Thoughts on the new CBD Congestion Charge
Russell Degnan

Regular readers will know that I am all in favour of user pays road pricing schemes. However I might make an exception for this one.

Unlike the London scheme that was introduced on the back of a mayoral election campaign, substantial debate, and an extensive economic analysis, this seems to have been dreamt up in a London hotel-room during the Premier's visit.

Take these quotes:

On Wednesday Premier Steve Bracks said from London that he was "leaving open" the idea of a levy. Barely 24 hours later it was reality and the majority of the revenue was headed not to the council but to the Government.

Acting Premier John Thwaites said the Government's share of the revenue would pay for improvements to public transport, expected to be announced in the May budget.

Treasurer John Brumby said the Government did not have figures that showed how the plan would ease congestion, but said the aim was to reduce traffic in peak periods, and not to punish casual visitors and shoppers.

Does this sound like a well thought out policy?

This wouldn't be a bad thing if it was a great idea. But it isn't. It is symbolic, simplistic, poorly targeted and likely to be ineffective. Firstly, the CBD is not congested. It is nothing like London was before the charge, even at peak hour. The congestion that does exist is near freeways and arterial roads in the suburbs. Secondly, the exceptions in the CBD - King St. and Lonsdale St. - are congested, not because of parked cars but because of through-traffic, which is not affected by the charge. Thirdly, the $400-800 a year will generate only $57.5 million over 3 years, which is a drop in the ocean as far as public transport is concerned. Fourthly, it is barely a quarter of an average all-day parking rate and unlikely to shift user preferences in any substantial way. Fifthly, it is not equitable, as it targets the CBD and its users. After years of policies to try and attract businesses and residents back to the CBD this policy is a direct imposition back onto them, even if it is small.

Conversely, I do support the use of parking as a measure of road congestion, because it has no effect on freight transport and because it is relatively cheap to implement; unlike tolling.

However, if the government was serious about city congestion they would create a study to examine congestion city-wide. The roads suffering from congestion are in Deer Park, Nunawading, Springvale, and other outer suburbs with severe public transport deficits and large freeways that draw in more traffic. A far more sensible policy would assess land uses for the number of vehicles they attract and create a charge based on that figure, with the money to go towards public transport in the area, and concessions for policies that attract alternative non-vehicle uses, such as bicycles and pedestrians.

And yes, this would labour large shopping centres and business parks with large bills. This is why economic analysis - despite its limitations - is an important part of policy making. It would need to phased in slowly to give people time to change their market preferences, and be supported by substantial public transport expenditure. It would require vision and commitment.

By contrast, this charge has neither. It is shoddy.

Sterner Matters 23rd April, 2005 17:01:56   [#] 


Popular Opinion
This is why you don't let politicians travel to other countries and get silly ideas in their head.

Popular opinion will defeat this initiative. The problem is that this debate will be about the government taking more money from poor, starving, over-taxed motorists already suffering from increased petrol prices - and not a debate about the best method to cut Melbourne's congestion problems. Another victory by the roads lobby is on its way.
Aaron Hewett  24th April, 2005 16:04:34  

I'm not so sure
I read the politics of this differently to you Aaron. I see it as a bone, thrown to environment as well as roads and business lobby groups. It only affects a small part of the population; and it won't have a signifcant effect on prices or congestion. But it does look good to outer suburban residents, suffering from congestion but not increased costs, when an electoral handout says: "This government is committed to reducing congestion on our roads through its congestion management strategy".

It is typical of the trend towards government as a public relations exercise. I don't think that is a good trend either.
Russ  24th April, 2005 19:10:30  


One only has to look at the "Celebrating Victorian Rail" "event" on Saturday at Spencer Street Station to realise how government is spending up big on PR. *sigh*

I wouldn't be surprised if many Victorians living in the country weren't able to make it to CVR on Saturday due to the shocking nature of rail transit outside of the metro area.
Aaron Hewett  25th April, 2005 12:37:40