PDF: 1832 KB - Bureau of Infrastructure, Transport and Regional ...


PDF: 1832 KB - Bureau of Infrastructure, Transport and Regional ...

At a glance

• High and increasing urban traffic congestion costs and the declining effectiveness

of established congestion management strategies are a major concern


• Congestion charging is gaining favour as an enduring solution that directly targets

congestion, has strong theoretical foundations, has worked well in key cities and

provides an ‘innovative source of finance’.

• A small number of schemes have been introduced following London’s foray: many

more are being considered.

• Congestion charging is often judged on its financial, political and/or technical

success. However, it is its economic success that ensures that it will be in the

community interest.

• Analysis shows that the economic success of London’s scheme is highly sensitive

to the choice of parameter values, particularly the ‘value of time’ used to estimate

the value of travel time savings of road users.

• The policy relevance of congestion cost estimates depends critically on how it is


• Choice of technology determines both the economics of a scheme and its

political acceptability. Cordon charging is likely to prevail over the more costly

area-charging (as adopted in London). Common use of the more versatile, global

positioning systems may still be a decade away.

• Gaining community support can be difficult and costly, particularly if the use of

the revenue generated from a scheme is not subject to standard public finance

evaluation processes.

• High implementation costs can undermine congestion charging.

• Existing congestion charging schemes are confined to small areas within cities or

links to those cities.

• The gains from a scheme depend on behavioural change for which Australian

cities may not be well-placed, due to insufficient coverage of high quality public

transport services.


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