Following on from last week’s article about Congestion Charging in London, we look at the experience of our northern neighbour, Singapore, to see another fine example of regulating traffic congestion with a multi-faceted “user pays” system.
An article by DAC (Danish Architecture Centre & Cities) reminds us that Singapore was one of the first to bring in congestion charging way back in 1975. The original Area License System (ALS) charged drivers a flat fee for unlimited entries into Singapore’s central area, with collection managed using manned toll booths. Immediately, there was a 45% reduction in the amount of traffic and 25% fewer accidents, while the average speeds increased from 11 mph to 21 mph (18k/hr to 34 k/hr).
In 1990, the chargeable area was extended to include the expressways leading into the city. With the objective of being able to manage road pricing even more precisely, Singapore has since replaced the ALS with a state of the art, digital Electronic Road Pricing (ERP) system. The ERP uses cash cards which are inserted into a car’s On-Board Unit (OBU), permanently affixed to every vehicle on the road (excluding only Emergency vehicles). On passing through the ERP gantry, the cash balance left on the card is displayed for the driver. The system allows for “live” variable road pricing, based on time of day, location, vehicle type, and even on current traffic conditions.
The ERP system has been credited with further reducing congestion by another 15%, and the concurrent increase in public transport use from 45% to 65% of all commuters. Meanwhile, the city boasts an impressive reduction in carbon emissions, while raising approximately $50M USD per year in revenue.
While the ERP system takes the lion’s share of the credit for managing congestion, there are also other factors at play. The government has introduced a range of measures aimed squarely at reducing car ownership and usage. One of these is the Vehicle Quota System (VQS), which aims to contain the annual increase in vehicles on the road to 3%.
Under the Vehicle Quota System (VQS), one must enter a bid system to even get permission to own a car (the Certificate of Entitlement), which will give you registration privileges for 10 years. If you are lucky enough to get a COE, then be prepared to pay an enormous tax for the privilege: customs duty are 41% on the value of any imported vehicle, then it will cost $1,000 to $5000 to register the car (private vs company), plus on first registration there will be an Additional Registration Fee (ARF) of 150% of the (inflated) market price of the car. Once you get the car on the road, there will be road taxes which vary with the age of your car.
As advised on the Expat Singapore website, new arrivals to the country will find owning a car in Singapore is very expensive, indeed, especially compared to US prices! Some estimates of what one can expect (including annual registration fee, import duty, road tax, registration fee and number plates) are: Audi A41.8 $182,000 (including COE), BMW 328 $238,000 (including COE); Mercedes 200E $201,902; Volvo 940 Turbo Estate 2.0 $160,753.
Suffice to say, the calculations are quite complicated, with fees varying based on engine capacity, year of manufacture, fuel type, with rebates available for cars with lower emissions. Details can be found here on the Transport Authority website.
The government makes no apologies, and is up front about the purpose of the scheme:
“The VQS, together with Electronic Road Pricing (ERP), is one of the key pillars in our traffic management strategies. With Singapore’s limited land resources and increasing demands for vehicle ownership, we need to make sure that our vehicle growth rates do not spiral out of control and lead to gridlock on our roads.”
The key to the success of the program in reducing congestion is, of course, that Singapore has a public transport system that is up to the task. Revenue from the ERP system is allocated, among other things, to the construction and maintenance of the road network, as well as the public transportation system.
The case for congestion charging in Australia
Image credit: therealsingapore.com
A far cry from Australia’s approach to taxing parking spaces, for which Singapore should be commended.