The Costs of Congestion

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So what are the true costs of congestion? It seems as if nobody really knows. At a recent Transport Select Committee evidence session into road user charging, MPs seemed less than satisfied with the answers they received. The CBI has estimated that congestion costs the economy approximately £20 billion. With 40% of congestion in London, this fits with TfL’s figure of £7-8 billion. However, the Committee appeared extremely sceptical about the exact quantification of the monetary value of congestion.

Moreover, the results of proposed charging schemes will not always produce the desired resuts. It has become clear that in the last three years any reduction in congestion as a result of the central London charging zone has effectively been eradicated by the reduction in road capacity, owing to road works and essential maintenance carried out by the utility companies. This has meant that levels of congestion have slowly crept back towards pre-2003 levels despite the fact that there is approximately 20 per cent less traffic entering the central London zone. Hence, Kulveer Ranger, Director of Transport at TfL, has called for a coordinated implementation of transport policies that complement the existence of the congestion zone.

Whilst the Department for Transport has not itself made an official measure of the costs of congestion, it has questioned the £20 billion estimate and suggests that a national road pricing scheme could achieve ‘time’ savings of £10 billion a year. It appears that no consistent methodology has been applied, whilst there have been criticisms of the value which the DfT places upon time. Hauliers are not alone in believing that ‘time’ should mean the period it takes to get a product onto the shop shelf.

Road user groups often make the argument that motorists pay more in transport-related taxes than the Government invests in transport services. However, road transport imposes many different costs on society, some of which are borne by the road user, but others are borne by society at large. Consequently, there will always be calls for the ‘polluter pays’ principle, yet such a policy would be problematic politically. Whilst it is necessary to recognise that taxes raised from one sector of industry may be passed on to vital areas such as health and education, it is essential that such a process is transparent so that taxpayers can see where their money has been invested. Although the public may support investment in the public transport network they are unlikely to accept any new, additional tax on motoring – congestion charging or otherwise – until such investments are delivered. This is a lesson from Manchester.

Some of the costs of congestion such as inefficiency, missed appointments, late arrivals, and overrun schedules are borne by employers. Yet it is employees who bear the costs of commuting, accounting for a quarter of the costs of motoring, which the Telecommuting 2000 research project estimates to be £13.5 billion in total per year. According to the project, each year employers lose at least £20 billion through congestion, and employees pay £13.5 billion to commute by car, making a much higher estimate than the CBI’s, of £33.5 billion per year. It is worthy of note that such estimates do not even consider the effects on the environment, on employees’ health or the “work/life balance”. It is also unclear what price of a barrel of oil has been used in these estimates. Consequenlty, the true costs of congestion may be much higher than anyone has even dared to ‘guestimate’.

Source : http://www.transportinfo.org.uk

Photo : http://images.drive.com.au

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