found to have an acceptable level of public support, largely because I think it’ll push traffic from motorways onto local roads. But I suppose closer analysis will explore the extent to which that’ll happen.

For other forms of congestion charging/road pricing, it seems there’s a tension between the effectiveness of the scheme at reducing congestion and the effectiveness of the scheme at raising revenue. To be effective at reducing congestion requires a lot of complexity (charging different rates depending on the time of day, the road chosen and probably charging all travel) which comes with a huge administration cost – eating away at the money actually available for improving the transport system. Simpler methods, such as cordon schemes (like London’s congestion charging system) are likely to have unintended consequences (like killing off the city centre) and aren’t likely to be as effective at reducing congestion where it’s most severe.

It’s a useful debate to be having though. I just wonder whether this support will remain when people imagine themselves paying $2 every time they drive along a motorway onramp.

32 comments to Strong support for motorway tolls?

  • Geoff Houtman

    Did we ever get the option of “spend what we can afford to”?

    Starting with the CRL and maintenance of the existing system, then ranking by declining importance until we reach our spending limit? I am sure Stephen Selwood was preaching this last year..

  • Swan

    To me what the numbers show is that demand for peak time use on the motorway network is “soft”. If $2 is seen as borderline expensive, then the basis for the NZTA’s economic evaluations needs to be questioned. At $2 people are valuing their trips a lot less than the NZTA thinks they are. Although I may be misimterpreting the data: people say petrol is expensive but they continue to buy it.

    However, if demand is this soft, it means road pricing would be extremely effective. The price for uncongested motorways may be as low as $3 a vehicle. At which point a bus based PT system becomes very attractive.

    • Stu Donovan

      Second that – but would just add that I think the elasticity of demand is quite non-linear, mainly because of the variety of trips that take place. So while demand is definitely soft at the margin, you would find there is a base level of demand that has relatively high willingness to pay.

      But yes, road pricing would be probably the best thing ever for Auckland’s bus network.

    • “…people say petrol is expensive but they continue to buy it.’

      Yes, indeed. Because Auckland is trapped in auto-dependency. People would love to have viable alternatives to the private vehicle for many of their journeys but for most of us these alternatives just aren’t there. This is the source of the inelasticity in petrol demand and car use, not some passion for cars or other absurd justifications.

      So work on building the fast, frequent, reliable, appealing, and cost-effective alternatives is a prerequisite to seeing true economically rational response to price signals in this market don’t you think? Be it petrol price, road pricing, carbon tax, whatever. So while I am all for the true costs of auto-dependency to be explicit and met more by its beneficiaries, won’t moves in this direction remain politically unachievable while choice in this market is so limited?

      A little more emphasis on the economic benefit to the whole nation on providing a balanced movement market in Auckland and less on finding fiscal excuses for why all current transport funds should be spent on the one mature system would be helpful.

    • Don’t forget that NZ is a low-wage economy. If you use the motorway twice a day, five days a week, travelling at peak time, the cumulative $4/day works out to $1040 over 52 weeks. That’s a noteworthy fraction of the mean personal income, and would be on top of the other costs associated with commuting.

  • A very skewed poll; additional petrol tax at 16-45c a litre!, what are they planning to build; a mision to Mars? I guess NZCID got the result they were after, isn’t this exactly the plan they were pushing earlier, shoving poor Cameron Brewer out front to be the posterboy on it even?

  • Rob Mayo

    Is motorway tolling something that Auckland Council can do itself or does it require central government agreement?

    • Hamish O

      It requires central government approval as the motorways are state highways and therefore are owned by the state.
      Mr Brownlee has clearly said that he will not allow “central government roads” to fund the city rail link (even if most of the money goes to roads).

      I think it is a silly idea any way, as Peter says it will “push traffic from motorways onto local roads”. Congestion charging is for managing demand, not making money. Geoff (the first commenter) is right, if we cut back the list of projects and maybe add a small regional fuel tax we’d be fine.

      • swan

        “It requires central government approval as the motorways are state highways and therefore are owned by the state.”

