Infrastructure Commission chief executive gives green light to congestion charging this year: 'Sometimes it's not about more concrete, it's about more courage'
New Zealander Nicola Chamberlain's ageing Saab sits most of the week unused outside her central Stockholm home.
The Swedish city's congestion charges mean she, her family and others have learned to use cycling and public transport more effectively. "I’m into building things and renovating my old wooden boat in my spare time," she says. "I once transported a three metre long piece of wood on the train, which was slightly awkward to get on and off but otherwise worked perfectly!"
Stockholm is cited as a model for Auckland, Wellington and perhaps other New Zealand cities as the Government tries to hammer out an agreed congestion charging model with opposition parties. "I think that investments in public transport and infrastructure need to be made in parallel with transportation taxes," Chamberlain warns.
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Now, Te Waihanga Infrastructure Commission chief executive Ross Copland has given congestion charging the green light: "2023 is the year that New Zealand should remove the barriers to congestion charging."
Copland used his plenary speech to the big Building Nations conference, in Christchurch, to deliver an emphatic call to immediate action.
"We really are at this point where we're in furious agreement. The evidence base is unequivocal. We've had 20 to 30 years of studies – we've seen Stockholm, we've seen London, we've got New York. And little old New Zealand, we've got this tremendous opportunity to use these really basic tools. We know they work, they're instant, and we'd love to have them."
"If paying a fair charge means you can make five deliveries in a day rather than three, the productivity benefits – and the savings – would far outweigh it." – Simon Bridges, Auckland Business Chamber
Both National and Act are open to supporting laws that would enable councils to introduce congestion charging, rather than force them to do so. But they've said they'll agree only if the Government scraps Auckland's 10 cents per litre regional fuel tax, a charge brought in to help fund public transport and roading projects.
There's one problem for the Government. Transport minister Michael Wood, who's been driving cross-party talks to agree the parameters of congestion charging this year, has been stood down for failing to declare his shares in Auckland Airport.
A spokesperson for acting minister Kieran McAnulty says the Government is working through what a congestion charging scheme could look like, and engaging with transport spokespeople across political parties. A more fulsome update, she promises, will be provided in the near future.
The Government's new Infrastructure Action Plan details specific work to enable congestion charging and investigate other pricing and demand management tools to reduce transport emissions.
This includes parking pricing, per-kilometre pricing, and low emissions zones. The Ministry of Transport is drafting new legislation, which the Government has promised to introduce this year, to enable local councils to set in place congestion charging regimes. At present, and tolled route must also provide for an alternative untolled route; that back-up would be removed from the new law.
The plan say officials are in talks with Auckland and Wellington city councils, both of which want to implement congestion charges (though new Auckland mayor Wayne Brown has wondered out loud whether it may be a distraction).
"A well-designed access charge is easy to understand, difficult to evade, removes incentives to ‘rat-run’, and means that travellers in outer suburbs are not faced with the prospect of cumulative charges for longer trips." – The Congestion Question
Designing a pay-to-enter ring fence for Auckland City CBD is well underway, with “time of use charging” already being used for the big trucks driving to and from the waterfront port to encourage them to stay off the roads at peak times.
Since May last year, trucks entering the container terminal at peak on weekdays have been charged $65; those arriving off-peak are charged $20. "We did this to support and incentivise off peak freight movements," says Ports of Auckland spokesperson Julie Wagener.
Simon Bridges, the chief executive of the Auckland Business Chamber, backs road pricing. "We should price the Auckland network for demand management purposes," he tells Newsroom.
"That said, it cannot be an excuse for ideological flights of fancies, for not finishing the infrastructure improvements required or for simply dragging in more revenue. If it ends up being for these reasons rather than allowing people to get around more easily it will end up a failed experiment because of the lack of public support."
He admits that imposing a charge to drive into the CBD is worrying for some businesses, but says that cost is not the only factor. "If paying a fair charge means you can make five deliveries in a day rather than three the productivity benefits – and the savings – would far outweigh it."
A report three years ago, titled The Congestion Question, considered how to design Auckland road pricing: point-based, distance-based or access charges.
It recommended an access charge, whereby every vehicle faces the same charge when it is detected on a charged road. "Auckland’s dispersed travel patterns and the prevalence of shorter trips mean that an access charge is required to encourage sufficient behaviour change and mode shift by travellers with flexibility," it said.
"A well-designed access charge is easy to understand, difficult to evade, removes incentives to ‘rat-run’, and means that travellers in outer suburbs are not faced with the prospect of cumulative charges for longer trips."
"After a year or so people got used to it and the congestion was more or less the same. Gradually higher prices have not made as much difference as you could hope." – Nicola Chamberlain, Stockholm
That's similar to the model introduced in Stockholm in 2006 – and so officials have been looking closely at how that works. The congestion charge, 'trängselskatt' is charged to vehicles that pass certain road tolls on certain days and times. Stockholm city is divided into zones, with different traffic restrictions. Heavy vehicles are prohibited from most inner city streets.
The NZ Infrastructure Strategy devotes a small section to the Stockholm experience. When the city trialled congestion charging in 2006, the its urban area had nearly 2 million residents – similar to Auckland.
Approximately 320,000 people were employed in the inner city and more than 210,000 commuted from outside the inner city. Car users faced significant delays while crossing congested bridges into the inner city during peak hours. A congestion charging scheme that charged all traffic entering the inner city was trialled in early 2006, and residents voted to make it permanent.
