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New road pricing system needed after years of political neglect

11 March 2019
Leading researcher proposes distance charge to cut congestion
Sydney's chronic traffic congestion results from "political neglect" and can only be solved by a radical new system of charges for road usage, according to a leading researcher at the University of Sydney Business School.

Internationally respected transport economist, Professor David Hensher, says the state government’s current attempt to build its way out of the problem with new tollways will only “buy a few years of growth” before the city’s roads are again as congested as they are today.

Professor Hensher’s call for a complete overhaul of the current road pricing system comes just weeks out from a state election which is likely to be influenced by government’s spending on infrastructure development.

Why we need a complementary toll system

Professor Hensher says massive road projects such as WestConnex and NorthConnex “have positive value”, however, his research indicates that a complementary user pays system of road charges could cut peak hour traffic further by up to 10 per cent or to “school holiday” levels.

If my proposal is radical it’s because we need a radical approach in order to make a difference.
Professor David Hensher

“Our research has suggested that we ought to move to a distance based charge of five cents a kilometre during peak hours but no charge at all in the off peak,” Professor Hensher said. “In order to ensure that people don’t pay more for their travel, we would also reduce registration charges.

“This is aligned with the many Federal government inquiries in road pricing,” he said.

Commuter vs commercial concern

A recent survey by the Business School’s Institute of Transport and Logistics Studies, headed by Professor Hensher, found that 70 per cent of road users would be prepared travel in off-peak periods if given a financial incentive to do so and to save time.

Professor Hensher rejected suggestions that his proposal was similar to the government’s policy of cutting registration fees for vehicle owners who paid more than a certain amount in tolls over a 12 month period.

“All that the government is doing there is subsidising toll operator Transurban by telling users that if they continue to spend money on toll roads, they will not have to pay registration,” Professor Hensher said.

“Sydney now has more toll roads than any other city in the world,” he added. “Transurban basically controls our road network and that is a problem because it is a commercial concern, not one that’s going to benefit society as a whole.”

Published research

Professor Hensher has published in peer-reviewed journals including:

Hensher D (2019) Editorial: Road pricing reform - Another attempt at getting started! Case Studies on Transport Policy.

Hensher D (2018) Toll roads - a view after 25 years Transport Reviews, 38 (1), 1-5.

Hensher D, and Mulley C (2014) Complementing distance based charges with discounted registration fees in the reform of road user charges: the impact for motorists and government revenue Transportation, 41 (4), 697-715.

Trevor Watson

Director of Media (Business School)

Listen to the podcast

Interview with Professor David Hensher

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