        I am pretty sure the council would need government approval even tolling local roads. So the next time you hear the local government minister say that National wants to encourage user pays for LG services, bear this in mind. (He has been pushing exactly that line of late, and noone has called him out on the hypocrisy of taking away the regional fuel tax).

  • SteveC

    Brownlee has said that Auckland can’t toll the motorway system because they’re not Auckland’s roads

    so maybe we should just toll the off-ramps!

  • I will state first of all that of the options presented I actually prefer the idea of network charging but I do have my doubts about this poll. As with all of these things the outcome is largely dependant on the info the respondent is given along with the way the question is asked so it is no surprise that the poll carried out for the NZCID returns the option that the NZCID was pushing.

    Its also no surprise that no “lets prioritise projects” option was given, the NZCID wants as many projects built as possible as it is their members that will build them so they will never advocate for that option.

  • Bbc

    What did they ask? If the question was would you pay $3 for a congestion free journey I’m sure a lot of people would say yes. However, the reality is thy you’d need to charge a lot more than that before people would stop driving.

    • Even at $1 many will take all sorts of other routes to avoid it. The result would be an emptier motorway for those for whom the charge is either trivial or can pass it on; so Auckland would end up with an apartheid of movement qualities, segregated by wealth. Congestion would migrate fully to the local road network. Economic rationalism at work perfectly. All the money generated would probably go to emergency and place ruining widening of the local road system as drivers complain loudly about being stuck in traffic there…..

      Anyway the NZCID know that the moment there is a new road tax the user pays industry will wind up and demand all these funds are spent on roads too. Hard to see any solution for finding a source of investment funds for improving Auckland on this planet.

      • SteveC

        Patrick, the experience in the US with HOT lanes (High Occupany/Toll, jokingly labelled “Lexus lanes”) was not that the wealthy used them, but that the people prepared to pay for a quicker journey were the strugglers off who held down two or more jobs and had to rush betwen jobs and home

        the roads/PT dichotomy is a sad and false one, as it’s all about people moving around adding value to the economy, why should those who choose the sustainable modes be penalised?

        • Well I agree but because of a superficial use of the idea of user-pays [excellent in theory] that does not properly account for externalities, cross subsidies, or indirect benefits the result is the lobby for nearly all transport funds to be spent directly on road space expansion. One that believes it has some kind moral force and is currently dominant.

          Steve can you imagine a situation where say every outside lane on Ak’s motorways was a toll lane with that revenue all going into a PT infrastructure investment fund? Could be good, well except for the no doubt huge cost of collection [whatever the technology- all you technophiles] but also the outrage from two groups. 1. those who will complain bitterly that they are paying so all improvements must be on MOAR ROADZ. And 2. Those who can quite rightly say that they have already paid for this motorway and want to be able to use all of it.

          Could it work. Stu?

          • swan

            I dont think it is an economics argument that says we would need to spend the proceeds of road pricing on roads. On the contrary, if roads are properly viewed as an economic asset (as opposed to a “social” asset) then the government (and local councils) would expect to generate a return from the asset. We don’t expect the dividends from publicly owned ports, airports or power companies to be spent exclusively in those industries so why should it be any different for roads?

          • Swan be careful about fudging the line between economic costs and benefits and financial ones. Don’t you mean ‘financial asset’ above, you seem to see an income stream as the only sign of value.

            But of course I agree with you about where transport funding should be spent; it is the nutty view of the road lobby that argues that it must all go on roads cos it comes from petrol tax or RUCs. This is like arguing that all alcohol tax must go on building new bars! Where in fact the reverse is the case; first these funds should be used to mitigate the dis-benefits that these accrue from these activities. Which means in the transport case measures which help us to drive less but still get around productively given the huge negative outcomes of auto dependency: In health, life expectancy, pollution, urban form, productivity, oil dependency, social isolation….. etc.

            These are economic costs, so don’t show up on any transport balance sheet. These are the problems of the limited financial view.

          • Collection costs for Alpurt were $0.78/trip in May 2010, and that’s including paying the capital costs of a back-end that can support tolling Auckland’s roads. More toll networks using that back-end lowers the transactional costs.. The gantries are actually moderately inexpensive, especially viewed against the costs of building more motorway lanes, so even a $2/trip toll would return over $1 to the transport fund.

