Grattan’s congestion charging push ignores immigration elephant

in the Room … the Grattan … has overlooked the 2 X City populations each hurtling towards TEN MILLION …

AND just to add to the joy of living in …

Sydney … another charge … another fee … this TAX will give people less choice, especially those living in outer Western suburbs. They will simply pay more for less amenity, as they have experienced with the proliferation of toll roads.

P.S. we know of people who live in the outer Western Suburbs and have to commute … on the Motorways … from early in the Morning … to work in the Eastern Suburbs! That will be even more costly!

Grattan’s congestion charging push ignores immigration elephant

By Unconventional Economist in Australian Economy

October 14, 2019 |comments

After last year claiming that commute times and congestion across Australia’s cities has not worsened (see here and here), the Grattan Institute’s Marion Terrill has demanded that Australia’s governments implement congestion charging to alleviate congestion pressures and prevent our cities from grinding to a standstill:

‘Australia’s capital cities should join many of the great cities of the world by charging drivers who use the busiest roads at the busiest times.

We recommend a three-stage reform: within the next five years, state governments should introduce cordon charging, where drivers pay to cross a boundary into the capital city CBDs in the morning peak and out in the afternoon peak; within the following five years, people should pay to drive along the busiest urban freeways and arterial roads at peak periods; and eventually people should be charged on a per-kilometre basis for driving across the city’s entire road network at the busiest times.

A modest cordon charge could mean 40 per cent fewer cars entering the CBDs in the morning peak, and speeds up to 16 per cent faster on roads in the CBD and up to 20 per cent faster on sections of major arterials leading into the CBD.

Modelling shows speeds across the entire Sydney and Melbourne road networks would increase by about 1 per cent. That might sound modest, but Sydney’s WestConnex and Melbourne’s North East Link are predicted to increase network speeds by 3 per cent and 1 per cent respectively – and those roads come with price tags of $16 billion and $17 billion respectively.

Everyone wants less congestion: it would make life easier for individual drivers and make our cities work better, too. This plan tackles congestion without asking communities to pay billions of dollars for major new roads.

New York, London, Beijing, Singapore, Stockholm, Milan, and Jakarta all have congestion charging or are heading that way. It’s time for Australian cities to embrace the idea.

If getting public transport right is a pre-condition for congestion charging, there has never been a better time in Australia, with investment in public transport and roads running at more than $30 billion in 2018-19 – an all-time high.

The technology has improved too, with Automatic Number Plate Recognition now accurate enough to use as the primary detection technology for congestion charging.

And the experience from global cities is that initial public hostility quickly turns to support when people see how effective congestion charging can be.

Concerns that congestion charging would hurt those who can least afford it are overblown. In fact the charges would mainly be paid by higher-income drivers, because people who drive to the city each day for work are more than twice as likely to earn a six-figure salary as other workers.

It’s also a myth that lower-income workers drive further. In fact it is typically higher-income workers who drive long distances to work.

Nor is it true that people have no choice but to drive; CBDs are well-serviced by public transport, and most people already get to the city by train, tram, or bus.

In the end, if particular roads are in high demand, it’s fairer that people who use them a lot pay more than those who rarely or never use them.

But congestion charging should come with a safety net: there should be discounts for low-income people with impaired mobility who need to get to the CBD in peak periods.

I agree with Grattan’s arguments about the need to shift towards direct road pricing, since it would encourage people to take non-essential trips at a different time (or not at all), thus improving efficiency through better managing congestion.

I also believe that direct road user charges are inevitable as revenue from fuel excise continues to collapse, brought about by the shift to both more efficient conventional vehicles as well as electric vehicles:

That said, congestion charging won’t magically create more road space to cater for Melbourne’s and Sydney’s ballooning populations, which are projected to roughly double to around 10 million people over the next 48 years:

*Nor will congestion charging magically fix Melbourne’s and Sydney’s chronically congested and deficient public transport networks.

All congestion charging will do is give people less choice, especially those living in outer suburban areas like the Western suburbs. They will simply pay more for less amenity, as they have experienced with the proliferation of toll roads.

If you don’t believe me, here’s Infrastructure Australia’s projections for Sydney and Melbourne, where congestion is projected to soar and access to jobs, schools, hospitals and open space will all decline by 2046, irrespective of how these cities build-out to cope with populations of 7.4 million and 7.3 million people respectively:

Thus, congestion charging is like placing a band-aid on a gaping wound.

Clearly, the simplest and best solution to mitigate the liveability problems afflicting our major cities is to slash immigration back to historical levels (see next chart) and prevent the pressures from building in the first place.

Grattan cannot possibly hope to ameliorate the many problems caused by excessive population growth while endorsing net overseas migration running at more than triple the historical average.

major road with cars