Congestion charging has significantly improved the performance of Stockholm’s transport network, the Infrastructure Strategy says. Traffic volumes on its roads dropped by 20 percent, as fewer people made unnecessary car trips and car and bus travel speeds improved.
The money collected through the scheme was used to fund the equivalent of NZ$15 billion of transport projects in the city. These included a significant expansion of bus services to cope with the increased demand for public transport. This helped ensure fairness and reduced any impacts on low-income users. No discounts were offered as it was assumed that Sweden’s comprehensive welfare system would help those on low incomes to manage the costs.
"Having a congestion charge in Auckland would just create anger, I feel, since there isn't a cheaper option." – Reuben Fortes, Stockholm
Now, Stockholm's most intensive road users can be charged up to 135 Swedish krona a day – that's NZ$21.10. But most motorists would pay less than $10 a day, and many like Chamberlain are now avoiding the congestion charge entirely by keeping their cars at home.
That underscores the different outcomes that road pricing is intended to achieve: to speed up movements by reducing gridlock and delays; to reduce toxic and smelly exhaust emissions; to reduce greenhouse gas emissions; and to provide revenue to support infrastructure for public transport and active modes of travel.
Chamberlain, who is originally from Wellington, says the congestion charge was initially effective in Stockholm. "You could clearly see the difference as traffic jams eased," she says. "But after a year or so people got used to it and the congestion was more or less the same. Gradually higher prices have not made as much difference as you could hope."
Auckland urban travel speeds, 1920-2010
Companies now require their staff to pay to enter the congestion zones, rather than covering the cost, which has helped. Overall, she thinks the charge has eased traffic jams and pollution and the income is used for infrastructure projects such as underground rail. And she welcomes that – after all, her husband Jonas is an engineer and works with underground train and infrastructure projects. "So we are quite pro public transportation!"
She suggests it might be better if the city imposed a big leap in price to give more effect to the congestion charge – though ironically, this might lead to a drop in revenue to finance transport infrastructure, with fewer drivers willing to pay a premium.
She has a warning for New Zealand cities, though, where public transport provision is less developed. "I think any congestion tax programme needs to consider if there are alternative and reasonable infrastructure options in place (there are in Stockholm) or if alternatives could be provided – as well as the short and long term consequences if they are not."
"I’m not sure Auckland could feasibly ramp up congestion charges too high without creating significant inflation pressures unless they provide reasonable public transport options." – Pablo Riddell, Stockholm
Other New Zealanders living in Stockholm have mixed views. Reuben Fortes, from Auckland, has to commute 59km from one side of Stockholm to the other, but avoids the congestion zone. "I think the biggest issue Auckland will have is the public transport. I've done pretty well in Stockholm without driving but had to drive everywhere in Auckland."
"Having a congestion charge in Auckland would just create anger, I feel, since there isn't a cheaper option."
He also warns that some tax regimes allow the congestion charge to be offset against income tax, which would undermine its deterrent value."
Pablo Riddell is another Aucklander living with his family in Stockholm. "We live in the city and we don’t have a car, so aren’t really impacted by the congestions tolls," he says. "But part of that is motivated by the charges. The charges have definitely been a positive from an inner-city living perspective, though there are motorways circumnavigating the inner city that get congested like any other city."
Riddell is a bond trader at a bank, but even he says the city's congestion charges are offputting. He takes his three young daughters out on a cargo bike instead.
"Stockholm is a very different city to Auckland – even if it is a similar size – in the sense that there is a lot more apartment living and highly efficient public transport system," he says.
"I’m not sure Auckland could feasibly ramp up congestion charges too high without creating significant inflation pressures unless they provide reasonable public transport options.
"I’m a big fan of reducing the number of the cars on the road in a bid to save the environment. As a family of five we have sold our car and bought a cargo bike to get around. So dedicated and well maintained bike lanes are also important. If we can bike during winter here then Aucklanders have no excuses!"
After his conference speech, Ross Copland told Newsroom that Auckland is "an obvious candidate" for applying a congestion charge. "Aucklanders on average spend five days a year stuck in traffic," he says. "But by removing the barriers, councils in many centres would have this option for addressing congestion."
"Too often, barriers to things like a congestion price are the ability to address the social concerns around the family who's at the margin, who needs to travel at peak time." – Ross Copland, Te Waihanga
The New Zealand Infrastructure Strategy, published last year, included a recommendation for removing the legislative barriers to congestion charging as a step toward unlocking greater efficiency from our roads, he says.
At the same time, solutions like subsidies need to be considered for those who can't afford congestion charges. He disclosed to the conference that Te Waihanga is beginning its first major 'deep dive' inquiry, starting to consult and engage with the public around this idea of 'what's fair when it comes to paying for infrastructure'.
"So we're talking about subsidies. And there's broadly only three ways that we pay for infrastructure: we pay through our rates, taxes, or user charges. And the mix in the distribution of those is obviously felt more acutely for the lower income quintiles in New Zealand.
"So we're really interested in understanding from New Zealanders, what do they think is fair? And then applying that into investment in pricing decision making, because too often, barriers to things like a congestion price are the ability to address the social concerns around the family who's at the margin, who needs to travel at peak time. And those regressive effects of pricing can be significant."