          • So a 50% return compared to a 100% (or damn near) for an increase in petrol tax…..

          • swan

            Yes but I think Alpurt was a gold plated bespoke system built with the intention/hope that it would be used on dozens of roads by now.

          • Patrick, an increase in petrol tax that delivered the same level of revenue would be absolutely enormous, though, and as usual would hit hardest at those who can least afford it.

            Swan, in much the same way that HOP is “a gold plated bespoke system”, I guess, if one uses that description for getting a system that can scale to be used for other projects in NZ instead of making everyone go it alone and get their own system as required. It’s not a bad idea for NZTA to have these systems developed, given that we’re such a small country it’s pointless for everyone who engages in the same kind of revenue-gathering activities (be they tolls or public transport fares) to have to develop and maintain their own systems in support.

          • Matt we have been consistent on the blog in saying that the NZCID’s list is not only unnecessarily large but many of the projects would in fact be destructive…. so you are right I am not suggesting a 45c increase like they do. Just a enough to fund a nice low interest government loan to build truly transformational long term investments like the CRL and spread that cost over the generations that will benefit. Here I agree with some of neoliberals in the comment stream; it is not best to use the PAYGO model for intergenerational assets. Especially the shape and habit changing ones as it means the benefits will accrue earlier and there is urgency here. We need to build balance away from our extreme autodependency now.

          • Here I agree with some of neoliberals in the comment stream; it is not best to use the PAYGO model for intergenerational assets.

            Neo-liberal economics is, quite simply, delusional. Money is not a resource, it’s a tool used to distribute resources (and in NZ they’re all public resources as well). To build something now you need to divert the necessary resources from those available now and that means that it’s impossible to pay for things later or have subsequent generations pay for them. All that illogic really does is throw someone interest payments that require exponential growth to pay and that is unsustainable.

    • What did they ask?

      Good question. I can’t remember the exact questions but there was numerous times when I couldn’t give the answer I wanted to. At a guess I’d say that that survey got the answer the NZCID wanted but not one that Aucklanders actually support.

  • Anthony

    Interesting to see where the support for tolls for funding the councils transport needs is coming from:
    http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10822258
    Support in principle for tolls
    Overall – 63.8 per cent

    Party voter support
    * Act – 88.6 per cent
    * Mana – 76.1 per cent
    * National – 66.8 per cent
    * NZ First – 65 per cent
    * Greens – 60.9 per cent
    * Labour – 56.3 per cent
    * United Future – 51.8 per cent
    * Maori Party – 25.3 per cent

  • Luke C

    I think we should think about the timeframe of tolling before dismissing it out of hand. Should definitely start with tolling the 15 or so entrances to the CBD. There are 2 purpose to this, one is liveability, and one is raising money. With regards to liveability it will greatly aid the aims of the Central City Masterplan. It will help reduce traffic around the CBD which will help push projects like Nelson/Hobson 2 laning, and Fanshawe Viaduct demolition.

    • Louis

      I can agree with the need to reduce cars out of the CBD but I have severe worries that it will encourage businesses to locate away from the CBD, which will lead to weakening the CBD which is definitely the opposite what we want to achieve.

      • Hamish O

        I agree completely Louis. I think we need to deliver the carrot before the stick – improve PT first then start penalising road use.

        Of course I think if we prioritised properly there would not be a funding gap.

        • Luke C

          Well thats why I think toll should be only on once the CBDRL is built, and this can help pay off councils debt for funding their $Billion half share. It may hurt a handful of businesses like the McDs and Mobil and Countdown on Quay St. However they should all be bowled in the longer term anyway. Any business that thinks its day is made by street parking in CBD is mad/wrong. I think of the CBD congestion charge as public transport snob tax, as once CBDRL is built, and along with bus improvements everyone should have quality alternative to car to get to CBD. Thats too why oppose general motorway charging for now as I know many workplaces where low income people work are in industrial parks with useless PT.

  • harminder

    What would be the purpose of the toll- pay for the CRL specifically or transport (public or private) more generally? If the former, it may be difficult to remove the toll stay after the CRL’s built.

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