Curing Congestion by Owning the Roads—and Tolling?.

Traffic congestion is a long-standing and much studied urban problem and, increasingly, as car-ownership levels rise worldwide, a global urban problem. While much is understood about congestion, it is almost akin to a disease without a cure. As Michael Manville, Associate Editor of ACCESS, the journal of the University of California’s Transportation Centre notes in the Fall 2009 issue, “We have built rail systems and carpool lanes and higher-density developments, but our traffic has just gotten worse. So now we are cynical…[like a patient prescribed expensive medicines that failed to cure.] …You might start to think your illness was incurable, and that the best approach was to learn to live with it.”

Mr. Manville goes on to note that the incurable disease analogy breaks down because we do know the cause of the problem: chronic traffic congestion is the result of too much driving.

Furthermore we do know, or at least many researchers agree that, there is a proven effective practical solution. Unfortunately, the ‘cure’—road tolls—is universally disliked, regarded as merely another tax grab from an already over-taxed citizenry, and thus politically unpalatable. As he points out, “What elected official wants to charge voters to drive? Politically, the easiest thing to do about congestion is nothing.”

Recently, however, a leading UK think tank, the Social Market Foundation (SMF) has recommended a way of overcoming the political objections to road user charging. It suggests transferring ownership of the ‘Strategic Roads Network’ in Britain from public to private hands, thereby giving “every citizen in the UK a tradable share in their network for free.” This shift—called ‘Voucher Mutualisation'—would also involve abolishing the Vehicle Excise Duty and paying profits from operating the roads to the shareholders, British citizens.”

The UK proposal estimates that the average car owner would be better off “to the tune of a £1,500 (C$2300) asset and £75 (C$120) per year. The average two-driver household with two children would be better by around £6,000 (C$9300) in assets and some £150 (C$230) per year.” Citizens who wanted to put the money to some other purpose could sell their shares or hold them to collect dividends from the annual £5-billion in annual profits it is estimated the road system would earn, based on toll rates comparable to similar charges in effect in continental Europe.

In the UK proposal, holding companies (owned by the citizen shareholders) would be responsible for operating the roads, charging for their use and re-investing in the network. Profits would be over and above monies re-invested in the network for maintenance and improvement. And the expected ultimate benefit, of course, would be free-flowing roads and all the economic, public health and environmental savings this would represent.

The full report, “Roads to Recovery—Reducing congestion through shared ownership” is a PDF, accessible through the SMF website at www.smf.co.uk/. If nothing more, the arguments why this system of voucher mutualisation would work in Britain now rather then the voucher privatization system tried with mixed success in other countries starting in the 1990s is a fascinating geo-political overview.

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